New South Wales Supreme Court CITATION : REGINA v George SEGAL [2006] NSWSC 621 This decision has been amended. Please see the end of the judgment for a list of the amendments. HEARING DATE(S) : 23 March 2006 JUDGMENT DATE : 22 June 2006 JUDGMENT OF : Hidden J at 1 DECISION : Concurrent sentences of two years - released forthwith on recognizance CATCHWORDS : CRIMINAL LAW - Sentence - four counts under s31 Financial Transaction Reports Act - further matters on s16 BA form - pleas of guilty - assistance to authorities Financial Transaction Reports Act 1988 (C'th) LEGISLATION CITED : Crimes Act 1914 (C'th) Director of Public Prosecutions Act 1983 Social Security Act 1991 CASES CITED : R v Rule [2003] NSWCCA 97 PARTIES : REGINA (Crown) George SEGAL (offender) FILE NUMBER(S) : SC 2003/1364 COUNSEL : Mr G Rodzicki (Crown) Mr C Bilinsky (sol - offender) SOLICITORS : Mr G Harrison (Crown) Mr C Bilinsky (offender) IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION CRIMINAL LIST Hidden J Thursday 22 June 2006 2003/1364 REGINA v George SEGAL JUDGMENT – REMARKS ON SENTENCE 1 HIS HONOUR: The offender, George Segal, has pleaded guilty to four counts under s31 of the Financial Transaction Reports Act 1988 (C'th) of conducting transactions so as to avoid the reporting requirements imposed by that Act. The first two counts charge that he was a party to transactions, while the third and fourth counts charge that he was knowingly concerned in transactions to which one Maureen Bates was a party. He also asks that I take into account five further offences under that same provision, set out on a form under s16BA of the Crimes Act 1914 (C'th). The first three of those relate to transactions to which he was a party, and the fourth and fifth relate to transactions to which Ms Bates was a party and in which he was knowingly concerned. 2 The facts need not be recited at length. They are summarised succinctly in a statement of facts provided by the Crown, as follows: Counts 1 – 2 on Indictment Offences 1 – 3 admitted on section 16BA Crimes Act 1914 form 1. Between 20 March and 27 June 2000, George Segal, using his own name or that of a trust associated with him, undertook a total of 20 transfers of cash in amounts of less than $10,000 to overseas bank accounts… 2. The transfers were undertaken by way of international fund transfers through banks in Sydney. Customer copies of the bank documentation were located in George Segal's study during the execution of a search warrant at his residential premises at Thornton Street, Darling Point. Counts 3 – 4 on Indictment Offences 4 – 5 admitted on section 16BA Crimes Act 1914 form 3. Between 10 April and 1 June 2000, another third party, Maureen Bates undertook transfers of cash in amounts of less than $10,000 to overseas bank accounts on behalf of George Segal. Bates conducted the cash transfers using her own name and a false name of Maria Grenfell… 4. Telephone calls were lawfully intercepted between George Segal and Bates in which Segal sought Bates' availability to conduct the transfers and arrangements were made between them for the transfers to be undertaken. In one instance Segal stated to Bates that he had yet to leave his residence as he was still counting the money. 5. Other intercepted telephone calls revealed that Bates was receiving payments from George Segal for undertaking the transfers on his behalf. 6. During the execution of the search warrant at the Thornton Street premises the NCA located the customer copies of the relevant bank transfer documents in George Segal's study. Also located was a piece of paper with the false name, address and phone number used by Bates. 7. George Segal's fingerprints were identified on three bank transfer documents held by the bank. 3 Attached to the statement of facts is a schedule of the transactions involved. From that schedule, it appears that the offences the subject of the first two counts on the indictment and the first three matters on the s16BA form involved transactions totalling $176,000. The remaining offences, counts 3 and 4 in the indictment and the fourth and fifth entries on the s16BA form, involved transactions totalling $237,000. The grand total of all the transactions was $413,000. 4 In the offender's case on sentence I received a statement he had made concerning the circumstances of the offences. In understanding that statement I was assisted by some background explained to me by his solicitor, Mr Bilinski, who appeared for him. 5 The offender was a friend of Ms Ida Ronen. In the late 1990s Ms Ronen was approached by a mutual friend who was involved in a company which traded in diamonds. That person sought Ms Ronen's assistance in sending money overseas. Ms Ronen, in turn, approached the offender about that matter, saying that he could earn money by charging a small percentage of the amount transferred. Put shortly, the object of this exercise was to enable the diamond trading company to evade Australian taxation of the proceeds of its trading – a practice which, apparently, was not unknown in that industry. 6 It is not necessary to recite in any detail the offender's statement. It is sufficient to say that he agreed to arrange the transfer of money from time to time, charging 4 percent of the amount involved. For a time, the transfers were effected by his accountant, Ms Helena Rule. Later, he transferred the money himself. He also engaged Ms Maureen Bates, with whom he was having a relationship, to transfer money. She was not well off financially, and he was able to help her by paying her for this service. 7 The offender's statement suggests a longer course of these dealings than is disclosed by the statement of facts tendered by the Crown. Of course, he is to be sentenced only in respect of the charges which are before me, on the basis of those facts. 8 He was arrested in February 2001 for these matters, as well as his part in a conspiracy to defraud the Commonwealth. That conspiracy involved a major fraud upon the Australian Taxation Office, in which the principal offenders were Ms Ronen and her two sons and in which the offender's role was relatively minor. 9 Early in 2003 he provided an induced statement to the authorities in the prosecution of the Ronens. He was granted a conditional undertaking, under s9(6D) of the Director of Public Prosecutions Act 1983, that he would not be prosecuted for that matter. Over several days in June 2004 he gave evidence at the trial of the Ronens before Whealy J. His evidence was described by a senior officer of the Australian Crime Commission as "compelling and credible", and was assessed as having substantially strengthened the prosecution case against the Ronens. They were found guilty and sentenced to terms of imprisonment. 10 He also supplied information nominating the persons he said were the owners of the money the subject of the offences with which I am dealing. Later, through his solicitor, he expressed his willingness to give evidence against those people. However, the Crime Commission decided not to pursue this information, on the basis that it was provided too long after his arrest and would be unlikely to be corroborated. 11 The only entry in his criminal history is his conviction in a Local Court in March 1999 of three charges under the Social Security Act relating to payments to which he was not entitled. He was ordered to perform 180 hours of community service. He is now seventy-one years old. He has two adult children and three grandchildren. He migrated to this country in 1957 and is an Australian citizen. For about the past three years he has been living with another woman, and that relationship appears to be stable. 12 In recent years he has been earning a modest income, managing bridge clubs. There were tendered on his behalf testimonials from responsible citizens, attesting to his general good character, his voluntary community work, and his remorse about the present offences. His voluntary service to the community includes work at a synagogue in the eastern suburbs and for the community radio station, 2MBSFM. From those testimonials it also appears that his relationship with his present partner is beneficial to him, and that his giving evidence against the Ronens caused him considerable stress and has compromised his relationship with a number of people with whom he and they used associate. 13 An offence under s31 of the Financial Transaction Reports Act carries a maximum prison term of five years. Provision is also made for a fine, but I accept that the offender is not in a position to pay a fine in any significant amount. In dealing with the four offences on the indictment, I must have regard to the criminality disclosed by the additional offences on the form under s16BA of the Crimes Act. As will be seen, I have regard to s16A of the Crimes Act and, in particular, such matters in subs(2) as are relevant to the present case. I have approached the question whether a term of imprisonment should be imposed guided by s17A of the same Act. 14 I acknowledge the assistance I have been afforded by the written and oral submissions of the Crown prosecutor, and the oral submissions of Mr Bilinski. The Crown prosecutor's written submissions refer to a number of decided cases which emphasise the undoubted seriousness of offences under the relevant provision of the Financial Transaction Reports Act, and the need for deterrent sentences. Ms Helena Rule, to whom I have earlier referred, was herself prosecuted for offences under s31. In his leading judgment in her appeal against the sentences imposed upon her, Buddin J explained the purpose and significance of the Act and, in particular, of s31, referring to relevant authority: R v Rule [2003] NSWCCA 97 at [6] ff. The legislation is clearly directed to the underground cash economy and to the detection of money laundering and, relevantly for present purposes, tax evasion. 15 Ms Rule appealed unsuccessfully against a sentence of twelve months full-time imprisonment with a recognizance release order after six months. She had pleaded guilty to two counts under s31, embracing a number of transactions in which she had been involved with her husband. The total amount of money transferred was about $427,000, and it would seem that this offender was not involved in all of those transactions. She had no previous convictions, but her criminality was aggravated by her status as an accountant. Given the differences between her case and that of this offender, I do not think that the sentence imposed upon her provides any guidance for the sentencing task which I must undertake. 16 Ms Bates pleaded guilty to four counts under s31, representing her involvement in the offender's enterprise in the manner which I have outlined in these reasons. She was dealt with in the District Court by Williams DCJ. On two counts, his Honour ordered her to perform 400 hours community service. On the other two counts he sentenced her to concurrent terms of imprisonment for twelve months but, pursuant to s20(1)(b) of the Crimes Act, he directed that she be released forthwith on recognizance to be of good behaviour for the same period. She was forty-one years old at the time of sentence, and had no prior convictions. His Honour noted that she undertook the transactions on behalf of the offender. In dealing with this offender I must, of coarse, have regard to the way in which Williams DCJ dealt with a person who was, to a significant extent, a co-offender. Nevertheless, the distinction between their subjective cases requires a different approach to the sentence of the present offender. 17 These are serious offences, committed by a man who cannot claim an unblemished criminal record. On the other hand, he is an elderly man, whose general good character and contribution to the community are evidenced by the testimonials to which I have referred. He has expressed remorse for his offences and his pleas guilty, albeit delayed and only after negotiation with the Crown, demonstrate a willingness to facilitate the course of justice. His assistance to the authorities in the Ronen matter entitles him to a significant measure of leniency, even though he had the benefit of an indemnity from prosecution for his part in that offence. He is also entitled to some recognition, albeit minor, for the assistance he proffered to the authorities in relation to the present matter. 18 At the time of the sentence proceedings before me, he was awaiting sentence at the Downing Centre Local Court for an offence of dishonesty of the kind of which he had been convicted in 1999. I have regard to that fact only insofar as it might bear upon his prospects of rehabilitation. Notwithstanding that matter, I have some confidence that he will not re-offend. Certainly, I think it most unlikely that he will ever again be involved in a criminal enterprise such as this. 19 All that said, I think it appropriate that his criminality be denounced by the imposition of a sentence of imprisonment. However, pursuant to s20(1)(b) of the Crimes Act, I would direct his immediate release on recognizance. Were it not for his pleas of guilty, his remorse and his assistance to the authorities, I would have imposed an aggregate sentence of the order of three years. In the light of those factors, I would reduce that term to two years. Although the offences were committed over a period in excess of three months, they were part of a continuing criminal enterprise and I consider that concurrent sentences are appropriate. 20 I shall consult the parties about how orders should be expressed to give effect to my intention. ********** 11/07/2006 - Incorrect file number on cover sheet - Paragraph(s) Cover sheet 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. 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