Overview

[1] On April 2, 2013, I found the defendant John Umenwoke guilty of defrauding Liquid Capital Exchange Corporation (“Liquid Capital”) of a sum of monies exceeding $5,000, between April 1, 2009 and May 5, 2009, contrary to section 380(1)(a) of the Criminal Code; see R. v. Umenwoke, 2013 ONSC 1629. He is now before me for sentencing. Sentencing submissions began on May 24, 2013 and Mr. Umenwoke testified with respect to his position that he lacks the financial means to make restitution. The hearing was adjourned in order for him to obtain and produce certain bank records and provide more specific medical evidence.

The Facts

(a) Circumstances of the Offence

[2] Liquid Capital is in the factoring business and funds accounts receivables of corporations. If after conducting their due diligence, Liquid Capital is satisfied that their requirements are met, they typically advance in the range of 75-85% of the amount of the receivables to the corporation. The receivables are then paid directly to them and when they are collected by Liquid Capital they remit the amount collected less their fees. Their fee averages between 2.5-3.5% for the first thirty days with the percentage charged increasing thereafter.

[3] In this case Liquid Capital advanced $75,650.60 in U.S. currency to Unified Solution Providers Inc. (“Unified”) in April 2009, based on information purporting to come from the 95% owner of Unified, Solomon Idiaraba, and on the strength of receivables represented to be owed by a company in Ghana.

[4] In deciding to find Mr. Umenwoke guilty of perpetrating a fraud on Liquid Capital, I found that he impersonated Mr. Idiaraba both in person and in creating and signing documents in his name, which led to credit checks of that person by Liquid Capital rather than Mr. Umenwoke, that he held out Mr. Idiaraba as a 95% shareholder of Unified when in fact the company was incorporated and 100% owned by his former girlfriend, that Mr. Umenwoke was the operating and directing mind of Unified, that his former girlfriend’s shares were held for his benefit and that Mr. Idiaraba, if he exists, did not own a majority interest in Unified. For these reasons I concluded that Mr. Umenwoke used deceit and falsehood in the application process to Liquid Capital seeking an advance and, as a result of his deceit, the funds were advanced by Liquid Capital. Mr. Umenwoke received most of those funds. Liquid Capital never recovered any of the money that it advanced and as such was deprived of $75,650.60 US.

(b) Impact on Liquid Capital

[5] Liquid Capital filed a victim impact statement. It itemized additional fees and charges which I presume are in accordance with the factoring agreement as well as the cost of litigation and time spent by the president of the company on this matter. Needless to say the losses incurred by Liquid Capital far exceed the amount originally advanced. The statement goes on to say that in the Unified transaction two of Liquid Capital’s franchisees participated, each funding 50% of the transaction, and those franchisees have since left the system. It states as well that Liquid Capital had never previously nor subsequently had a loss on a participation and so this transaction has caused harm to its reputation. Now when asked if Liquid Capital has ever had a loss on participation they have to say yes.

(c) Circumstances of Mr. Umenwoke

[6] I received a Pre-Sentence Report (“PSR”) for Mr. Umenwoke. Mr. Umenwoke is 63 years old. He has no criminal record. He has eight brothers and seven sisters and his mother is still alive. They are all living in Nigeria along with his four children. He married in his early twenties in Nigeria. He is now estranged from his ex-wife. He told the author of the PSR that he is estranged from his children as well but that is at odds with the letter from his daughter that I will come to. Mr. Umenwoke was religiously raised as a Jehovah Witness. He was employed as an evangelical Jehovah Witness preacher between the ages of 18 and 21. He is a graduate of the University of Nigeria with a Bachelor of Science Degree in Computer Science. After he graduated from university in Nigeria, Mr. Umenwoke was employed as a secondary school teacher there. He fled to Canada in 2006 because in Nigeria he was being persecuted for his religious beliefs. He is now a Canadian citizen.

[7] Mr. Umenwoke’s daughter’s letter to the court states that she and her family are very surprised that he has been found guilty of a crime. She states that her father is known as a preacher and that he has been a good provider and that she and her brothers have had a university education in Nigeria that Mr. Umenwoke paid for. They Skype with their father every week and she states that he has been a source of strength and encouragement to her and her family. On behalf of his children she begs the court for mercy because of her father’s bad health. She asks that he be given a second chance.

[8] A letter from an ESL instructor, Mr. Duru, states that he has known Mr. Umenwoke as an evangelizer for four years and that he helps people in need unreservedly. He finds the crime that Mr. Umenwoke has been found guilty of to be completely out of character for him. The probation officer also contacted Mr. Duru and he expressed his belief as to why this offence occurred which is not admissible.

[9] Mr. Umenwoke also provided a letter from an accountant who has known him for more than three years. He describes Mr. Umenwoke as a well-trained IT professional who is very good at fixing and building computers. He lives in the same community as Mr. Umenwoke and says he is very peaceful and not a threat to the peace and safety of the community in any way. He also states that the crime Mr. Umenwoke was found guilty of is completely out of character for him. He is also concerned about Mr. Umenwoke’s bad health.

[10] The probation officer contacted Mr. Chima who is Nigerian Canadian and is employed as a lawyer. He has known Mr. Umenwoke for about three years. Mr. Umenwoke services his computers. He told the author of the PSR that he has no reason to doubt Mr. Umenwoke’s integrity and that he does not believe that Mr. Umenwoke is actually “criminally minded”.

[11] Mr. Umenwoke presented as “polite, pleasant, cooperative, compliant, and remorseful” to the probation officer. He reports that Mr. Umenwoke is extremely anxious about the possibility of being placed in custody and is afraid that his health would deteriorate quickly there. The probation officer concludes that Mr. Umenwoke appears to be a suitable candidate for a possible disposition of community supervision.

[12] With respect to Mr. Umenwoke’s medical condition, medical reports were provided to the probation officer and to the court. Mr. Umenwoke’s family doctor is Dr. Issar. He provided a handwritten letter to the court stating that Mr. Umenwoke suffers from sleep apnea, severe hypertension, hypertrophic cardiomyopathy and benign prostatic hyperplasia. He requires a CPAP machine for his sleep apnea which must be used every night. He is monitored frequently by his specialist and family doctor for his numerous medical conditions. He is also on numerous medications for these ailments.

[13] Following the adjournment, I received a further letter from Dr. Issar dated June 10, 2013. The additional information is as follows. Mr. Umenwoke had surgery last year related to his diagnosis of benign prostatic hyperplasia and is under observation by his urologist who is afraid it may become cancerous. Dr. Issar reports that Mr. Umenwoke is receiving homemaking services that have helped him to recover from this surgery. Dr. Issar states that Mr. Umenwoke has a considerable number of chronic diseases namely cardiac, renal, urological and musculoskeletal and that he requires follow up from a number of specialists. He has back pain issues which are being monitored regularly and at his home by physiotherapy and an occupational therapist. He has a kidney problem that is under control and is regularly monitored.

[14] Dr. Issar included a list of some fourteen doctors and clinics that Mr. Umenwoke uses. He sees the doctors monthly and those visits result in required lab visits. Dr. Issar states that the list does not include unscheduled and emergency visits due to sudden changes in his health. He concludes as follows: “In view of all these health issues John Umenwoke is struggling with at this time, the effect of incarceration will destroy the progress made so far to cure and rehabilitate him. He may even die if incarcerated.”

[15] Mr. Umenwoke’s cardiologist is Dr. Saleem Kassam. No letter was filed from Dr. Kassam as he was out of the country at the time of the original sentencing hearing. Although this was one of the reasons the sentencing hearing was adjourned, no further information was provided from him. Based on the information I do have, it appears that Dr. Kassam referred Mr. Umenwoke to a cardiology specialist, Dr. Howard Leong-Poi, for possible hypertrophic, who saw him in May and December 2010. In a letter from Dr. Leong-Poi to Dr. Kassam of December 19, 2012, Dr. Leong-Poi states that based on his various tests he believes Mr. Umenwoke does suffer from hypertrophic cardiomyopathy. Mr. Umenwoke was to see Dr. Leong-Poi again this spring.

[16] In a letter from Dr. Leong-Poi to the court dated May 9, 2013, the doctor states that he is following Mr. Umenwoke for a serious cardiac condition that requires regular clinic visits and clinical assessment. He goes on to say that Mr. Umenwoke is on heart medications that require monitoring and adjustment depending on clinical symptoms and test results. He is followed by a respirologist for his sleep disorder. The doctor concludes that any living conditions that restrict Mr. Umenwoke’s ability to have his health monitored and treatments adjusted could negatively impact his health and long-term wellness.

[17] As for Mr. Umenwoke’s ability to make financial restitution there is no dispute that since December 2010 he has been supported by the Ontario Disability Support Program (“ODSP”). He clears $865 a month from his payments which are to cover his basic needs including shelter, special diet and other medical expenses. An additional amount is paid to subsidize his housing.

[18] Mr. Umenwoke testified at the sentencing hearing. He said that he has no other income apart from the $865 a month he receives as a disability pension from ODSP. He does not own a house anywhere. According to Mr. Umenwoke the Limevale Crescent property was owned by Solomon Idiaraba. He said that he did not have any interest in it or any other property in Canada. It was sold by the bank in 2009. Mr. Umenwoke testified that he has no investments anywhere and no money in the bank.

[19] Mr. Wright wanted to do some due diligence with respect to this information and it was agreed that Mr. Umenwoke would provide copies of his bank statements with the National Bank of Canada and the Royal Bank of Canada from January 2003 to the present. When the sentencing hearing resumed on June 18th, Mr. Wright advised me that he was satisfied as a result, that Mr. Umenwoke currently lacks the financial means to make financial restitution.

[20] Mr. Wright also examined Mr. Umenwoke about the private investigator report that Liquid Capital obtained before the trial, showing him selling a van. Mr. Umenwoke said he sold that van for $300. He had also told the private investigator that he was purchasing a new Nissan minivan. Mr. Umenwoke testified that he still has that car and its worth about $3,000. It is however, a 2004 and not roadworthy at the moment. He does not have money to fix it.

[21] With respect to his time in the United States, Mr. Umenwoke testified that he had a student visa for the United States and was working when he was attending Northwood University, in the computer lab, servicing computers until his health did not allow him to continue. He stated that he was only going to school in Michigan and had no property in the United States. Mr. Wright questioned this as he had found a corporate registration showing Mr. Umenwoke as a registered agent for Network Computer Reboot Incorporated showing that it was active with 1,300 shares. Mr. Umenwoke testified that Computer Reboot was a company he was using to buy computer parts, that it’s a closely held corporation and he owns all the shares and it is dormant. Although his explanation was not clear he testified that he had to file corporate papers in Michigan under the corporate name. Mr. Umenwoke stated that the Ontario Computer Reboot company is also dormant and not operational. This evidence was never contradicted.

[22] When Mr. Umenwoke was called by Mr. Okoronkwo to speak to his assets, almost immediately he turned to the court and spoke very sincerely and without prompting from his counsel. He continued on even though Mr. Okoronkwo was trying to get his attention. He told me that he was very sorry for what he had done and that he was sorry for the trouble that he had caused Liquid Capital and the Crown and that this was not because he got caught. He said this conduct was not in his character or personality, that he was ashamed, that there was no justification for what he did and that he did it because of financial pressures given his children were in school and he was going to university in the United States. He acknowledged that he had not shown a good example for his children and he asked that I show him some mercy. Mr. Umenwoke testified that if he had property he would sell it and pay the amount owing to Liquid Capital. He stated that where he comes from “we are proud people” and that what was happening to him was very shameful because of his “wrong thinking”.

[23] At the conclusion of the sentencing hearing Mr. Umenwoke again took the opportunity to address me. He reiterated many of the same things that he had told me earlier. He told me that he would never do anything like this again and that he was willing to use his computer skills to teach computer skills to children or persons in jail and do community service to make restitution.

[24] Although Mr. Umenwoke’s counsel may have preferred that he not make this statement so that he could maintain his innocence on any appeal, I found these statements, particularly the one made spontaneously by Mr. Umenwoke when he took the stand, to be very sincere. It was as if he had to unburden himself with his guilt and shame. In my view this is a very important step in Mr. Umenwoke’s rehabilitation.

Legal Parameters

[25] Fraud over $5,000 is a serious offence and the maximum sentence is fourteen years pursuant to section 380(1) of the Criminal Code.

Positions of Crown and Defence

[26] Mr. Wright submitted that a fit sentence in this case would be eighteen months incarceration plus probation of twelve months which should include community service. At the original date for the sentencing hearing he also asked that there be an order for restitution in the amount of the funds advanced to Liquid Capitol, in Canadian currency, in the amount of $77,920 pursuant to section 738(1) of the Criminal Code. He also asks for a DNA order. Although this is a secondary designated offence and as such a DNA order is discretionary, Mr. Wright argued that since Mr. Umenwoke attempted to use false identity to avoid being caught, a DNA order is appropriate.

[27] Mr. Wright submitted that if I consider a conditional sentence it should be two years less a day with community service; he suggested 100 hours. He also asked that Mr. Umenwoke’s conditions include not possessing any identification or negotiable instrument, credit card or debit card that is not in his own name, not applying for any bank account not in his own name, not applying for any instrument of credit without prior approval of his probation officer, and having no contact with Liquid Capital (save for any legal proceedings) and Ms. Mokgwathi, Mr. Umenwoke’s former girlfriend.

[28] Mr. Okoronkwo’s position is that any sentence should be served as a conditional sentence with strict house arrest, largely because of Mr. Umenwoke’s health issues. He also took the position that Mr. Umenwoke could not pay any restitution and submitted that a DNA order should not be made. Mr. Okoronkwo did not have difficulty with a term of community service. When I questioned what Mr. Umenwoke could do, since he is not well enough to work, Mr. Umenwoke advised me that since he is very good on the computer he could do computer training as a community service.

[29] Mr. Umenwoke was released immediately after his arrest in 2010. There were no onerous bail conditions. There is, therefore, no credit for any pre-sentence custody.

Case Law

[30] Mr. Wright relied on the following cases in support of his position:

R. v. Suhr (2002), 13476 ONCA

[31] The offender pleaded guilty to one count of theft over $5,000 relating to the theft of a quantity of telephones valued at approximately $100,000. He used the money to fund his gambling addiction. The Court of Appeal upheld the sentencing decision of the trial judge of six months imprisonment, eighteen months probation and 240 hours of community service as well as a freestanding restitution order requiring the offender to repay $90,000 to Bell Canada. The offender had already paid $10,000 back. The offender was in a position of trust because his position as an administrative technician facilitated this offence. This was the offender’s first offence but because of the magnitude and duration and the breach of trust component of the offence the court held that justified the sentencing judge’s decision to refuse to impose a conditional sentence. The court considered this a relatively low level breach of trust. Mr. Wright argued that this case is comparable to ours in that a similar amount of money is involved. The duration of the theft in our case is shorter but the complexity is greater.

R. v. Mastromonaco, [2002] O.J. No. 4612 (S.C.J.)

[32] The offender defrauded an unsophisticated elderly couple of $70,000. The court found he was in a position of trust and sentenced him to 21 months in jail and he was ordered to make restitution. The offender stood in a position of trust to the victims in that he had prepared income tax returns for them and assisted them with estate planning. The victims were considered vulnerable. The vulnerability of the victims and the breach of trust were considered significant aggravating factors. The court was satisfied that a conditional sentence could be imposed but was not satisfied that it would promote responsibility and acknowledgement of harm in this offender as he had twice refused to express any remorse for his conduct or to acknowledge the harm he had caused to his victims. In those circumstances Valin J. declined to exercise his discretion in favour of making a conditional sentence order.

R. v. Goertzen, 2004 BCCA 639, [2004] B.C.J. No. 2802 (B.C.C.A.)

[33] The Court of Appeal upheld the decision of the trial judge. He found the offender had abused a position of trust or authority in relation to the victim. The offender had not expressed any remorse for his involvement in the frauds. He had no criminal record. The offender was convicted of three counts of fraud over $5,000, one count of forgery and one count of using a cheque knowing it to be forged. The victims were persuaded to believe that the offender and a co-accused were friends and each trusted them enough to believe their farfetched concoctions concerning possible jobs with the UN. The frauds involved false bank accounts, false cheques and a protracted series of steps designed to elicit more and more money from the victims. The trial judge found as a mitigating factor the fact the offender had a technical skill capable of being applied to meaningful employment and is well regarded in that context. Aggravating circumstances included the fact the offender participated in two distinct criminal transactions that were separated from one another by approximately a year, each fraud was well planned involving the development of trust with the victims, the frauds took many months to set up and execute, the frauds were multifaceted, one of the frauds involved an emotionally vulnerable person, and the losses were substantial. The offender was sentenced to 20 months in custody after credit for one month in custody on two counts and 28 months consecutive on another count. The other sentences were concurrent sentences. He was also ordered to pay $85,000 in total in favour of the various victims. The Court of Appeal agreed that the sentence for Mr. Goertzen was at the high end of the range.

R. v. Wentzell, [2011] N.S.J. No. 270 (N.S.S.C.)

[34] The offender pleaded guilty to defrauding the public of almost $70,000 by submitting fictitious travel claims for repayment. He had no criminal record. He was under psychiatric care although it was not suggested that caused his behaviour. He also had physical ailments such as angina and acid reflux. He was willing to make restitution.

[35] The defence requested a conditional sentence which was objected to by the Crown who was seeking a 12-15 month term of imprisonment. The offender was sentenced to six months imprisonment followed by one year probation. The probation included 50 hours of community service and making restitution in the amount of $70,000. Aggravating factors considered included a breach of trust in that the offender defrauded taxpayers, the fact that the offence was committed for personal gain and that it was an offence that spanned almost a two year period of time and it appeared very calculated and premeditated.

[36] The court focused on the need for general and specific deterrence and denunciation in deciding to incarcerate the offender for six months to be followed by probation for one year. It is not clear why a conditional sentence was not granted.

R. v. Kioussis, [2011] O.J. No. 6158 (S.C.J.)

[37] The offender, aged 64, pleaded guilty to fraud over $5,000. She was a senior law clerk and office manager and had defrauded her employer, a solicitor, of over $600,000 over a six year period. She had made restitution in excess of the amount taken. The funds were stolen to pay significant healthcare costs of caring for an ailing husband and mother. As a result of her scheme numerous clients lost money and sued the solicitor and the solicitor was forced into bankruptcy. The offender had no criminal record and was mentally fragile. There was genuine concern from professionals monitoring her that should she be incarcerated she might become ill to the point of self harm.

[38] Rutherford J. imposed a conditional sentence of two years less a day. He held that despite the significant aggravating factors this was one of those rare cases where a conditional sentence was appropriate. The guilty plea was a clear demonstration of remorse. The deceit and dishonesty was not motivated by greed but by anxiety, depression and a psychological dependency on her late husband and elderly mother. More than full restitution had been made. He also imposed 100 community hours of service and 18 months probation.

[39] This was a large scale breach of trust fraud case. It is important to note that Rutherford J.’s statement that this was a rare case for a conditional sentence was in the context of the fact that the imposition of a conditional sentence in a large scale breach of trust case is a rarity.

[40] Mr. Okoronkwo relied on the following cases:

R. v. Popert, 2010 ONCA 89

[41] The Court of Appeal held that restitution orders are discretionary but that they are to be made with restraint and caution. The ability of an offender to make restitution is an important factor that must be considered before a restitution order is imposed (at para. 40). Since a restitution order survives any bankruptcy of the accused it is an order for life. It must not be such a burden that it may affect the prospects of rehabilitation of the accused.

R. v. Scott, 2011 ONSC 5964

[42] The offender was found guilty of defrauding her employer of $9,367. Although more allegations had been made, the court found that the accused defrauded her employer on only one occasion. The offender had no criminal record. The offender was sentenced to 14 months imprisonment in the community consisting of six months house arrest and eight months of curfew plus 120 hours of community service, one year of probation and a standalone restitution order. Justice Belobaba was influenced by the significant psychological and emotional impact that the prosecution, conviction and impending sentencing had on the offender; she had endured more than three years of severe depression and self imposed social isolation. She did however, lack remorse and continued to believe she was innocent of any wrongdoing. Nevertheless Belobaba J. was of the view that she was not likely to repeat the offence in the future.

R. v. Wilson (2003), 48181 (Ont. C.A.)

[43] The offender pleaded guilty to fraud over $5,000 and received a conditional sentence of two years less a day which was appealed. The offender was the chief chiropodist for the University Health Network and over a four year period had submitted hundreds of false invoices to his employer defrauding the hospital system of approximately $900,000. The court concluded that a conditional sentence was demonstrably unfit and that the trial judge had overemphasized the significance of the offender’s guilty plea. It was determined to be outside the range of sentence that had recently been approved by the court in R. v. Bogart (2002), 2002 41073 (ON CA), 167 C.C.C. (3d) 390 (Ont. C.A.), (leave to appeal to the Supreme Court of Canada denied March 20, 2003), it failed to satisfy the principles of general deterrence and was disproportionate to the gravity of the offence and the offender’s degree of responsibility. The part of this case Mr. Okoronkwo relied upon was a passage from Bogart at pp. 399-400, where Laskin J.A. stated that special circumstances might justify a conditional sentence for OHIP fraud where the doctor could point to exceptional personal circumstances such as ill health or advanced age.

R. v. Bunn, 2000 SCC 9, [2000] 1 S.C.R. 183 (S.C.C.)

[44] The first time offender in this case, a lawyer, had converted $86,000 from his trust account. The Supreme Court noted the ruin and humiliation that the offender had brought down upon himself and his family, together with the loss of his licence to practice and concluded that would provide sufficient denunciation and deterrence when coupled with the conditional sentence of two years less a day with house arrest and 200 hours of community service imposed by the Court of Appeal. The court also noted the offender was the sole provider and caregiver for his wife, who suffered from multiple sclerosis and was confined to a wheelchair, and their teenage daughter.

R. v. Proulx, 2000 SCC 5, [2000]1 S.C.R. 61

[45] In support of his position that a conditional sentence ought to be imposed Mr. Okoronkwo relied on Proulx at paras. 100, 102, 107 and 115.

Principles of Sentencing

[46] The principles of sentencing are set out in ss. 718, 718.1 and 718.2 of the Criminal Code and I am guided by those principles. The most fundamental principle is proportionality in s. 718.1; the fitness of the sentence must reflect the gravity of the offence and the degree of responsibility of the offender. Section 718.2(iii) provides that a court that imposes a sentence shall also take into consideration evidence that the offender, in committing the offence, abused a position of trust or authority in relation to the victim, which shall be deemed to be an aggravating circumstance. The victim in this case strictly speaking was Liquid Capital. I note the definition however, in section 2 of the Code is that “victim” includes the victim of an alleged offence. This is relevant to an argument advanced by Mr. Wright that I will come to.

Determination of a Fit Sentence

[47] I consider the circumstances relevant to sentencing that are aggravating to be as follows:

a) Mr. Wright submits that there was complexity in the planning of this fraud in that Mr. Umenwoke created a company; Unified with Ms. Mokgwathi and had her open and hold the company bank account. He also did the planning to make the application for the factoring agreement and in meeting with Liquid Capital representatives. In this planning he used an alternate identity to avoid civil and criminal liability. I accept this submission.

b) Although Mr. Wright acknowledges that this is not a typical breach of trust case, he submitted that because Ms. Mokgwathi was jeopardized because she was subject to the stress and expense of criminal charges and a civil lawsuit, she was also a victim. Without Ms. Mokgwathi trusting Mr. Umenwoke, he would not have been able to involve her in the incorporation of the company or its banking. She was involved as an innocent third party because she trusted him and as such he was able to perpetrate the fraud. In my view there is merit to this argument and certainly given the expansive definition of “victim” in the Criminal Code, Ms. Mokgwathi could be considered a victim and Mr. Umenwoke clearly had established a relationship of trust with her that he was able to abuse in order to perpetrate this fraud. The cases relied upon by Mr. Wright, however, are all very clear cases of breach of trust, primarily cases where the offender has used a position of trust to defraud his employer or the government. I would, therefore, not put this case on the same level of seriousness as cases where trust funds are misappropriated.

c) Mr. Umenwoke was caught; he did not voluntarily disclose his criminal activity.

[48] I turn to the mitigating factors. Mr. Umenwoke is a first time offender and appears otherwise to be of good character. He is 63 years old and unable to work.

[49] I have considered the evidence that I have that Mr. Umenwoke was motivated not so much for personal gain to accumulate wealth but rather to fund the university education of his children. To that extent he was under financial stress. I do not accept, however, that this is a mitigating factor. The money misappropriated went to Mr. Umenwoke’s company and he personally received those funds. The fact he chose to use those funds for his children’s university education does not excuse his conduct.

[50] Mr. Umenwoke pleaded not guilty to the charges as, of course, he had a right to do. As such, however, he does not get any mitigation of sentence as a result of a guilty plea. This is a neutral factor.

[51] However, as I have stated, when Mr. Umenwoke took the stand, and when he had an opportunity to address me, he took responsibility for his actions, told me of the shame that he feels, how sorry he is for what has occurred and how this offence is out of character for him. Given he has no criminal record, I accept that. Furthermore, I was impressed with his expressions of remorse-I have no doubt that they were spontaneous and sincere. He told me that if he had property to sell he would do so in order to make financial restitution. Given Mr. Umenwoke’s age, his poor medical condition and given the impact this has had on Mr. Umenwoke personally and on his family, in addition to the shame and guilt he feels as a result of his wrongdoing, Mr. Umenwoke has not only taken responsibility for his actions but he has also convinced me that the likelihood of his re-offending is low.

[52] I have considered Mr. Umenwoke’s medical condition, and whether or not as a result of the many medical ailments that he has, I should reduce the length of the sentence I would otherwise consider fit. In the Ontario Court of Appeal’s decision in R. v. Aquino, [2002] O.J. No. 3631, where at sentencing, the offender was seriously disabled and required rehabilitative therapy, in relation to his medical condition, the Court of Appeal stated:

The correctional authorities are obliged under the Corrections and Conditional Release Act to provide inmates with essential healthcare. For that purpose, the respondent should be assessed immediately and appropriate steps taken to provide the proper medical care, including the rehabilitative treatment which the evidence indicates that the respondent requires.

Consequently, the accused was sentenced to four years in prison.

[53] Even in cases where the courts have concluded that jail would have an “extreme effect” on an offender, a conditional sentence has not been considered appropriate in an otherwise serious case, see for e.g. R. v. Shahnawaz (2000), 2000 16973 (ON CA), 149 C.C.C. (3d) 97 (Ont. C.A.). In the circumstances of this case, it could be said that Mr. Umenwoke’s health and treatment for his various conditions is a matter for the correction authorities.

[54] However, in light of Bogart there is authority for the proposition that Mr. Umenwoke’s medical condition can be taken into account in deciding whether or not to impose a conditional sentence. In my view although Mr. Umenwoke’s poor health cannot result in a sentence that is otherwise not appropriate, if in considering a conditional sentence, I conclude that it is within the range of a reasonable sentence, Mr. Umenwoke’s poor health is a proper factor to consider. Certainly he has a great number of chronic and otherwise serious ailments and I expect it would be difficult for the correctional authorities to accommodate the many appointments he needs to make in order to maintain his health.

[55] I have also considered the fact that the amount of the fraud in this case is not consistent with the typical large scale frauds where hundreds and thousands of dollars have been misappropriated. That is not to suggest, however, that the amount Mr. Umenwoke defrauded Liquid Capital of was not significant or that it did not cause the company significant damages and harm.

[56] I have considered the cases relied upon by Mr. Wright and Mr. Okoronkwo, which I have summarized and I do not find any of them to be of much assistance, save to the extent they set out some general sentencing principles. All of Mr. Wright’s cases deal with classic breach of trust cases and many involve much larger sums of money. The same is true of the cases Mr. Okoronkwo has referred to. In my view however, the sentence proposed by Mr. Wright is not unreasonable given all of the aggravating and mitigating circumstances in this case. I find that he is correct in the range of what would be a reasonable sentence in this case. Given Mr. Wright’s position, a conditional sentence is available to Mr. Umenwoke.

[57] In determining whether or not to impose a conditional sentence, I am guided by the decision of the Supreme Court of Canada in Proulx. In that case, the court confirmed that conditional sentences were introduced by Parliament to reduce reliance on incarceration and to increase the use of restorative justice principles in sentencing. The court stated at para. 90 that when the necessary preconditions are satisfied “serious consideration should be given to the imposition of a conditional sentence”.

[58] The first criterion for imposing a conditional sentence is met in this case given my conclusion that a term of imprisonment of less than two years is appropriate. The remaining considerations are whether permitting Mr. Umenwoke to serve his sentence in the community would not endanger the safety of the community and that a conditional sentence would be consistent with the fundamental purpose and principles of sentencing set out in sections 718 to 718.2 of the Criminal Code. For the reasons stated, I have concluded that the likelihood of Mr. Umenwoke re-offending is slim, although I recognize that one can never rule out the possibility of re-offending. I do not believe, however, that a period of incarceration is necessary for specific deterrence. Nevertheless, the sentence imposed must bring home to Mr. Umenwoke that this conduct will be treated seriously by this Court in order to deter him from ever engaging in this kind of criminal activity again.

[59] More importantly, however, as the cases that I have referred to emphasize, is the real need for general deterrence. Many frauds are committed by well-educated persons of previous good character holding various positions of trust. As in this case these types of crimes are not usually crimes of impulse and usually involve planning. As a matter of general deterrence, an educated person should be aware of the consequences and this awareness comes from sentences given to others. Otherwise law-abiding persons, who engage in this type of crime, are more likely to be deterred by the threat of severe penalties.

[60] I recognize however, that Chief Justice Lamer stated in Proulx that the stigma of a conditional sentence with house arrest should not be underestimated. Although incarceration, which is ordinarily a harsher sanction, may provide more deterrence than a conditional sentence, he cautioned that courts should be wary of placing too much weight on deterrence when choosing between a conditional sentence and incarceration. The empirical evidence suggests that the deterrent effect of incarceration is uncertain. Moreover, a conditional sentence can provide significant deterrence if sufficiently punitive; see Proulx at paras. 105 and 107.

[61] In considering all of the circumstances, given Mr. Umenwoke is a 63 year old first offender, the amount and nature of the fraud, Mr. Umenwoke’s expression of remorse, his acceptance of his wrongdoing and his serious health issues, I have concluded that a conditional sentence would be consistent with the principles of sentencing in this case. In doing so, I in no way intend to minimize the seriousness of this offence or its impact on Liquid Capital. However, in all of these circumstances, to permit Mr. Umenwoke to avoid incarceration for his crime and serve his sentence in the community on strict terms, would in my view not send the wrong message to anyone who is in a position of trust and might be similarly inclined.

[62] Finally although I accept that this is not an appropriate case to make an order for financial restitution, given Mr. Umenwoke’s age, lack of assets and income, he does seem very willing to do valuable community service by working with computers notwithstanding his poor health. His willingness to perform such community service is an important component of the overall sentence and must be taken into account in assessing the totality of the sentence. It can have the effect of reducing the length of sentence that would otherwise be imposed. Certainly his inability to pay is not a reason to refuse to impose a conditional sentence.

[63] In all of the circumstances, I have concluded that a conditional sentence of 20 months with a period of house arrest and then curfew and a requirement of community service, followed by one year of probation, is a fit sentence for Mr. Umenwoke’s commission of fraud over $5,000.

[64] As for a DNA order, I am persuaded that I should order the taking of Mr. Umenwoke’s DNA. Fraud is a secondary designated offence and, pursuant to section 487.051(3)(b) of the Criminal Code, I may make this order if the Crown has satisfied me that an order would be in the best interests of the administration of justice. Subsection (3) provides that I must consider various factors in making this decision. Mr. Umenwoke has no criminal record. Furthermore, I appreciate, as the Supreme Court said in R. v. C. (R.W.), 2005 SCC 61, [2005] 3 S.C.R. 99 at paras. 25-28, that although a DNA order has a minimal effect on the privacy of a person because the procedure for collecting samples is non-invasive, informational privacy is seriously engaged because DNA contains the highest level of private and personal information. However, in considering the nature of this offence, and the manner in which it was committed, it may be that his DNA would assist in solving any future crimes he might commit. In all of the circumstances, I am satisfied that it would be in the best interests of justice to make this order.

Disposition

[65] Mr. Umenwoke would you please stand.

[66] For the reasons I have given, on your conviction for fraud over $5,000, I sentence you to a conditional sentence of 20 months to be served in the community on the following conditions:

(a) Keep the peace and be of good behaviour;

(b) Appear before the Court when required to do so by the Court;

(c) Report on or before July 3, 2013, in person to a supervisor and thereafter report when required by the supervisor and in the manner directed by the supervisor;

(d) Remain within the Province of Ontario unless written permission to go outside the Province is obtained from the Court or the supervisor;

(e) Notify the supervisor in advance of any change of name or address and promptly notify the supervisor of any change in employment or occupation;

(f) Perform 125 hours of Community Service Work. I leave the nature of this work to you and your supervisor but hope that you can find a way to put your knowledge and skill in building and fixing computers to work. Your community service is to commence within 60 days of the date of commencement of the Order and shall be completed at a rate of not less than ten hours per month in consecutive months and shall be completed to the satisfaction of the supervisor or designate, within 18 months, which will include providing the supervisor with proof of attendance and completion of community service assignments;

(g) For the first twelve months of this order, you shall be confined to your residence under house arrest for 24 hours per day, 7 days per week. The only times you may be absent from your residence are as follows:

i) being at church;

ii) attendance for the purpose of providing community service;

iii) attending scheduled medical appointments or dealing with a medical emergency;

iv) court attendances and reporting to your supervisor;

v) attending to shopping for essentials and banking on Saturdays between 12 p.m. noon and 6 p.m.;

vi) travel directly to or from any of these activities; and

vii) at any other time with the prior written permission of the supervisor.

(h) For the remainder of your conditional sentence, you are not to be away from your place of residence each and every night between the hours of 11:00 p.m. and 6:00 a.m., subject to attending scheduled medical appointments or dealing with a medical emergency or any special variation granted by your supervisor;

(i) Do not possess any identification or negotiable instrument, credit card or debit card, bank account that is not in your own name;

(j) Do not apply for any new instrument of credit (example credit cards) without prior approval of your supervisor; and

(k) Do not have any contact directly or indirectly with anyone from Liquid Capital (save for any legal proceedings) or Ms. Mokgwathi.

[67] After your conditional sentence of 20 months, there will be a term of probation of 12 months on the same terms that govern your conditional sentence save for the substitution of a probation officer for a supervisor, to whom you must report within two business days of the end of your conditional sentence order, clause (f); community service, is modified to require 50 hours of community service over the first 8 months of your period of probation and clauses (g) and (h) related to your house arrest and curfew will be deleted.

[68] Mr. Umenwoke, a copy of this conditional sentence order will be given to you by the court officials. They will ensure that the substance of section 742.4 of the Criminal Code, which deals with the procedure for amending the non-statutory conditions and section 742.6 of the Criminal Code which deals with the procedure on any breach of condition are explained to you regarding the conditional sentence. They will also give you a copy of the probation order and ensure that the substance of section 732.2(3) which deals with the procedure for making changes to that order and sections 732.2(5) and 733.1 which deal with the procedure on any breach of the terms of your probation order are explained to you. Please pay very careful attention to all of these conditions and this information.

[69] Mr. Umenwoke, I must tell you that breach of any of these conditions will be taken very seriously by this Court. Our courts have said that if there is a breach of a conditional sentence order, the judge should start with the presumption that you do the rest of the time in jail. You must, therefore, appreciate that incarceration will likely result if any of the conditions of your conditional sentence are breached. I hope that the conditions that I have imposed will bring home to you the seriousness of your conduct and assist you in becoming a productive and law-abiding member of our community.

SPIES J.

Released: June 28, 2013

CITATION: R. v. Umenwoke, 2013 ONSC 4496

COURT FILE NO.: 12-10000512-0000

DATE: 20130628

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

HER MAJESTY THE QUEEN

and -

JOHN UMENWOKE

Defendant

REASONS FOR sentence

SPIES J.

Released: June 28, 2013

R. v. Umenwoke, 2013 ONSC 4496

Case Summary

Overview

The Facts

(a) Circumstances of the Offence

(b) Impact on Liquid Capital

(c) Circumstances of Mr. Umenwoke

Legal Parameters

Positions of Crown and Defence

Case Law

Principles of Sentencing

Determination of a Fit Sentence

Disposition

Judge

Counsel

Parties

Areas of Law

Fact Patterns

Issues

Statutory Provisions 5

Legal Tests 1

Legislation 1