Anita Whittle [2019] EWCA Crim 1897
Miss Whittle had pleaded guilty on 26 May 2017 to four dishonesty offences committed whilst employed as Parish Clerk and Responsible Financial Officer of Bratton Parish Council in Wiltshire. Two offences were theft, involving the transfer of funds and payment of cheques into her own account, totalling £11,972.66. The other two offences were obtaining property by deception (pre-Fraud Act 2006) and dishonestly making a false representation contrary to sections 1 and 2 of the Fraud Act 2006. On 25 July 2018 a confiscation order was made in the sum of £26,901.30.
The facts underlying the fraud offences involved a scheme by which Bratton Parish Council had agreed around December 2005 to make monthly pension contributions into a Wiltshire County Council pension fund for Miss Whittle’s benefit. Instead of paying the money into the pension fund, Miss Whittle represented that it was being so paid but in fact received and retained the sums herself. The total misappropriated in this way was £14,928.64. Combined with the straightforward thefts, the total obtained was £26,901.30.
At the confiscation hearing both parties agreed that the benefit from the criminal conduct was £26,901.30 and that this was also the recoverable amount. The defence argued that it would be disproportionate to require payment of the £14,928.64 relating to the pension contributions, as Miss Whittle would have received the benefit of the money in any event, albeit not until she reached retirement age in 18 years’ time. The judge saw some force in this argument but ultimately concluded that it would not be disproportionate to make a confiscation order for the full sum.
On appeal, Miss McAnaw on behalf of the appellant repeated the disproportionality argument. The single judge who granted leave had raised a further question of whether Miss Whittle’s benefit was the full value of the pension contributions or a lesser amount representing the benefit of early receipt of sums that would in due course have been paid as pension payments.
Lord Justice Leggatt, giving the judgment of the court, held that the parties had been correct to agree that the amount of the benefit was the full amount of money that should have been used to pay pension contributions but which Miss Whittle had kept for herself. Pursuant to section 76(4) and (7) of the Proceeds of Crime Act 2002, if a person obtains property as a result of criminal conduct, the benefit is the value of the property obtained. The payments received were intangible property and their value was the sum total of them. The court relied on R v Shabir [2008] EWCA Crim 1809; [2009] 1 CrAppR(S) 84, where it was held that the correct measure of benefit was the full amount received even where all that had happened was that the defendant had dishonestly obtained early receipt of money he was entitled to receive at a later date. In that case, a pharmacist who dishonestly claimed more for prescriptions than he was entitled to had obtained a benefit of the full amount received, though confiscation of that sum was held to be disproportionate.
The court concluded that the judge had been entitled and indeed correct to find that it would not be disproportionate to require payment of the full amount. Unlike Shabir, this was not a case in which Miss Whittle was entitled to receive any of the relevant sums for her own benefit, nor could she be said to have any right to receive the amounts at a later date. A report from Osborne Clarke, legal advisers to Wiltshire County Council in connection with its pension fund, explained that under the applicable legislation Miss Whittle would only have become entitled to join the Local Government Pension Scheme if her employer had issued a statutory resolution authorising her to do so, which Bratton Parish Council had never done. Furthermore, no contributions had ever actually been paid into the pension fund.
The court acknowledged the difficulty in valuing the pension rights that would have accrued had the money been paid into the fund. This would depend on what the contributions had grown to in 18 years, with account taken of the fact that Miss Whittle had received the money early. Miss McAnaw realistically accepted that the burden of proof must fall on the defence to present an appropriate valuation, but submitted that it would have been reasonable to assume that the value of the rights Miss Whittle would have acquired would have equalled the amount of the contributions paid, had the money been paid into the Local Government Pension Scheme.
Lord Justice Leggatt held that it was not necessary to decide these questions of valuation. There was a more fundamental question of principle. As a matter of principle, a defendant could not rely on a contention that she would or might have acquired valuable rights if only she had acted honestly instead of dishonestly in order to advance an argument that confiscation is disproportionate. Determining what amount it is proportionate to require a defendant to pay is not simply an accounting exercise. In R v Waya [2012] UKSC 51; [2013] 1 AC 294, at paragraph 26, the Supreme Court made clear that a legitimate and proportionate confiscation order may require a defendant to pay the whole of the sum obtained by crime without enabling him or her to set off expenses of the crime. Lord Walker and Hughes LJ had explained that to embark upon an accounting exercise in which the defendant is entitled to set off the cost of committing crime would be to treat the criminal enterprise as if it were a legitimate business and confiscation a form of business taxation. The same was true of an accounting exercise in which the defendant is permitted to deduct benefits that would have been received if he or she had not engaged in criminal conduct. There was no difference in principle between costs that would have been avoided and benefits that would have been gained if the defendant had acted lawfully.
The court therefore held that it did not avail Miss Whittle to say that she would or might have acquired pension rights if only she had acted honestly instead of defrauding the Parish Council of money which she had falsely represented was being used to make pension contributions. In circumstances such as these, there was nothing disproportionate about confiscating the full amount of the benefit that had been obtained. In short, the appellant could not reduce a confiscation order by reference to benefits she would have received had she acted lawfully rather than criminally, and the appeal was dismissed.
The appellant raised an issue about the assessment of a sum she was ordered to pay under a confiscation order.
As a Parish Clerk, she stole money on two occasions by transferring money from the Parish account to her own account and paying cheques into her account. The total amount taken was £11,972.66. Two further offences were committed of dishonestly making a false representation. She misappropriated money by representing it was being paid into a pension fund for her benefit when she was receiving it herself. The money taken in this way was £14,928.64.
A confiscation order was subsequently made for the full sum of £26,901.30.
The defence argued it was disproportionate for the appellant to pay the sum of £14,928.64 which was supposed to have been paid into a pension fund for her, as she would have received the benefit of it in any event. The judge appears to have seen some force in this argument but ultimately concluded it was not disproportionate to include the sum.
The same submission was made on appeal. Further, an issue was raised whether, on the facts of this case, the appellant’s benefit from her conduct was the full value of the pension contributions, or a lesser amount representing the benefit of the early receipt of sums that would in due course have been paid as pension payments.
Held: it is not necessary to decide the questions of valuation, deciding what amount it is proportionate to pay is not an accounting exercise. A legitimate and proportionate confiscation order may require a defendant to pay the whole of the sum which he has obtained by crime without enabling him to set off expenses of the crime. There is no difference in principle between costs that would have been avoided and benefits that would have been gained if the defendant had acted lawfully.
The appeal was dismissed.