ADVICE ON THEFT & FALSE ACCOUNTING
I have been asked to advise POL on my view of the “equality” of the offences
of theft and false accounting under the Theft Act 1968, and to consider the
terms of the letter sent by POL to SS on 24" February 2015.
SS is, I am told, beginning to advance arguments that POL is abusing its
prosecutorial role by charging subpostmasters with theft, when there is no
evidence of it, in order only to pressure subpostmasters into pleading guilty
to false accounting.
I have read M103 (the case of Timothy Burgess) where at §4.19 to §4.22, SS
assert the following: -
1)
2)
3)
4)
5)
6)
7)
8)
In the POIR, POL had said Burgess had initially been charged with theft
“but this was subsequently withdrawn”.
The Magistrates declined jurisdiction based on their sentencing
powers and sent the case for trial when theft was the only live matter.
POL representations at court had been that Burgess had taken the
money and altered the accounts to cover his tracks.
At the Crown Court, POL responded favourably to a letter offering a
plea to false accounting in the alternative to theft and so POL did not
proceed on the theft count.
Burgess pleaded not guilty to theft but guilty to false accounting
POL offered no evidence on the theft count.
SS opine that they “consider that it is not correct to say that the theft
matter was withdrawn”.
Neither the “Summary of facts” provided on disclosure to Burgess nor
anything served subsequently revealed in SS’s view any evidence of
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theft."
9) Thus, SS concludes “this was possibly an abuse of Post Office’s
authority ...” and prior review say by the CPS might have led to the
theft charge being discontinued before the case arrived at the
Magistrates’ Court.
10) SS have seen several such cases where the “practice has been
frequently employed by Post Office to encourage defendants, in the
absence of evidence of theft, to plead guilty to the “lesser” charge of
false accounting in the hope of avoiding a custodial sentence”.
4, I have read CK’s response to these allegations upon which Jane McLeod’s
letter to SS of 24" February 2015 appears to be based.
5. I have also been made aware that Sir Tony Hooper has seen the letter, and
the gist of what he has said, among other things, is that false accounting is a
lesser charge than theft, so SS was not incorrect to characterise it as such. He
added however that if someone steals, then that is more serious than if
someone falsely accounts to cover up an accidental loss of £10,000. But if
someone falsely accounted for say £500,000 then that offence is of greater
seriousness.
6. In its advice, CK had said that SS’s views were inexpert and wrong. On this
particular topic, they said:
. The suggestion that the offence of false accounting is a less serious
offence to that of theft. This suggestion has appeared in a number of
contexts, most commonly where an Applicant has pleaded guilty to the
former offence so as to avoid “the more serious” charge of theft, or
has pleaded guilty to “the lesser offence” of false accounting.
‘If SS is right, then Burgess was sent to the Crown Court on the theft charge only and, as a result of
his solicitor’s letter, and POL’s favourable response to it, the false accounting charge was added to the
indictment as an alternative to theft. This does not mean there was no evidence underlying the
allegation of theft
10.
- In fact, both offences are equal in law: both are offences of
dishonesty and both carry the same maximum sentence (7 years
imprisonment).
This was used as the basis for a letter that was sent to SS, which included the
statement:
. The suggestion that the offence of false accounting is a less serious
offence to that of theft is incorrect. Both offences are equal in law:
both are offences of dishonesty and both carry the same maximum
sentence (7 years imprisonment).
I understand that POL wishes to ensure that the statement made in its letter
of 24" February 2015 is defensible. Thus, my specific advice is required on
the following:
> As a basic legal point, whether both offences do carry the same
maximum sentence and whether they are both offences of dishonesty
(we presume that this is correct and is not the source of Tony's
comment)?
Vv
What arguments could be advanced to defend this statement?
Vv
What arguments could be advanced to attack this statement?
> Whether in your view it is fair to characterise these offences as being
equal (against whatever yardstick you think is most appropriate to
apply)?
First, there is no legal concept of the “equality” of offences in law. All I think
CK meant by it was that both are offences of dishonesty carrying identical
maximum sentences. This was a generalisation but in reality means little or
nothing.
Tony Hooper’s examples are trite examples of where an allegation of theft
may be of more seriousness than an allegation of false accounting and where
an allegation of false accounting may in certain circumstances be of greater
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11.
12.
13.
seriousness than theft. But the examples he gives are of course also
generalisations, and are not case-specific examples.
There will indeed be cases where a theft causing actual loss, if the default is
say in the 10s of £1000s, will be of far greater seriousness than the false
accounting that was undertaken to cover it up. Conversely, there will be
cases where the false accounting was of far greater sophistication than the
theft it was designed to cover up as to characterise that conduct as of greater
seriousness.
To illustrate the point a little differently, the Sentencing Guidelines Council
issued a definitive sentencing guideline effective from st January 2009 to
cover theft including (at Section E) the situation where there had been theft
in breach of trust for which the Council set custody starting points and ranges
of sentence for certain financial levels of offending. Subject to additional
aggravating or mitigating factors, under this guideline, the theft of £125,000
or more, or theft of £20,000 or more in breach of a high degree of trust
attracts a starting point of 3 years’ custody in the range of 2 to 6 years
custody. The theft of £20,000 or more but less than £125,000, or the theft of
£2,000 or more but less than £20,000 in breach of a high degree of trust
attracts a starting point of 2 years’ custody in the range of 12 months to 3
years’ custody. The theft of £2,000 or more but less than £20,000, or the
theft of less than £2,000 in breach of a high degree of trust attracts a starting
point of 18 weeks’ custody in the range of a high community order to 12
months custody, and the theft of less than £2,000 attracts a starting point of
a medium community order in the range of a fine to 26 weeks’ custody.
More recently, the Sentencing Council (the successor to the Sentencing
Guidelines Council) published a definitive sentencing guideline on Fraud,
Bribery and Money Laundering offences effective from 1° October 2014, in
which false accounting is included under heads of ‘Fraud’, ‘Revenue Fraud’
and ‘Benefit Fraud’. Just using the ‘Fraud’ heading for these purposes:
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14.
15.
16.
17.
different custody starting points were indicated within certain sentencing
ranges depending on the harm caused and the culpability of the offender
(high, medium or lesser) starting at Category 1 (£500,000 or more; high
culpability) providing a starting point of 5 years 6 months in the range 4 years
to 6 years 6 months’ custody to Category 5 (less than £5,000; low culpability)
providing a starting point of a fine in the range of a discharge to a low level
community order.
My point is that merely because the charges involve dishonesty and
maximum sentences of 7 years is not to tell the whole story of how in
individual cases a judge is likely to sentence one from the other. Each
involves a careful process of assessment of the culpability of the offender,
the harm caused, the aggravating and mitigating factors and the individual
guideline into which the offence fits.
If I may say so, the so-called “equality” of the offences is an unnecessary and
unprofitable focal point of attention. The other issues raised by the letter
have greater force and are defensible.
I also have in mind the case of R v Eden (1971) 55 Cr.App.R. 193. This was a
Post Office prosecution case, the outcome of which turned on its own facts.
However, the importance of the case lies in what it had to say about parallel
theft and false accounting charges in such prosecutions.
The Court held that on a prosecution for parallel offences of theft and false
accounting, it does not follow that because the defendant is not guilty of
theft, he must also be not guilty of false accounting. A defendant who has
deliberately made false entries for gain within the meaning of section
34(2)(a)(i) to cover up a muddle is guilty of false accounting, contrary to
section 17 of the Theft Act 1968, whether or not he has at that time
committed a theft. Such a gain may be constituted by putting off the evil day
of having to sort out the muddle and pay up, as well as by other forms of
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18.
19.
20.
temporary gain. In future in Post Office prosecutions relating to parallel
charges of theft and false accounting, the prosecution should make up its
mind whether it intends to submit that there should be a conviction for false
accounting only if theft is proved; if so, reliance should be placed on a count
for theft only. On the other hand, there may be cases where it is wise to
include in the indictment counts for false accounting also, as, for instance,
where the prosecution intends to submit that temporary gain may have been
the object of the defendant's dishonest act.
The distinction that was being made between theft on the one hand and false
accounting on the other is that theft requires proof of the dishonest
appropriation of property belonging to another with the intention of
permanently depriving the other of it. False accounting is committed where
a person dishonestly with a view to gain for himself or another or with intent
to cause loss to another destroys, defaces, conceals or falsifies any account
or record or document made or required for any accounting purpose. But
“gain” or “loss” for the purposes of false accounting extends to any gain or
loss whether temporary or permanent.
Thus the Court’s view that it would be wise to have on the indictment a count
of false accounting where for example a temporary gain could be the object
of the dishonest act. A temporary gain could not be the subject of a theft
charge where the deprivation has to be permanent. Otherwise the Court
could not see the point in having two charges in parallel if the prosecution’s
purpose was to prove the theft only by proof of the false accounting etc.
In the time I have I have been unable to discover whether CK routinely
charges false accounting in all cases of theft or not or indeed vice-versa. But I
do have in mind that CK’s early iteration of a POL draft policy document
(stated as effective from 1° November 2013 but not in fact implemented) did
say at §5.2:
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21.
22.
In addition to those matters set out in the Code for Crown
Prosecutors, Post Office Ltd. will apply the following considerations:
i. Alternative charges. Where a suspect is charged with offences of
theft and false accounting arising out of the same basic facts,
those charges will always be alternative charges.” This
approach is not to be regarded as an invitation to plead guilty to
any particular charge(s).
Footnote 12 stated, “This is consistent with the decision of Sachs U in Rv
Eden 55 Cr.App.R. 193 CA”. I m not sure this is entirely consistent with the
decision. However, where the evidence supports the addition of alternative
charges, for instance, where POL cannot say on the evidence if there has
been any actual financial loss or whether the false accounting was simply to
cover up for accident or muddle where there has been no actual loss,
alternative counts are entirely permissible, as they are where some
distinction is to be made between permanent deprivation and a temporary
gain or loss.
In conclusion advise:
1)
2)
3)
4)
Both offences of theft and false accounting do indeed involve
dishonesty and do carry a maximum sentence of 7 years’
imprisonment.
I think the only argument that may be advanced to defend the
statement is that it is accurate within the narrow context in which it
was stated.
The point is that false accounting may be a lesser offence, and may
often be a lesser offence in the context in which it is charged, so to
argue it is not a lesser offence is not accurate; it all depends on the
circumstances of the individual case as Tony Hooper’s illustrations
show.
The statement is undermined by the fact that the seriousness or
otherwise of any offence of theft or false accounting must always
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depend on its own facts, as is demonstrated by the many ways in
which such offences may be committed, and how offenders may be
sentenced for them.
Brian Altman QC
2 Bedford Row
London WC1R 4BU
baltma mo ""GRO
8" March 2015