Sarah McPhee
Adam Cranston pocketed $6.8 million from a $105 million scheme to defraud the Tax Office and has accepted he faced a “relatively long” prison sentence but denied he was top of the tree in the conspiracy, his barrister has told a court.
Cranston, 36, was found guilty in March of conspiring with others, including his sister Lauren Cranston, to dishonestly cause a loss to the Commonwealth and conspiring to deal with more than $1 million believing it to be the proceeds of crime.
Using a tiered network of companies, the conspirators skimmed PAYG (pay as you go) withholding tax and GST out of money received from legitimate clients of payroll business Plutus Payroll, and failed to remit $105 million to the ATO between March 2014 and May 2017.
The Crown at trial said Cranston splashed cash on luxury cars including a Mercedes and Porsche, a $240,000 deposit and loan repayments for a Cirrus SR22 single-engine plane, and properties at Vacy in the Hunter Region and Miranda and Burraneer in Sydney’s Sutherland Shire.
At Cranston’s sentence hearing in the NSW Supreme Court on Wednesday, barrister John Stratton, SC, submitted that his client received a personal benefit of $6.8 million, but jailed co-conspirator Simon Anquetil had received a benefit of $12 million.
“It reflects the differences in their role,” Stratton argued.
He argued Cranston acted impulsively but accepted he was facing a “relatively long” prison sentence.
Stratton said Cranston was diagnosed with ADHD when he was nine, struggled at school and did not complete university but managed to obtain employment and had continued to work in custody.
Cranston is the son of former ATO deputy commissioner Michael Cranston, who is not accused of any wrongdoing.
“It seems that Mr Cranston felt he was a disappointment to his father,” the barrister said.
He said his client spent five weeks in segregation as “he was regarded as a high-profile inmate”.
Stratton said Cranston had a detailed history of drug abuse, including suffering from cannabis use disorder, and submitted that “for much of the time of the offending ... he was affected by substances”.
Justice Anthony Payne said Cranston had pleaded not guilty and “continues to assert his innocence” but there was “some limited insight into the offending” in medical reports tendered by the defence.
Stratton said there was evidence of contrition from Cranston to a psychiatrist when he described his conduct as “wrong, stupid and greedy” and said, “I did not realise the gravity of what I did.”
He said Cranston had no prior criminal record and argued he had good prospects of rehabilitation.
Crown prosecutor Rae Sharp, KC, submitted Cranston was one of the principals of the conspiracy involved in key decisions and “made a conscious decision to engage in this offending”.
“When one considers the sophisticated nature of the scheme [and] the number of steps that were taken in order to plan and implement the offending, including steps taken to avoid detection, these are all very intentional and targeted steps,” Sharp said.
Paraphrasing one of the defence reports, the prosecutor said Cranston had described feeling “stuck” and thinking, “I’m in for a penny, in effect, I’m in for a pound now”.
“He’d been in for a pound from the start, that was the entire purpose of the scheme from the outset,” Sharp said.
She said Cranston had previously established a business as an individual, and it was a capacity that “might still be open to him on his release”.
In response, the judge said there was a “notoriety” attached to Cranston through his name and his relationship to his father.
Payne noted he was grateful to Commonwealth authorities for “facilitating the course of justice” by funding Cranston’s lawyers for the sentence hearing, after a previous refusal by the attorney-general.
Lauren Cranston was jailed for a maximum of eight years, his school friend Patrick Willmott for nine years and solicitor Dev Menon for 14 years. Cranston and former professional snowboarder Jason Onley, whom the Crown labelled at trial as “one of the biggest spenders” in the fraud, will be sentenced for their roles on Tuesday.