N7362

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

CR (FC) 205 of 2017

THE STATE

V

JACOB KOM

Waigani: Miviri AJ
2018: 27 June, 13 July

CRIMINAL LAW – PRACTICE AND PROCEDURE – Misappropriation s.383A – Plea – electronic transfer – bank officer – victim deceased customer of bank – serious breach of trust – phone banking – PSR MAR not favourable to prisoner – no means to repay – custodial term appropriate – strong punitive sentence.

Facts

Prisoner was a bank officer who put a stop to the account of a deceased customer but then removed the stop and put in two phone numbers to which money was taken out and deposited into running into K 41, 859.00 which he used personally.

Held:

Serious breach of trust 
Bank officer
Dishonestly applied to his own use
Deceased Customer’s money
Punitive and deterrent sentence

Cases: 

Acting Public Prosecutor v Don Hale [1998] PGSC 26; SC 564 
The State v Allan Peter Utieng (Unreported Judgement delivered in Wewak on 23rd November 2000) SCR 15 of 2000
The State v Avia Aihi (No3) [1982] PNGLR 92 
The State v Belawa [1988-89] PNGLR 496
The State v Doreen Lipirin [2001] PGSC 11; SC673 
The State v Duk [2009] PGNC 247; N3924 
The State v Eric Emmanuel Vele [2002] PGNC 93; N2252
The State v Kaia [1995] PGNC 166; N1401 
The State v Zuvani [2004] PGNC 127; N2641 

Counsel:

T Aihi, for the State	
E Sasingan, for the Defendant
		
SENTENCE
13th July, 2018
 
1.	MIVIRI AJ: This is the sentence of a bank employee who misappropriated moneys that came into his possession in the course of his duties.

Short Facts

2.	Jacob Kom was employed by the Australia New Zealand Banking Group (PNG) Limited as a small Medium Relation Officer at the water front harbour city branch. James Naveung a customer of the bank died on the 26th January 2012. He had a personal account number 12829401 segmented under the SME category managed by the accused there. Between 31st December 2012 and the 31st October 2013 the accused placed stops on the account then lifted it linking it to Digicel mobile numbers 72771285 and 70855533. He instructed his colleagues to do this. And within this period accused dishonestly applied to his own use and to that of others through mobile phone banking system a sum of Forty One Thousand Eight Hundred And Fifty Nine Kina (K41, 859.00) the property of James Naveung.

Charge

3.	Prisoner is charged pursuant to Section 383A of the Criminal Code with misappropriation. He was dishonest and applied the proceeds to his own use or to that of others. It is clear that the money was in the account of the deceased at the bank and therefore not his money. It was in his control as an officer of the bank by virtue of that employment but did not belong to him. Section 383A covers in all material aspects what is the subject of the facts here against the prisoner.

4.	Section 383A reads:

“(1) A person who dishonestly applies to his own use or to the use of another person –

(a)	Property belonging to another; or
(b)	Property belonging to him, which is in his possession or control (either solely or conjointly with another person) subject to a trust, direction or condition or on account of any other person, 
is guilty of the crime of misappropriation of property.

(2)	An offender guilty of the crime of misappropriation of property is liable to imprisonment for five years except in any of the following cases when he is liable to imprisonment for ten years-
	(a)	where the offender is a director of a company and the property 	dishonestly applied is company property;
(b)	where the offender is an employee and the property dishonestly 	applied is the property of his employer;
(c)	where the property dishonestly applied was subject to a trust, 	Direction or condition;
(d)	where the property dishonestly applied is of a value of K2000 or 	upwards.

(3)	For the purposes of this section-
	
(a)	property includes money and all other property real or personal, 	legal or equitable, including things in action and other intangible property;
(b) 	a persons application of property may be dishonest even although he is willing to pay for the property or he intends to restore the property afterwards or to make restitution thereof to the person to whom it belongs or to fulfil his obligations afterwards in respect of the property;
(c) 	a person’s application of property shall be taken not to be dishonest, except where the property came into possession or control as  trustee or personal representative, if when he applies the property he does not know to whom the property belongs and believes on reasonable grounds that such person cannot be discovered by taking reasonable steps;
(d)	persons to whom property belongs to include the owner, any part owner, any person having a legal or equitable interest in or claim to the property and any person who. Immediately before the offender’s application of the property, had control of it. “

5.	Here also it should be clear that the money was above K2000 and therefore drew sentence up to maximum of 10 years imprisonment. 

Issue

6.	What then is the appropriate sentence for the prisoner?

Mitigation
 
7.	The Prisoner pleaded guilty to committing the offence over almost a year starting from the 31st day of December 2012 to the 31st day of October 2013 involving K 41, 859.00 which he dishonestly applied to his own use or to the use of others. Whilst he was a bank officer dealing with large sums of cash by virtue of that fact. He was persistent in the way that he carried out the offence. And was not deterred that it was computer based and generated therefore evidence would have mounted as did here against him. Nor was he deterred that the bank was trusted by the Public and this was seriously breached in the way that he acted. Even the sophisticated nature of banking involving the use of electronic and electronic system including the internet did not deter that he would be caught with the evidence. It is necessary by the sentences imposed to protect that system of banking and the banks including customers from employees as scrupulous as the prisoner here. The level of trust is very high and it must be properly protected by stringent punitive and deterrent sentence. Banks drive business and the economy and the livelihood of public who put their faith in must be protected. It is also a very prevalent offence and must be deterred. 

Amount taken

8.	His persistence and perseverance in the offence saw the total sum of money accumulate to K 41, 859.00, indeed a large sum of money from a deceased person who had an account with the bank. By that fact it dictated that the larger the amount the greater the punishment or sentence should be. It was also important to decide whether or not the prisoner had means to settle or payback the money stolen: Doreen Lipirin v The State [2001] PGSC 11 ; SC673 (9 November 2001).  The presentence and means assessment reports before the court after application by defence counsel were both not in favour of the prisoner. There was no means upon which the moneys misappropriated would be recouped and paid back to the bank and the deceased customers account. Both reports recommended against probation as he had no means to make good what he stole. And alternatives to imprisonment would not be considered given.

9.	Imprisonment started at 10 years but the range and tariff set out in Belawa v The State [1988-89] PNGLR 496 was appropriate in the determination. Relevant to the facts here was that where the amount was K10, 000 to K40, 000 suggested term was 3 years imprisonment as appropriate. K40, 000 to K150, 000 as 3 to 5 years imprisonment. The amount here was K 41, 859.00 hence the term in view was 3 to 5 years imprisonment. A further consideration by section 383A (2) (d) was the fact that this was an amount of over K2000 which draw 10 years as maximum sentence to be imposed. It could be 5 years if it was amount below K2000 which wasn’t the case here. So effectively the prisoner was looking at a possibility of being sentenced to 10 years for the offence. That in itself was the maximum under that section for the crime. In accordance with Avia Aihi v The State (No3) [1982] PNGLR 92 (5 March 1982) the maximum was always reserved for the worst offence of misappropriation. Which weren’t the case here and therefore a determinate term was in view against the prisoner. And in so determining it was relevant to set out the facts for and against in determining.

Use of money

10.	Firstly the Prisoner transferred the money out of the account of the deceased into the two phone numbers where he accessed and applied to his own use and to that of others. The evidence did not disclose the specifics as to what he applied the proceeds to.  But he did use phone banking to deposit these moneys into different accounts of persons he knew. He did not have any authority in the way that he executed this either from the bank or from a representative of the deceased.

Effect upon Victim

11.	And in this way primarily the victim James Naveung suffered because his moneys were withdrawn from his account by the prisoner using phone banking. The trust with the bank had been seriously breached by the prisoner in the way that he acted by the withdrawal of those monies. The banks reputation had been seriously breached. Public confidence in the bank as an institution where they could keep their money and conduct business was seriously affected by the actions of the prisoner.

Effect on offender

12.	  Prisoner lost his job where he was earning K 594.21 as a Small Medium Relations Officer as of the 29th November 2013. His family survived on that money. There was no other means apart. He had no one to blame except his own greed. There was no reason apparent or identifiable as to why he did what he did.

Restitution

13.	Prisoner had no means to repay the K41, 859.00 to the bank or the victim James Naveung. The presentence and the means assessment did not disclose any means upon which the prisoner could draw to pay off that money. Restitution was not tangible to be considered as basis in view. And the presentence and means assessment reports both recommended against fundamentally because prisoner had no means if it was considered. It was not an option given for the prisoner in view of the gravity of the offence set out above.

Prisoners History

14.	Prisoner is 32 years old from Nondugl, North Wagi Jiwaka married with two children. He is the first born of 9 children. Both his parents are old resident back in the village. He is educated from the University of Papua New Guinea graduating with Bachelor in Business Management in 2008. At the time of the offence he had a privileged position with the Australia New Zealand Bank at the Harbour City Branch attached at the Small Business Relationship. The level of trust in that position was very high because the duties performed involved large sums of money between the bank and its customers as was the case here with James Naveung a deceased person which made it even venerable. It was therefore quite a serious breach against the prisoner clearly voiced by his Manager Mr Titus Kemi, Tony Vagi, Investigator, and Fatima Tiko also an investigator. They elaborated the prisoner was in a position of trust responsible for deceased customers moneys. He breached that trust and stole and never made any attempt to go back to the bank,  apologise or repay the money initially. And denied the allegation there and therefore persons such as him could not be reemployed or employed by the bank as there was no guarantee that the people’s money would be safe in view of that fact. It was also their view that he should be sentenced to jail to deter other bank employees to signal that such behaviour could not be tolerated by the banks.

15.	The prisoner on the other hand in the same report blamed an unknown person who had instructed him over the phone number unknown to do what he did. And he followed suit to email to his colleagues responsible who executed and he did what he did. Sentence was determined not on emotions but on the justice of each individual case. Here prisoner was a university graduated employee; he was discharged with dealing with large sums of money exchanging hands between the bank and its customers in his case deceased persons. It was not in accordance with the justice of the case that he would be exonerated because he still had the power of reason and choice here. His choice did not deviate the sentence due by Justice not emotion. And that was clear by that same report where prisoner blamed himself for what happened pleading to be accorded mercy by the court for the offence. Which again was depended on the justice of the case.

16.	Alternatives to imprisonment were not exercising mercy by that fact alone but based on sound reasons to allow for restitution, reformation and service of justice in the case. Deterrence and retribution for the offence committed. The presentence and means assessment reports here were sourced on these premises precincts. Both reports did not converse that for the prisoner and therefore there were no alternatives before the court to consider other than imprisonment in jail. 

17.	Banks were institution with high regard in the community and Australia New Zealand Bank was no different from any other commercial bank. Business and the economy was depended on maintaining these reputation and regard employees of the banks were persons of integrity and repute to so breach here warranted a stern punitive and deterrent sentence to be imposed to reflect. There were no other extenuating circumstances apparent or identifiable before to consider any other sentence other than what was considered proportionate here of 5 years IHL.

18.	Balanced with what you assert on behalf of your family including your wife and two children, it is pertinent to adopt what the Supreme Court said in Allan Peter Utieng v The State (Unreported Judgement delivered in Wewak on 23rd November 2000) SCR 15 of 2000:

“An offender should consider his background first before committing any offence. Implicit in that is the fact that, it is a little too late to talk about an offenders personal background including the needs of his family concerns once he is proven guilty according to law. His background and concerns should have little or no weight against the need to impose a sentence or punishment that best befits an offence he has committed in the particular circumstances in which the offence was committed.”

19.	The gravity of the offence outweighs his personal background. Comparatively The State v Eric Emmanuel Vele [2002] PGNC 93; N2252 is different and not applicable to the circumstances of the present. There Prisoner took the initiative to make repayment of K 11,091.23 even before the formal orders of court and had a balance remaining of K4, 008.77 to settle the money stolen from the Port Moresby Westpac Bank Limited where he was employed as Supervisor International Bank centre. And the presentence report recommended probation with community supervision which the court acceded to in view of that being so in the light of Acting Public Prosecutor v Don Hale [1998] PGSC 26; SC 564 (27 August 1998) that criminal sentencing is a community responsibility. The sentence there was 2 and a half years suspended on very strict conditions of Probation. The circumstances of that case do not par out with the present. There has been no repayment despite a payment of K15, 000.00 paid to the prisoner for his finish pay by the bank. He did not take the initiative to repay and has not shown any factors as with Vele’s case (supra). 

20.	In State v Zuvani [2004] PGNC 127; N2641 (25 August 2004) prisoner pleaded guilty to transferring paperless K22, 685.43 over a period of time property of her employer Bank of South Pacific Limited into a relatives account where she used the save card withdraw and used the money. She had almost made complete and full restitution of that money back to the bank. The court considered and imposed 4 years wholly suspended on seven conditions on probation attaching. 

21.	In State v Duk [2009] PGNC 247; N3924 (15 July 2009) prisoner here was an accountant of Wau Microbank. He dishonestly obtained and used K32, 800 in customer’s deposits that he applied to his own use contrary to section 383A of the Code. He never paid back any amount of that money. The court considered and imposed 4 years IHL none of which was suspended given that he had not repaid nor was there any facts to impose otherwise. He was a graduate from the Divine Word University with a bachelor of Business Studies similar to the prisoner here. The amount there is lower than the present.

22.	 In State v Kaia [1995] PGNC 166; N1401 (6 September 1995) that was misappropriation of K94, 478. 31 by an Accounts Supervisor from the Australian New Zealand Bank Limited none of the money was repaid and the court considered that 4 years IHL was appropriate given and so imposed. Bail was ordered refunded forthwith.

23.	Given this and all set out above I adjudge that a proportionate and appropriate sentence upon the prisoner in view is 4 years IHL for the crime of Misappropriation. 

24.	The sentence of the court is 4 years IHL less time in custody.

25.	Bail of K5000 is refunded forthwith.

Ordered Accordingly,
__________________________________________________________________Public Prosecutor:  Lawyer for the State	
Public Solicitor   :  Lawyer for the Defendant