England and Wales Court of Appeal (Criminal Division) Decisions

IN THE COURT OF APPEAL
CRIMINAL DIVISION

		Royal Courts of Justice The Strand London WC2A 2LL
		22nd February 2002

1. MR JUSTICE COOKE: This is an appeal against sentence brought by leave of a two judge court which considered that the matter should be dealt with by a full court of three judges because of the lack of guidelines on sentence for offences of this kind.
2. On 1st March 2001 at the Crown Court in Isleworth the applicant pleaded guilty to assisting another person to obtain the benefit of criminal conduct contrary to section 93A(1) of the Criminal Justice Act 1988; that was count 2 on the indictment. He was a man of 51 years of age. He was sentenced on 13th June 2001 to five years' imprisonment and a confiscation order was made in the sum of £172,746.
3. The essential facts were these. On a number of occasions the appellant exchanged large cash sums of sterling into foreign currency at a Bureau de Change called Link FX at Victoria railway station. Most of the exchanges were made into Dutch Guilders. On one particular occasion, 21st April 1998, Customs and Excise officers had been observing him. He was arrested at Heathrow Airport about to board a flight for Holland. In his possession were 388,925 Dutch Guilders which he had purchased earlier from the Bureau for £117,146. The Guilders was seized but the applicant was not then arrested.
4. Customs and Excise officers in plain clothes kept observations on the Link FX Bureau. On 29th February 2000 the applicant was seen to enter it and was arrested upon his departure. In his possession on that occasion were some 199,600 Dutch Guilders which the applicant had exchanged for £55,600. That amount and the amount seized on 21st April 1999 were still in the possession of Customs and Excise at the time of sentence and formed the subject matter of the confiscation order.
5. Originally it was the prosecution's primary case that the appellant was guilty on count 1, that of assisting another person to obtain the benefit of drug trafficking contrary to section 50(1) of the Drug Trafficking Act of 1994. But it was to count 2 that the appellant pleaded guilty, namely assisting another person to obtain the benefit of criminal conduct contrary to section 93A(1) of the Criminal Justice Act 1988. That plea was not entered at the outset. In interview he was shown a schedule of transactions but said he did not remember them. He was asked in particular about the transaction on 21st April when he said the money had come from Africa.
6. When he did plead there was ultimately an agreed written basis of the plea which ran as follows:

"The applicant, on behalf of others, exchanged Sterling into Dutch Guilders at Link Exchange Bureau at Victoria on the following occasions."

7. There were then listed a series of occasions between the dates of 22nd October 1998 and 29th February 2000, some 11 occasions, with a total figure of £1.227 million involved. The written basis of plea went on to say that:

"The amounts in Sterling represented the proceeds of jewellery smuggled into the UK from Uganda, thus evading declaration for the purposes of payment of VAT Excise duties or other taxes. The suppliers of the diamonds were people whom the applicant said he knew only by their first names, which were Michael, Joseph and Karim. The purchaser of the diamonds was Iqbal Khan."

8. The written basis of plea went on to say that:

"The applicant's role was that of middle man between the supplier and the purchaser for which he received a commission of 3 per cent to 6 per cent. On one occasion he did his own deal making £42,000. It was part of his role to convert the money to pay for the diamonds in Sterling into Dutch Guilders and to take the foreign currency to Holland."

9. It was common ground that it was VAT tax that had been evaded by the exchanges in question and that the VAT which would have been payable on the sums, which we have listed, at the standard rate of 17.5 per cent, would have amounted to some £215,000.
10. The grounds of appeal which were put forward were these. The sentence was manifestly excessive because the learned judge gave insufficient credit for the applicant's guilty plea, because he failed to take sufficiently into account the undisputed factual basis of the plea of guilty and primarily that, as a result, he ought to have sentenced him by reference to the guidelines laid down by the Court of Appeal in R v Dosanjh, BAILII: [1998] EWCA Crim 1450 - in other words, by reference to the amount of VAT evaded which he was assisting the original offenders to retain. It was said that the guidelines in Dosanjh, by fair and reasonable analogy, were appropriate to be applied to the offence of laundering the cash in question.
11. It was also said that in passing the sentence the judge wrongly asserted that the appellant was as culpable for the purpose of sentence as those who had committed the antecedent offence, the criminal conduct which was the source of the proceeds retained with his assistance.
12. We were referred to Dosanjh [1999] 1 Cr App R(S) 107, where guidelines were set out by this court for the fraudulent evasion of excise duty. There Rose LJ suggested that for evasion of duty of amounts between £100,000 and £500,000 two to three years on a guilty plea would be an appropriate sentence. We were also referred to R v Greenwood [1995] 16 Cr App R(S) 614, where this court said that those who launder money from drugs are nearly as bad, but not quite as bad, as those who deal in drugs. It was suggested, therefore, that, applying those guidelines by analogy, and even allowing for an element of deterrence which counsel for the appellant concedes is appropriate, five years' imprisonment was manifestly excessive.
13. It seems us, however, that money laundering is a stand alone offence where the constituent elements may be many and varied. There may be circumstances where the launderer has no knowledge of the source of the money laundered and indeed may choose not to know. He may know that it represents the proceeds of criminal activity, but beyond that he is careful not to ask any questions. Many such offenders say they are ignorant of the origin of the proceeds in question and that this should isolate them from the original crime.
14. It is pointed out that in this case the maximum sentence for the offence for which the appellant was charged is ten years, whereas the maximum sentence for the evasion of duty was seven years. The former makes allowance for the many and varied antecedent offences to which it could relate.
15. It seem to us, therefore, that there is no necessarily direct relationship between the sentence for the laundering offence and the original antecedent offence. The criminality in laundering arises from the encouragement and nourishment it gives to crime in general. Without it many crimes would be rendered much less fruitful and perhaps more difficult to perpetrate.
16. Nonetheless the sentence for laundering cannot be wholly disproportionate to the sentence for the original antecedent offence, where the offence is that of being involved in an arrangement whereby the retention or control of the proceeds of criminal conduct, here the evasion of £215,000 of VAT, is facilitated by the offender. He is assisting in the original crime, whether with knowledge or blind eye knowledge of it, or, some other known or unknown criminality.
17. In the sentencing remarks the judge said that he considered launderers of drug money as equally reprehensible as drug dealers when considering the decision in Greenwood. We can see the force of that but content ourselves with saying that the offences are different and can attract different sentences depending on the different facts of each individual case. Moreover, it is clear to us that deterrence may, and does here, play a strong part.
18. Having said that, without being tied to Dosanjh in anyway, we consider that there is, nonetheless, force in the point made that five years on a plea for this offence is excessive. There were aggravating features here, in as much as the appellant had been stopped previously, as we have already mentioned, and yet persisted with his money laundering conduct thereafter.
19. To be sentenced, however, to five years on a plea implies perhaps seven years on a contested trial which is too long generally it seems to us, as well as being out of kilter with the offence of evasion of duty, the antecedent offence from which the plea of laundering flowed.
20. Looking at all the matters in the round, it seems to us that the sentence was manifestly excessive. We therefore quash it and substitute for it a sentence of three and a half years.