Griffiths & Anor, R v

MR JUSTICE LEVESON: On 19th June 2006, following a trial lasting some two weeks, Leslie Dennis Pattison, an estate agent who also provided financial services, was convicted of offences of entering into a money laundering arrangement, contrary to section 328(1) of the Proceeds of Crime Act 2002, and acquiring criminal property, contrary to section 329(1) of the Act. He was sentenced to concurrent terms of three years' imprisonment. Phillip John Griffiths, a solicitor, was convicted of failing to make a required disclosure, contrary to section 330(1) of the same Act. He was sentenced to 15 months' imprisonment. Their appeals against sentence have been referred to the full court by the Registrar.

The facts can be summarised briefly. The background starts with Peter and Donna Davis, who were dealers in drugs, subsequently being sentenced to 15 years and seven years' imprisonment respectively. In November of 2002, when their criminal conduct was being investigated, the police served a production order on Mr Griffiths in relation to premises which he had conveyed on behalf of a member of their family. In March 2004 both pleaded guilty to substantial offending and, while awaiting both sentence and confiscation proceedings, sought to dispose of a house called Bryn Arden. This property had been acquired in December 2001 for £83,000, partly by mortgage of £43,000 arranged by Mr Pattison. By 2004 the property had increased in value to something in the order of £150,000 and was so valued by Mr Pattison for the purposes of the confiscation proceedings.

In May 2004 Peter Davis approached Mr Pattison and offered to sell him Bryn Arden for the value of the outstanding mortgage, then £43,000. The case for the Crown was that this was an attempt to frustrate the confiscation proceedings. Mr Pattison approached Mr Griffiths with a view to effect conveyance. He, as a conveyancer solicitor, knew enough about local prices to appreciate that this was a substantial undervalue. Their evidence to justify this conduct differed. Mr Pattison said that he told Mr Griffiths that a very good commercial opportunity had come his way. Mr Griffiths said that Mr Pattison had told him that some friends of his were in financial trouble and that he, Mr Pattison, was buying out the mortgage to help them. In undertaking the conveyance, however, Mr Griffiths cut a number of corners which might itself reveal a window upon what he ought to have done. Thus, he approached the building society for a redemption figure without the consent of the mortgagees and did not advise the Davis' about their need for separate representation given the acknowledged sale at a substantial undervalue. He performed the transaction, however, for no more than his normal conveyancing fee of some £399. No further profit to Mr Griffiths was alleged. After transfer Mr Pattison visited Mr Davis in prison.

In the case of Mr Pattison, the essence of his criminality was entering into a money laundering agreement and acquiring criminal property, knowing or suspecting in the first case that it facilitated the acquisition, retention, use of control or criminal property by the Davis' and, in the second, that it represented in whole or in part the proceeds of criminal conduct on their part.

Mr Griffiths was similarly charged but acquitted of these offences. He was convicted of failing to make a required disclosure to the authorities, having reasonable grounds for knowing or suspecting that other persons, that is to say Mr Pattison and Mr and Mrs Davis, were engaged in money laundering. Although this offence can also be committed with knowledge or suspicion as to the tru facts, Mr Butterfield, for the Crown, accepted that, had the jury been prepared to accept his case to that effect, namely that Mr Griffiths knew or suspected money laundering, he would then have been convicted of the more serious offences. The judge also proceeded on that premise.

At the time of sentence both men were 45 years of age and both of good character. In both cases a number of character witnesses were available, and in relation to Mr Griffiths, in particular, the effect of conviction was emphasised as particularly grave.

When passing sentence, the learned judge, who had had the opportunity of watching these defendants throughout the two week trial, said of Mr Pattison:

As to Mr Griffiths, he said:

On behalf of Mr Pattison, Mr Gloag first argued that detection in relation to the offending was inevitable. Given that his client fought the case tooth and nail before the jury, that submission is singularly unattractive and in one sense might aggravate the offence on the basis that the corollary is that his client was not prepared to accept the criminality of his conduct and thus all the more required a deterrent sentence. If the point had been made that the offending carried none of the indicia of false names, dummy organisations or cover-up, that might have been slightly more relevant. It is also right that the offending was not part of a pattern of money laundering, such as has been evident in a number of cases. We agree with the learned judge that this was a one-off offence borne out of greed, pure and simple.

What then should be the appropriate sentence? Three years' imprisonment was the sentence ultimately imposed by this court in Gonzales & Sarmiento [2002] EWCA Crim 2686, where some £700,000 in currency was brought to this country from South America in a single trip with efforts being made to hide involvement and avoid detection. In Yoonus [2005] 1 Cr App R (S) 46, four years' imprisonment was ultimately imposed for a course of conduct of laundering drugs money, converting sterling into foreign currency. Both those cases, however, concern the different circumstances of moving currency. Of greater significance, both followed guilty pleas. Credit for pleading guilty in this type of case is always substantial, not only because it allows the court to accept that the professional defendant has appreciated the gravity of his misconduct, but also because it has the effect of saving substantial court time and public funds.

Although the view of the learned sentencing judge is entitled to great deference, we have come to the view that his starting point for Mr Pattison was somewhat higher than it needed to have been. Organising the cover-up or laundering the proceeds of crime is always particularly serious, especially if organised or set up as an operation. Custodial sentences are absolutely inevitable in almost every case, if not every case, and this attempt to avoid confiscation is also serious. It is not, however, in our judgment, in an identical bracket to the other cases. It was, as we have said, a one-off attempt to hide profit from the court. This itself has given rise to substantial confiscation proceedings against Mr Pattison. We believe that the offences could have been met sufficiently by sentences of 27 months' imprisonment. In his case, therefore, the sentence of three years' imprisonment on each count concurrent is quashed and a sentence of 27 months imposed. To that extent his appeal succeeds.

The case of Mr Griffiths is somewhat different. In a lengthy letter to the court he has recounted the consequences of his conviction, although we underline that these are consequences brought entirely upon himself. Most significantly, he was acquitted of the more serious offences based on knowledge and suspicion and was convicted of failing to disclose to the authorities when he had reasonable grounds for knowing or suspecting that this transaction involved money laundering. Further, he was not making any great profit. The consequence: his practice as a solicitor is lost and he has suffered all the financial consequences of cessation and the difficulties that he will inevitably face seeking to earn a living. Rightly, he will be struck off the Roll of Solicitors. Without going into any further detail, the impact on his health and personal life has also been very dramatic. Having said all that, however, again we agree with the learned judge when he observed that society demands a high degree of professionalism from solicitors. They are one of the door keepers of financial probity in connection with this legislation and it is one of the obligations to which each one will be required to measure up to the hilt. In that regard, we also agree that a custodial sentence was equally inevitable. Need it have been as long as 15 months' imprisonment to make the point that has to be made?

In Duff [2003] 1 Cr App R (S) 88 page 466, this court dealt with a solicitor who pleaded guilty to two counts of failing to disclose knowledge or suspicion of money laundering in circumstances in which he had first been handed £60,000, part of which was for an investment, albeit all later returned, with £10,000 subsequently being placed into a company by that client set up to solicit business for the solicitor. The court rejected the submission that the custody threshold was not passed and dismissed an appeal from a six month sentence. That is not the same as saying that six months' imprisonment was the correct sentence.

In addition, Mr Carmichael has brought our attention to the Northern Irish case of McCartan [2004] NICA 43, in which a sentence of six months' imprisonment was reduced to allow for immediate release of a solicitor who failed to alert the police to suspicions that he was alleged to have had that the client of a mortgage broker with whom he had a professional relationship was engaged in money laundering the proceeds of drug trafficking. Once again, that particular appellant pleaded guilty. We repeat, as we have said in relation to Mr Pattison, that credit for pleading guilty in this type of case is always substantial. On the other hand, giving the judgment of the court, the Lord Chief Justice, Lord Kerr, referred to Duff and said at paragraph 18:

We also take the view that this offence is the product of a lapse in the high standards expected of a solicitor. To seek to put any further gloss upon it would be to go behind the verdict of the jury.

Having regard to all these circumstances, we take the view that in his case also the sentence was longer than necessary. We quash the term of 15 months and impose a term of six months' imprisonment. To that extent this appeal succeeds.

We do not leave the case without underlining to all professional people involved in the handling of money and with an involvement in financial transactions the absolute obligation to observe scrupulously the terms of this legislation and the inevitable penalty that will follow failure so to do.