Jersey Unreported Judgments

[2010]JRC112

ROYAL COURT

(Samedi Division)

15^th June 2010

Before     :

Sir Christopher Pitchers, Commissioner, and Jurats Tibbo and Kerley.

The Attorney General

-v-

Peter Wilson Michel

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

6 counts of:	Assisting another to retain the benefit of criminal conduct, contrary to Article 32(1)(a) of the Proceeds of Crime (Jersey) Law 1999 (Counts 1, 2, 3, 5, 7 and 9).
1 count of:	Assisting another to retain the benefit of criminal conduct, contrary to Article 32(1)(b)(i) of the Proceeds of Crime (Jersey) Law 1999 (Count 6).

Age:  63.

Plea: Guilty.

Details of Offence:

The essential facts of this case are that the 63 year old accused was a chartered accountant who used his business to help his foreign clients cheat their home revenue authorities and shelter the proceeds of crime by hiding stolen funds/funds chargeable to tax and passing the proceeds back to the malefactors.  He offered a money laundering service whereby he would transfer, convert, invest or disguise the criminal proceeds which such clients wished to hide in accordance with their instructions.  He did this to the extent of many millions of pounds.  The business was characterised by secrecy, untruthful records and the absence of records.  The defendant also offered his services to a professional criminal engaged in wholesale duty evasion, who provided him with millions of pounds to look after while he was a fugitive from justice. 

In 2006-2007, Mr Michel was convicted in two trials and sentenced to a term of 6 years for each of the counts on which had been convicted on both Indictments.  The defendant appealed against the convictions resulting from both trials.  The appeal against conviction from the first trial was dismissed, however, in November 2009, the Judicial Committee of the Privy Council advised that the convictions on the second Indictment should be quashed as a result of the conduct of the trial judge.  The Jersey Court of Appeal subsequently ordered a re-trial.  A new 9 count Indictment was brought to which Mr Michel pleaded guilty to all counts bar 4 and 8 (relating to Smith and Krezjl). 

Following conviction on 18^th June, 2007, a confiscation order under the Proceeds of Crime (Jersey) Law 1999 in the sum of £9.7 million was made against the defendant.  Taking into account the non pursuit of counts 4 and 8, the prosecution moved for a confiscation order in the sum of £6,528,707 (the remaining £1,469,662 to be apportioned to the defendant). 

Details of Mitigation:

The defence did not propose to address the Court in mitigation (they provided a copy of the original mitigation bundle).  Mr Michel had agreed to the Crown's recommendations, the defence advised that there was no need for the Court to read this bundle if it also proposed to accept the Crown's recommendations. 

Sentencing

Mr Michel accepted the Crown's recommendation that concurrent sentences of 4 years be imposed for each count.  Mr Michel did not argue against the proposed sentence because it would not return him to prison, and allow him to continue his release on licence.  The defence also brought to attention The Court of Appeal Law 1961 schedule 2 Article 2 which provides "where a person ordered to be retried is again convicted on retrial, the Royal Court may pass in respect of the offence any sentence authorises by law, not being a sentence of greater severity than that passed on the original conviction". 

Confiscation & Costs

Mr Michel accepted the Crown's recommendation as to confiscation and interest on confiscation and interest on confiscation.

Costs

The Crown sought an order that Mr Michel pay a contribution of £800,000 towards prosecution costs.  This was agreed by Mr Michel. 

Disqualification

The defence argued that no public interest would be served by disqualification for reasons including the accused's age and the means by which he had offended.  Court rejected this and also the defence argument that disqualification should start from the date of the original conviction rather than from the present. 

Previous Convictions:

None. 

Conclusions:

Count 1:	4 years' imprisonment.
Count 2:	4 years' imprisonment, concurrent.
Count 3:	4 years' imprisonment, concurrent.
Count 5:	4 years' imprisonment, concurrent.
Count 6:	4 years' imprisonment, concurrent.
Count 7:	4 years' imprisonment, concurrent.
Count 9:	4 years' imprisonment, concurrent.

Total:  4 years' imprisonment. 

Costs order sought against the defendant in the sum of £800,000.

Confiscation order sought in the sum of £6,528,707.

For the Court, in its civil capacity to order under Article 78 of the Companies (Jersey) Law 1991 disqualification of the defendant from any capacity stipulated in Article 78(1)(a)(b)(c) for a period of 10 years, starting from the date of the order.  In Re Sevenoaks Stationers (Retail) Limited [1991] Ch 164, three bands of seriousness of offence with corresponding periods of disqualification:- (a) "not very serious cases" 2-5 years, (b) serious cases 6-10 years, (c) particularly serious 10 years.  The prosecution regarded this case as falling within bank (c) or at least the very top of band (b). 

Total

4 years' imprisonment and a 10 year disqualification from being a director of or taking part in management of a company, being a member of the council or taking part in the management of a foundation or being concerned with the management of a body incorporated outside Jersey.  Costs order against the defendant of £800,000.  Confiscation order of £6,528,707.  Disqualification from any capacity stipulated in Article 78(1)(a)(b)(c) for a period of 10 years, starting from the date of the order. 

Sentence and Observations of Court:

The Court agreed with the conclusions of the Crown in respect of the counts on the indictment and the confiscation order.  The Court concluded as follows:-

Count 1:	4 years' imprisonment.
Count 2:	4 years' imprisonment, concurrent.
Count 3:	4 years' imprisonment, concurrent.
Count 5:	4 years' imprisonment, concurrent.
Count 6:	4 years' imprisonment, concurrent.
Count 7:	4 years' imprisonment, concurrent.
Count 9:	4 years' imprisonment, concurrent.

Total:  4 years' imprisonment. 

Costs order made in the sum of £800,000.

Regarding the disqualification, the Court found that Mr Michel was the main operator of a range of sophisticated techniques designed specifically to disguise criminal proceeds.  It was clearly in the public interest that he be disqualified. 

The Court rules that Mr Michel's crimes fell within band (b) regarding seriousness of offence.  His crimes did not involve stealing or defrauding any of his clients so the risk to the public was lessened.  The Court thus concluded that 6 years was appropriate, the starting point being the day of the sentence (not any earlier time). 

S. M. Baker, Esq., Crown Advocate.

Advocate D. F. Le Quesne for the Defendant.

JUDGMENT

THE commissioner:

1.        In view of the procedural history of this case, there is no need to say anything very much about the facts.  This was a sophisticated high-value and deliberate course of dishonesty in which you helped equally dishonest clients to avoid tax or, in at least one case, worse than that.  So far as penalty is concerned the law is clear, we cannot impose a longer penalty than was imposed upon you in relation to the original trial, that applies both to the term of imprisonment and also to the confiscation. 

2.        The sentence must be such as would reflect the fact that you have served 4 years of your 6 year sentence.  Accordingly, in respect of each of the counts on the Indictment to which you have pleaded guilty will be a sentence of 4 years' imprisonment concurrent.  It is intended that that should not mean you will return to prison, and I assume your Advocate has ensured that that in fact will have that effect.  We enter verdicts of not guilty on Counts 4 and 8. 

3.        So far as confiscation is concerned, there will be an order for confiscation pursuant to Article 3 of the Proceeds of Crime (Jersey) Law 1999 in the sum of £6,528,707 pence.  Interest accruing on the money which is in the hands of the Viscount since December 2008 will be treated as having been earned in sums in proportion to that sum and the sum which the Viscount holds which will be returned to you because it reflects the other Counts to which you have pleaded not guilty, so that is in the proportion of £6,528,707 to £1,469,662.  Interest will be taken to run from the date of payment of the original confiscation order, December 2008, until today's date. 

4.        There will be an order that you pay the costs of the Prosecution in the sum of £800,000. 

5.        The one new area which we must deal with in a little more detail is the application by the Attorney General that you be disqualified from acting in relation to the management of the body corporate.  This is not part of the penalty so can now properly be added.  The facts of the case were that you assisted those running companies, to run those companies dishonestly.  That in our judgement is ample grounds to provide the legal basis for disqualifying you in that way.  The Court must be satisfied that it is in the public interest that you be disqualified and the Court must also be satisfied that you are unfit by reason of your behaviour towards bodies corporate to be involved in the running of bodies corporate in future.  We are satisfied of both of those things.  The question remains what the length of the disqualification should be.  We accept the argument of Mr Baker that on the face of it, bearing in mind the seriousness of the risk that you present, the appropriate length of disqualification would be 10 years.  On the other hand, there is force in Advocate Le Quesne's argument that this should more properly have been dealt with at the original sentencing hearing.  The appropriate length of time would then have been 10 years.  Any order that we now make runs from today so the disqualification will be reduced from that notional period of 10 years to one of 6 years and you will be disqualified from concerning yourself in the management of a body corporate for a period of 6 years running from today. 

Authorities

Proceeds of Crime (Jersey) Law 1999.

Re Delaney [1995] JLR N 2b.

Re Sevenoaks Stationers (Retail) Limited [1991] Ch 164.

Re Hay [1996] JLR N 2b.

AG-v-Fagan [2005] JRC 031.