R. v. Bath and Khangura

2012 BCSC 645 R. v. Bath and Khangura IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: R. v. Bath and Khangura, 2012 BCSC 645 Date: 20120410 Docket: X70890-1 Registry: New Westminster Regina v. Sikander Singh Bath and Manjit Singh Khangura Before: The Honourable Madam Justice H. Holmes Oral Reasons for Sentence Counsel for the Crown: D. Greenbank M. Ruhl Counsel for the Accused, Mr. Bath: K. Drolet Counsel for the Accused, Mr. Khangura: R. Enright Place and Date of Submissions: New Westminster, B.C. February 28-29, 2012 Place and Date of Sentence: New Westminster, B.C. April 10, 2012 [1] THE COURT: INTRODUCTION [2] I found Mr. Bath guilty of six counts of fraud and Mr. Khangura guilty of three counts of fraud, contrary to s. 380 of the Criminal Code, for dishonestly obtaining very large Goods and Services Tax (GST) refunds for numerous sham companies. The companies were not entitled to the refunds because they did no real business and had not paid or collected GST to be refunded. [3] Each count relates to a different company, each having a name that suggests that it is in the lumber or shake and shingle product business. The six companies in whose frauds Mr. Bath took part received a total of $7,980,122 between August 1994 and August 1997. The three companies in whose frauds Mr. Khangura took part received a total of $3,164,853 between May 1995 and May 1997. (In the calculation of the dollar amount of the frauds, one should note that one company, with total frauds of $1,290,852, is common to both Mr. Bath's and Mr. Khangura's frauds.) [4] The task now is to determine the appropriate sentences. One challenge in the determination is to identify sentences which sufficiently denounce the conduct and deter these accused and others, but which also recognize that Mr. Bath and Mr. Khangura, who are now in their forties and fifties respectively, were much younger men when they committed these offences in very different circumstances some fifteen to seventeen years ago. THE CIRCUMSTANCES OF THE OFFENCES [5] The offences were relatively straightforward. The sham companies were incorporated, and accounts in their name were established at various financial institutions in the Lower Mainland of British Columbia. The companies filed GST registration documents, and then began to file periodic claims for very large refunds for GST which they falsely claimed to have paid on goods and services used to produce exports from Canada. In reality, the companies did little or no business at all. The Canada Revenue Agency (CRA) issued refunds corresponding to the companies' claims, mostly by mailing cheques to the mail box addresses given for the claimant companies. Many of the refund cheques were deposited to the companies' accounts at various financial institutions, the proceeds often transferred or withdrawn as cash shortly after. Cash withdrawals from one financial institution in particular were in astonishingly large amounts. [6] It was clear from the evidence that Mr. Bath and Mr. Khangura did not act alone in the frauds. Mr. Paramjit Singh Gill, who was charged on the same indictment as Mr. Bath and Mr. Khangura, pleaded guilty to the charge of fraud common to those which Mr. Bath and Mr. Khangura committed, and also to the two other frauds which I found Mr. Khangura committed as well. As my reasons following the trial explain, a Mr. Tony Kondolay was also heavily involved in several of the frauds which I found Mr. Bath and Mr. Khangura committed. Further, as I found, Mr. Bath used a Mr. Zora Maan, an unsophisticated odd jobs worker who lived and worked at Mr. Bath's home, as a nominee director of some of the sham companies, and directed him to sign various corporate and banking documents and to pick up some of the large cash withdrawals. It seems likely that other people were also involved in the frauds, whether as equal parties with Mr. Bath or Mr. Khangura, or as nominees or front men they or others directed. [7] Mr. Greenbank advises that efforts to track the fraudulently obtained funds have been unsuccessful and that little or no chance of recovery remains. THE BACKGROUND OF THE OFFENDERS Sikander Singh Bath [8] Mr. Bath is now 41 years of age. He came to Canada with his mother and four older siblings at the age of five. He completed grade 10 at school and then left when his elder brother was seriously injured and responsibility for the family businesses was thrust upon him. Over the years, his family had built businesses which include several farms locally and in the United States, a fruit processing plant, and a large shake and shingle mill. [9] Mr. Bath has been married for 22 years and has three children aged 19, 17, and 9. The family lived in Mission until 2002, when they went to live with relatives while the family's current home was built. Eventually, the bank foreclosed on the home, but a friend purchased the home and allowed the Bath family to remain by renting it back to them. [10] Mr. Bath has had some serious mental health challenges. Mr. Drolet explains that Mr. Bath was diagnosed in the early 1990s with bipolar depressive disorder. He remains under medical care, even now, for that and various other medical challenges. Mr. Drolet also explains that Mr. Bath's mental health problems may have predated his diagnosis. In particular, with the eldest brother's injury and Mr. Bath's assumption of responsibility within the family, Mr. Bath measured himself against the needs and expectations of his extended family and felt himself lacking. Serious difficulties with self-esteem resulted. [11] Mr. Bath has had difficulty in the past with gambling. I am advised that by the mid-1990s, he had accumulated a debt of more than $1 million to a gambling house or houses in Los Angeles that then took legal proceedings against him. I am advised that, commendably, he has overcome his gambling problem. [12] Mr. Bath credits the support of his wife and family for helping him deal with his depressive disorder and with his gambling problems, and for helping ensure his continued compliance with the numerous conditions that his medical care requires. [13] Mr. Bath underwent bankruptcy proceedings, his assets all distributed, but unfortunately not in a fashion that satisfied all the debts owing. Mr. Bath is medically disqualified from employment, and, I am advised, receives Employment Insurance or some form of disability benefits. [14] I am advised that Mr. Bath's relationship with his extended family is strained, one infers largely because of the various difficulties I have mentioned and the public disgrace associated with these charges. [15] Mr. Bath filed a detailed letter from his family physician. Mr. Bath's physician advises that Mr. Bath's various conditions, including his mental health condition, require follow-up and close monitoring. The physician identifies a total of about thirteen past medical and mental health problems, and advises that Mr. Bath is currently prescribed about ten different medications. [16] Mr. Bath's health problems seem to have reached a peak in 1995 and 1996, and then again in 2002 and 2008. Under the advice of his physician, he made numerous trips to India in approximately 1995 and 1996 in an effort to reduce his stress. This appears to have been only partially successful. [17] Mr. Bath has one criminal conviction, on August 19, 1997, for assault. He received a suspended sentence and probation for one year. I am told that the offence related to a bar fight, and resulted from Mr. Bath having been intoxicated by a combination of alcohol and the prescription medication he was taking. I am advised that apart from in association with that event, substance abuse has never been a problem for Mr. Bath, and that he is taking great care to monitor the effects of his various prescription medications and to avoid any adverse effects from their combination with alcohol. [18] Mr. Bath has been on bail in relation to the charges on the indictment for a very great length of time, and has complied with the terms and conditions of his release assiduously. [19] Mr. Drolet advises that the one positive benefit arising from the trial is that Mr. Bath has been able to renew a relationship with Mr. Louis Clark, who was called by the Crown to testify about the shake and shingle industry. Mr. Clark is now attempting to help Mr. Bath return to a more productive role in society and in the industry. I am advised that he has employed Mr. Bath as a manager of a recycling plant that identifies wood products suitable for recycling. [20] Mr. Bath filed numerous letters of support from friends and family. Many speak of Mr. Bath's remarkable strength of character, and recognize his enormous compassion for other people and his desire to help those less fortunate than himself in the community. At the same time, they note that Mr. Bath is able to recognize the benefits he himself enjoys in having a good home and a loving and supportive spouse and children who care for him and for whom he cares very much. [21] Mr. Drolet submits that the letters can give the Court a very high degree of confidence that the Mr. Bath described in them is a very different man from the person who committed the offences for which he was found guilty in the trial. I do not doubt this, but I also note that many of the letters describe Mr. Bath over a very long period of friendship or acquaintanceship without express reference to a marked or fundamental change in his conduct or character at any stage. Also, many speak of Mr. Bath as an honest person, and express doubt that he could have committed these offences; however, I have found that he did commit these offences. [22] It is of some concern, also, that the detailed and thoughtful pre-sentence report notes that Mr. Bath "doesn't really remember details of his involvement in the offences because his memory has been affected by his illness", and reports "nor does he really know whether he did anything wrong". Furthermore, Mr. Bath "indicates that he has not profited from the offences", and notes instead how his health and his wife and children have suffered. [23] These reported comments, coupled with the content of letters written by certain close family members, give me concern that Mr. Bath's insight into his conduct and its effects is limited, despite the lapse of time, and that his rehabilitation, while well underway, is not complete. Manjit Singh Khangura [24] Mr. Khangura is nearly 57 years of age. He came to Canada with his parents at the age of 15. He has several brothers and sisters, and his father is still alive and lives with Mr. Khangura's siblings on the family farm in the Lower Mainland. [25] In their early days in Canada, the family had relatively meagre means. However, they gradually accumulated savings and purchased farmland, expanding their farming business as it proved successful, first into larger farms and later into property development, both residential and agricultural. Mr. Khangura worked outside the farm as well, first in a sawmill and later in trucking, mostly long-haul trucking. [26] Mr. Khangura left school in grade 11. As the eldest son after the unfortunate death of his brother, Mr. Khangura became the family decision maker. The businesses succeeded and Mr. Khangura's family situation was stable through the 1970s and 1980s, but both went awry in the 1990s. Mr. Enright advises that Mr. Khangura has difficulty identifying why the problems occurred, but the reasons seem to have included a particularly bad construction deal in the early 1990s, bad business arrangements with long-time family friend, Mr. Kondolay, who I mentioned earlier, and Mr. Khangura's own substance abuse problems with alcohol and, eventually, cocaine. Mr. Khangura does not suggest that the offences were motivated by an urge to feed his addiction. Rather, he indicates that his substance abuse reflected his low state of mind at the time. [27] Eventually, the family businesses went bankrupt and the assets were lost. Mr. Khangura drifted from his wife and children, and divorced in 1998. He hit an all-time low in the late 1990s in all his family relationships, and eventually realized that he needed to rebuild his life. He was then fortunate in meeting his new wife and forming a new family, including two children from her former marriage as well as the young son they have had together. Mr. Khangura is very close to his young son, who is now 10 years of age. For the past four years the family has lived in a townhouse in Abbotsford owned by Mr. Khangura's father. [28] Mr. Khangura has resumed trucking, and has rebuilt his credit and financial position enough to enable him to buy an older truck, from which he makes a living. He values the truck at approximately $12,000. [29] Mr. Khangura was unaware of the investigation until 2001, some five or six years after the events in question. His arrest in 2002 came as a shock, and has been the source of great shame and embarrassment, largely because of the media coverage in the Indo-Canadian press. Hardest for him to witness has been the resulting stress on his family, especially the two elder children of his second wife. [30] Mr. Khangura is extremely concerned about the effect of a period of imprisonment on his relationship with his young son and on his family's financial well-being. His wife earns a modest income at a packing plant which, he fears, will be insufficient to support the family. Mr. Khangura fears that he may need to sell the truck to provide financial support. [31] The pre-sentence report outlines various health issues, including several that require ongoing care. [32] Mr. Khangura has one previous criminal conviction from March 13, 2000, for impaired driving and failing or refusing to provide a breath sample, with a $300 fine for each offence. [33] Mr. Khangura has been on bail supervision since his arrest in 2002, and reported in person to his bail supervisor until late 2009 or early 2010. This created challenges for him in his employment, which required ready contact with employers, and involved long-haul trucking. He nonetheless complied perfectly. Appointments with counsel and appearances in court in the lengthy trial made for further difficulties in his ongoing employment. I am told that often he drove at night and attended court during the day, in order to provide for his family. [34] Mr. Khangura has filed more than a dozen extremely helpful and supportive letters from his physician, family, and friends. They describe him as hard-working and dependable, dedicated to his immediate and extended family, and as a good person at his core. The writers describe Mr. Khangura as a person who looks to make a positive difference where he can, such as by helping out at the local wrestling club. [35] Various people close to Mr. Khangura made note of the significant and negative changes in his life in the 1990s. Many of those people associate those changes with his substance abuse at the time. Several people describe Mr. Khangura as now a changed person who is back on a productive and family-oriented track. They also note the stresses that the court process has caused him and his immediate family. [36] At least one of the writers describes Mr. Khangura as incredibly remorseful for what he has done. That remorse also was evident in the remarks Mr. Khangura personally made to the Court following Mr. Enright's submissions. THE APPLICABLE SENTENCING PRINCIPLES General Principles [37] The general principles that govern the determination of a fit sentence are found both in our common law and in the Criminal Code, in s. 718 and the neighbouring sections. [38] The fundamental purpose of sentencing is to contribute to respect for the law and the maintenance of a just, peaceful, and safe society. That purpose underlies six main sentencing objectives: (1) denunciation of the offending conduct; (2) deterrence of the offender and of other people from criminal conduct; (3) separation of the offender from society where necessary; (4) rehabilitation of offenders; (5) reparation to victims or the community; and (6) the fostering of the offender's acknowledgement of responsibility and of the harm done to victims and the community. [39] The relative emphasis to be given to the various objectives will vary according to the particular offence and the particular offender. It is clear from the case authorities, as well as from the circumstances, that these offences require particular emphasis on denunciation and deterrence. [40] Further principles of sentencing, designed to help achieve the sentencing objectives I have outlined, are set out in ss. 718.1 and 718.2 of the Criminal Code. They include that a sentence should be proportionate to the gravity of the offence and the degree of responsibility of the offender, and should be similar to sentences imposed on similar offenders for similar offences committed in similar circumstances. A sentence should be increased or reduced to reflect any relevant aggravating or mitigating circumstances relating to the offence or the offender. An offender should not be deprived of liberty if less restrictive sanctions may be appropriate in the circumstances. THE CROWN'S POSITION [41] Mr. Greenbank submits that general deterrence must be emphasized as the primary sentencing principle in cases such as this, where the frauds were long-lasting and involved excessive financial gain. He submits that the public can be protected from further fraud only by the imposition of sentences that are likely to deter similar conduct by others. Denunciation should also play a large part, because the scheme underlying the frauds attacked the very essence of the GST system, which relies on the honesty of registrants in their reporting. [42] Mr. Greenbank submits that the range of appropriate sentences for frauds is wide and takes account, among other things, of the financial amount involved. These offences should therefore fall near the high end of the range. If the Court concludes that the offenders' financial positions do not permit large fines or restitution orders, he submits that given the size of the frauds -- close to $8 million in Mr. Bath's case and about $3 million in Mr. Khangura's -- the case authorities support a sentence of seven years' imprisonment for Mr. Bath and five years' imprisonment for Mr. Khangura. [43] However, Mr. Greenbank also agrees that certain circumstances mitigate that position. In addition to the mitigating factors noted by the defence, which I will discuss shortly, Mr. Greenbank submits that Mr. Bath's and Mr. Khangura's participation in the court process over a very lengthy period of time demonstrated a true respect for the court process, for counsel, and for the Court. THE DEFENCE POSITION Sikander Singh Bath [44] Mr. Drolet submits that sentencing for large frauds is not a mathematical calculus, but rather must assess the offender's moral culpability and the potential threat he poses to the community. He submits that the evidence makes clear that Mr. Bath poses no ongoing threat to the community, and that the circumstances allow Mr. Bath's moral culpability to be viewed as less severe than in cases where, for example, fraudsters target vulnerable individuals with no apparent remorse. Mr. Bath accepts the Court's verdict and fully accepts responsibility for his offences. [45] Mr. Drolet submits that the appropriate range of sentence is between approximately two and four years' imprisonment. He submits that the sentencing objectives would be fully satisfied in relation to Mr. Bath's offences by a conditional sentence of imprisonment of two years less a day, including house arrest, followed by three years' probation. [46] Mr. Drolet submits that if the Court concludes that a conditional sentence of imprisonment is not appropriate, then the period of imprisonment should be no longer than three years. Manjit Singh Khangura [47] Mr. Enright endorses the range of sentence Mr. Drolet outlines. He submits similarly that sentencing for large frauds involves more than a correlation of the dollar amount of the frauds to the length of the prison sentence. Sentencing must take a more nuanced approach, examining also the particular harm done by the offender and the circumstances of the offender, both at the time of the frauds and at the time of the sentencing. [48] Mr. Enright submits that Mr. Khangura has fully demonstrated his remorse in the decade and a half since the offences. He committed the offences in the aftermath of his family's financial collapse and in the throes of his consequential substance abuse, the loss of his first marriage, and the loss or near-loss of his relationship with the children of that marriage. He has risen above those events to build a life around not material items, but rather socially-valuable relationships. [49] Mr. Enright submits that with the strong family support he enjoys and his stable place in the community, Mr. Khangura would perform well under a conditional sentence of imprisonment of two years less a day, or a shorter period, and that both he and his family and the larger community would benefit from that form of sentence. THE APPLICATION OF THE SENTENCING PRINCIPLES IN THIS CASE Aggravating and Mitigating Circumstances [50] I agree with Mr. Greenbank that the following are aggravating circumstances in the case: · the frauds undermined the honour system on which the GST system relies · they involved premeditation and planning through the use of companies incorporated for the purpose · the frauds continued over a significant period of time -- Mr. Bath's frauds over a total period of approximately three years, Mr. Khangura's frauds over a total period of approximately two years -- and they involved a large number of transactions · the dollar amounts of the frauds were very significant and are at the high end of the range of known GST frauds · the frauds affect all Canadian taxpayers and those who benefit from services funded by the Government of Canada · there is little hope of recovery of any of the fraudulently obtained funds · Mr. Bath and Mr. Khangura committed the offences not from necessity but, it must be inferred, out of greed. [51] Mitigating circumstances include the following: · Mr. Bath and Mr. Khangura have no record for similar offences · because other people were involved in the offences, one cannot conclude that Mr. Bath and Mr. Khangura each received the entire proceeds of their frauds · a very long time has passed since the offences, and since Mr. Bath and Mr. Khangura were arrested and charged for the offences · during that very long time, each of Mr. Bath and Mr. Khangura have dedicated themselves to restoring their medical and emotional health and their family and social relationships, and have given valuable service to the community · over the lengthy period of the trial and the earlier court proceedings, Mr. Bath and Mr. Khangura each showed respect for the Court and its processes, demonstrating maturity and recognition of the consequences of their conduct · as I have already noted, each of Mr. Bath and Mr. Khangura complied scrupulously with Court-imposed conditions over a long period of time, and · as I find, Mr. Khangura in particular has come to understand the effects of his offences and feels profound remorse for their consequences. The Main Sentencing Objectives for these Offences [52] The present offences call for sentences that send a strong message of denunciation and condemnation, and that are sufficiently severe to deter other people from similar conduct. [53] Offences of this type are relatively easy to commit, because the GST reporting system relies in large part on the honesty of its registrants. It is to the benefit of the community as a whole that the system be able to do so. [54] These offences are more readily deterred than offences which are committed on impulse in the heat of the moment without foresight or planning. Offences such as Mr. Bath's and Mr. Khangura's, which were directly motivated by financial gain, are typically committed in the full light of day, the relative risks and benefits calmly assessed. When those offences are detected and the offenders convicted, the sentences therefore need to send a message that the risks are not worth taking. Imposition of a Fine? [55] Large frauds such as these invite a consideration of fines or restitution orders as part of the sentence. The frauds removed millions of dollars of taxpayer money that might otherwise have been used for the benefit of the Canadian public. Large fines or restitution orders could provide some reparation for the harm done, as well as helping to fulfil some of the other sentencing objectives. [56] However, s. 734(2) of the Criminal Code says that a court may not impose a fine unless satisfied that the offender is able to pay the fine. [57] In the case of R. v. Topp, 2011 SCC 43, [2011] 3 S.C.R. 119, Mr. Justice Fish explained that, as a practical matter, s. 734(2) prevents a court imposing a fine unless sufficient evidence or information satisfies the court, on a balance of probabilities, that the offender can afford to pay the fine. Mr. Greenbank explains that the Crown can offer no such evidence or information here. [58] In appropriate circumstances, a court may infer from the very frauds themselves that the offender has the necessary funds to pay a fine at the time of sentencing, especially if the offender offers no explanation about what happened to the fruits of the fraud. However, a court is not bound as a matter of law to draw that inference, and the strength of any inference the court does draw will depend on the circumstances. [59] There is some evidence to suggest that Mr. Bath is not financially destitute. For example, he funds, or expects to fund, post-secondary education outside the country for his two young adult children. [60] However, other factors suggest that an inference based only on the fact and financial size of the frauds would not reliably assist in this case. The CRA has evidently tried to trace or recover the proceeds of the frauds without success. Also, it seems unlikely that Mr. Bath and Mr. Khangura each enjoyed the entire proceeds of the frauds because, as I have mentioned, other people were involved in their commission. [61] In my view, in all the circumstances, s. 734(2) prevents the Court imposing a fine as part of Mr. Bath's and Mr. Khangura's sentences. Paramjit Gill's Sentence [62] Section 718.2(b) requires a sentence to be "similar to sentences imposed on similar offenders for similar offences committed in similar circumstances". [63] Co-charged with Mr. Bath and Mr. Khangura with some of the offences on the indictment was Mr. Paramjit Gill. After committal for trial in this Court, but before the start of the trial, Mr. Gill entered guilty pleas to three offences of fraud. According to one of the terms of his detailed plea agreement with the Crown, which is described in reasons I gave after Mr. Bath's and Mr. Khangura's trial (2011 BCSC 1726 at paras. 45-49), Mr. Gill was not sentenced until after he had testified for the Crown in the trial. [64] Mr. Gill was sentenced by another judge of this Court on February 3, 2012. Counsel advise that the Court accepted a joint submission, contemplated in the plea agreement, that Mr. Gill be sentenced to a conditional sentence of imprisonment for two years less a day. The Court imposed no fine because Mr. Gill appeared unable to pay one. [65] Mr. Gill was not an impressive witness in the trial and I found much of his evidence to be unreliable. Mr. Drolet submits that the sentences now to be imposed on Mr. Bath and Mr. Khangura should not send the message that more lenient treatment results from telling the story that the CRA appears to want to hear, and from lying to the Court, than from asserting one's right to a trial. [66] I agree that such a message would be unfortunate and inappropriate. However, in my view several factors distinguish Mr. Gill's situation. Perhaps most important is that, as Mr. Greenbank advises, Mr. Gill's sentencing proceeded on the basis of different facts from those before the Court after Mr. Bath's and Mr. Khangura's trial. But also several mitigating factors applied in Mr. Gill's situation that do not apply here. At a relatively early stage, Mr. Gill entered guilty pleas to the three fraud charges he faced, and thus removed the need for a trial in relation to his offences. He cooperated in interviews with the CRA and with Crown counsel, and he underwent the process of testifying in the trial for a total of almost 12 days, almost nine of those days under challenging cross-examination. His cross-examination spanned a long period of time while the trial was stood down, because events transpired which required investigation before the trial could continue. [67] Mr. Gill's sentence is a factor to be considered in determining the appropriate sentences for Mr. Bath and Mr. Khangura, but in my view sentences equal or even equivalent to his are not necessarily required. Case Authorities [68] I have been given numerous helpful case authorities and I will mention only some of them. [69] In R. v. Elless, 2007 BCSC 962, the fraudulent GST refund scheme was identical to the scheme by which Mr. Bath and Mr. Khangura committed these frauds. Ms. Elless, in conjunction with two companies, falsely claimed and obtained a total of $1,248,709 in input tax credits over the course of several years, and she and the companies were convicted of dozens of counts under the Excise Tax Act. In sentencing her to four years' imprisonment, as well as imposing a fine in the amount of the funds obtained (under s. 327(1)(d) of the Excise Tax Act), Madam Justice Sinclair Prowse, at para. 21, quoted the comments made by The Honourable Judge Miller in R. v. Hofbauer, 2004 BCPC 604, to describe the scheme as not just a failure to pay taxes owed, but rather "... a much more predatory scheme wherein the participants took positive steps to fraudulently obtain a very large amount of money from the government that they never had any claim to at all anytime". That description also applies here. [70] Sinclair Prowse J. also described the range of sentences she gleaned from the authorities (at paras. 52-53): 52 As the cases presented in this hearing disclosed, the governing principles of sentencing for the commission of this type of offence are denunciation and deterrence. That is, the sentence must be one that denounces the conduct, that deters other people from committing similar offences, and that deters you from committing similar offences in the future. 53 The specific range of sentence as set out in such cases as R. v. Hofbauer, 2004 BCSC 1810 and R. v. Rodney, 2004 BCSC 1780, for this type of offence with the mitigating circumstance of a guilty plea and without significant aggravating circumstances is between 18 and 36 months' imprisonment, and with aggravating circumstances is between three to five years' imprisonment. [71] Mr. Greenbank referred to other cases with particularly aggravating features where the sentences for multi-million dollar frauds fell even higher than that range. For example, in R. v. DiGiuseppe, 2008 ONCJ 127, aff'd 2010 ONCA 91, a large scale ($3.5 million) fraud and tax evasion resulted in a six-year sentence. [72] Mr. Drolet submits that the cases where the sentences fall toward the high end of the range generally involve conduct with greater moral culpability. In R. v. Bertram (1990), 40 O.A.C. 317, for example, the offences were treated as extremely serious because they involved the deceitful behaviour of a trusted person. In R. v. DiPalma, [2001] O.J. No. 3586 (S.C.J.), the offender breached the trust he owed to his clients. In R. v. Hofbauer, 2004 BCPC 604, var'd in part 2004 BCSC 1810, the offender was an employee of Revenue Canada and he exploited the system he had a responsibility, in a position of trust, to protect. In R. v. Lear, [2001] M.J. No. 397, the offender disposed of assets in an attempt to make himself judgment proof, and continued his criminal activities after his arrest. In R. v. Biller, 2005 BCSC 1278, the offences had profound personal consequences for the victims. And in Elless, the offender lacked remorse and, in testimony that the judge rejected, blamed other people, including her sister. [73] Mr. Drolet submits that, as in determining fit sentences for historical sexual offences, the Court here must take account of all of the sentencing principles, including the principles which recognize the value of the offender's rehabilitation and which keep offenders in the community unless removal is necessary to protect the public. He submits that the sentences suggested by the Crown are simply outside the applicable range. He notes, for example, that in R. v. Gray (1995), 95 D.T.C. 5262 (Ont. C.A.), the Ontario Court of Appeal upheld sentences of two and one-half years and two years less a day, respectively, for the two accused. Similarly, in R. v. Port Oldsmobile Chevrolet Ltd., 2010 BCCA 47, the B.C. Court of Appeal upheld sentences of imprisonment for two years less a day plus fines totalling the amount of the false claims, resulting from charges under the Excise Tax Act for false claims for GST input tax credits totalling nearly $7 million. And, in R. v. Tulloch, [2002] O.J. No. 5446, a guilty plea in relation to a scheme to buy and sell non-existent heavy equipment over the course of eight months resulted in a conditional sentence of imprisonment for two years less a day. Mr. Drolet submits, with Mr. Enright concurring, that those sentences demonstrate that the range is wider than suggested by the Crown, and, even for offences involving very large dollar amounts, allows for sentences lower than the range the Crown suggests. [74] Some of these, and other cases involving sentences of approximately two years imprisonment, involved significant mitigating factors, such as guilty pleas, which do not apply in Mr. Bath's and Mr. Khangura's cases. Others of those cases involved charges under the Excise Tax Act, where the maximum term of imprisonment is significantly lower than the maximum terms for Criminal Code frauds, and where very substantial fines typically form part of the sentence. [75] In my view, Mr. Bath's and Mr. Khangura's offences require sentences which send a stronger message of denunciation and deterrence. [76] It is true that sentencing for offences of this type is not a mathematical exercise. But, as I have noted, society's denunciation of the offences and the deterrent effect of the sentence have meaning only if the sentence responds meaningfully to the magnitude of the fraud. It is therefore no surprise that, as Mr. Greenbank notes in his submissions, sentences for frauds of several million dollars or more generally result in sentences at the upper end of the range. [77] However, in my view the sentences also require some mitigation to reflect the various factors I have noted earlier, including, in particular, the length of time that has passed since the commission of the offences and since Mr. Bath and Mr. Khangura were arrested and charged. [78] The passage of time has several effects. It has allowed for rehabilitation, including by Mr. Bath and Mr. Khangura coming to understand the consequences of their offences for society at large, as well as for those around them. As I have noted, in my view Mr. Khangura's rehabilitation is more complete than Mr. Bath's. [79] The passage of time before sentencing has also prolonged the onerous direct and indirect effects of the court proceedings and the charges that preceded them on the accused. Direct effects include that Mr. Khangura has been unable to work during the lengthy trial, or has had to work at night while attending court in the day. Mr. Bath was less affected in this manner because he has been unable to work for medical reasons. Indirect effects include the stress and the uncertainty for Mr. Bath's and Mr. Khangura's families, as their counsel and their letters of support so powerfully describe. [80] Taken as a whole, Mr. Bath's offences are, I conclude, even more serious than Mr. Khangura's. Mr. Bath's offences are double in their number and more than double the total dollar amount of Mr. Khangura's. Mr. Bath's offences were also committed over a longer period of time. SENTENCE [81] I ask you each to stand please, Mr. Bath and Mr. Khangura. I am going to impose sentence. [82] Mr. Bath, on each of the six charges of which I found you guilty, I sentence you to imprisonment for four and one-half years. The sentence on each count is to be served concurrently to the sentences on each of the other counts. [83] Mr. Khangura, on each of the three charges of which I found you guilty, I sentence you to imprisonment for three years. The sentence on each count is to be served concurrently to the sentences on each of the other counts. [84] Are there any supplementary orders that need to be considered, counsel, or any points of clarification? [85] MR. GREENBANK: No, My Lady. [86] MR. DROLET: No, My Lady. [87] MR. ENRIGHT: No, My Lady. [88] THE COURT: Thank you. We will adjourn. "H. Holmes, J." The Honourable Madam Justice H. Holmes