Serious Fraud Office v Wright [2020] NZDC 10897 (13 May 2020)

Last Updated: 18 June 2021

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

IN THE DISTRICT COURT AT AUCKLAND I TE KŌTI-Ā-ROHE KI TĀMAKI MAKAURAU

CRI-2018-004-006078

[2020] NZDC 10897

SERIOUS FRAUD OFFICE

Prosecutor v

CHRISTOPHER GEORGE WRIGHT Defendant

Hearing:	13 May 2020
Appearances:	P Davey for the Prosecutor S Tait for the Defendant
Judgment:	13 May 2020

NOTES OF JUDGE R J COLLINS ON SENTENCING

[1] Mr Wright, you are aware that the outcome today has to be a term of imprisonment and that is dictated by the sheer size of the fraud that you committed and you know that for humanitarian reasons pertaining to your health, that pursuant to s 100 Sentencing Act 2002 I will be deferring the commencement of that term of imprisonment for two months. I need to record the facts on which you are sentenced and then I need to give the reasons for the sentence that I reach.

[2] You face one charge and that is a charge that over the six year period between 1 January 2010 and 30 April 2016 at Auckland, you received or were in possession or you had control of property, being money, received from the Inland Revenue for the benefit of other persons. You were in receipt or you had possession of that money on

SERIOUS FRAUD OFFICE v CHRISTOPHER GEORGE WRIGHT [2020] NZDC 10897 [13 May 2020]

terms or in circumstances that you knew required you to deal with the property in accordance with the requirement of another person or other persons and you intentionally dealt with the property otherwise in accordance with those requirements and, in doing that, you committed theft. The charge was a representative charge, which the law allows. The particulars of the charge are recorded that the property was the proceeds of tax refunds received from Inland Revenue for the benefit of clients of Balancing Act Tax Services Limited and totalled approximately $1,011,514. And you entered a guilty plea to that charge on 12 March 2019 and, for various reasons, sentencing had been delayed until today.

[3] There is no doubt that you were the controlling mind and hand of Balancing Act Tax Services. In other words, that was simply an alter ego for you. And in broad terms, what has been put forward as the cause of your offending was a gambling addiction.

[4] Your offending had multiple victims. They were clients of yours. Some of them were people that considered you to be their friend. Two victim impact statements have been provided. I do not doubt at all that they are representative of the impact of many victims in this case.

[5] The full detail of your offending is set out in a comprehensive seven page summary of facts prepared by the Serious Fraud Office but, for sentencing purposes, the essence of your offending can be captured from para (45) onwards of that summary. It records that the total value of the IRD refunds paid and earmarked for clients between January 2010 and April 2018 was approximately $1.12 million, being

$1,069,768 IRD client refunds paid into a trust account and $53,991 of IRD client refunds paid into accounts associated with you, and that left at that point a total of

$1,123,759 in the amount of IRD refunds proceeds received earmarked for your clients and your victims. The amount of IRD refunds received also identified that approximately $112,000 was paid to the IRD or paid to clients from the trust account as shown below and then that deduction produced the figure of $1,011,514.

[6] The summary goes on to record that between January 2010 and April 2016 you had that control over approximately $1.01 million of refunds earmarked for clients.

While those proceeds were pooled and transferred between your various accounts, they were primarily received and held in the trust account. While you controlled that money, being the proceeds earmarked for clients, and intentionally dealt with those proceeds otherwise than required, the sum of approximately $271,404 was ultimately paid to your tax agency clients. You paid the amount of $271,404 only after six clients independently discovered the thefts and confronted you, demanding that you repay their funds. I interpose here into the summary it is clear that you did that with the strong motivation to avoid further detection and avoid prosecution of yourself.

[7] The residual balance of $829,000 from the earmarked IRD proceeds was not legitimately used to offset any actual or unfunded accounting fees. There was no written authority provided by clients for you to offset proceeds from IRD refunds that they might largely have been unaware of. On any objective view, this is a substantial fraud.

[8] I have read the pre-sentence report. I have to say that taken overall I do not regard it, as far as you are concerned, as being a positive document. That is no reflection or criticism of the report writer. Given the size and the magnitude of your offending there was limited scope for the report writer in that regard. It is noted however though, and as Mr Davey for the Serious Fraud Office points out, an aspect which directly needs to be assessed against your claim for remorse, the report writer observes that, “Mr Wright presented to the interview with notes of what he wanted to say and be added to the report. One of these notes was that he was remorseful. The writer did not feel he expressed real remorse during the interview. He failed to recognise the impact his offending has had on the victims and the wider community, presenting with self-pity of his current circumstance and went into detail of how much he has lost due to the offending. Mr Wright spent most of the interview discussing the impacts on his life and the unfair treatment of the Society of Accountants, the Serious Fraud Office and the Inland Revenue Department.”

[9] I have also read and considered the report prepared by a consultant psychiatrist, Dr Dougal. That report is dated 12 August 2019. The report was sought pursuant to s 38 Criminal Procedure Act 2011 to assist the Court in the sentencing process. In that report you also claim remorse, but you also expressed your attitudes and your anger

towards the investigating authorities. In short, the report does not disclose any mental impairment or mental health issue that has a material impact on sentencing today. I am unpersuaded that any health issue you had was in any way causative of your offending. In fact, I am of the other view that mental health issues that you may now have are far more likely to be the result of your offending and the predicament in which you have placed yourself.

[10] All the principles and purposes of sentencing are operative today. For a fraud of this magnitude, clearly the principles of accountability, denunciation and deterrence are important but I also must give consideration to your rehabilitation.

[11] I have received extensive written submissions from the Serious Fraud Office and also from Mr Tait who has provided extensive submissions on your behalf, including further supplementary submissions. A number of cases have been referred to me. I am not going to go through them. They are set out in the submissions. You may have read them. You may be aware of them, you may not.

[12] What I have to do is set a starting point for your offending then I have to consider whether there should be any uplift in terms of that offending, the aggravated factors involved with it, any mitigating factors involved with it, then consider whether there are any aggravating or mitigating factors which apply to you personally, to arrive at an end sentence.

[13] There is not a great deal between the lawyers, Mr Wright, which is not surprising because they are both experienced counsel well capable of assessing the previous cases for offending such as this. The Serious Fraud Office submit that the starting point for your offending should be one of six years. The prosecution stress the significant breach of trust is an aggravating factor, pointing out that that occurred when you were a well-remunerated professional carrying out this work. They point out the reparation that was paid was simply money that you were never entitled to in the first place and say that it does not fall into the sort of reparation which might be seen as an offer to make amends. And the Serious Fraud Office argue that the appropriate starting point is one of six years’ imprisonment and in particular refer to

the case of Inland Revenue Department v Nandan where a starting point of five years eight months was approved.1

[14] Mr Tait argues for you that I can adopt a starting point of five years.

[15] In my view, the appropriate starting point is one of five years eight months and that is because I am simply not prepared or see no good reason to adopt a different starting point than that which was adopted in Nandan.

[16] From that starting point Mr Tait argues for you that you are entitled to discounts for the following factors. He says that there was a significant delay from the commencement of the investigation to the time of your arrest. Mr Davey has countered that by saying that was just simply a fact of the nature of this sort of investigation. I agree with Mr Davey and I do not see that as a factor for which I am prepared to give any discrete discount.

[17] Secondly, it is argued that you are remorseful. I am not satisfied that you are objectively remorseful. I have no doubt that you are particularly sorry for yourself and the predicament that you now find yourself.

[18] Thirdly, it is argued that there should be credit at 64 years of age for previous good character. There are some minor unrelated convictions. I do not regard those as aggravating at all. I agree that there should be a modest credit for your previous good character, but your case does not fall into the category of cases where significant discount can be given to somebody on account of their extensive good public works done over many years.

[19] It is argued that there should be some credit for you for your health considerations. I agree that there should be some modest discount for that. As I have already stated, my view, based on the forensic report and the other material before me, is that any mental or emotional health issues you have are a result of your offending and not causative of that offending.

1 Inland Revenue Department v Nandan [2017] NZDC 24175.

[20] I am not prepared to grant any credit for time spent on bail. There is nothing onerous about the bail conditions which applied to you and nor am I prepared in the circumstances to give any specific credit for co-operation with the authorities. I accept what Mr Davey says, that the co-operation was of a broad nature, admitting culpability but, nevertheless, the investigating authorities were left to work through and ascertain much of the detail of that offending.

[21] So therefore, the sentence will be imposed in this way. Combining a five percent credit for good character and one of a five percent acknowledgement for your health issues and rounding that up slightly, that becomes a credit of seven months and reduces the five year eight month starting point to one of 61 months. Allowing another month for the fact that for the next two months you will be restricted in your liberty while waiting to surrender to your bail to commence your sentence, it takes matters to five years or 60 months. From that, a discount of 25 percent will apply. That is the maximum that I can impose.

[22] The guilty plea did not come at the earliest time and the case ultimately against you would have been unanswerable and overwhelming. Those two factors count against you giving you full credit, but the Supreme Court have said that I am to assess the true worth of the plea. Your guilty plea saved everybody concerned, victims, prosecuting agencies, the Court system, a significant amount of time and resource by avoiding a trial. A 15 month credit for that takes matters to 45 months, which brings about an end point of three years nine months.

[23] On the charge of theft, Mr Wright, you are sentenced to a term of imprisonment of three years nine months. The commencement of that term of imprisonment will be deferred for two months pursuant to s 100 Sentencing Act. That is on humanitarian grounds. That is being as a result of the medical treatment that you have required, in particular the dental treatment that you have required and will require in the near future as a result of a recent fall that you had.

[24] Your bail will continue. A new bail bond will be sent to Mr Tait electronically and he will provide that to you. Currently, still in the COVID-19 alert level 3 phase that we are in we will not be taking you into custody and serving you with that bail

bond and the counter at the Court is closed for face-to-face contact between Court staff and defendants, but the transmission of that bail bond to Mr Tait will suffice as authentication of the bail conditions by you.

[25] Your bail conditions that vary from those that you have been on or had been on are as follows. You are to reside at [address deleted]. You are to observe a curfew there between 4.00 pm and 8.00 am. You are to surrender to the manager or superintendent of the Mt Eden Correction Facility on 13 July 2020 at 9.00 am and the other conditions of your bail remain.

R J Collins

District Court Judge