Ministry of Social Development v Peters [2017] NZDC 17825 (9 August 2017)

Last Updated: 19 February 2018

EDITORIAL NOTE: CHANGES MADE TO THIS JUDGMENT APPEAR IN [SQUARE BRACKETS].

IN THE DISTRICT COURT AT WAITAKERE

CRI-2016-090-002978

[2017] NZDC 17825

MINISTRY OF SOCIAL DEVELOPMENT

Prosecutor v

ESTHER PETERS Defendant

Hearing:	9 August 2017
Appearances:	S Malaviya for the Prosecutor Y Lee for the Defendant
Judgment:	9 August 2017

NOTES OF JUDGE K J GLUBB ON SENTENCING

sther Peters, you appear before this Court facing a total of 34 charges. Two of obtaining by deception, 28 of using a document, three of forgery and one of using a forged document. You have pleaded guilty to those charges and you are for sentence.

The Facts

etween 10 June 2014 and 20 January 2016 you and your co-offender Ms Huihui embarked on a large scale fraud offending spree. You obtained control of an identity and bank account belonging to [victim 1] and registered as a Work and Income accommodation supplier in that name. During the offending period the Ministry granted 138 financial hardship assistance applications made by 132 clients of Work and Income who claimed to have been provided accommodation by Work and Income supplier [victim 1].

he Ministry subsequently paid bond and rent in advance payments directly to the bank account registered to the supplier. A schedule of the money paid by the Ministry into the Work and Income supplier [victim 1’s] bank account is included with the summary of facts. It is an extensive schedule.

s a result of information received, enquiries were made and it was established that [victim 1] left New Zealand on 16 June 2014 and since that date has not returned. [Victim 1] has never (a) created or issued a tenancy agreement, owned or managed a property or tenancy, facilitated the collection of rents and bonds as a property manager or landlord, had any association with the company ITalk Offers Limited and she did not give implied authority to the defendants to use her identity or bank account in her absence.

treat you as joint principals in this. I make no distinction between one or the other. There has been some issue in relation to quantum. For Ms Huihui, when she went into the Alcohol and Other Drug Court, a figure of $150,000 was established. Your counsel submits that the balance is $80,000. For my part I see this as one overall scheme and I treat you as joint principals and liable for the quantum as detailed. As a result of the offending the defendants obtained a pecuniary advantage of $247,820.14 by fraudulently using the identity and bank account of [victim 1] to create a false Work and Income supplier.

urning to the forgery charge, on 9 April 2014 you applied for a self-employed Flexi-wage payment for start-up costs in relation to a new business venture called ITalk Offers Limited. This was granted to you on 6 June 2014. On 8 June 2014 you registered a company ITalk Offers Limited with the New Zealand Companies Office in the name of Estherana Peters as sole director.

s a result of information received, enquiries were carried out and it was established that on or before 3 June 2014 you made and submitted a false [company name deleted] invoice to the Ministry in support of your self-employed Flexi-wage payment application. As a result of that offending you received a benefit that you were not entitled to in the sum of $11,000.

he second forgery. On about 10 June 2014, Ms Huihui applied to the Ministry for financial assistance of $1760 bond for a new accommodation, advising her landlord would be completing the Work and Income supplier form to enable a direct payment. On 11 June, Ms Huihui submitted a Work and Income supplier form purporting to be from her landlord [victim 1] and a Watercare Services Limited wastewater charges bill in relation to a Great North Road, New Lynn issued by [victim 1] as proof of property ownership. The Ministry subsequently processed the payment for [victim 1] as requested as a Work and Income supplier and assigned a supplier’s number to that in the computer system.

n 20 June Ms Huihui made application for financial assistance of $1760 and that was granted. As a result of information received enquiries were carried out and it was established that the Watercare Services Limited wastewater charges bill for the Great North Road, New Lynn in the name of [victim 1] was false and made by you, Ms Peters, on or before 11 June 2014.

urning now to the 27 using a document charges. The offending involved both of you providing false tenancy agreements to Work and Income clients for properties they had no implied authority over, using the name and signature of [victim 1] as the purported landlord. Typically, these clients were complicit and the defendants encouraged and assisted them to use the false tenancy agreements to make applications to Work and Income for financial assistance on the fictitious costs outlined in the tenancy agreement, knowing that they would not be moving into the property.

nce the application had been approved the Ministry made payment into [victim 1’s] registered supplier bank account. The defendants; so you and Ms Huihui; would withdraw the funds and in many cases share the proceeds with the applicant. As a result, you aided a large number of individuals to obtain financial assistance that they were not entitled to. In terms of the number of those, there are 27 applicants and the amount of money received in relation to those was $41,933.70.

now turn to the using forged documents. On or about 16 November 2015 you made a financial assistance application to the Ministry, claiming that you were moving to a rental property in Great South Road, Papakura and that you had incurred new

accommodation costs. In support of that you submitted a tenancy agreement issued by the landlord [victim 1] of ITalk Offers Limited. On 16 November 2015 the application for financial assistance was granted and the Ministry paid $440 bond to the Work and Income supplier [victim 1].

nquiries were made and it was established that the tenancy agreement used was false and had been created by you. You had never lived at the Great South Road, Papakura address. Nor did you have implied authority of the owners to rent it at that time.

dditionally, there is a further forgery charge and that relates to some 65 tenancy agreements. The offending also involved you, Ms Peters, and your business ITalk Offers Limited, a company through which you managed a number of boarding houses in the Auckland area. Between 30 September 2014 and 30 November 2015 you provided 65 tenants with false tenancy agreements that you created using the name and signature of [victim 1] of ITalk Offers Limited requiring a specified amount of bond and rent advance payments prior to moving in.

ll tenants made successful financial hardship applications to Work and Income and for the costs outlined in the tenancy agreements. As a result, the Ministry paid bond and rent in advance payments into the Work and Income supplier [victim 1’s] bank account controlled by both of you for your pecuniary advantage. Further enquiries have been made and it has been established that none of the bonds paid into that account were lodged with Tenancy Services.

ou were interviewed in April 2016. You admitted the offending and stated in explanation you were under financial stress. As a result of the offending a debt in the sum of $247,820 is recorded. The Ministry is not seeking reparation. They will recover under their own powers.

n addition to those charges there are two further charges, one of using a forged document. The victim in this matter was [victim 2], who was employed as a property manager. In early September 2015 you used the alias of Esther Ana Kumar and made contact with the victim in relation to renting an apartment located in Upper Queen

Street, Auckland which he manages. After viewing the apartment you entered into a tenancy agreement for the apartment. You agreed to pay the sum upfront of $3500 which consisted of rent in advance, a bond and letting fee. The agreed weekly rent was $700.

n 19 September you signed a rental agreement and provided the victim with a printout of Internet bank transfer from your account to the victim’s account for

$3500. On receiving that document the victim handed the possession of the key to you. Subsequently, the victim checked his bank account for the $3500 payment and discovered that it was never made. He further discovered that weekly rent payments of $700 were not being paid. He made numerous attempts to contact you and was unsuccessful. On 7 October he attended at the apartment and found that you had sublet that to tourists who were residing there. They provided him with the rental documentation, and a copy of a driver’s licence that showed your face and the person to whom they were paying rent.

hen he viewed that, he recognised you as the person who had rented the apartment using the alias of Esther Ana Kumar. You had control of that for a total of 12 weeks. No payments were ever made. Police executed a production order on your account in relation to that Internet transaction printout and found that no transfer for that amount was ever made. The only maximum balance ever available in that account was $720.

inally, in December 2016, the victim in this matter, [victim 3], placed her Jeep Patriot for sale on TradeMe for $40,000. She had a $30,000 loan still outstanding on the vehicle and intended to pay that off once the vehicle was sold. You responded to the advertisement. You used the name of Alina Shaw Kumar and agreed to the full asking price. On 17 January 2017 you made an arrangement with the victim’s finance company for that loan to be transferred to you and your partner’s name. You took possession of the vehicle and the remaining $10,000 was to be paid off in instalments of $500 a week. As no payments were made, the victim subsequently reported this to the police. I have now been advised that reparation is not sought in relation to that matter.

hen I look to this catalogue of offending, it is significant and it does you no credit whatsoever. When I turn to the aggravating factors of this offending there is the planning and premeditation front and centre. This was a sophisticated scheme in which you were provided the status of registered Work and Income supplier. In consequence of that, you used your position, which is a trusted position, to deal with the Ministry and thereby facilitated this scheme. This was repeat offending; ongoing for a period of one year and seven months. Not an extensive period but significant nonetheless, and it enabled you to defraud the Ministry in the way detailed. The number of separate incidents of fraud was very significant.

also note that you enlisted and encouraged others to be part of this dishonest and fraudulent scheme. Those individuals were effectively seduced by you with the prospect of further financial assistance through the scheme. A number of those were first offenders and they have been, over time, all coming through this Court and are now themselves in trouble and having to pay back money to the Ministry as well. That is significant.

here is the fact that profit was the motive in this. You were in it for what you could get out of it and you saw this as an easy way of gaining money. There is the breach of trust. The system that is operated by the Government and the Ministry of Social Development puts in place a system where those who are in need can get access to money in times of need. You abused that system. You abused the trust that was accorded you as a supplier, and you were able to use that trust to your advantage significantly. There is the quantum. As I say, $247,820.14. I have already indicated that I treat you as a joint principal with Ms Huihui. I make no distinction between you. What I recognise is that you were both fully involved and it is in this overall scheme and the amount obtained was the total I have already detailed, and in assessing your culpability I factor that in.

hen I look to matters which aggravate circumstances for you personally, there is your previous conviction history. Between 16 May 2009 through to 8 May 2010, so 12 months, you incurred 34 convictions for fraud. I infer from that that there must have been a scheme involved in that as well for you to have been before the Court

at that time on those charges. You were sentenced to 18 months’ imprisonment then. You are now back at it.

see no mitigation in this offending whatsoever.

have the benefit of a pre-sentence report. You are 36 years of age. The report writer identifies those factors which contribute to your offending as your attitude during the offence and your criminal associate. It was also noted that you tended to blame your co-offender despite the police summary outlining your involvement in the offences. The explanation for using the false identity you registered as a Work and Income accommodation supplier was because you were having some problems registering your own identity.

t also makes an observation that you drink periodically and it is noted in there that you did not believe that alcohol or drugs contributed to your offending, and you felt you were in control of your use. In terms of your risk of reoffending, it is assessed as being moderate and your risk of harm to others is also assessed as moderate because of the number of people that were involved in this offending. They consider your ability to comply with release conditions is high, noting that you have in past. They traversed electronically-monitored options with you and you declined to be assessed for that. In light of the extensive and sophisticated nature of this offending, imprisonment is the recommendation of the report writer.

have the benefit of submissions filed by the prosecution. Mr Malaviya submits that the Court should take a starting point of four years and six months, or 54 months, I should uplift by eight months for your previous conviction history and I should then give you a 10 to 15 percent discount for your pleas and arrive at an end sentence of about 52 to 54 months.

or you, Mr Lee makes submissions which also still appear to suggest it might well be amenable to conversion, although he does not seek conversion. He recognises that imprisonment would be the outcome irrespective. He asks this Court to take a starting point in the vicinity of 18 months and noting that $80,000 should be the level at which your culpability is assessed, and that there should be an uplift and thereafter

discounts and he submits that it may well be back towards two to three years ultimately. He brings to the Court’s attention the decision of Ransom v R [2010] NZCA 390, [2010] BCL 679[2010] NZCA 390; , (2010) 25 CRNZ 163 (CA) and also brings to the Court’s attention the outcome for Ms Harrison, who stole some $726,000 and got three years and seven months.

n determining what to do with this matter I have had particular recourse to a number of authorities: Hogan v Ministry of Social Development [2005] 441/27 8 July 2005, a decision of the Napier High Court, R v Thompson [2016] NZCA 156. Isakko v Police HC Christchurch CRI-2004-4-0-156, 16 September 2004, MSD v Diedrichs CRI-2012-004-004660, 22 March 2012, Auckland District Court, and finally a decision of R v Bartlett CRI-2007-044-007979, a decision of the Auckland District Court on 17 October 2008.

hat I recognise in terms of those authorities is that R v Thompson is probably the most similar. On that occasion 33 months’ imprisonment was imposed, but Collins J made a number of observations on the aggravating features in addition to the extent of the fraud. He noted those as including the duration of the offending, the abuse of trust involved in acquiring the known provider status in order to perpetrate the fraud, the number of separate incidents of fraud, the involvement of others in the fraudulent scheme and the profit made underpinning the fraud. All of those are factors that I have identified in this offending.

ounsel has also made a submission that I should deal with this on the basis of parity. What Mr Lee, submits is that your co-offender has, on entry of guilty pleas, been admitted to the Alcohol and Other Drug Treatment Court and is proceeding through that; the indication being successful completion of that Court then there is likely to be a home detention sentence imposed.

hat I note today is that this matter is on an entirely different track. It is not a matter which this Court can accord parity to. There are entry requirements for that Court and it is a long course which takes some time to progress through and the ultimate outcome is then dependent on performance therein. Whilst I recognise there may well be different outcomes for two co-offenders, the fact that you were denied

entry to that Court suggests you did not have those underlying issues to contend with. Accordingly, I sentence you on that basis and I do not endeavour to achieve parity in this matter.

he starting point I adopt today for you, Ms Peters, is one of four years’ imprisonment. I then look to the additional matters. There are the extra charges of using a document which were not previously considered when the sentence indication was given and rejected, and then there are the two charges that the police have laid. One was whilst you were on bail and one of which occurred around the same time. For those additional matters I uplift by six months. That gets me to 54 months. I then look to your previous conviction history. It is significant, it is highly relevant. I could uplift for 12 months; I do not, I keep the uplift to eight months. That gets me to 62 months’ imprisonment.

hen I look to your situation today I do not see any discernible remorse and I do not see personal circumstances which suggest that there are significant issues, as I have already identified in the pre-sentence report. Whilst you may have had the odd drink, it does not seem to be a matter which warrants any form of discount in mitigation.

then look to your pleas. Your pleas have not come at the earliest opportunity. Counsel for the Ministry submits 10 percent to 15 percent would be appropriate given this was a plea entered at trial callover. However, I am satisfied that it has nonetheless avoided the necessity for a lengthy trial and appropriate recognition is required. I do not propose to pull back on the discount. I will accord you the 20 percent as previously indicated, 20 percent of 62 months is 12.4. That brings me down to 49.6 months, which I round down in your favour to 49 months.

am satisfied, Ms Peters, on the basis of the applicable authorities and the statutory factors, that in the circumstances a sentence of imprisonment is required and that the purpose for which the sentence is being imposed cannot be achieved by a less restrictive sentence or a combination of other sentences. I have, of course, taken into account the need for denunciation and deterrence, but equally to hold you accountable

and recognise the gravity of this offending, whilst imposing the least restrictive sentence possible.

s Peters, on all charges, with the exception of the two most recent, on each of those I convict you and sentence you to four years and one month imprisonment, or 49 months’ imprisonment. On the two other charges laid by the police I convict you and sentence you to 12 months’ imprisonment on each. I record that all sentences are to be served concurrently.

s Peters, you have shown real ability to offend in a fraudulent way. You are now in custody for some considerable time. When you come out, turn those clear abilities and skills that you have got to good end and support yourself appropriately.

ADDENDUM:

also have before me a s 88 report, Ms Peters, which indicates that you owe some $3716.50 in fines. In view of the sentence of imprisonment that I have just imposed, I remit those fines in full.

K J Glubb

District Court Judge
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