Prakash v State [2018] FJHC 77; HAA92.2017 (14 February 2018)

IN THE HIGH COURT OF FIJI
AT LAUTOKA
APPELLATE JURISDICTION

CRIMINAL APPEAL NO. HAA 92 of 2017

(Criminal Case No. 093 of 2014)

BETWEEN:

PRASHIL PRAKASH

AND:

THE STATE

Counsel: Mr M N Khan for the Appellant
Mr A Singh for the Respondent

Date of Hearing:20 December 2017
Date of Judgment:14 February 2018

JUDGMENT

[1] This is a timely appeal against both conviction and sentence. The appellant was charged with two counts of money laundering contrary to section 69(3) (b) of the Proceeds of Crime Act 1997. Following a trial in the Magistrates’ Court at Nadi, the appellant was convicted of only one count (count 2). That count alleged that the appellant received $350.00 knowing or ought to have reasonably known that the said money was derived directly or indirectly from some form of unlawful activities. On 11 August 2017, the appellant was sentenced to 3 years’ imprisonment with a non-parole period of 12 months.

[2] The grounds of appeal are:

1. THAT the Learned Trial Magistrate erred in law and in fact in finding and/or concluding that the Appellant knew or ought to have known that the sum of $350 was unlawfully and/or dishonestly transferred to his count from the account of Jovilisi (PW1).
2. THAT the Learned Trial Magistrate did not properly direct herself or misdirected herself on the element “requisite knowledge”.
3. THAT the learned Trial Magistrate did not properly direct herself and/or misdirected herself on the burden of proof.
4. THAT the Learned Trial Magistrate erred in law and in fact in that he failed and/or neglected and/or did not adequately and/properly consider the defence case.
5. THAT the Accused failed to get a fair trial in the matter in all the circumstances of the case.
6. The sentence imposed was excessive and wrong in principle.
7. That the Learned Trial Magistrate erred in not taking into account relevant factors.

[3] At trial, the prosecution led evidence from four witnesses. The first prosecution witness was Mr Jovilisi Yaya. Mr Yaya’s evidence was that in April 2012, he found out that an unauthorized electronic transfer of $350.00 was made from his Westpac bank account to another customer’s account. He reported the matter to the bank and police. Investigation revealed that the $350.00 was transferred into the appellant’s account. The money was transferred from the appellant’s account into his sister’s account and withdrawn on the same day using an ATM card.

[4] The appellant’s sister was called to give evidence by the prosecution. Her evidence was that the appellant had requested to use her account as he did not have an access card to his Westpac account. Her evidence was that on previous occasions the appellant had used her account for withdrawal purposes. After withdrawal, the money was sent electronically to one Barry Green in England through Western Union.

[5] The third witness was an employee of Westpac bank. He explained the bank documents and the transactions relevant to the charge. The fourth witness was the investigating officer who tendered the appellant’s caution interview. In his caution interview, the appellant remained silent.

[6] At trial, the appellant elected to remain silent as well. He did not call any other witnesses. In closing, the appellant insisted on providing a written statement to explain his conduct with supporting documents that were not led in evidence. In her judgment, the learned trial magistrate quite properly disregarded the appellant’s untested written statement and annexed documents because closing address was not evidence.

[7] The appellant did not dispute the physical element of money laundering. He did not dispute that he had received $350.00 into his bank account. He claimed that he did not know the $350.00 was proceeds of crime. He disputed the fault or the mental element of money laundering.

[8] Section 69 (3) of the Proceeds of Crimes Act 1997 incorporates a broad range of physical conduct that may constitute money laundering. The conduct includes engaging, receiving possessing, concealing, converting, transferring proceeds of crime or disguising the true nature of the proceeds of crime.

[9] The fault or the mental element required for money laundering is knowledge or ought to have reasonably known that the property concerned was proceeds of crime. Proceeds of crime is a property or benefit that is wholly or partly derived or realized directly or indirectly from commission of a serious offence – attracts maximum penalty of imprisonment for not less than 6 months. The person charged with money laundering does not need to have been involved in the commission of the predicate offence.

[10] In the present case, the prosecution did not allege that the appellant was involved in the theft of money from Mr Yaya’s account. Theft is a serious offence. It attracts a maximum penalty of 10 years imprisonment. The prosecution alleged that the appellant received money into his account either knowing the money was proceeds of crime or ought to have reasonably known that the money was proceeds of crime. There was no direct evidence of the mental element. The prosecution relied upon circumstantial evidence to prove that the appellant knew or ought to have reasonably known that the money he received into his account was proceeds of crime. The prosecution led evidence of the manner in which the money was siphoned overseas using the sister’s account within a short period of time after the appellant had received it into his account. The prosecution also led evidence of an earlier email from the appellant to Mr Green that read:

“It’s a pleasure working with you. Sir, I hope that now you can trust me with larger amounts as well. I will not have any problems cleaning it for you on my side.”(underlining mine).

[11] Although the appellant did not give evidence, he did not dispute that he was the author of the above email. His contention is that the word ‘cleaning’ is a typographical error and that he meant to write the word ‘clearing’ and not the word ‘cleaning’. The appellant further contended that he himself was scammed in believing that he was engaged in a genuine business transaction with an overseas businessman. The hurdle with this contention is that the appellant chose not to give evidence at the trial, which was his right, but a natural consequence that flows from the decision to remain silent is that the guilt of the accused is determined on the evidence led by the prosecution.

[12] In her judgment, the learned trial magistrate correctly directed herself on the mental element of money laundering and concluded by way of inference that the appellant either knew or ought to have reasonably known that he had received proceeds of crime into his account based on the circumstantial evidence led by the prosecution. The circumstantial evidence was strong. It was open on the evidence for the learned trial magistrate to find the appellant’s contention that he was scammed into receiving proceeds of crime not plausible. The finding that the appellant knew or ought to have known that he had received proceeds of crime was available on the evidence. Grounds one and two have not been made out.

[13] Ground 3 alleges that the learned trial magistrate did not properly or misdirected on the burden of proof. In her judgment, the learned trial magistrate clearly directed that the burden of proof was on the prosecution to prove the charge beyond a reasonable doubt. Counsel for the appellant submits that the learned trial magistrate shifted the burden of proof on the appellant when she made a reference to the appellant remaining silent in his caution interview in her judgment. This submission is wholly misconceived. While the learned trial magistrate made reference to the fact that the appellant had opted to remain silent in his caution interview, she did not make any adverse inferences of guilt because of the appellant’s decision to remain silent. Before finding the appellant guilty, the learned trial magistrate expressly stated that the prosecution has proved all the elements of the charge beyond a reasonable doubt. Ground three fails.

[14] Ground 4 alleges that the learned trial magistrate did not properly or adequately consider the defence case. The prosecution did not allege that the appellant was involved in the predicate offence, that is, theft from Mr Yaya’s account. The prosecution case was that the appellant knowingly or ought to have reasonably known that the money he received into his bank account was proceeds of crime. The appellant’s case that he himself was a victim of a scam and he did not know he was dealing with proceeds of crime when he received the money into his account from Mr Yaya’s account.

[15] The appellant’s contention that he was scammed into believing that he was engaged in a genuine business transaction with a person overseas did not fit well with the manner in which the tainted $350.00 came into his account, transferred to his sister’s account, withdrawn and transferred electronically overseas by him. The appellant’s case was considered by the learned trial magistrate and disbelieved. The learned trial magistrate found the appellant either knew or ought to have reasonably known from the circumstances in which he had received the $350.00 that he was receiving proceeds of crime. This finding was open on the evidence. Ground four fails.

[16] The fifth ground alleges that the appellant received an unfair trial due to lack of legal representation. According to the court record, the appellant elected to represent himself. He waived his right to counsel. At the trial, he competently cross-examined the prosecution witnesses and challenged the prosecution case. He was advised of his rights and he chose not to give evidence or call witnesses. His defence of lack of knowledge of the true nature of the money he had received into his bank account was fairly considered by the learned trial magistrate. The trial was fair. Ground five fails.

[17] The final ground is against sentence. The appellant contends that his sentence is excessive and wrong in principle and that the learned magistrate did not take into account relevant considerations. Counsel for the appellant in his submissions has referred to a number of fraud cases where the offenders were given suspended sentences.

[18] The maximum penalty prescribed for money laundering is a fine of $120,000.00 and/or a term of imprisonment for 20 years. After referring to earlier cases on money laundering, the learned magistrate used 5 years as a starting point and then adjusted the term to reflect the mitigating and aggravating factors. The mitigating and aggravating factors that the learned magistrate took into account were:

The aggravating factors in this case are,

(a) the money involved in this case transferred to another country, the crime is across the border,
(b) you damage the trust of the customers of Westpac bank about e-banking system,
(c) you used your sister’s account to commit this crime without her permission to commit the crime,
(d) The involvement of others, and an organized crime with a person in a foreign country.

The following facts in your written mitigation I consider in your favor,

(i) You are married with two daughters eldest is 21 months and youngest is still a baby,
(ii) You were awarded the highest honors for an academic achievement in both primary and High School level close to achieve a Degree in Computer Science,
(iii) Clear records without previous convictions,
(iv) Cooperated with the police,
(v) Part time student at USP,
(vi) Regrets for committing this crime.

[19] In O'Keefe v State [2007] FJCA 34; AAU0029.2007 (25 June 2007), the accused who was a foreigner was charged with four counts of predicate offences (forgery and obtaining by deception) and one count of money laundering. He appeared in the Magistrates’ Court and pleaded guilty to all the charges. The total amount defrauded was $90,930.78. He was sentenced to terms of imprisonment ranging from 6 months to 2 years for the predicate offences and 5 years imprisonment for money laundering. All sentences were made concurrent. The total sentence was 5 years’ imprisonment. An appeal against sentence was dismissed by the High Court. On a further appeal, the Court of Appeal held that the learned magistrate erred in principle in taking into account the predicate offences as an aggravating factor to enhance the sentence for money laundering because the offender had already been punished for those offences and any further punishment using the facts of the predicate offences constituted double punishment. The Court said at [21]-[22]:

When the magistrate was formulating the appropriate sentence for the money laundering he had already reached the conclusion that the appropriate penalty for the principal fraud by which the victims were relieved of their hard earned cash was two years imprisonment. He then passed to a consideration of the extra dimension demonstrated by the method of disguising the origin and nature of the funds on which they were living and probably furthering this or other criminal activity. Having done that he passed a sentence which suggested that final count should add a further three years imprisonment – more that double the sentence for the substantive fraud.

In that he erred and, in accepting it, so did the learned judge.

[20] While the appeal against sentence for money laundering was allowed, the Court of Appeal emphasized that money laundering should be treated as a serious offence for the following reasons at [15]:

When sentencing in individual cases, the court must strike a balance between the seriousness of the offence as reflected in the maximum sentence available under the law and the seriousness of the actual acts of the person who is to be sentenced. Money laundering is clearly potentially a very serious offence. It can be, and is, used to disguise the true nature of money derived from criminal activity and so make it available for legitimate use. It is essential for large criminal organizations if they are to be able to maximise the proceeds of their unlawful activities. Of necessity, it is an international problem and undoubtedly smaller jurisdictions may be seen as useful and unsuspecting conduits. That is why Parliament imposed the heavy penalties under the Proceeds of Crime Act.

[21] In the present case, the learned magistrate considered the seriousness of the offence based on the maximum sentence available under the law and the tariff of 5 – 12 years imprisonment. She did not consider the seriousness of the actual conduct of the appellant. The failure to consider the seriousness of the actual acts of the offender is an error of principle. The criminal conduct of the appellant was that he had received $350.00 into his bank account knowing or ought to have reasonably known that the money was proceeds of crime. He then used his sister’s account to withdraw the money before electronically transferring it overseas using a money transfer agent.

[22] Although there is no expression of genuine remorse by the appellant, his criminality is far lower than the criminality involved in O’ Keefe’s case. The amount of $350.00 is relatively smaller than the $90,930.78 involved in O’Keefe’s case. The appellant’s sentence of 3 years imprisonment for one incident of receiving a small amount of tainted cash is clearly disproportionate to a sentence of 3 ½ years’ imprisonment imposed in O’ Keefe for a well-planned conduct of disguising a substantial amount of money using false identities and bank accounts. Such an error vitiated the exercise of the sentencing discretion. In all circumstances, the sentence imposed by the learned magistrate was manifestly excessive. A term of 9 months’ imprisonment reflects the seriousness of the actual criminal conduct of the appellant. Suspension is inappropriate. The primary purpose of the sentence for money laundering is general deterrence. A term of 9 months’ imprisonment serves that purpose.

Orders of the Court:

1. Conviction affirmed.
2. Appeal against conviction dismissed.
3. Appeal against sentence allowed.
4. The sentence imposed in the Magistrates’ Court is set aside and substituted with a sentence of 9 months’ imprisonment effective from 11 August 2017.
   

.............................................
Hon. Mr. Justice Daniel Goundar

Solicitors

Nazeem Lawyers for the Appellant

Director of Public Prosecutions for the Respondent