Defendant discharged after police ‘failed to obtain and retain’ material that could have been evidence
A judge halted the prosecution of a company director charged with theft due to police failure to retain evidence related to the case.
Justice Charles Quin agreed with defense attorney Ben Tonner on Tuesday that there had been an abuse of the court process and discharged Fernando Mendes on an indictment that accused him of stealing US$132,807.43 from Finab Ltd., where he had been managing director.
The theft was alleged to have occurred between June 2009 and January 2011.
Mr. Tonner argued that the Crown had failed to obtain and retain material evidence – mostly emails and documents stored on computers.
Justice Quin stated, “This court is very disturbed by the extremely late and incomplete disclosure of electronic data from Finab … I am also concerned by the apparent lack of support that the Royal Cayman Islands Police Service has given to the director of public prosecutions in this case.
“This is a concern that I have expressed on previous occasions,” the judge said. “It is imperative that senior investigating officers liaise closely with Crown counsel to ensure that discovery/disclosure is carefully examined and to ensure that it is as full and as complete as possible.”
The court heard that emails provided by Finab in July 2014, more than three years after Mr. Mendes was arrested, showed that the company’s CEO had signed off on an expenses amount that Mr. Mendes was later accused of stealing, and that another amount he was accused of stealing had in fact been dividends to shareholders.
The judge pointed out that it is the RCIPS’s duty to investigate allegations. “It is also the duty of the RCIPS to collect and preserve all the relevant and material evidence as soon as possible, which may include evidence that undermines the Crown’s case and supports the case for the defendant,” he said.
This matter began on Feb. 10, 2011, when the chief executive officer and primary shareholder of Finab made a complaint to the Financial Crime Unit regarding Mr. Mendes and matters relating to Conimbriga Investments Ltd.
Officers arrested Mr. Mendes the next day at the Finab office and seized the laptop on his desk and the hard drive for his personal computer.
On March 8, 2011, Mr. Mendes’s attorney wrote to the Financial Crime Unit stating that he wished to make a suspicious activity report. The attorney said the matter was time sensitive, since the view might be taken that evidence might be destroyed.
The next day, Mr. Mendes produced a statement alleging that Finab’s CEO and others were committing, and encouraging others to commit, actions to evade U.S. income tax. He expressed concern that staff had been instructed to hide or destroy evidence that could prove his innocence.
Two days after that, Finab’s office manager alleged for the first time that Mr. Mendes had misappropriated funds from Finab, providing checks and spreadsheets.
Mr. Mendes appeared in court for the first time on Oct. 19, 2011, to face charges of theft from both Finab and Conimbriga, plus accusations of false accounting and making a false statement as a company director. He pleaded not guilty to all. By the time his trial was to have started, the Crown maintained only the one charge of theft from Finab.
Meanwhile, defense attorneys kept asking for disclosure of evidence.
On some date after March 2, 2012, they received a schedule of unused material confirming that electronic documents had been seized from Finab in February 2011. Justice Quin explained that the schedule contained check boxes after each item listed that were to be marked as to whether the item was disclosable or not. But all of the boxes were blank; boxes for signatures of the reviewing officers were also blank. This inferred that neither police nor the office of the director of public prosecutions had addressed “the vital questions of disclosure/discovery and inspection of this unused material.”
The defense continued to ask for material they believed existed that would show Mr. Mendes’s innocence. The Financial Crime Unit in-house expert was of the view that some emails may have been in a cloud server to which police did not have access. The FCU described the files as “technical and difficult to extract.” There were other files such as a QuickBooks file 2010 which the police had been unable to read.
In September 2013, an IT expert was contracted to do a statement and he confirmed he had told the RCIPS how to access various files. In December 2013, police stated there were no additions to the material already provided.
On May 21, 2014, the day Mr. Tonner was to make his abuse of process application, the Crown was advised that the Finab CEO had found “a lot of old emails between himself and the defendant.” A large number of Finab emails was provided in July 2014.
Justice Quin highlighted some of the evidence revealed. Emails in June and July 2010 revealed that the CEO had approved an expense of US$1,863.69, although Mr. Mendes had been accused of stealing it. Another amount he was accused of misappropriating was $4,506.86, but the emails disclosed in July 2014 demonstrated that this sum was in fact dividends to shareholders.
“The foregoing examples cause the court great concern and they lead to the inevitable question of what other documents that have not been disclosed by Finab which can show that, not only is the defendant not guilty of the charge against him but that, in fact, he is innocent,” the judge said.
He pointed out that if trial had gone ahead as previously scheduled for June 2012, Mr. Mendes might well have been found guilty of stealing these amounts and that would have been a serious miscarriage of justice.
Justice Quin said it should have been obvious to the Financial Crime Unit that material was missing from their investigation. It appeared that former Crown counsel Michael Snape and Toyin Salako, Crown counsel who took over the case from him, were the first people to put pressure on Finab and its CEO to provide additional disclosure.
The judge concluded that the Financial Crime Unit had failed to seize significant and relevant material at the time Mr. Mendes was arrested, and then failed to pursue all reasonable lines of enquiry and therefore failed to obtain and retain material which could well have served to undermine the Crown’s case and assist the defense.
This failure led to a serious prejudice that rendered it impossible for Mr. Mendes to have a fair trial, he said, particularly since five years had passed from the time of the alleged offense. He therefore stayed the prosecution of the case and ordered the discharge.