R v Tertsis [2023] NSWDC 442

District Court New South Wales

Medium Neutral Citation: R v Tertsis [2023] NSWDC 442 Hearing dates: 22/9/23 Date of orders: 22/9/23 Decision date: 22 September 2023 Jurisdiction: Criminal Before: Bourke SC DCJ Decision: Convicted and sentenced to a Commonwealth term of imprisonment of 3 years 3 months with a NPP of 18 months (14/9/22-13/3/24). A 25 percent discount has been taken into account. Catchwords: Crime – Sentence – Commonwealth offence – Import tobacco with intention of defrauding the Commonwealth of revenue Legislation Cited: Customs Act (Cth) 1901 Crimes Act 1914 Cases Cited: R v Zhang [2017] SASCFC 5 R v Saleh [2015] NSWCCA 299 Category: Sentence Parties: Commonwealth DPP – Crown Dimitrios Tertsis - Offender Representation: Mr P Scard for Crown Mr M Ainsworth for Offender File Number(s): 22/275204

sentence 1. The offender Mr Dimitrios Tertsis is for sentence on a single offence under the Customs Act (Cth) 1901 being an offence under s 233BABAD(1) of importing tobacco with intention of defrauding the revenue. 2. The maximum penalty for that offence is ten years imprisonment. The maximum penalty is of course an important guidepost in the sentencing exercise to which I have had regard. 3. I intend on account of the offender's plea of guilty to allow a 25% discount by reason of the utilitarian value of that plea. There is of course no specified percentage in Commonwealth matters but nonetheless that is the discount that I consider appropriate in this case.

FACTS 1. Turning to factual matters, the Agreed Facts note that the offender arrived in Australia from Greece in November 2019 and thereafter was involved with others in the preparation for, and importation of, two shipping containers which contained tobacco products. He did so with the intention of avoiding the payment of Customs duty. Each container was intercepted by Australian Border Force and were found to contain a total of 16 million cigarettes. The Customs duty relating to them was $17,904,800. 2. The offender, a Greek citizen, was recruited to participate in the offences by a Georgios Machalias who had arrived in Australia on the same day in November 2019 as the offender. There is no evidence, however, as to how they came to know each other. 3. Mr Machalias is also a Greek citizen. He left Australia in late-2019 and has not returned to Australia. It is not known whether Mr Machalias gave directions to the offender about the imports or whether both Machalias and the offender acted on the directions of another man, Paul Validis, who was directly involved in the purchase of the tobacco that was in the containers. As I have said the offence involved two containers. 4. The first container was shipped from Singapore to Sydney in late September 2021 via Malaysia. Its documentation recorded that it contained 14,000 pail buckets. However, following X-ray, the container was found to contain 600 cardboard boxes concealed at the rear of the container behind a large number of plastic buckets. Inside the boxes there was found 6 million Canyon brand cigarettes comprising 5.2 million premium cigarettes, 700,000 standard cigarettes and 100,000 menthol. 5. The container was being shipped to a company called Agora Trading Pty Ltd, an entity which had been incorporated in the name of Machalias about six months after he left Australia. The company was one over which the offender exercised control and was created solely for the purposes of importations. 6. In preparing for the arrival of the first container the offender caused Agora Trading to enter into a rental agreement for two storage units at Kennards in Chullora. In dealing with Kennards, the offender used the name "James". He also provided Kennards with two mobile phone numbers on which he could be contacted, one of which was subscribed in the name of Mr Machalias. 7. The offender operated a number of accounts with the Commonwealth Bank which were used to make payments in furtherance of the importation. One of them was in the name of Mr Machalias and had been opened more than a year after his departure from Australia. The account in the name of Machalias was used solely for the purposes of meeting expenses associated with the importation enterprise. It received funds either by over‑the‑counter cash deposits or by transfers from a CBA account in the name of International Rising Pty Ltd of which Machalias was the sole director. 8. In addition to using the CBA account in the name of Machalias to make seven payments to Kennards this offender used the account to pay $5,539 to GSA Freight Logistics which acted as the freight forwarder for Agora Trading. That payment was made by the offender on the day that the container arrived at Port Botany. 9. Of that sum, $2,994 related to duty and taxes payable to the Commonwealth based on the declared importation of the buckets said to have been in the container. 10. In the days before the arrival of the container a payment in that amount had been made by a Customs broker named Century Customs Services which was acting on the instructions of GSA Freight Logistics and in reliance on documents provided by Agora Trading. Century Customs Services were provided with an authority from Agora Trading which was purportedly signed by Mr Machalias as well as a false invoice relating to 14,000 buckets which was consistent with the information on the waybill. The author of the false documents, however, is not known. 11. The container arrived at Port Botany on 29 September 2021. 12. About three days later, this offender called Kennards at Chullora to seek permission for the container to be delivered there at some stage in the coming week. 13. Between 6 and 8 October 2021 a number of bookings were made with Fast Track Deliveries, a transportation company, by somebody using the name of Agora Trading relating to the collection and transfer of the container. 14. The identity of the person with whom Fast Track Deliveries dealt is not apparent, however, the offender made at least three telephone calls to Kennards around this time to provide updates about the container's likely arrival date. 15. Around this same time the offender was seen travelling in a vehicle driven by Paul Validis in which vehicle ABF officers subsequently found a USB device containing documents relating to the importation as well as a business card for Kennards Chullora. 16. During a later search of Mr Validis' residence, ABF officers seized an iPhone on which were found numerous communications between Validis and the offender, as well as WhatsApp conversations with a Mr Da Silva which related to the purchase and shipping of Canyon brand cigarettes. One of those messages which was received by Validis from Da Silva in March 2021 related to this importation and was in the following terms: "Container cost 4000 USD (you can sell the container after). Singapore Malaysia 2000 USD Transloading including changing paperwork and container 6000 USD Freight to Sydney from Singapore through Malaysia 6200 USD Total equals 18,200 USD for first container You can pay them direct. You can pay in Singapore dollars" 1. I note of course that the reference to USD is evidently a reference to United States dollars. 2. In July 2021, Validis used a Westpac account which he controlled to make two payments to the total of $22,780 to an account held by Mr Da Silva in Vietnam. Another payment in the amount of $20,807 was made to Da Silva by Harry Soumelidis who was an associate of Validis with whom this offender also came to be associated whilst he was in Australia. During a search of Mr Validis's residence, ABF officers found a key marked "WH" to a warehouse in Ingleburn which was apparently where the offender resided for most of the time he was in Australia and which had been leased by Machalias as a director of International Rising Proprietary Limited the day before he left Australia. 3. The offender used a CBA account in the name of that company, (International Rising), to make payments for rent and utilities on the warehouse from late December 2020. The first container was delivered to Kennards Chullora on 9 October 2021. CCTV captured the offender unpacking the container along with other males. That CCTV footage also captured the offender's surprise upon learning that the cigarettes which had been removed by ABF officers were not in the container. Subsequently, the offender abandoned inside the Kennards Storage Units the "cover load" of red plastic buckets and he had no further contact with Kennards Chullora. 4. The customs duties payable on the six million cigarettes inside this container was $6,714,300. It is an agreed fact that at no stage did the offender, Machalias, Validis or Agora Trading have the means to pay that sum. 5. Turning then to the second importation. While Validis had sourced the Canyon cigarettes directly through Mr Da Silva, Validis was also able to source other brands of cigarettes through contacts in the United Arab Emirates. Mr Validis, with the help of others including Mr Da Silva then caused more cigarettes to be shipped to Australia via Singapore. From around mid-March 2021 Validis engaged in WhatsApp communications with contacts in the UAE for the purchase of about 1,000 boxes of Mac brand cigarettes for an amount of USD 85,000. 6. Between 16 and 19 August 2021, Validis used a Westpac account that he controlled to make three payments to a total of about $113,000 to an account in the UAE in furtherance of the purchase of the cigarettes. In early September 2021 Validis approved a bill of lading in relation to the shipment of Mac brand cigarettes from UAE to a consignee in Singapore named Octa Metal Pipe which had been nominated by Mr Dasilva. At the same time, Validis used WhatsApp to send a copy of the bill of lading to this offender and this bill of lading indicated that the contents of the shipment to Singapore was cigarettes. 7. As part of the agreement between Validis and Dasilva, it was understood that Octa Metal would then on-ship the container to Sydney on the basis that it was a consignment of food packaging. To help substantiate this, the offender assisted Validis to create false packing lists and invoices relating to the purported purchase from Octa Metal of 1,365 "packing boxes (pizza)" weighing 14,288 kilograms. No payment however was ever made to Octa Metal for this purported purchase. 8. In late September 2021, with the assistance of Dasilva, a booking was made for the shipping of a 40 foot shipping container to Sydney from Singapore. In the days before this booking, two payments to a total of $49,143 were paid to a freight forwarder. The first payment of $25,000 was made by Validis's associate Mr Soumelidis. The second payment for the balance of the amount was made by Mr Validis himself. 9. On 27 September 2021, a representative of the Orient Overseas Customer Line sent an email to International Rising Proprietary Limited seeking to confirm that the bill of lading was correct. It was this offender who replied to that email in which he nominated Bluetongue International as the customs broker. Throughout his involvement with Bluetongue, the offender used the name (described in the statement of facts as an alias) of "James". 10. In the first week of October 2021, Bluetongue exchanged a number of emails with the offender so as to gather documents and information needed to submit an import declaration to the ABF. During those exchanges, the offender provided Bluetongue with invoices and other documents that he knew to be false. These documents were also found in the possession of Validis when his car was later searched. 11. On 8 October 2021, Bluetongue used the information and documents provided by the offender to lodge an import declaration from which a liability of $3,198 in duties and taxes arose, based of course upon the falsely declared contents of that container. Later that day, Bluetongue sent an invoice to International Rising Proprietary Limited for that sum plus its fees which the offender caused to be paid. 12. The second container arrived on 17 October 2021. Unknown to the offender, in the days before the arrival of the container, ABF staff had conducted searches of Validis's premises and of the Ingleburn warehouse where the offender mostly resided. Although the offender's personal effects were at the warehouse, he was not present at that location on 14 October 2021, which presumably is the day that the Australian Border Force carried out their searches. It is noted that while Validis was in the presence of ABF members, the offender tried to call him multiple times. In the days after the container arrived, the offender continued to exchange emails with Bluetongue about the progress of the container and its delivery to the Ingleburn warehouse. 13. The second container had, however, been intercepted and was found to contain ten million MAC branded cigarettes packed into 1,000 different boxes comprising three million MAC black red cigarettes and seven million MAC black gold brand cigarettes. The customs duty payable to the Commonwealth in relation to the importation of those ten million cigarettes was $11,190,500 in circumstances where the applicable rate of duty was $1.11905 per cigarette stick. At no stage over the offending period did the offender, Machalias, Validis or International Rising Pty Ltd have the means to meet that liability. 14. The offender was arrested on 14 September 2022, in other words, nearly a year later, whilst working at a business operated by Mr Validis's associate, Harry Soumelidis. Those then are, in summary, the agreed facts.