Described as a somewhat idiotic cog in a much bigger money laundering machine, Sophonias Hailemichael’s conviction for money-laundering was overturned on appeal subject to him paying full reparation and completing 80 hours of voluntary community work.
The High Court heard Hailemichael was sucked into a ‘get rich quick scheme’ touted on Tiktok. Aged in his early twenties, he was described as vulnerable in that he was suffering from mental health issues. He had recently lost his job. A long-term relationship had recently ended.
When questioned by police, Hailemichael admitted he knew the Tiktok scheme was a scam and that he was being used as a money mule.
Hailemichael recruited two acquaintances who provided their bank account details. Subsequently, online fraudsters transferred $3000 into each account. His acquaintances then withdrew the money: keeping some as reward for their involvement; handing the rest to Hailemichael.
Hailemichael passed on the balance to his Tiktok contact, receiving $1450 in payment.
After Hailemichael pleaded guilty in the District Court, the trial judge emphasised that the victim had lost a total of $41,000 in the scam and that Hailemichael’s involvement was made worse by the fact he had previously worked in the banking sector.
On appeal, Justice Becroft said the gravity of Hailemichael’s offending was better described as low, or low to moderate. The victim’s total losses of $41,000 should not be pinned on Hailemichael alone; only a small part of this loss was attributable to Hailemichael’s involvement as a money mule. And his banking sector experience was not sophisticated, Justice Becroft said. He had worked at an ASB bank call centre as first point of contact for customers seeking to refinance.
Justice Becroft laid considerable emphasis on recent work by the NZ Work Research Institute highlighting that males with a first-time conviction suffer a sharp decline in employment prospects and earnings after conviction.
In the period up to his High Court appeal, Hailemichael saved sufficient money to make reparations, money saved primarily out of his social welfare benefit. There was evidence from WINZ that any conviction for money laundering would result in Hailemichael being offered only low level, entry jobs; he was unlikely to ever get a job placement involving a position of trust or handling money.
Hailemichael v. Police – High Court (13.02.24)
24.053