Joanne Mooney v. Her Majesty’s Advocate [2019] HCJAC 49

Note of appeal against sentence:- The appellant was indicted to the sheriff court in relation to being involved in a fraudulent scheme whereby HMRC were induced to make payment to claimants the sum of £50,981 and an attempt was made to induce payment of a further £35,968. The appellant pled guilty to taking part in the fraudulent scheme with £15,294 of the £50,981 received by her. The sentencing sheriff impose a sentence on the appellant including a compensation order to HMRC in the sum of £15,000. A confiscation order, in terms of the Proceeds of Crime Act 2002, was made in which the appellant’s benefit from the criminal conduct was identified as £50,981 with a recoverable amount of £1 and an order for payment of that sum was made. The appellant appealed against the finding by the sheriff that the benefit from her criminal conduct was £50,981 rather than £15,294. It was submitted that terms of section 143(4) of the 2002 Act a person benefits from conduct if they obtain property as a result or connected with the conduct and what is critical is the benefit obtained by the individual offender rather than the measure of overall loss. It was submitted that the appellant required to have received the benefit and been able to exercise control over it. Reference was made to CPS v Jennings 2008 UKHL 29 where Lord Bingham observed at paragraph 13:- “... The rationale of the confiscation regime is that the defendant is deprived of what he has gained or its equivalent. He cannot, and should not, be deprived of what he has never obtained or its equivalent, because that is a fine. This must ordinarily mean that he has obtained property so as to own it...”. It was submitted in the present case that the appellant had benefitted to the sum of £15,294 and not the greater sum of £50,981 and the sheriff erred in holding that she had benefitted to the greater sum. It was submitted on behalf of the Crown that the property does not have to pass through the hands of the individual for it to be obtained by them and the individual only has to have control over the disposition of that property and reference was made to R v Kudlip Singh Sander [2013] EWCA Crim 670. In relation to the circumstances of the present case it was submitted that the appellant had control over the disposition of the property in that she had completed, registered and submitted the fraudulent tax-returns and by doing so, represented a tax overpayment to HMRC who would subsequently repay each individual concerned. Sine qua non the appellant’s conduct there would have been no repayment of the larger sum. Reference was made to the case of R v Fulton [2019] EWCA Crim 163 where it was said that the central role the offender played in a money laundering operation was such that it could not be said that he had only benefitted to the extent of the commission he personally received. Here the court refused the appeal by majority. The court noted that, having regard to the authorities referred to, the extent to which an accused benefits for the purposes of the 2002 Act is case sensitive. In refusing the appeal the court considered that:- “...too great a reliance should not therefore be placed on these concepts, or for the need to show that the individual exercised “rights” over any of the property in question which are akin to such rights...What is important is the whole factual background, and the inferences which may be drawn therefrom... ”. The court here considered that it was an important factor that the appellant was the sole driving force in that it was her actions alone that resulted in the payments being made by HMRC to the claimants and her conduct was so closely linked to the disposition of the greater sum that she could be considered to have “obtained it". The court observed that it would offend against common sense for a fraudster who had been clever enough to structure their fraud in a particular way to avoid falling within scope of the section and avoid the consequences. In other words if the greater sum had been paid by HMRC directly to the appellant then she would have benefited as defined by the statute to the extent of the total sum, however, the fact that the structure of payment operated in a different manner meant that she did not receive the greater sum, however, the court did not consider it attractive that the 2002 Act would not operate to allow recovery of the greater sum in those circumstances. The court considered that the £15,294 was so inextricably linked to the greater sum that it could be said that she obtained the greater sum and “obtaining” is not to mean “receiving” as the court viewed the sums paid to the claimants as an integral part of the appellant’s fraudulent scheme. The court noted that the sums which she obtained through commission were directly related to the extent to which she was able to cause HMRC into making payments to the claimants so the more she fraudulently claimed the more she personally gained and the court considered that as a consequence she received a share of the whole proceeds of the crime. The dissenting opinion by Lord Glennie referred to the importance of the word “obtained” in relation to the criminal property and that the word should be given its broad normal meaning, namely, that a person obtains property when he receives it, either alone or jointly or through another, in such a way as to assume over it a power of disposition or control and, as such, on the circumstances of the present case there was no way for concluding that the appellant obtained the greater sum. Lord Glennie went on to state that the fact that she alone was responsible for the entire fraudulent scheme was irrelevant.