A MILDURA accountant, who was conned into transferring millions of dollars in stolen money that has never been recovered, will be sentenced today.
The Supreme Court sitting in Mildura was told that more than $7 million was lost over 12-years during which Bruce Richard Penny stole from a successful and legitimate investment business using unidentified accounts and alleged borrowers who had no knowledge of the loans.
Penny’s plea hearing heard he lived an almost double-life, continuing a criminal enterprise while engaging in significant community work.
In a special hearing in the Supreme Court yesterday, Justice Betty King said Penny had traded on the trust of people – people who had great trust in him and the offending had clearly made someone else rich.
Justice King likened the con to a Nigerian bank scam which she said most people would not fall for, but about which Penny had made conscious decisions in his offending.
Sixty-two-year-old Penny yesterday formally pleaded guilty to 19 charges including eight counts of theft, two counts of falsifying records required for accounting and nine counts of obtaining financial advantage by deception.
Justice King told Penny, who was released on continuing bail until sentence at 1pm today, that he should not take the bail extension as an indication of sentence.
“I have not made up my mind,” the Judge said.
In a court packed with Penny’s family and friends, Justice King said she had not seen the equal of 16 testimonials on Penny’s behalf during her 12 years as a Supreme Court Judge.
“They are without doubt some of the most genuine testimonials that I have come across,” she said.
Justice King said the offending was “clearly out of character”, however, the criminality of what he had done could not be removed.
She said that while Penny may not have benefited financially from the offending, “he is the one who stole the money” and “the man who hasn’t paid a penny back to anyone”.
Crown prosecutor Peter Rose, SC, told the court that Penny, as an employee of the then Thomson and Associates, used legitimate investment business Tatjana Securities to give long-time friend John Edward (Ted) Allen millions of dollars between 1997 and 2009.
Penny managed the business for a horticulturalist friend who died in 2005, leaving his two children as benefactors.
Penny used bogus accounts and unsuspecting borrowers, including a neighbour and former Thomson and Associates customers, who had no knowledge of the loans.
The prosecutor said that despite the benefactors telling Penny in 2007 that they intended to wind up the business and he should stop issuing loans, he continued to authorise further electronic loan transfers to Mr Allen throughout 2008 and 2009.
The court was told the two children wanted to transfer loan arrangements to computer program QuickBooks and sought full details of all accounts from Penny to make the business more transparent.
Suspicions were raised about the size of loans approved by Penny through the investment business as well as a lack of information and apparent inability to provide documentation to another accounting firm assigned by the family to update the company financial records.
At a meeting between Penny, family members of the investment company, their new accountants and a lawyer acting on behalf of the family, the accused admitted that loan documentation was false and the false loans related to Penny’s long-term friend, who had mining enterprise interests.
The prosecutor said Penny agreed to hand over all details relating to Tatjana Securities, however a subsequent police search of his Chaffey Avenue home in February 2010 revealed a “large number” of documents relating to Tatjana loan files, leases, bank statements and payments to Mr Allen.
The court was told that Penny had also personally given Mr Allen $187,000.
Mr Rose said Penny’s case was one that cried out for “significant punishment”.
“We say this is a serious breach of trust and serious fraud,” he said.
The prosecutor said that when police contacted Mr Allen in May 2010, he declined to speak with them on legal advice.
Defence counsel Bruce Walmsley, SC, said it was “fairly identifiable” that a singular focus in the matter could be seen in Mr Allen.
He said Penny had overreached his permitted constraints and was incapable of clawing back from his “erstwhile friend”.
Mr Walmsley said Mr Allen was “elusive” and “almost invisible”, while there was no evidence that Penny had financially benefited from the offending.
Justice King, however, said she was not sure if Mr Allen had committed a criminal offence.
“Lying to someone who is a friend is not a criminal offence,” she said.
“It’s a con, but it’s not an offence.”
Justice King said Penny had made a conscious decision to provide further amounts of money to Mr Allen which perpetuated the criminality.
The accused was a smart and intelligent man who “comes up with a whole different scheme to avoid detection”.
Justice King said victims had suffered significant losses, stress and pressure from what she likened to a Nigerian bank scam.
“That’s what this is to a large degree,” she said.
“He doesn’t think he can get out of it.”
The court was told that charges of theft, false accounting and obtaining financial advantage by deception each carried a maximum 10-year term of imprisonment.
This article appeared in Tuesday’s Sunraysia Daily 07/02/2012.
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