R v Kefford[2022] QCA 81

SUPREME COURT OF QUEENSLAND

MORRISON JA:  I will ask Justice Kelly to give his reasons first.

KELLY J:  On 19 October 2021, the applicant pleaded guilty to one count of knowingly engaging in money laundering.  On 21 January 2022, he was sentenced to imprisonment for four years to be suspended after 10 months with an operational period of four years.  He applies for leave to appeal against that sentence on the ground that the sentencing judge failed to adequately take into account cumulative matters of mitigation and imposed a sentence that was manifestly excessive.

The applicant was sentenced by reference to an agreed statement of facts.  The money laundering occurred over a period of approximately 14 months between October 2018 and December 2019.  The amount of money laundered totalled $2,124,747.63.  He was aged between 63 and 65 years of age at the time of the offending.

Some two and a half years prior to the offending, in March 2016, the applicant came to the attention of police as a suspect in money laundering offences involving unknown persons in Malaysia.  When interviewed by the police, he told them that he had been contacted by a person who informed him that he had won the lottery in Germany but that, in order to obtain the winnings, he needed to transfer amounts of money to the person, which he did.  That person had convinced the applicant to open bank accounts and allow money to enter his accounts before forwarding the money to overseas bank accounts.

The applicant was issued with a warning notice in relation to money laundering.  That notice contained a clear definition of money laundering.  He was explicitly warned that the lottery story was a scam and that his actions constituted money laundering.  He told police that he “completely understood” and would not engage in any similar conduct.

Some years later, the applicant was contacted again by the Malaysian interests.  He was told that the Malaysian Government owed him $5,500,000 which had accumulated in an investment fund and that he should open Australian bank accounts to allow the money to be transferred to him.  He was told that he would be required to forward amounts to accounts in Malaysia for the process to be completed.

The subject offending then began and spanned four separate incidents.  The incidents involved fraudulent emails being generated, which misdirected payments to be made to various bank accounts held by the applicant.  To facilitate the offending, the applicant had opened numerous bank accounts across multiple banks and credit institutions for the sole purpose of money laundering.  The victims of the fraud were entirely innocent members of the public.  The first incident occurred in October 2018 and involved $196,843.90.  The second incident occurred in April 2019 and involved $63,814.44.  The third incident occurred in September 2019 and involved two amounts of $600,000 and $590,000.  The fourth incident occurred in December 2019 and involved $674,089.29.

On 19 February 2020, the applicant was interviewed by the police in relation to the second and third incidents.  In relation to the third incident, he explained to police that he had refused to transfer the second amount of $590,000.  This refusal had caused him to receive threatening calls and emails and, as a result, he had left the country on Christmas Day 2019, returning on 14 February 2020.  During his overseas trip, he had purchased a yacht for $92,000.  He was issued with a Notice to Appear on 11 March 2020, but departed for overseas on 22 February 2020.

On 25 March 2020, a yacht was located dead in the water 35 nautical miles north of Aruba.  The applicant and another Australian were found onboard.  According to the Netherlands Coast Guard, both men were acting suspiciously and had failed to respond to calls from the Coast Guard.  When rescued, they were apparently irate at having to leave behind two heavy bags which they said contained clothes.  They claimed to be sailing the yacht back to Australia however their route suggested they were heading towards Haiti or the Dominican Republic.

On 16 June 2020, the applicant was interviewed in relation to the first incident.  He admitted to transferring the funds as directed by people in Malaysia but claimed that he had not received any benefit for himself and that he had tried to contact police in relation to the matter.

On 2 June 2021, police met with the applicant to speak to him about the fourth incident.  At that time, he was provided with his rights and cautioned.

The known benefit derived by the applicant from the four incidents included $92,000 which he used to purchase the yacht and at least $2762.72 which he spent on other daily expenses.

At the sentencing hearing, the applicant tendered into evidence a psychologist’s report.  That report described him as an intelligent person who felt intense shame as regards his offending.  The report opined that he met the criteria for a diagnosis of Major Depressive Disorder and suffered from, inter alia, suicidal ideation.  He was regarded as a good candidate for psychological therapy and further treatment.

The applicant pleaded guilty, but his was not a timely or early plea.  The sentencing judge gave the applicant credit for his plea and regarded it as revealing a willingness to facilitate the administration of justice.  The plea was entered on the basis that the applicant ought reasonably to have known that the laundered money was tainted property.  He was sentenced on this basis.

The sentencing judge observed that money laundering is often used to fund serious criminal enterprises.  The agreed facts revealed that there were numerous innocent victims of this offending which had occurred over a protracted period and involved a very large sum of money.  The sentencing judge was cognisant of, and expressly had regard to, the principles contained in s 9 of the Penalties and Sentences Act 1992 (Qld).  His Honour formed the view that there was a need for specific and general deterrence but was careful to take into account all relevant mitigating factors.  In particular, the applicant was recognised as being a person of otherwise good character and his very minor criminal history was disregarded.  He was accepted as being someone who suffered from significant depression at the time of the offending and particular note was taken of the issues raised in the psychologist’s report.

The Crown had submitted that an appropriate head sentence would be four years to be suspended after 12 months.  The applicant’s counsel conceded that a term of imprisonment should be imposed but submitted that the sentencing discretion should be exercised so as to wholly suspend that term of imprisonment or, alternatively, keep it at a minimum.  In this regard, one of the matters which the applicant’s counsel sought to emphasise was that the offending had involved “a degree of self-deception that is somewhat breathtaking”.  In the sentencing remarks, his Honour rejected that characterisation and instead found that the offending had been motivated by sheer greed.  That was a finding which was plainly open.

The sentencing judge was referred to R v Hannan; Ex parte Attorney-General (Qld) [2019] 2 Qd R 213 where a respondent pleaded guilty to one count of money laundering and was sentenced to three years’ imprisonment wholly suspended with an operational period of three years.  The respondent in Hannan was much younger, being aged 24 to 26 years old, with no previous criminal history.  Her husband was the head of a cannabis production syndicate and she had not played an active part in the production or trafficking of the drug.  Rather, her role had been to filter the proceeds of the drug operation through the lawful family businesses.  The offending had occurred over approximately three years and the money laundered totalled $649,189.

Having regard to Hannan, there can be no doubt that the present case warranted a period of actual custody in order to properly reflect the seriousness of the applicant’s offending.  The head sentence of four years was objectively reasonable given that, in comparison to the offending in Hannan, the subject offending was committed by an older person, involved significantly larger amounts of money and occurred in defiance of a prior warning by police.  In having regard to the various factors of mitigation, the sentencing judge discounted the head sentence by considerably more than the usual one third discount.  That generous discount was made to account for the plea of guilty, the applicant’s state of mental health, the others matters referred to in the psychologist’s report, the applicant’s remorse and good character.

It has not been demonstrated that the sentencing judge overlooked any factor which his Honour was bound to take into account in the exercise of his discretion.  In order to succeed on the ground that a sentence is manifestly excessive, the applicant was required to show that the sentence was unreasonable or plainly unjust such that it might be inferred that in some way there has been a failure properly to exercise the discretion which the law reposes in the Court of first instance.^[1]

The weight to be given to relevant considerations was always a matter for the sentencing judge in the exercise of the sentencing discretion.^[2]  The applicant has failed to demonstrate that there is any proper basis upon which this Court could be driven to conclude that there has been some misapplication of principle by the sentencing judge.

The application for leave to appeal against sentence must be refused.

MORRISON JA:  I agree.

MULLINS JA:  I agree.

MORRISON JA:  The order of the Court is that the application for leave to appeal against sentence is refused.