Jersey Unreported Judgments

Inferior Number Sentencing - fraud - attempted fraud.

[2016]JRC033C

Royal Court

(Samedi)

5 February 2016

The Attorney General

-v-

Jean Jacques Gosselin

Sentencing by the Inferior Number of the Royal Court, following guilty pleas to the following charges:

Age:  43.

Plea: Guilty.

Details of Offence:

In 2007 Gosselin, a skilled electrician, started working for - and by 2010 had become a 20% shareholding director of - a small electrical contracting firm JMEC Ltd.  Historically he had undertaken private evening and weekend work in the same field; as a director of the firm he continued to provide those services to one of his old clients between October 2011 - November 2014, submitting invoices in the firm's name but with his own personal bank details for remittances (Counts 1 & 2, totalling   £8,166:50).  The remaining ten Counts of fraud all cover a relatively brief period of time, from 14^th October, 2014, when the first of the invoices was raised, to 20^th December, 2014, when the last payment was received into the defendant's bank account.  These offences were committed as the defendant was aggrieved at not having received any dividend for 2013 and 2014 and, believing his co-director was withholding monies from him, the defendant 'took the matter into his own hands'; these ten counts involved a sum of £4,968:92.  The attempted frauds (Counts 8, 14 & 15) related to a total sum of £680:00, monies which were paid direct to JMEC as the clients had the correct bank details set up for electronic banking.  The total financial loss to JMEC was recorded at £3,732:26 in recorded time and materials.  The offences were committed in breach of the trust reposed in the defendant who was not just an employee but also a director of JMEC Ltd. 

Details of Mitigation:

Co-operation with the police enquiries, made immediate admissions, provided all access codes for electronic devices and on-line accounting system and relevant paperwork.  Early guilty pleas in lower court, confirmed on indictment.  Audited accounts of JMEC Ltd. showed the defendant was due dividends of approximately £12,500, which he offered against a compensation claim submitted on behalf of JMEC Ltd.  Expressed remorse during preparation of social enquiry report by which time, the author stated, he 'had better insight to the illegality of his actions'; the report recommended a non-custodial disposal.  Positive reference from current employer together with other supportive letters. 

Previous Convictions:

Three previous convictions, two as a youth and the most recent, a motoring offence dating back to 1997, attracting a fine of £100.  Treated as being of previous good character. 

Conclusions:

Total: 15 months' imprisonment. 

Compensation Order sought in the sum of £13,135.42. 

The Crown gave consideration to seeking an Order under Art. 78 of the Companies (Jersey) Law1991 barring the defendant from holding a directorship for a specified period but took the view such action, normally a measure brought into effect where a defendant was a director of a banking, trust or other financial institution or otherwise large company for the protection of investors and the preservation of the good name of the Island, was not warranted in this instance. 

With regard to the compensation claim submitted by JMEC Ltd. and the offer in settlement made by the defendant the Crown observed that in accordance with Art. 4 of the Criminal Justice (Compensation Orders)(Jersey) Law 1994 unless payments towards the satisfaction of any compensation order made pass through the hands of the Viscount they cannot be said to have been paid towards the satisfaction of that order.  The Crown took the view any dispute over dividends due was a civil matter and left any claim to be dealt with in the appropriate forum. 

Sentence and Observations of Court:

Conclusions granted, however by virtue of Art. 2 of the Criminal Justice (Suspension of Prison Sentences) (Jersey) Law 2003 the Court ordered that the sentence be suspended for a period of two years. 

Observations: The Crown did not present expert forensic evidence concerning the finances of JMEC Ltd so the Court sentenced the Defendant on the basis of his version of events as regards his dispute with the other director and shareholder in the company.  The defendant had a minority shareholding in the company which took the case out of the category of cases of frauds by disgruntled employees. 

Compensation Order not made due to civil dispute. 

The Solicitor General appeared for the Crown.

Advocate R. S. Tremoceiro for the Defendant.

JUDGMENT

THE BAILIFF:

1.        You are here to be sentenced on an Indictment to which you have pleaded guilty; 12 counts of fraud totalling £13,295.42 and three counts of attempted fraud totalling £680.  These various offences were committed against a company of which you were a director and in which you were a shareholder holding 20% of the shares. 

2.        By your plea you have admitted that you acted dishonestly and there is no question that you did so.  Although there were subsequent issues about the financial affairs of the company some of the offences were committed in 2011 at an early stage therefore. 

3.        We have also seen a victim personal statement which has been signed by your co-shareholder in which he says that he finds it very difficult to reconcile the fact that you were, as he puts it, a trusted business partner, and a close friend, known for some 25 years and I add to that that the sentencing policy of this Court is absolutely clear that offences committed in breach of trust will lead to a custodial sentence being passed unless there are some exceptional circumstances.  In that context, exceptional circumstances do not include the absence of any criminal record and do not include remorse because experience has shown that in these sorts of cases people are always very remorseful for what they have done, nearly always, very remorseful for what they have done. 

4.        The case for saying that this one is exceptional really seems to us to amount to this.  Just as your partner says that he feels that he has been betrayed by a breach of trust on your part, you feel that you have been betrayed by a breach of trust on his part.  He held the majority shareholding in the company and you consider that he acted wrongly towards you not in the relatively minor way of taking holidays, but allowing the company to apply its workforce and assets for his personal benefit and for example, procuring that the company did not distribute profits by way of dividend after the first year or so and indeed it paid him when it felt it could and paid you sometimes in relation to that dividend. 

5.        It is said on your behalf that you did not have access to the financial information which enabled you to test what was being done.  What cannot be said is that that justified you in pursuing a dishonest course of conduct. 

6.        The difficulty that the Court has faced is that there is no doubt in our view that if you are right in what you say, then that would have an impact on the sentence because it goes to your culpability for these offences.  If you are not right then unquestionably you would be serving a sentence of imprisonment. 

7.        The Crown does not wish to move for an adjournment so that there can be evidence heard which would settle whether you are right or not and we understand the reasons for that because it would be a difficult and complicated case with extensive evidence but it means, we think, that we must proceed on the basis that what you have to say may be right.  We are sentencing you therefore on that basis, making it absolutely plain that we are not making any finding that you are right as opposed to your partner, and neither you nor he are, as it were, coming out of the sentencing remarks with the knowledge that the Court has endorsed either of your accounts of what took place.  We are simply sentencing you on the basis that what you say is right because we have no evidence that it is not and it seems to us that that is the fair way of dealing with this criminal case. 

8.        We note that the guilty plea which you have entered is particularly valuable in that context because the contentions which have been put to us could have been applied to a not guilty plea and a case put before the jury so here we are with a situation where we are to sentence you on the basis that you are not a disgruntled employee but a partner in a company with an entitlement to be aggrieved and in the course of that you have acted foolishly and dishonestly. 

9.        We think that those are exceptional circumstances.  You should never have acted as you did, you acted dishonestly, but in the light of those circumstances we are not going to impose an immediate custodial sentence.  Nonetheless the conduct of dishonesty and the aggravation of that dishonesty by breach of trust means that a custodial sentence must be imposed.

10.      We are therefore going to impose a sentence of 15 months' imprisonment but it will be suspended for 2 years.  What that means is that if you do not commit any further offences in the course of the next 2 years you will not be required to serve it.  If, however, you do commit any further offence you are liable to be brought back to this Court and the probability, the very high probability, is that sentence will then be imposed and you will start serving it at that point. 

11.      The Crown has also moved for a Compensation Order to be made.  In the circumstances that we have found that there is a real identifiable civil dispute where it is quite possible that the other claims which might be made might make it inappropriate that the money which has been dishonestly removed from the company should be returned to it, and effectively returned therefore to the fellow shareholder, we do not think it is appropriate to make a Compensation Order in this case.  In any event we are not clear whether the money has not already been repaid from the material that has been put before us but that is beside the point.  In the light of the civil dispute we are not going to make the Compensation Order. 

12.      The Court hopes that you recognise that you are fortunate to have escaped an immediate custodial sentencing but it is in the light of the extraordinary exceptional financial circumstances put before us. 

13.      There is one refinement to what I have said.  Rightly the Crown draws my attention to the fact that it was 15 months' imprisonment on the fraud offences and the conclusions for 6 months', concurrent, on the attempted fraud offences.  The sentence is 15 months suspended on the fraud offences and 6 months, concurrent, on the attempted fraud offences but they are all suspended so it still makes a total of 15 months' imprisonment, suspended. 

Authorities

Whelan on Aspects of Sentencing in the Superior Court of Jersey.

AG-v-Shore [2010] JRC 064.

AG-v-McCallion [2014] JRC 148B.

AG-v-Oliveira [2012] JRC 018.

R-v-Barrick [1985] 7 Cr. App. R. (S) 142.

Criminal Justice (Compensation Orders)(Jersey) Law 1994.

Companies (Jersey) Law 1991.