Prosecutor killed off Wheatley deal

THE Commonwealth Director of Public Prosecutions personally intervened to overrule a deal under which tax cheat Glenn Wheatley would have received a suspended sentence in return for helping authorities chase other high-profile frauds.

Glenn Wheatley arrives at the County Court in Melbourne for sentencing. Picture: Stuart McEvoy

THE Commonwealth Director of Public Prosecutions personally intervened to overrule a deal under which tax cheat Glenn Wheatley would have received a suspended sentence in return for helping authorities chase other high-profile frauds.

Despite his Melbourne deputy agreeing to terms with Wheatley's lawyers, The Weekend Australian can reveal that CDPP Damian Bugg QC decided the music guru's crimes were too significant for the agency to argue that a judge spare him jail time.

Mr Bugg was also of the view that a suspended sentence for Wheatley would be out of step with case law, with those who had committed similar white-collar crimes receiving heftier penalties.

In a letter sent to Wheatley on March 7 last year, the CDPP confirmed it had changed its mind after telling the promoter in December 2005 that the prosecutors would ask a sentencing judge to hand down a wholly suspended sentence.

"Since the meeting, further analysis of the relevant facts and sentencing pattern has occurred and the matter has been discussed with the director," the letter said.

Wheatley had been told by telephone on January 20 last year of the CDPP's reversal.

Mr Bugg's decision overruled that of Melbourne-based Deputy Director of Public Prosecutions, David Adsett, who told Wheatley's solicitor Paul Galbally in December 2005 that a suspended sentence would be sought.

A spokeswoman for Mr Bugg said last night that the CDPP position was clarified "well before any plea was entered". "The issue of any sentence is a matter for the court," the spokeswoman said.

Wheatley's lawyers yesterday lodged papers with the Victorian Court of Appeal, arguing that the sentence was excessive and contained errors of fact and law.

The Weekend Australian understands that central to the appeal will be whether Wheatley's co-operation with authorities was given sufficient weight by sentencing judge Tim Wood.

Wheatley's hefty sentence attracted widespread criticism from the legal community, which argued that his tough treatment would deter other tax-evaders from confessing and paying up just as Tax Commissioner Michael D'Ascenzo was offering an amnesty from prosecution for offenders. Top tax lawyer Mark Leibler said there was an "element of paranoia" about Operation Wickenby, the taskforce investigating money laundering and offshore tax evasion.

"The tax office probably won't be enthralled with the fact that Wheatley has been given a substantial jail sentence because it will make it more difficult to entice others to come forward," Mr Leibler said.

Wheatley's barrister, Robert Richter QC, told Judge Wood senior lawyers at the CDPP had refused Wheatley an indemnity from prosecution but had promised to submit to the judge that a wholly suspended sentence was "within range". Later, there was some decision to "jack up" the penalty sought, Mr Richter said.

A date for Wheatley's appeal has not been set.