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District Court 12 February 2025

R v Valvo

[2025] NSWDC 422

Fraud & dishonesty
CRIME SENTENCE

Citation: R v Valvo [2025] NSWDC 422
Court: District Court of New South Wales
Date: 12 February 2025
Judge(s): Neilson DCJ

Background

The offender was a registered financial adviser and sole director of a financial services company operating in Sydney. Between July 2019 and January 2020, he submitted forged "Change of Account Fees" forms to the administrator of the Wealthtrac Superannuation Master Trust, falsely purporting to authorise ad hoc adviser fee withdrawals of approximately $10,000 from each of 12 clients' superannuation accounts. The clients had not agreed to these fees and had not signed the forms bearing their names.

The offender had long-standing personal advisory relationships with each of the 12 victims. Some clients did not discover the unauthorised withdrawals until months later, often only when switching financial advisers or reviewing their account statements. The total amount taken across all victims was approximately $120,000, though the precise figures varied due to GST and administrative charges added on top of the base fees.

All 12 victims were ultimately reimbursed, but the offender personally refunded only two of them in full. The remaining victims were compensated by Oasis Fund Management Ltd, the trustee of the Wealthtrac fund, who then sought reparation from the offender.

  • Whether the offender's conduct of submitting forged fee authority forms, in the course of carrying on a financial services business, constituted dishonest conduct in relation to a financial product under ss 1041G and 1311(1) of the Corporations Act 2001 (Cth)
  • What sentence was appropriate, having regard to the maximum penalty, the number of victims, the degree of premeditation, the offender's personal circumstances, and the extent of restitution
  • Whether a fine should be imposed in addition to a custodial sentence, and if so, at what quantum, given limited evidence of the offender's financial position

Decision

The offender pleaded guilty to a single "rolled up" charge covering all 12 instances of dishonest conduct. The maximum penalty for the offence is 15 years imprisonment and, in the circumstances of this case, a fine of up to $945,000. Neilson DCJ accepted the guilty plea and proceeded to sentence.

The court imposed a three-year term of imprisonment but ordered the offender's immediate release on a recognizance (a form of suspended sentence under Commonwealth law), subject to a five-year period of good behaviour and conditions requiring reparation and payment of a fine. The court noted that the offending involved a serious breach of trust by a professional who had cultivated long-term personal relationships with his clients and then exploited access to their retirement savings.

On the question of a fine, the court accepted that where an offence involves extracting money from clients, a pecuniary penalty is appropriate alongside a custodial sentence. The Crown pressed for a substantially higher fine, while the offender's counsel submitted he was largely impecunious. The court noted there was little clear evidence of the offender's financial position, and settled on a fine of $20,000, acknowledging this required a degree of estimation.

The court also noted the offender had recently commenced attendance at Odyssey House for an assessment and was attending SMART recovery sessions in early 2025, addressing dependencies on drugs, alcohol, and gambling. This was treated as a relevant personal circumstance in sentencing.

Orders Made

  • The offender was convicted of engaging in dishonest conduct in relation to a financial product, contrary to ss 1041G and 1311(1) of the Corporations Act 2001 (Cth)
  • Sentenced to three years imprisonment, with immediate release on recognizance
  • Conditions of recognizance:
  • Good behaviour for five years
  • Reparation to Oasis Fund Management Ltd in the sum of $95,007.70 (plus any interest accrued since that sum was last specified)
  • Pecuniary penalty of $20,000 payable to the Commonwealth of Australia, at the time and in the manner stipulated by the Registrar of the Court

Key Takeaways

  • A financial adviser who forges client signatures on fee authority forms and submits them to a superannuation fund administrator, in the course of carrying on a financial services business, can be convicted of dishonest conduct in relation to a financial product under s 1041G of the Corporations Act 2001 (Cth), which carries a maximum penalty of 15 years imprisonment.
  • Under Commonwealth sentencing provisions, a court may suspend a term of imprisonment by ordering immediate release on recognizance, with conditions including good behaviour, reparation, and payment of a fine.
  • Where an offence involves the peculation of money from clients, the District Court confirmed that a fine is appropriate in addition to a custodial sentence, even where financial means are uncertain.
  • Restitution to victims, whether made personally by the offender or by a third party such as a trustee, remains a relevant factor in sentencing, but full third-party reimbursement does not displace the need for reparation orders in favour of that third party.
  • The use of a "rolled up" charge, consolidating multiple discrete acts of dishonesty against different victims into a single count, is a recognised charging approach in proceedings of this kind, as confirmed by cases including DPP (Cth) v Gregory (2011) 34 VR 1.

Legislation and Cases Referenced

Legislation
- Corporations Act 2001 (Cth), ss 760A, 1041G, 1311(1)
- Crimes Act 1914 (Cth), ss 16A(2), 16C, 17A(1), 20(1)(b)

Cases
- DPP (Cth) v Gregory (2011) 34 VR 1
- Jahandideh v R [2014] NSWCCA 178
- Nicholls v R [2016] VSCA 300