The Court of Criminal Appeal recently imposed a nine year sentence in a case of significant and systematic fraud on the public revenue involving illegal tax evasion and social security fraud.

Background

The case, DPP v Paul Murray  involved a 63 year old former carpenter who was sentenced to over 12 years imprisonment by the Circuit Criminal Court after pleading guilty to having a false passport and 25 sample counts of social welfare fraud. Mr Murray falsely misappropriated approximately €249,000 between 2006 and 2010 in what the investigating officer described as the “largest fraud of its kind uncovered to date”.  Since 1995, Mr Murray had been living mainly in Thailand.  Using an array of false documents, he stole the identities of his brothers and other people who were completely unaware of his actions. These were used to illegally claim a range of allowances. The fraud came to light after he applied for a passport in his brother’s name when a valid passport was already in existence.  Only €11,151 of the misappropriated funds were repaid.

Appeal

Counsel for Mr Murray claimed that the sentence imposed by the Circuit Criminal Court was so severe as to be excessive and breached the “totality principle” where the overall sentence was required to be proportionate to the moral delinquency of the offender. The Court agreed that the sentence was excessive and indicated that such sentences should be reserved for offences against the person such as manslaughter or serious assault.  While taxation and fraud offences did not fall into the same category, the Court rejected any suggestion that crimes involving a loss of public revenue were “somehow victimless crimes”.

State’s fiscal emergency

The Court referred specifically to the collapse of US investment firm Lehman Brothers in 2008 and the resulting global financial crisis which had “ushered in a contraction in our economy which is unparalleled in living memory”.  The State had “struggled during this period with a series of fiscal emergencies”.  All of this called for a “high level of social solidarity” which “would be gravely endangered if tax payers were led to believe that social security fraud was rampant or that, when detected, would not be dealt with severely”.

Duty of fidelity and loyalty

As the holder of an Irish passport, Mr Murray owed a “fidelity to the nation and loyalty to the State”.  The Court stressed that “in a time of fiscal emergency” that fidelity and loyalty demanded that social solidarity be respected. By defrauding the state Mr Murray had “set that fidelity and loyalty at naught”.

Sentencing guidelines

The Court suggested that “future significant and systemic frauds directed upon the public revenue” should generally result in “an immediate and appreciable custodial sentence” having regard to the individual circumstances of the accused person(s). In Mr Murray’s case the sentence was reduced to nine years, with the final year suspended in acknowledgment of his guilty plea. 

The guidelines were adopted by Dublin Circuit Criminal Court in March when it imposed a six year sentence on a 46 year old man for what it called a “grave” and “huge” tax evasion scheme in failing to pay €1.6 million duty on more than 1,000 tonnes of garlic from China.