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Social Security Reporter |
Age pension debts: casino records of gambling losses used to infer income level
(2011/91)
Decided: 14th February 2011 by B. Tamberlin and D. Letcher
On 29 June 2007 age pension overpayments were raised against Mr and Mrs George for the period 1 January 2002 to 14 May 2007, each in the sum of $32,669.89. The debts were raised on the basis that during the relevant period, Mr George regularly gambled at Star City Casino, and purchased gambling chips at the casino totalling around $499,000. On the information given the conclusion was drawn that Mr George had incurred gambling losses of $223,250. From the extent of these losses, it was decided that it should be inferred that Mr George’s income was such as to establish that he and his wife were not entitled to a major part of the age pension.
On 15 September 2008 the SSAT decided that Mr and Mrs George did not owe any debts to the Commonwealth pursuant to the Social Security Act 1991 (the Act). The Secretary then sought review of this decision with the AAT.
Section 8 of the Act defines the expression ‘income’ to mean an ‘income amount earned, derived or received by the person for the person’s own use or benefit’ or a periodic gift or allowance. The expression ‘income amount’ is defined to mean valuable consideration, personal earnings, moneys or profits. An income amount is earned, derived or received regardless of the means by which it is obtained or the source from which it is obtained. By s. 1223 of the Act, where a social security payment is made and the recipient was not entitled to obtain that benefit, the amount of the payment is a debt due to the Commonwealth and may be recovered.
The issue for the AAT concerned the use which could be made of records of the Star City Casino kept during the relevant period, in the form of a ‘Patron Profile Report’ in respect of Mr George’s activities at the Casino during 2001 to 2007 for the purposes of determining Mr George’s income. In examining this issue, the AAT considered the appropriate application of evidentiary principles relating to circumstantial evidence and the inferences which can be drawn from it, as applied to casino records of gambling losses and the inferences which could be drawn as to a person’s level of income.
Evidence before the AAT included the Patron Profile Report for Mr George, an analysis of the data by two expert witnesses, and evidence from Mr George.
Mr George gave evidence and admitted that he and his wife regularly attended the casino during the relevant period and did gamble, attending the casino largely for social reasons. He contended that by using a particular way of operating, including gambling and losing only small amounts, betting evenly on red and black colours, and recycling casino chips by purchasing then cashing them, he did not in fact incur any gambling losses, or at least any losses which would provide evidence disentitling him from age pension as a result of income received. Mr George’s evidence was that he engaged in his system of gambling to qualify for greater benefits from the casino than he would otherwise have received by purchasing and repurchasing more chips.
Mr George said that the case against him depended on inferences sought to be drawn from the recording of alleged losses, said to have been suffered by Mr George during the relevant period, by operators of the Casino.
The Secretary said that the case depended on expert evidence and on inferences available from the data assembled by the casino. This data consisted of the casino’s Patron Profile Report as collected by a computer program operated by the casino known as the PitTrack System.
The AAT did not accept the evidence and submission by Mr George that he was able to successfully manipulate his gaming activities to be able to convince dealers that he was gambling and losing money when he was not. They found Mr George’s belief in the benefit of purchasing more chips to be mistaken, because the casino was really concerned with forming an estimation of how much he lost at gambling, not how many chips he purchased. The AAT did not accept Mr George’s evidence that he did not suffer any significant gambling losses.
In relation to the use which could be made of the Patron Profile Report, the AAT found that they could not conclude on the balance of probabilities, that inferences should be drawn that any particular amount of gambling losses or order of losses was incurred by Mr George over the relevant period. They did not accept that the casino’s Patron Profile Report on Mr George could reasonably be used as the basis for any probative inference as to the likely income or assets of Mr and Mrs George during the relevant period.
The AAT noted that there was no direct evidence of Mr George’s spending money at the casino or losing money, in the form of television footage, cash receipts, or statutory financial records or documents. On examination, the PitTrack system’s purpose was for dealers and casino staff to record a player’s ‘Rating’, assessing the amount of losses incurred by a gambler, in order to offer higher levels of complimentary items and incentives to those incurring substantial losses to encourage them to frequent the casino.
Given that the Patron Profile Report was created for this internal casino purpose, and its data was heavily dependent on direct observations, opinions and conclusions by dealers, the AAT found that there was a real probability of serious substantial inaccuracy arising from distraction of staff members and supervisors’ inability to make precise accurate observations. The evidence of the two experts was found to not advance the Secretary’s case because the data underlying the reports had not been established to be accurate.
The AAT concluded that it had not been established on the balance of probabilities that Mr and Mrs George were not entitled to receipt of the age pension during the relevant period or that any debt was due by either of them to the Commonwealth.
The AAT affirmed the decision under review that Mr and Mrs George did not owe any debts to the Commonwealth pursuant to the Social Security Act 1991.
[K.W.]
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URL: http://www.austlii.edu.au/au/journals/SocSecRpr/2011/21.html