England and Wales Court of Appeal (Criminal Division) Decisions

IN THE COURT OF APPEAL
CRIMINAL DIVISION

		Royal Courts of Justice Strand London, WC2A 2LL
		Wednesday, 22 July 2009

1. LORD JUSTICE RICHARDS: The court has before it three appeals against sentence in a case of conspiracy to defraud and related offences. The matter was before this court on 18 June when an application by Babatunde Awoyemi for leave to appeal against conviction was dismissed. On that occasion the court also heard submissions in support of applications by Babatunde Awoyemi and Tony Adepoju for leave to appeal against sentence and an appeal against sentence by Olufemi Awoyemi. The court decided to grant the two applications for leave to appeal against sentence and to adjourn all sentence matters to today's hearing so as to obtain the assistance of counsel for the Crown on the scale of the conspiracy and the relevance of certain authorities to which we were referred by counsel for the appellants. Today we have had the benefit of written submissions and brief oral submissions from Mr Femi-ola on behalf of Babatunde Awoyemi, Miss Frances Bolton on behalf Adepoju and Mr Stephen Fidler on behalf of Olufemi Awoyemi, together with Mr Holt on behalf of the Crown.
2. In order to set the scene we need to repeat some of the background as set out in the judgment given on 18 June.
3. Babatunde Awoyemi was convicted after trial of conspiracy to defraud, conspiracy to commit a false identity document offence, possessing criminal property and two counts of possession of a false identity document with intent. He was acquitted of a further count of possession of a false identity document with intent. He was sentenced to seven years' imprisonment, less 16 days spent in custody on remand, in respect of the conspiracy count. On the other counts he was given concurrent sentences of 18 months' imprisonment.
4. Adepoju was convicted of conspiracy to defraud and was sentenced to seven years' imprisonment, less 15 days spent in custody on remand. He was acquitted on a count of possession of a false identity document with intent.
5. Olufemi Awoyemi pleaded guilty on the first day of trial to conspiracy to defraud. He was sentenced to six years' imprisonment, less 16 days spent in custody on remand. Further counts of possession of a false identity document with intent were ordered to remain on the file on the usual terms.
6. A co-accused, Temitope Adegoke, was convicted of conspiracy to defraud and was sentenced to two years' imprisonment.
7. The appellants and the co-accused were business partners who all studied at and graduated from the University of Luton. Babatunde and Olufemi Awoyemi are brothers.
8. On 18 July 2006 a substantial police operation took place in Luton during which each of the defendants' homes and their business premises were searched. A substantial number of identity documents were seized, including both genuine and forged documents. According to the prosecution's opening there were documents in over 170 different names. The prosecution case was that the applicants and co-accused conspired to defraud others. They acted as part of a criminal organisation who obtained genuine and false identity documents and were able to manipulate and create other identification documents to be passed on to others who would then use these identities to commit further offences.
9. In relation to Babatunde Awoyemi the prosecution relied on a large number of documents found at his home, including a cheque cards, utility bills, a national insurance card and a counterfeit passport. Details of an American Express account were also found stored on his mobile phone.
10. In relation to Adepoju the prosecution relied on documents found under his bed and in his kitchen, together with bank cards, utility bills, financial documents and counterfeit travellers cheques. The police found similar documents at his business premises, stored in an unused lavatory and a store room. Bank details were also found stored on his mobile telephone.
11. In relation to Olufemi Awoyemi the prosecution relied on three laptops found at his home which contained scanned bank statements and utility bills that had been altered and reproduced with altered names and addresses. Similar identity documents were found at his business premises. He pleaded guilty to conspiracy to defraud on a written basis of plea in which he accepted that he had an equal role with the co-defendants in the conspiracy. He also accepted that various documents listed in a schedule relied on by the prosecution were false, forged or stolen and were part of the conspiracy. He distinguished between those documents and other material which he said formed part of his legitimate business and was not accepted as being part of the conspiracy.
12. The judge's sentencing remarks were detailed and helpful. He started by referring to the fact that the use of false and stolen identity documents to create false identities is very much on the increase notwithstanding the passing of The Identity Cards Act 2006. He pointed out that examination of the documents found by the police at the defendants' premises showed them to be exactly the sort of documents needed by those who set out to cheat anyone who relied on proof of identity before providing financial services, property or other services. In the words of the particulars of the conspiracy count, they were for use in defrauding such corporations, partnerships, firms and persons who rely on identities by obtaining, possessing, creating and using false identities. Some of the documents were genuine and had been stolen, others were false. Many documents had on them names and addresses with dates and places of birth, account numbers, bank sort codes and expiry dates. In addition, mobile phones and a memory stick were recovered which had similar information on them, being sent from one conspirator to another by text or the details being stored for later use or transfer.
13. The judge referred to the use of false identity documents as undermining the very foundations of a civilised society. He said that at one extreme end of the spectrum it is an essential part of the kit of those involved in terrorism. False identities are used for immigration offences, such as people trafficking. They are used for benefit fraud and to obtain employment and for the illegal obtaining of monies from banks and suppliers of mortgages, loans and so forth. In this case American Express accounts about which the court had heard had been drained of over £162,000 and the potential loss was said by the prosecution to be over £2 million.
14. The prosecution had never suggested that the defendants themselves actually used the documents in question to commit such fraud. What had been alleged and proved against them was that they were part of a criminal organisation which obtained genuine and false identity documents and was able to manipulate and create other identity documents to be passed on to others who would then use them to commit that sort of offence.
15. The judge then referred to the large number of documents found at the homes of the defendants and to the links with other documents and other premises.
16. In relation to Babatunde Awoyemi and Adepoju he was satisfied that they were both at the very heart of the conspiracy though he accepted that others were also involved, probably at the same level.
17. He said that Olufemi Awoyemi's role was as the computer expert and creator of the false documents, no doubt having been pressured by Babatunde Awoyemi and Adepoju and also by others; but he succumbed to that pressure and worked, as it were, in a factory producing forged documents. The other defendant, Temitope Adegoke, was the runner for those more deeply involved.
18. So that was the basis on which the judge passed the sentences he did.
19. Before considering the appellants' submissions with regard to those sentences we should say a little more about the personal circumstances of each of the appellants.
20. Babatunde Awoyemi is a 41-year old man with a small number of previous convictions of which the only two of possible relevance were for offences of obtaining property by deception in 1990 and 1993, but in view of their date and the fact that he had not received a custodial sentence for them they were of no significance and the judge treated Babatunde as being of effectively good character.
21. Adepoju is 35 years old and has no previous convictions. He had an irrelevant caution against his name. The judge referred to him as an intelligent man who appeared to have established a good reputation in the community and was a credit to himself and to his friends and family. He was in fact a licensee in Luton and was one of those who held meetings with the council and the police as to how the town could be improved. He had also held parties in support of various charities and had done much to support others.
22. Olufemi Awoyemi is 38 years old. His record included a number of offences of dishonesty in 1994 to 1995 but they had not been the subject of a custodial sentence and were of little significance. The judge sentenced him on the basis of plea to which we have referred. He also observed that Olufemi had pleaded guilty on the day the case was listed for trial and deserved some credit for that, though the credit would have been considerably higher if he had pleaded at a much earlier stage.
23. The thrust of the submissions on behalf of all the appellants is that the judge took too high a starting point for this conspiracy, which, although serious, was not on such a scale or of such a nature as to warrant sentences of seven years on conviction after trial.
24. Among the authorities relied on the most important are Taj and others [2003] EWCA Crim 2633, Din and others [2004] EWCA Crim 3362 and Militaru and Bujor [2007] EWCA Crim 2531.
25. Taj concerned the manufacture and use of cloned and skimmed cards. The main organiser obtained supplies sufficient to print 19,000 cards. Taj had continued the conspiracy after the main organiser's arrest and was found in possession of computer equipment for cloning, together with thousands of blank cards and 500 counterfeit cards. The established loss to banks was £123,000. The potential loss was estimated to be in the region of £34 million. The main organiser entered early pleas of guilty to one count of conspiracy to defraud and five counts of obtaining property by deception. His total sentence of seven years (five years for the conspiracy and two years consecutive for the substantive offences) was reduced on appeal to a total of five and a half years. Taj and another man pleaded guilty at trial to conspiracy to defraud. They were sentenced to five years and four years' imprisonment respectively but those sentences were reduced on appeal by one year in each case.
26. Din also concerned a conspiracy to defraud by the fraudulent creation and use of cloned and skimmed cards. The loss to the banks in that case was just over £241,000 and there had been attempts to cause further losses of the order of £244,000. The court said that the defendants in Taj had been involved in more sophisticated criminal conduct with potentially much greater illicit profit than those in Din. For the defendants in Din a starting point of seven years was considered to be too high even allowing for a proper deterrent element. The highest sentence imposed at first instance was five years on a late plea. The court reduced that sentence on appeal to four years.
27. In Militaru the court reviewed those and other authorities, which were said to demonstrate that this court had accepted the prevalence of this offending, the real damage it does to individuals and financial institutions and the need for deterrent sentences. The judgment continued at paragraph 21:

"The principles which we derive from these decisions are (i) the conspiracy at its most serious will embrace all of the following features: the unlawful capture of information from the magnetic strip of genuine cards and of the PIN number inserted by the customer; the use of that information in the manufacture of cloned cards and the use of the cards to perpetrate the fraud on individuals and banking institutions; (ii) the seriousness of the offence will be assessed by reference to breadth of the conspiracy, the offender's position in it, his participation in it and the loss actual and intended; (iii) deterrent sentences are called for. The sentencer should bear in mind the maximum sentence for conspiracy to defraud is 10 years."

28. A little later, at paragraphs 25 to 26, the court stated:

"It seems to this Court that sentences towards the top of the range, approaching 10 years after a trial, need to be reserved for those serious cases which involve two or more of the limbs to which we have referred and to those who are more central to the organisation of the operation. The evidence established here limited involvement, under the direction of others, in the first part only of the fraudulent scheme, that is the illicit collection of data. That the appellant joined a wider dishonest scheme, which they knew to be fraudulent cannot, however, be in doubt. They pleaded guilty to a conspiracy to defraud the United Kingdom clearing banks.

In our judgment, the appropriate starting point, following a trial, would have been in the order of 4 to 5 years."

29. It is submitted by reference to those authorities that a starting point of seven years was too high in this case. Various features of the case are stressed as making this less serious a conspiracy than the judge seems to have considered it to be. First, the charge of conspiracy itself and the prosecution case concerned the creation and use of identity documents for the defrauding of various financial institutions in particular, not for terrorism or other purposes. The only matter in relation to which it could be inferred that the appellants were aware of the potential use of cards concerned the American Express cards. The established loss in respect of American Express was £162,000. There were only very small sums in respect of two other cards. Beyond that there was merely speculation as to what the loss may have been. It is submitted that there was no allegation that the appellants had themselves used the identity documents nor any proof of direct benefit to the appellants from the use of such documents.
30. A further point is that no or no sufficient account was taken of the fact that all of the appellants had legitimate trade and business dealings and other innocent reasons which could account for some of the identity documents found in their possession and which also explained their acquittal on some substantive counts. Miss Bolton went into this at great, if not excessive, length in her written submissions on behalf of Adepoju but the same point applies to all the appellants. For example, in dismissing Babatunde Awoyemi's application for leave to appeal against conviction the court referred to the Crown's acceptance that he ran a legitimate business as a mortgage broker and to evidence from a client of that business which explained his acquittal on one of the counts.
31. There is an additional, specific submission on behalf of Olufemi Awoyemi as to an alleged disparity between his sentence and those imposed on the other two. It is said that Olufemi's accepted lesser role and his plea of guilty should have led to a lower sentence than that imposed on him. The judge did not state what credit he was giving for the plea. Although the normal credit for a plea at the start of trial would be 10 per cent, it is submitted in the written submissions, at least, that greater credit was appropriate in the particular circumstances, given the volume of the case, the nature of the evidence and the savings in terms of time and cost of the trial.
32. For the Crown, Mr Holt submits that the prosecution case was that these appellants were involved in providing false identities for whoever was willing and able to pay. The criminal operation was large scale and the vast amount of material seized would have been only a snapshot of the whole scheme. It is suggested that the operation had been going on for many months, if not years. Stolen documents such as utility bills, credit cards, passports and national insurance cards would come from a variety of criminal sources. The appellants were a form of fence, or middle men, handing them. The customers of this type of identity fraud range over a wide area of criminal activity. The prosecution could not say which specific criminal activity any of the false identities went to service, but they were available to whoever wanted to buy and could be put to whatever activity those persons wanted to use them for. Thus Mr Holt supports the judge's approach to sentencing. He submits that the cases relating to conspiracy to defraud financial institutions by the fraudulent use of cloned cares are unhelpful, as the present case has a much wider ambit than defrauding banks and building societies. He also submits that the judge was in the best position to assess the level and sophistication of the criminal investigation.
33. There is, in our judgment, real force in the submission that the judge was in the best position to assess the nature of this conspiracy. He was plainly entitled on the evidence he heard to regard it as a very serious conspiracy involving the obtaining and creation of identity documents on a substantial scale for use by others for illegal purposes. It does nothing to lessen the seriousness of the conspiracy that the appellants were supplying the documents to others rather than using those documents themselves.
34. We also recognise that the potential uses of identity documents of the kind to which this conspiracy related are very wide. But it remains the case, and it is important to bear in mind, that it was charged as a conspiracy to defraud (so that, for example, any reference to terrorism is inapposite) and that the only specific use identified as stemming from the conspiracy relates to the American Express cards. It seems to us, contrary to the submission on behalf of the Crown, that the authorities relating to conspiracy to defraud banks and other financial institutions by the use of cloned cards are of relevance and provide some guidance as to the appropriate level of sentencing in this case, though it does have to be borne in mind at the same time that this conspiracy potentially involved wider uses of false identity documents.
35. It is also relevant that the only financial loss actually established is just over £162,000. The much higher figure of £2 million put forward by the prosecution by way of estimated potential total loss goes no further than to underline that the £162,000 is necessarily a minimum sum. It does not in itself provide a reliable indicator of the actual scale of the operation.
36. It would plainly be wrong to treat the conspiracy as encompassing all the identity documents found in the possession of the appellants. Some of the documents could be attributed to their legitimate businesses or had other innocent explanations as evidenced by the not guilty verdicts on some counts. Again, the judge was best placed to determine the extent to which allowance should be made for this consideration, though he did not deal clearly with the point in his otherwise very full sentencing remarks.
37. Looking at the matter overall and bearing in mind the authorities to which we have referred, we have come to the conclusion that the judge did place the starting point for this particular conspiracy somewhat too high. In our judgment, an appropriate starting point would have been six years rather than seven years. We do not accept the submission that the starting point should be as low as the four to five years adopted on the particular facts of Militaru.
38. We see no reason why any reduction from that starting point should be made in the case of Babatunde Awoyemi or Adepoju, who were found to have been at the heart of the conspiracy. In the case of each of them we allow their appeal and substitute a sentence of six years' imprisonment for the sentence of seven years imposed below.
39. In the case of Olufemi Awoyemi there are clearly two factors which justify a reduction from the starting point: the judge's acceptance that he was not quite on the same level as the other two and the credit due to him for his plea of guilty. In our judgment, the appropriate sentence for him, taking those two factors into account, is one of five years' imprisonment. The judge adopted a differential of one year between Olufemi and the other two. That caters adequately for the distinguishing factors. A year's differential is that much more significant in the light of the reduction in all the sentences resulting from the lower starting point we have adopted. We do not accept that any greater credit than 10 per cent was appropriate for a plea of guilty entered at such a late stage. The balance of the one year differential is sufficient to reflect Olufemi's lesser role in the conspiracy. We therefore allow his appeal by substituting a sentence of five years' imprisonment for the sentence of six years imposed below.
40. To that extent each of the appeals is allowed. We make clear that in relation to all the appellants time served on remand will still count towards sentence.