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Public Prosecutor v Gama [2005] VUSC 60; Criminal Case No 011 of 2005 (11 April 2005)

IN THE SUPREME COURT
OF THE REPUBLIC OF VANUATU
(Criminal Jurisdiction)

Criminal Case No. 11 of 2005

PUBLIC PROSECUTOR

–v-

WARREN GAMA

Coram: Justice Treston

Mr. Mirou for Public Prosecutor
Mr. Nalial for Accused

Date of Sentence: 11 April 2005

SENTENCE

You appear for sentence today, on a total of one hundred and forty eight counts. There are seventy four counts of misappropriation and seventy four counts of theft and I am grateful to the Prosecutor for the information that he has provided for me both today and on Friday in relation to the facts which you have accepted. For the period of just over three and a half years from 25 May 2001 to 2 December 2004 you defrauded your employer, the ANZ Bank (Vanuatu) Limited, in a number of sophisticated and systematic ways when you were employed as team leader/supervisor in the treasury department of the bank. While you were in that position of control, the summary says, you systematically manipulated various accounts with the intention of defrauding the bank and succeeded in so doing in the total sum of VT18, 660, 386. The detail of your sophisticated system is set out in the summary and the Prosecution alleged that the monies were applied to your own use including the purchase of white goods, overseas and domestic travel, cash and kind to family members, clothes, assistance in building a church, purchase of vehicle, school fee payments, socializing, personal goods including a stereo system and electrical goods, and purchasing materials for a house of yours.

The Prosecutor helpfully provided me with a number of relevant cases with sentencing guidelines and I will refer to some of those in a moment. He also usefully referred to a decision in the Papua New Guinea Supreme Court in Belawa v. State (1988-89) PNGLR 496 which set out a ten point heading system of approach to dealing with sentencing in large scale fraud cases such as this. Neither counsel has been able to point to me any similar case in this jurisdiction where the amount of the defalcation anywhere near approached the amount in your case of VT18.6 million. Some analogies were drawn by your counsel to a case where someone defrauded an organization of VT6 million and was sentenced to two years of imprisonment. That was a third of the amount that you have stolen or defrauded from the bank.

The Prosecutor has provided me with a list of items recovered by the bank which totals VT637, 957 including cash refunded on air tickets, proceeds of accounts held by the bank, proceeds from the sale of a generator and part payment of a vehicle. There are other items totalling VT160, 000 including a tent, a stove, a bottle of gas and a fuel drum that have been recovered by the police. They were items which you admitted buying with stolen money.

The Prosecutor submits to me that, on the basis of the authorities which he has provided, an appropriate sentence in relation to the guidelines set out ought to be a severe one for deterrent purposes ranging somewhere between five and seven years of imprisonment.

On your behalf, your counsel stresses that you have pleaded guilty and you ought to be given a discount for that, that you have shown remorse by admitting your guilt at the first opportunity, and that you cooperated both with the Police and the ANZ investigators. You did not resist arrest when you were approached by the police and I ought to take into account, your lawyer submits to me, that you are a first offender and are unlikely to offend again. I am asked to note that you reputation has been irreparably damaged and that your promising career has been destroyed and it would be difficult for you to obtain employment in the banking industry in the future.

I am asked to take into account your young family. You are engaged to be married to your fiancée. You have a young daughter. Your fiancée has been in Court supporting you throughout since I have been involved in the matter. I am asked to take into account that you have been in custody for three and a half months or so in relatively poor conditions.

Set out in the submissions is a list of items that you have returned or intend to return and I have totalled those up and they amount to some VT2, 982, 500. Some of those items, such as the very large amount of VT2 million for the house on Ambae which you are prepared to have sold and the proceeds given to the bank, are estimates because there is no guarantee of course that that house will realize the amount that you put on it. But even so, the total amount of just under VT3 million is a very small amount of the total outstanding and there is no prospect, it seems to me, put forward by your lawyer for any further reparation in the future.

I take into account the character reference given by Joe Ligo, Chief Executive Officer of the Vanuatu Investment Promotion Authority, in relation to your Christian ministry, your membership in church and what you have done in prison since you have been there in relation to prayer meetings. Analogy is drawn with some criminal matters involving sexual matters which I find of limited assistance because they are completely different crimes and in any event some of the comments that I will refer to you shortly in the reported cases in relation to fraud indicate that people who severely abuse trust in crimes of this kind ought to be dealt with more severely than other crimes.

Your counsel submitted to me that the time you have spent in prison already ought to be a sufficient punishment that is three and a half months or a fine although he resiled from the submission about a fine when the practicalities of that were brought home to him. A fine seems to me to be totally inappropriate when you owe such a huge amount of money and you have defrauded the bank of the amount that I have referred to.

It is further submitted to me that should I impose a sentence of imprisonment that could be or ought to be suspended in accordance with the legislation concerning suspension of sentencing because the Court might be of the view that because of the nature of the crime and the character of you as an offender, it would not be appropriate to make you suffer a penalty.

When I consider the question of sentencing, I must of course approach the matter on a structured basis. I must hold you accountable for the harm you have done not only to the victim, the bank, but also to the community at large. I must of course hold you responsible for the offending which you have undertaken. I must endeavour to provide for your interests. I must look at the question of reparation. I must denounce your conduct and deter you and others who might be like minded to offend in this way from such offending. I need to protect the bank and the community generally from this sort of offending of large scale fraud and I also need to consider your interests among the mix of other matters that I have considered and stated. Of course the least restrictive outcome upon you must be the one that I must impose as a matter of fairness.

I start by referring to these offences. There are, as I have said, one hundred and forty eight of them. The maximum potential penalty in relation to each offence is twelve years imprisonment. So if one multiplies, in an inappropriate way in some respects, one hundred and forty eight charges by twelve years one would come to almost two thousand years worth of imprisonment because if one does the calculation it comes to one thousand seven hundred and seventy six years, that is by multiplying one hundred and forty eight by twelve. Of course that is a fanciful approach to take but I do so just to let you know what the maximum potential sentence would you face in arithmetical terms amounts to. Your offending is indeed at the very highest end of the scale because each counsel was unable to provide me with another example of defalcation on this scale within this jurisdiction in relation to a bank or similar organization.

As the Prosecutor has said the leading authority on sentencing guidelines for fraud and theft is Public Prosecutor v Keith Mala which was a decision of the former Chief Justice of this jurisdiction in Criminal Case No. 42 of 1995 there His Lordship said as follows: -

"The type of case with which we are concerned is where a person in a position of trust, for example, an accountant, solicitor, bank employee, manager of a company or public servant, has used that privileged and trusted position to defraud his partners or clients or employers or the general public of a sizeable sum of money. He will usually, as in this case, be a person of hitherto impeccable character... but Professional men should expect to be punished as severely as the others, in some cases more severely."

His Lordship went on to say: -

"In general a term of immediate imprisonment is inevitable, save in very exceptional circumstances or where the amount of money obtained is small. Despite the great punishment that offenders of this sort bring upon themselves, the Court should nevertheless pass a sufficiently substantial term of imprisonment to mark publicly the gravity of the offence. The sum involved is obviously not the only factor to be considered, but it may in many cases provide a useful guide. Where the amount involved cannot be described as small but less than 1 million vatu or thereabouts, terms of imprisonment ranging from the very short up to 18 months are appropriate. Cases involving sums of between 1 million and 5 million vatu will merit a term of about two to three years imprisonment. Where greater sums are involved, for example those over 10 million vatu, then a term of three and a half years to four and a half years would be justified."

And of course that was a comment that was made back in 1995. Other examples as I have already referred to were given to me by the Prosecutor in relation to thefts by senior public servants such as Public Prosecutor v Leah Tureleo Criminal Case No. 48 of 1995 where VT6 million was stolen and the sentence was two years imprisonment and the Court in that case talked about a gross breach of trust by a senior and trusted employee and a deterrent effect was necessary. The Court said such breaches of trust cannot be dealt with by any other form of sentence except an immediate custodial sentence in spite of a plea of guilty and an immediate admissions to the police. The Court went on to say this: -

"I am also told she has very young children. That cannot weigh at all with the Court which is only too well aware of the type of hardship that is brought upon themselves and their families by this type of offender."

Again where three offenders were charged with a misappropriation of VT8 million in Public Prosecutor v Benjamin, Paul & Tau Criminal Case No. 14 of 1994 and the sentence was two years imprisonment and an order for reparation. In that case His Lordship Justice Kent said:-

"The scheme thus described, was deliberate and sophisticated. It was conducted by the defendant using their knowledge that they had gained as part of their training in the Bank, and their subsequent understanding of Banking procedures"

and he went on to say:-

"People are not entitled to help themselves to other people's property. Despite this, it is apparent that it is happening frequently in the community."

and he went on further to say:-

"...It was conceded in submission and I think correctly, that the magnitude of these offences, the systematic way in which the offences were carried out and therefore dishonesty that this reveals means that even though they are first offenders, jail is inevitable. I add that the breach of trust involved is a significant feature in this case."

So there are a number of authorities which would indicate that imprisonment as a first option is appropriate and in your case I consider that suspension of sentence is simply not an option.

I am grateful for the Papua New Guinea case of Belawa (above) which sets out the approach that I have referred to in the ten factors which can be considered in a matter such as this.

First, one must look at the amount taken. The principle is the larger the amount the greater should be the punishment. Here of course there was a huge amount lost viz. VT18, 660, 386. So the appropriate sentence and punishment should be greater.

Second, the quality and degree of trust reposed in the offender including his rank. Clearly a greater degree of trust and a higher rank means the offence is more serious, and in this case it is clear from the summary, that you were a person who was one of the senior bank officers on the customer foreign currency term deposit account and you were a person in whom the bank reposed trust and recognized that by the rank that you held. You were in a high position in the bank and that made it easier for you to be able to carry out this defalcation in any event. You were a supervisor in charge of the treasury department of the bank dealing with investors and the movement of money in the international and domestic market.

Three, the period over which the frauds or thefts have been perpetrated. They took place over a period of three and a half years from 25 May 2001 to 2 December 2004 so the period involved was significant indeed. In your case it was systemic fraud and the degree of seriousness is towards the top end of the scale. It was not a spur of the moment act but required careful planning in the way that you directed the interest from the accounts and transferred it into your own personal accounts for your own use. You manipulated money over that period for your own use and can be given no credit for other than having formed a proven determination to carry on in that way and your conduct in the future is somewhat problematic.

Four, the use of which the money or property was put. You stole money to benefit yourself and your family, wife, friends on other islands and in other countries but that is not by way of mitigation in your case because when one looks at the type of goods that were utilized and purchased some were in the category of luxury goods.

Five, the effect on the victim, the bank has lost significant amounts of money and not only lost money but has also suffered loss of reputation as a result of your activities and in the booklet which it has produced, the bank is distressed to report that unacceptable and disappointing trends involving 5% average staff dismissal rates across the Pacific region was a result of internal fraud.

Six, the impact of the offences upon the public and public confidence. It was the bank that suffered the loss in this case but there is a loss of trust and confidence involved for the bank itself through your activities as a trusted employee.

Seven, on the effect on you, yourself. Clearly you have and will suffer public disgrace and it will be difficult for you to obtain future employment in similar positions of trust and your family will suffer and I take those matters into account.

Eight, restitution. Although I have already referred to this, realistic reparation for the total amount or any where near it is not possible. Even on your calculations VT3 million is the maximum that you could ever hope to pay back including the sale of your house. The amounts that you have already referred to and which have been recovered by the bank to date are very small, less than a million vatu in the total scheme of things.

Nine, your own history. Certainly, you are a person who has not appeared before the Courts before. You are a first offender and I take that into account.

Finally, number ten, matters of mitigation special to yourself. You have cooperated with the police, you have a good church record and have undertaken some activities within the prison to date and they are matters which you can call upon.

I then approach those matters in that way, having set out that ten step process. There is of course in a sentencing activity a balance of aggravating and mitigating features. Many of them have of course been referred to already in the approach that I have taken but there was by way of significant aggravation the huge loss of more than VT18.5 Million. There was a serious breach of trust involved in your activities and in the position, which you held, a long period over which the dishonesty occurred and finally there is little prospect of realistic reparation.

Those aggravating features can be balanced of course against the mitigating ones of your plea of guilty and the fact that you have been of previously good character. But at the end of the day, the aggravating features clearly outweigh the mitigating ones. After all, this was sophisticated systematic and calculated course of action over a lengthy period demonstrating premeditation, planning and plain avarice and you must face the consequences of those factors and your own actions.

I have earnestly considered what might be the appropriate sentence in your case Mr. Gama. I must take into account the very large amount, the period of which it occurred and the maximum potential penalty and I must also add to the mix the very number of charges that are involved, and that was not a factor that was particularly addressed in the ten points that I referred to but that was a significant feature indeed.

I assess the appropriate sentence globally for all the offences and I do not impose individual penalties for each offence. There are 148 counts. I am conscious that the maximum penalty for each offence is 12 years imprisonment. I do not intend to break up the overall sentence into individual ones for each count but I say that the sentence is for all offences and is concurrent.

My view is this, the appropriate sentence in your case is twelve years imprisonment. I immediately take off for your plea of guilty one third of that sentence reducing it to eight years imprisonment. I also give you credit for other factors contained within that allowance that I have referred to by way of mitigation. You had been in custody already for some three and a half months, I also deduct that period from the sentence of eight years imprisonment meaning that the finite sentence which I today impose is one of seven years, eight and a half months imprisonment. I understand the effect upon your family of that. I understand the effects upon you because of the conditions within the institution but that is as maybe because this was a very, very serious, series of offences in my view, approaching the most serious that I have been called upon to deal with in this jurisdiction.

You have fourteen days to appeal that sentence if you are dissatisfied with it.

Dated AT PORT VILA, this 11th day of May 2004

BY THE COURT

P. I. TRESTON
Judge.