Citation: R v Zhang [2023] NSWDC 229
Court: District Court of New South Wales
Date: 14 June 2023
Judge(s): Newlinds DCJ
Background
The appellant was convicted in the Local Court of dealing with money in circumstances where there was a risk it was an instrument of crime, valued at less than $100,000, contrary to s 400.4(2) of the Criminal Code Act 1995 (Cth). The conviction arose from conduct in June 2020, when the appellant, then 28 and unemployed, agreed to deposit cheques into bank accounts on behalf of a man he had met at a casino, receiving between $100 and $300 per deposit in return.
The appellant gave evidence that he believed the man ran a construction business and was unaware anything improper was occurring. He said he carried out the deposits simply to help and because he needed the money. The prosecution identified fraud under s 192E of the Crimes Act 1900 (NSW) as the relevant predicate offence.
The appeal to the District Court challenged the conviction, with the central dispute being whether the element of recklessness had been established beyond reasonable doubt.
Legal Issues
- Whether the prosecution established the element of recklessness under s 400.4(2) of the Criminal Code Act 1995 (Cth), specifically whether the appellant was aware of a substantial risk that the money was an instrument of crime
- Whether the prosecution was required to identify and prove a specific predicate offence, and whether it had done so in this case
- Whether the decisions in Chen v DPP and Xue v R had any bearing on the outcome
Decision
Issue 1: Recklessness
Newlinds DCJ rejected the appellant's account of his state of mind as entirely implausible, agreeing with the magistrate's assessment (at [15]-[16]). The primary facts, drawn largely from the appellant's own explanation, left no other rational explanation than that the appellant knowingly allowed himself to become an instrument in a crime (at [19]).
The Court was satisfied beyond reasonable doubt that the appellant was at least aware of a substantial risk, that is, a risk beyond mere speculation, that he was facilitating a fraud (at [20], [27]). Rejection of the appellant's evidence, while leaving the prosecution to prove its case by inference, did not prevent the Court from drawing that inference firmly on the facts established (at [16], [20]).
Issue 2: The predicate offence and the Chen/Xue authorities
The Court considered Chen v DPP, which established that a prosecution under s 400.4 of the Criminal Code must identify a specific predicate offence by way of particulars. The Court also noted that Xue v R distinguished Chen only in relation to charges under s 400.9, otherwise confirming the Chen ratio (at [23]-[24]).
Neither case altered the outcome here. The prosecution had identified fraud under s 192E of the Crimes Act 1900 (NSW) as the predicate offence, and the magistrate had found that fraud proved (at [25]). The appellant's argument that the evidence might support some other indictable offence rather than fraud did not need to be resolved, because the Court was satisfied beyond reasonable doubt that the appellant was aware of a substantial risk of involvement in fraud specifically (at [26]-[27]).
Orders Made
- The conviction appeal was dismissed
- The orders of Magistrate Guy made on 10 August 2022 were confirmed
Key Takeaways
- A prosecution under s 400.4 of the Criminal Code Act 1995 (Cth) must identify a specific predicate offence by way of particulars; a general reference to criminal activity is insufficient, consistent with Chen v DPP (at [23]).
- Where the prosecution does identify and prove a specific predicate offence, the Chen particularity requirement is satisfied and the case proceeds as an ordinary question of proof (at [25]).
- Recklessness under s 400.4(2) requires awareness of a "substantial risk," meaning something more than a fanciful or speculative risk, which the District Court described as a relatively low threshold for the prosecution to meet (at [12]-[13]).
- Rejection of a defendant's evidence about their state of mind does not itself establish the prosecution case; however, the court may still draw inferences from proved primary facts that satisfy the recklessness element beyond reasonable doubt (at [16], [20]).
- In dismissing the appeal, the District Court found that an implausible innocent explanation, combined with the objective features of the conduct, was sufficient to support an inference of awareness of a substantial risk of fraud (at [19]-[20], [27]).
Legislation and Cases Referenced
Legislation
- Crimes Appeal and Review Act 2001 (s 18)
- Criminal Code Act (1995) (Cth), s 400.4(2)
- Crimes Act NSW 1900 , s 192(e)
- s 400.4 of the Criminal Code
- s 400.4 of the Criminal Code Act 1995
Cases
- Chen v Director of Public Prosecutions [2011] NSWCCA 205
- Xue v R [2021] NSWCCA 270