Fiona Mae Bilton, from Victoria, was the Head of Operations for stockbroker BBY Limited which entered voluntary administration on 17 May 2015 and liquidation on 22 June 2015 leaving significant shortfalls in clients' funds.

Over a period of approximately two years, Bilton lodged false reports with St George Bank (St George) regarding the amount of BBY’s unsettled equities trades for the benefit of the company. This resulted in additional funding from an overdraft facility for BBY on 115 separate occasions.

Bilton claimed the additional funding on behalf of BBY, even though she was aware that BBY was not entitled, to:

* draw down AUD4,394,962 on 28 June 2013 (which was repaid the following day),
* draw down of an average of AUD3.53 million per day in the period mid-November 2014 to February 2015 (which was repaid the following day); and
* retain the additional funding from its overdraft facility during the period March to May 2015 of an average daily amount of AUD2.67 million.

Bilton’s final claim on 6 May 2015 in the amount of AUD3,376,417 was not repaid and formed part of the claim by St George upon BBY in liquidation.

When handing down the sentence, His Honour Judge Doyle said that Ms Bilton’s conduct involved serious offending and the obtaining of an extremely large financial advantage for BBY, and masked the risk of lending from St George.

ASIC suspended BBY’s Australian Financial Services licence in May 2015. That suspension remained in place until its licence was cancelled in June 2021.

Bilton was sentenced as a ‘continuing criminal enterprise offender’ under the Sentencing Act 1991 (Victoria), such that the maximum penalty for each offence pursuant to s 82(1) of the Crimes Act 1958 (Victoria) was 20 years’ imprisonment.

In the event, and because the Judge took the view that this was a very unusual case and that but for these circumstances, a lengthy term of imprisonment would have been imposed, Bilton was sentenced to two years' imprisonment suspended for two years on the first charge and on the second and third charges to a community correction order for three and a half years on the second and third charges, including 380 hours of unpaid community work.

All three charges were brought under 82(1) Crimes Act 1958 (Vic).

The charges are fraud i.e. obtaining a pecuniary advantage by deception not theft. This means that it was not necessary to prove an intention to permanently deprive the bank of the money.

There is also an interesting parallel between the customer borrowing money overnight and banks overnighting between each other. The material difference, of course, is that the banks are in possession of the facts and in this case the bank was misled and, for bank's overnighting, the understanding is that one bank is making and the other is accepting a deposit. No one thinks of that as debt but it is, as the global financial crisis demonstrated in one catastrophic night when the overnight money stopped moving.