Scales of Justice - ID 1753558

Current Topics

Proceeds of Crime and Criminal Assets Recovery

:: Limitation Periods
:: Forfeiture of Property
:: Tainted property
:: Pecuniary Penalties/Proceeds Assessment Orders/Drug Proceeds Orders
:: Examination Hearings
:: The NSW Crime Commission
:: The Australian Criminal Intelligence Commission

Limitation Periods

There are limitation periods in place in respect of applications under each of the relevant Acts. Please refer to the individual Acts in question for specific limitation periods.

The implications of failing to meet these obligations are for want of a better term; draconian, in that (depending of course on the particular Act in question) what they may potentially result in is the loss of a client’s whole estate without a hearing.

A current reading of the relevant Act may not readily identify the problem. For example, section 92 to 94 of the Commonwealth Proceeds of Crime Act needs to be read conditionally upon a conviction having occurred. 

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Forfeiture of Property

(a) Criminal Assets Recovery Act 1990 (NSW) (CARA).
Section 22 sets out the forfeiture regime. Providing a restraining order is in place and it is more probable than not that the person whose suspected serious crime related activity formed the basis of the restraining order, was at any time not more than 6 years before the making of the application for the assets forfeiture order, engaged in a serious crime related activity, then the Supreme Court must make an assets forfeiture order.

(b) Confiscation of Proceeds of Crime Act 1989 (NSW) (COPOC).
This statute is conviction based and operated primarily by the NSW DPP. If the offence is deemed serious pursuant to section 5, then the forfeiture process is set out pursuant to section 18. The first step is to prove that the property sought to be forfeited is tainted and then the onus is on the convicted person to avoid the discretion to forfeit by evidencing the normal and intended use of the asset and/or demonstrating hardship.

(c) Proceeds of Crime Act (Cth) (POCA) 1987 and 2002.
The 1987 Act is strictly conviction based, however pursuant to the 2002 Act, forfeiture can either be conviction or non conviction based.

Conviction based forfeiture is effected when the offence is deemed a serious offence as defined under POCA. It is arguable that statutory forfeiture within this Act is its most draconian feature. Should the offence be deemed to be a ‘serious offence’ and provided a restraining order is in place at the end of six months following the date of conviction, then by virtue of section 92 of the 2002 Act, the property subject to that restraining order is automatically forfeited (unless excluded). This is effected without a hearing and pursuant simply by operation of the statute in question!
An extension of the six month limitation can be granted for only for an additional nine months. Thus with the extension, statutory forfeiture is effected fifteen months after conviction.

When the conviction for an offence is a Commonwealth Offence, but not a serious offence, section 19 of POCA allows for forfeiture upon a similar process to that found under COPOC.

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Tainted property

Is a notion under the Confiscation of Proceeds of Crime Act 1989 (NSW) (COPOC), which is a conviction based Act and operated primarily by the NSW DPP. As a general rule the Act is invoked when property is deemed to have become ‘Tainted’ by virtue of an offence. (Noting the offence must be a serious offence pursuant to section 5 of COPOC.)

The defining of particular property as being tainted by the offence is the vital first step in the forfeiture process pursuant to section 18 of COPOC. Once taint is established the onus then reverts upon the convicted person to avoid the discretion to forfeit by evidencing either hardship or the normal and intended use of the asset.

The NSW DPP has in recent times sought to extend the definition of ‘taint.’ However to date those efforts have proved unsuccessful. For property to be tainted there must be a substantial connection between the property and the offence.

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Pecuniary Penalties/Proceeds Assessment Orders/Drug Proceeds Orders

It is a mis-statement to say that when assessing the quantum of a pecuniary penalty order (Commonwealth) or proceeds assessment order (NSW) that the Court should only take into account direct proceeds of crime. Both acts (Proceeds of Crime Act 2002 – Commonwealth and the Criminal Assets Recovery Act 1990 (NSW) are worded in such a fashion a Court can consider a whole range of matters, such as income/expenditure or assets/liabilities.

In addition more recent amendments have resulted in third parties to a crime (ie such as agents of principals) being liable as a principal even though technically they received no proceeds of crime at all.

A more recent process undertaken by the DPP is the introduction of drug proceeds orders after a conviction. This quite often results in a process of "double jeopardy", in that a person is sentenced to a term of imprisonment and only following the sentence is there an application for a drug proceeds order. Practitioners should be conscious of this as the payment of a drug proceeds order cannot be taken into account on a sentence, however is arguable to be taken in account in respect to contrition and remorse.

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Examination Hearings

Normally when a restraining order is granted, the issuing Judge will make an order either at that time or soon thereafter for the examination of a defendant and/or others who may be associated with the defendant.

It again is wrong to assume that just because what is said in the examination cannot be used in criminal proceedings, that the examination process has no great relevance. The examination process can form the basis of how a matter is to proceed (and often does) as the evidence given in an examination can be used in later civil hearings under the relevant Act.

Thus it becomes imperative that an examinee is well prepared for the examination, experience has shown that examinees who are well prepared at the examination benefit at any subsequent hearings.

The recent High Court of Australia decisions in X7 and Lee provide some guidance as to processors and protections that can be afforded to an examinee in an examination hearing. However, and relevantly, the perceived inconsistency between these two decisions is emphasised by Hayne J in Lee.

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The NSW Crime Commission

The New South Wales Crime Commission is a statutory corporation established by section 5(1) of the New South Wales Crime Commission Act 1985. The Act was assented to (as the State Drug Crime Commission Act 1985) on 1 November 1985. The life of the Commission commenced 20 January 1986 with the appointment by the then Governor of the Commission's first Members. The NSW Crime Commission is the custodian of the Criminal Assets Recovery Act (NSW) 1990 (CARA). It is not a prosecutorial body thus its independence is assured by statute.

A principal objective of the Commission is to reduce the incidence of illegal drug trafficking. A secondary objective of the Commission is to reduce the incidence of organised and other crime. The Commission has two principal functions:
1.   The investigation of relevant criminal activity, and;
2.   The operation and implementation of the Criminal Assets Recovery Act (1990) NSW section 2a.

The investigation of relevant criminal activity is conducted largely in private and strict laws are in place to ensure the integrity of any investigations undertaken. Breaches of these strict laws have serious criminal consequences.

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The Australian Criminal Intelligence Commission

Coming soon

To Contact Greg Jones: Garfield Barwick Chamber, Level 11, 53 Martin Place, Sydney, 2000.
Phone 02 8815 9388  Mobile 0418 404985  Email: gjones@chambers.net.au