Local Court of New South Wales CITATION: P v Hodgson [2010] NSWLC 6 JURISDICTION: Criminal PARTIES: NSW Police Edward James Hodgson FILE NUMBER: PLACE OF HEARING: Cooma Local Court DATE OF DECISION: 04/07/2010 MAGISTRATE: Magistrate van Zuylen CATCHWORDS: Larceny, public servant LEGISLATION CITED: Crimes Act 1900 Criminal Procedure Act 1986 R v Doan (2000) 115 NSWLR 115 R v Thomson & Houlton 49 NSWLR 383 R v Falzon & Pullen unrep, 20/2/1992, NSWCCA CASES CITED: R v Mungomery (2004) 151 A Crim R 376 R v Hawkins (1989) 45 A Crim R 430 R v Swadling [2004] NSWCCA 421 R v Todorovic [2008] NSWCCA 49 R v Finnie [2002] NSWCCA 533 TEXTS CITED: REPRESENTATION: n/a n/a ORDERS: The defendant is convicted and sentenced to a non-parole period of 16 months imprisonment. The defendant is ordered to pay compensation in the sum of $324,476.95 to Australia Post 1 The defendant Edward James Hodgson pleaded guilty to one offence of larceny as a public servant pursuant to section 159 of the Crimes Act (NSW) 1900. The amount of property stolen was the sum of $324,476.95. The money was stolen between 12.01am on 6 November 2009 and 11.59pm on 15 December 2009 at Jindabyne where the defendant was employed as a postal manager with Australia Post. 2 An offence under section 159 of the Crimes Act carries a maximum sentence of 10 years. It is a Table 1 offence under the Criminal Procedure Act where the value of the property exceeds $5,000.00. The maximum penalty for this offence in the Local Court is 2 years imprisonment. The prosecution declined to make an election under the Criminal Procedure Act. 3 The offence on which I have to pass sentence is a matter to which the principles stated by the Court of Criminal Appeal in R v Doan (2000) 115 NSWLR115 apply. In that decision Grove J. (Spigelman CJ, Kirby J agreeing) said at [35]: "The result of true construction of the statutory provisions in New South Wales is that, what has been described is a jurisdictional maximum and not a maximum penalty for any offence triable within that jurisdiction. In other words, where the maximum penalty is lower because the charge should impose a penalty reflecting the objective seriousness of the offence, tempered if appropriate by subjective circumstances, taking care only not to exceed maximum jurisdictional limit. The implication of the argument of the appellant that, in lieu of prescribed maximum penalties exceeding two years imprisonment, a maximum of two years imprisonment for all offences triable summarily in the Local Court has been substituted must be rejected. As must also be rejected the corollary that a sentence of two years imprisonment should be reserved for a 'worst case'". 4 The defendant pleaded guilty to the charge on 3 February 2010, the second return date. The case was first mentioned at Cooma Local Court on 20 January 2010, when it was adjourned for the police prosecutor to refer the case to the DPP to see if there was to be an election. There was no election and the defendant pleaded guilty. The plea was entered at the first available opportunity, and in the circumstances, I allow the full 25% discount for the utilitarian value of the plea of guilty: R v Thompson & Houlton 49 NSWLR 383. Also, pleading guilty is a factor which especially in white collar crimes, attracts a considerable measure of leniency: R v Falzon & Pullen (unrep, 20/2/1992, NSWCCA) Facts 5 The Police Facts Sheet was tendered. In summary, it says that on 16 December 2009, Australia Post Investigators contacted police in relation to a theft from Jindabyne Post Office. The Australia Post Investigators attended the Jindabyne Post Office where they spoke to the Manager, Edward Hodgson, about the missing money. The defendant admitted to the offence and supplied the investigators with dockets for the amount of $324,476.95, which he had transferred via computer to Western Union as a money transfer. He did this via 72 separate transactions made from Jindabyne Post Office between 6 November 2009 and 15 December 2009. At no time did he deposit any money into the Post Office takings to pay for any of the Western Union Transfers. He acknowledged he had no permission to use the money and had performed office administration transfers in an attempt to hide the theft. Australia Post seeks compensation for the amount stolen. Matters of General Principle 6 Hulme J in R v Mungomery (2004) 151 A Crim R 376, said at [41], in a case involving three counts of defrauding a company : "The cases in this area also stress the importance of general deterrence. Organisations, be they business or government, cannot operate effectively without placing a good deal of trust in their employees. Opportunities for the abuse of that trust are legion and breaches are often difficult to detect. Commonly, offenders are able to continue their depredations for long periods (although that is not so in the present Jindabyne case – my insertion). Often matters only come to light when the total amounts involved become too large to be overlooked. It seems to me an inevitable inference that there must be many cases where offending is never discovered – a factor also arguing for sentences which are substantial deterrents." 7 In the case of R v Swadling [2004] NSWCCA 421, Hulme J said at [7], in a case involving nine counts of larceny as a clerk, with a further eleven counts taken into account, involving a total sum of $322,766: "As generally occurs, of the 5 principal factors to be taken into account in sentencing, general deterrence, personal deterrence, rehabilitation, retribution, and protection of society, it is general deterrence and retribution that are the factors most important in this case. Virtually all organs in society, shops, banks and other businesses and government, of necessity, depend on employees to handle cash or other forms of money. While steps can be put in place to minimise the prospect of defalcation and to maximise the prospects of detection if such defalcation occurs, few such systems are perfect and reliance must be placed to a substantial degree on the honesty of employees. Funds available to be stolen will often be vastly greater than the annual salary of any individual employee so temptation is liable to exist." 8 A sentencing court must take into account matters of objective seriousness such as the amount of money involved (R v Hawkins (1989) 45 A Crim R 430, and R v Mungomery), and whether the loss is irretrievable (R v Todorovic [2008] NSWCCA 49). Defendant's Explanation for the Offence 9 As is customary in the Local Court, Mr Hodgson did not give evidence in the matter. His reasons for the offence are contained in: the Police Facts Sheet, a signed letter presented to the court by his solicitor, a psychological report prepared by Dr Roger Blake, the Pre Sentence Report and written submissions tendered by his solicitor and read to Cooma Local Court on 17 March 2010. They all give a similar explanation. 10 The defendant joined a website called, "Adult Friend Finder", at the beginning of October 2009. Two weeks into his membership a person by the name of "Theresa White" from Bowling Green Kentucky, USA contacted him and they started chatting. She said she would like to come and visit but did not have enough money to cover flights. Initially, he sent his own money over to pay for it. Mr Hodgson says that around 28 or 29 October, Theresa told him about an inheritance she was to receive and had been contacted by an attorney from Spain called "Smith Cole". Either he, or "Theresa", it is not entirely clear whom, would receive an inheritance of $2,000,000.00 after he made "fee payments". Mr Hodgson's solicitor tendered a large number of copies of email correspondence between Mr Hodgson and "Smith Cole Attorneys", which appear to show how the attorney demanded money, paid in euros, in amounts of usually 2,000 to 2,800, paid in various names such as, Marisol Garcia, Ben Edwards, Roman Koval, to secure "the inheritance". It appears that Mr Hodgson paid these amounts as requested by Western Union transfer. I find it extraordinary that the defendant continued to pay the requested amounts when one reads the appalling English grammar and spelling contained in the "Smith Cole" emails, and the improbable names to whom he was to make the payments. 11 A close reading of the correspondence shows that the defendant was aware of the illegality of his actions and the subterfuge he was using to carry on with the criminal offending. For example, in an email dated 18 November 2009, the defendant says, "Was unable to get the transfers done today due to an inspection by management", he says in a further email dated 9 December 2009, "I require $300,000 to repay my work, or I go to gaol, as question (sic) are being asked which need answering". Defendant's Subjective Circumstances 12 The defendant is a person of prior good character with no previous criminal convictions, and on his behalf, his solicitor submitted references from; the Minister of the Alpine Congregation Uniting Church, the owner of a local newsagency and local Justice of the Peace. They all speak of their high regard for him and his great involvement in the local community since arriving in Jindabyne 2 years ago. 13 A psychological report prepared by Dr Roger Blake, was tendered to the court by his solicitor. He is 42 years old, he was married for 13 years and there were 2 children resulting from the relationship. After the marriage ended, he moved to Jindabyne in 2008. His ex wife and children still live in Townsville. He has worked for Australia Post since 1986 after completing year 12. He worked his way up to a managerial role working in regional NSW and Queensland. 14 In Dr Blake's clinical opinion and experience, Mr Hodgson presents with many of the stereotypical indicators and history of a person who has always had Aspergers Syndrome, which he describes as a pervasive developmental disorder which includes social and emotional dysfunction and poor insight into self and relationship with others. Dr Blake describes how the defendant's emotional vulnerability, social inadequacy and depression led him to internet dating sites, forming a "bond" with "Theresa White" and with the introduction of "Smith Cole" he became obsessed with complying with their requests. Given his all consuming nature, Mr Hodgson lost all rational perspective and crossed the line into illegality. 15 The Pre Sentence Report refers to him having sought psychiatric assistance due to the dissolution of his marriage and a self-harm attempt in 2007. He was prescribed anti-depressant medication and he continues to use that medication. There is no indication that the abuse of alcohol, use of drugs or involvement in gambling are factors within Mr Hodgson's lifestyle. Although, Mr Hodgson reported to the Probation Officer significant financial commitments relating to a personal loan and credit card repayments. The defendant acknowledged to the Probation Officer his naivety for having allowed himself to become involved in the scheme that led to him offending and believed that he would subsequently acquire significant wealth that would have assisted his financial strains. The Pre Sentence Report assessed him as unlikely to require, or benefit from, supervision by the service. He is suitable for a Community Service Order and Periodic Detention. Defence Submissions 16 The solicitors for the defendant submit that the court should take into account his plea of guilty, his prior good character, the circumstances of the offence, his emotional vulnerability, the loss of financial support to his children and former wife and all other matters contained in the reports and references handed up by them. For all these reasons, his solicitors submit that the Court should consider imposing community service or periodic detention. 17 The written submissions on behalf of the defendant also refer the court to the specific details of the case of R v Swadling [2004] NSWCCA 421. It was a total of $322,766 taken over a period of 21 months. Smart AJ assessed the offences in the mid range of seriousness. There were nine counts with eleven offences on a Form 1. The overall head sentence imposed was one of 6 years 3 months and the overall non-parole period was one of 3 years 3 months. The defence submissions also referred to the case of R v Finnie [2002] NSWCCA 552. In that case, in relation to ten counts of serious fraud offences contained in four indictments, with seven matters involving further serious fraud offences in four separate Form 1's, for a total sum of over $636,000, the Court of Criminal Appeal, on an inadequacy appeal, sentenced the Respondent to a head sentence of 4 years 4 months with a non-parole period of 2 years and 10 months. The Court expressed their view that the criminality was "extremely serious". The defence submit that in a comparison of the cases of R v Swadling and R v Finnie, to Mr Hodgson's case, his case could be assessed in the lower range of seriousness. Remarks and Conclusion 18 The Court takes into account the extremely large amount of money stolen ($324,476.95) over a period of less than 6 weeks, his position as a manager at Australia Post at Jindabyne and assesses the objective criminality as above the mid range of seriousness. I do not accept the submissions of the defendant's solicitors on this point. 19 The Court must consider the great need for general deterrence in matters of this type. The defendant was clearly entrusted with responsibility for large amounts of money, which until he committed this offence, he had carried out in accordance with his duties for 23 years. He committed these offences to secure an "inheritance" so it was for greed and not need. There appears little chance of the money being recovered. 20 The court also takes into account; his immediate plea of guilty, his prior good character, his diagnosis of Aspergers Syndrome, his depression and loss of employment. No doubt, his Aspergers Syndrome and his personal circumstances made him vulnerable to the particular internet scam he apparently fell for, but he clearly knew he was doing the wrong thing as evidenced by the email correspondence he has supplied and which I quoted earlier in this judgement. 21 The Court takes into account the statements of legal principle referred to in the cited cases. The cases of Swadling and Finnie give general guidance in relation to the sentences imposed for specific amounts of money, but there are a number of specific differences between those cases and the present one, particularly the fact that Mr Hodgson is facing only one charge rather than multiple counts. Although the Police Facts Sheet says there were 72 separate transactions involved in the larceny as a public servant charge. Also, Judicial Commission statistics are of limited assistance as there are only 4 cases included in the database for the Section 159 charge. 22 I am of the view that no other sentence other than the imposition of a sentence of full time imprisonment is appropriate. Taking into account all the aggravating and mitigating factors, I am of the opinion that the appropriate sentence is in the vicinity of 32 months imprisonment. From that must be deducted the discount of 25% for the utilitarian value of the plea. The Court makes a finding of special circumstances because; it is the first time he has been sentenced to a period of full-time imprisonment, he has been diagnosed with Aspergers Syndrome which would make a sentence of imprisonment more difficult for him and because of his prior good character, there are good prospects for rehabilitation. I set a non-parole period of 16 months. 23 In respect of the charge of larceny as a public servant, Edward James Hodgson is convicted and sentenced to a non-parole period of 16 months to commence on 7 April 2010 and expire on 6 August 2011 with a total term of 2 years. 24 I order compensation in the sum of $324,476.95 payable to Australia Post. Brian van Zuylen Magistrate Cooma Local Court 7 April 2010 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.