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CIVIL FORFEITURE OF THE PROCEEDS OF CRIME BILL 2002
EXPLANATORY NOTES
GENERAL OUTLINE
Objects of the Legislation
The object of this Bill is to allow a Court to confiscate the assets of a person,
without it being necessary for that person to be convicted of an offence on the
criminal standard of proof if the Court finds it `more probable than not' that the
assets were derived from serious crime related activities.
The Bill also contains provisions which will allow law enforcement agencies to
effectively identify property which has been derived from serious crime related
activities. The Bill then enacts provisions that allow confiscation of the
proceeds of such property and for the proceeds to be recovered as a debt
payable to the state.
Reasons for the objectives and how they will be achieved
A person who derives economic or financial benefit from committing a crime
should be prevented form realising or keeping any such benefit. The
community is concerned to ensure that persons who commit crimes that result
in large financial gains, are not able to reap the financial reward of their crime,
irrespective of whether they serve a jail sentence.
Therefore, there needs to be effective legislation in place that enables the
State to confiscate any assets which a person has derived from serious crime
related activities.
To be effective, the State needs to be able to confiscate such assets even
when criminal charges are not made out on the standard of `beyond
reasonable doubt'. This legislation will allow a Court to order the confiscation
of assets which it finds more probable than not were derived through serious
crime related activity.
Further, the Bill will enact provisions that will allow the Crime and Misconduct
Commission to make application to the relevant Queensland court to restrain
a person from dealing with potentially tainted property.
If the property is subsequently found to be tainted, the Bill makes provision for
it to be confiscated by the Public Trustee by way of Order of the Court. The
Bill also includes provisions that allow for monitoring orders and a wide range
of search powers to be employed that will enable authorities to identify tainted
property.
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This Bill will enact provisions that will allow the Crime and Misconduct
Commission to make application to the relevant Queensland Court to restrain
a person from dealing with potentially tainted property. If the property is
subsequently found to be tainted, the Bill makes provisions for it to be
confiscated by the Public Trustee by way of order of the Court.
Further, the Bill includes provisions allowing for monitoring orders and a wide
range of search powers to be employed that will enable authorities to identify
tainted property.
Alternative measures to achieve objectives
The Bill, as proposed, is the most appropriate means of achieving the
objectives of the legislation. Although it concerns the confiscation of assets
derived through crime related activity, this Bill is a more appropriate means of
achieving the objectives than if such provisions were inserted into the Criminal
Code.
This is simply because, to be effective, the provisions of this law must operate
on the balance of probabilities. The Criminal Code is concerned with crimes
that must be proved beyond reasonable doubt. Further, legislation making
provision for the confiscation of assets derived through serious crime related
activity must contain provisions relating to finance and the realisation of the
value of the assets by the State.
Therefore, to enact this law in a single piece of legislation will enhance
drafting clarity and the workability of the laws. It will provide one Act that will
govern all proceedings for the confiscation of assets derived from crime in this
State.
Administrative cost to Government of implementation
The administrative cost to Government of the implementation of this
legislation would be the increased costs of investigation by the police and
Crime and Misconduct Commission. Further, the number of cases brought
before the courts will increase. That is, actions will be brought seeking
confiscation of assets derived through serious criminal activity, independent of
a criminal action.
These costs, however, are all costs that the Government and State must bear
in the interests of justice.
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Fundamental legislative principles
Section 4 of the Legislative Standards Act, 1992 requires a Bill to have regard
to Fundamental Legislative Principles. s 4 (2) requires that legislation have
regard to, inter alia, the rights and liberties of individuals. Section 4(3)
prescribes that whether legislation has sufficient regard to the rights and
liberties of individuals depends, for example, whether the legislation
(b) ... is consistent with principles of natural justice; and ...
(d) does not reverse the onus of proof in criminal proceedings
without adequate justification; and ...
(g) does not adversely affect rights and liberties, or impose
obligations, retrospectively; and ...
(i) provides for the compulsory acquisition of property only with fair
compensation; ...
It is necessary to address each of the relevant issues as outlined above. With
respect to s 4(3)(b) the Bill does not infringe the principles of natural justice.
The Bill is only concerned with confiscating assets from persons who have
derived those assets from some form of serious crime related activity.
Section 4(3)(g) is satisfied, because in any instances where the provisions of
the Bill prescribe a reverse onus of proof, they are doing so with respect to
civil proceedings. Further, The Bill will not have retrospective operation. As
such it satisfies s 4(3)(g).
The Bill does not offend s 4(3)(i) which seeks to prevent the compulsory
acquisition of property without fair compensation. The intent of s 4(3)(i) is to
ensure that a person with clear title to property does not have that property
compulsorily acquired without sufficient compensation. Confiscation of
property under this Bill will only occur in circumstances where the person
who's property is being acquired does not have clear title to it.
The provisions of this Bill only affect the rights and liberties of individuals to
the extent that it allows for the confiscation of assets from an individual if a
court is satisfied, on the balance of probabilities, that the asset was derived
from serious criminal activity. That is, a person may not be found guilty of
having committed such a crime, but may still have their assets confiscated on
a civil standard of proof. It is arguable that such a person gave up such rights
and liberties when they obtained the property from such activity.
As such, the Bill only affects the rights and liberties of individuals to the extent
that an individual may have assets confiscated from them, if it is more
probable than not that they derived those assets from serious crime related
activity.
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Consultation
Consultation has occurred with interest groups and the community at large.
NOTES ON PROVISIONS
PART 1 - PRELIMINARY
Clause 1 sets out the short title of the Act.
Clause 2 states that the Act commences on a day to be fixed by
proclamation.
Clause 3 sets out the main objects of the Act. These objects, as
outlined above, are to allow for the confiscation of assets of a person where a
court finds it more probable than not that those assets were obtained by the
person through serious crime related activity. That is, a person does not have
to be found guilty of an offence at the criminal standard for assets that are
suspected of being derived through serious crime related activity to be
confiscated from them. Further, the objects of the Bill are to better enable law
enforcement officers to identify and recover property which has been
misappropriated through criminal activity. Once identified, the Bill allows such
property to be recovered as a debt to the State. While the provisions of this
Bill allowing confiscation of assets without a person having been found guilty
of an offence may be seen to be against fundamental legislative principles,
the provisions are justified on the basis that a person should not be allowed to
keep the benefits of assets that are derived from serious crime related activity.
Clause 4 provides that the dictionary in the schedule to the Act defines
particular terms used in the Act.
Clause 5 the Act binds the State and as far as the Parliament has
legislative power to do so, also binds the Commonwealth and other States.
Clause 6 provides that a note in the text of the Act forms part of the
Act.
Clause 7 provides that proceedings initiated on application for a
restraining order or confiscation order under the Act is not a criminal
proceeding. Further, the rules of evidence applicable to Civil proceedings
apply to proceedings under this Act while the rules of evidence in criminal
proceedings do not apply to proceedings under this Act. The rules relating to
construction of criminal Act only apply to offences against this Act.
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Clause 8 defines an interest in `property' to include a person's money,
goodwill in a business, an interest in a licence, an interest in property outside
Queensland and any interest prescribed by regulation. Apart from these
provisions, if a person would have an interest in property under the effective
control of another person, then that property is an interest of the person who
has effective control over it.
Clause 9 defines the circumstances in which a person will be taken to
have `effective control' over property. A person will be taken to have effective
control over property even if they do not have a traditional legal or equitable
interest in it or a direct or indirect right, power or privilege over or in relation to
the property. This clause provides that in determining whether a person has
`effective control' over property, regard may be had to any relevant factors.
Clause 10 prescribes when property is to be considered to be `illegally
acquired property'. If property is any part of the proceeds of an illegal activity,
or if any part of the proceeds of the disposal of property gained through illegal
activity or was acquired in any part using illegally acquired property it will be
considered `illegally acquired property' under this clause. It will not matter
whether the dealing with the illegally acquired property occurred prior to the
enactment of this clause. Further, it does not matter if proceeds are credited
to an account the property in the account will still be illegally acquired.
Clause 11 makes provision as to when property ceases to be or again
becomes illegally acquired property. The clause provides that property will
cease to be `illegally acquired property' when it is acquired by a person
without knowledge or reasonable suspicion that it is illegally acquired property
and for sufficient consideration. Further, illegally acquired property distributed
under a will ceases to be illegally acquired property when it is vested in a
beneficiary. The clause provides that if illegally acquired property that has
ceased to be illegally acquired property is again acquired by the person in
whose hands it was illegally acquired, it will once again be considered to be
illegally acquired property.
Clause 12 defines `serious crime derived property'. Pursuant to this
clause, property will be `serious crime derived property' if it is all or part of the
proceeds of serious crime related activity, all or part of the disposal of serious
crime derived property or was acquired in any part using serious crime
derived property. It is irrelevant when the serious crime related activity or the
disposal of the property happened.
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Clause 13 makes provision as to when property ceases to be or again
becomes `serious crime derived property'. The clause provides that property
will cease to be `serious crime derived property' when it is acquired by a
person without knowledge or reasonable suspicion that it is illegally acquired
property and for sufficient consideration. Further, serious crime derived
property distributed under a will ceases to be illegally acquired property when
it is vested in a beneficiary. The clause provides that if illegally acquired
property that has ceased to be serious crime derived property is again
acquired by the person in whose hands it was serious crime derived property,
it will once again be considered to be serious crime derived property.
Clause 14 provides for the appropriate court to hear an application
under the Act for a restraining order or a confiscation order relating to either
illegally acquired property or serious crime derived property. This clause
provides that the `appropriate court' is to be determined with reference to the
estimated value of the property and the limit of the relevant court's civil
jurisdiction. The limit of a court's civil jurisdiction under this clause is
determined by reference to the limit that that would apply to a civil action in
that particular court.
PART 2 RESTRAINING ORDERS
Clause 15 provides that the commission may apply to the court for a
restraining order restricting a person from disposing or attempting to dispose
of or otherwise deal with property referred to in the order. There is no need for
notice to be given to the party to whom the order relates. A person may be
restrained from dealing with either specific property or a certain class of
property. An application made under this clause must state the grounds on
which the application is made and be accompanied by an affidavit of an
authorised officer making the application stating why the restraining order is
sought.
Clause 16 provides that after having regard to the grounds for the
application specified under clause 16, the court considers the grounds
reasonable, the court must make the restraining order sought.
Clause 17 allows a restraining order to order the public trustee to take
control of some or all of the property restrained under the order. Further, the
restraining order may make provision for the meeting of certain expenses out
of the value of the assets involved.
Clause 18 provides that a restraining order only remains in force after
the first 48 hours of operation while an application for other relevant orders
has been made but not yet decided.
Clause 19 a restraining order will not prevent an enforcement against
the property. However, such an order does not apply to property acquired
after the order is made unless the order states it applies to such property.
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Clause 20 If a restraining order is made, the commission must give
notice to the Director of Public Prosecutions (`DPP') and the Commissioner of
Police. If the person whose property the order relates to has not been notified
of its existence, they too must be notified of it. If it is not possible to notify the
person the order will still have effect.
Clause 21 allows the appropriate court may make further orders in
addition to the restraining order that it considers appropriate. These may
include but are not limited to those orders specified in this clause.
Clause 22 provides that a person who is subject to proceedings under
clause 21 cannot refuse to answer a question or provide information on the
grounds of self-incrimination or that such disclosure would be in breach of
some other obligation against disclosure. However, evidence so gathered is
not admissible against the person in any other criminal or civil proceedings
except a proceedings with respect to the truthfulness of the statement made
or other proceeding contemplated by this Act.
Clause 23 provides that where an application is made to the court for
an assets forfeiture order, the court may order the public trustee to sell the
property to which the application relates in certain circumstances. Any
proceeds of the sale of such property are taken to be restrained under the
restraining order.
Clause 24 provides that details of restraining orders that are made
must be kept in a certain way.
Clause 25 deals with the contravention of a restraining order which has
been made. This clause provides that where the provisions of a restraining
order are breached, an offence is committed. The clause provides for both
defences and penalties for such an act.
Clause 26 provides restrictions to any restraining order that allows for
payment of a person's legal expenses from the assets that it applies to. Such
expenses will only be met where the court is satisfied that a person cannot
meet their legal expenses with their unrestrained property and a range of
other factors.
Clause 27 provides that notwithstanding anything contained in a
restraining order, the value of legal expenses that may be met from the
property subject to a restraining order must not exceed the maximum value
specified in the clause.
Clause 28 provides that where a restraining order allows for payment
of legal expenses out of the property it covers, the commission or the public
trustee (if the order so provides) may make an application for an order for the
legal expenses to be assessed.
Clause 29 provides protection to the public trustee in the discharge of
their duties under the Act.
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Clause 30 allows the public trustee to deduct fees from the proceeds of
the property to compensate them for the discharge of their duties in relation to
the property. If the property concerned is not sold, the Public Trustee may be
paid from the proceeds account.
Clause 31 provides that, if during the operation of a restraining order,
the court does not make an assets forfeiture order or a proceeds assessment
order, the court may make an order concerning the continuation in force of the
restraining order.
Clause 32 provides that a certificate signed and sealed by the public
trustee stating that the restraining order has been made and its terms will be
evidence of the public trustee's right to act under a restraining order.
PART 3 - CONFISCATION
Clause 33 provides that while a restraining order is in force, the
commission may apply for an assets forfeiture order.
Clause 34 directs that the court must make an assets forfeiture order if
it finds it to be more probable than not that the person concerned has been, at
any time prior to the making of the application, been engaged in a serious
crime related activity involving a drug offence or a serious crime related
activity liable to punishment by imprisonment for more than 5 years.
Clause 35 provides that upon the coming into effect of an assets
forfeiture order the property is forfeited to the State and vests in the public
trustee for the State. Such property must be disposed of by the public trustee
subject to the direction of the Treasurer. The proceeds are to be credited to
the proceeds account.
Clause 36 prohibits dealing with property to which an assets forfeiture
order applies. The clause further provides defence and punishment provisions
in relation to this offence.
Clause 37 provides that where an application for an assets forfeiture
order has been made but the order has not been granted, a person to whose
property the application relates may make application for an exclusion order
to exclude part of their property from any order made pursuant to the original
order.
Clause 38 provides that if evidence is adduced that shows it more
probable than not that a stated part of the value of property forfeited under an
order has not been derived from a serious crime related activity, the court may
make an order that the person be paid an amount equivalent to the value of
such assets previously forfeited.
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Clause 39 provides that the commission may apply to the court for a
proceeds assessment order directing a person to pay to the Treasurer an
amount equal to the value of the proceeds derived from an illegal activity that
took place prior to the making of the order.
Clause 40 makes directions as to the circumstances in which a
proceeds assessment order may be made. Pursuant to this clause, the court
must make such an order if the court finds it more probable than not that the
person in question was, prior to the making of the application, engaged in a
serious crime related activity involving a drug offence or an activity carrying a
punishment of at least 5 years imprisonment.
Clause 41 sets out a range of factors that the court must have regard
to when making an assessment under clause 40. This clause allows a court to
receive evidence regarding the assessment, notwithstanding the rules of law
or practice regarding hearsay evidence, of a police officer, a member of the
Australian Federal Police, a Customs Officer or a commission officer under
the Crime and Misconduct Act, 2001 (Qld), as to the market value at a
particular time of a certain drug or the amounts that would ordinarily be paid at
that time for such a drug.
Clause 42 upon application of the commission, the court must, if it is
satisfied that property is in the effective control of a person about whom the
court has made a proceeds assessment order, make an order declaring the
interest available to satisfy the proceeds assessment order, if the person in
question has insufficient assets to otherwise do so.
Clause 43 provides that if the public trustee has control over the assets
due to a restraining order or if a person has had a proceeds assessment order
made against them, upon the public trustee's application, the court may make
an order directing the public trustee to pay to the Treasurer an amount
sufficient to discharge the person's debt to the State under this Act.
Clause 44 provides that if a court makes a proceeds assessment order
against a person, the interests of the person in property are, until the
assessed amount is paid, charged in favour of the State to an extent
necessary to secure payment of the amount as assessed.
Clause 45 establishes a `Proceeds Account'. Further, this clause
provides for amounts that must be paid from the proceeds account.
PART 4 INFORMATION GATHERING POWERS
Clause 46 provides for the Supreme Court to make a `production order'
which would compel a person who is reasonably suspected of holding a
document that tracks the history of property to produce such a document.
Clause 47 a Judge of the Supreme Court may make such an order only
if satisfied there are reasonable grounds for suspecting that a person has in
their possession such a document.
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Clause 48 sets out the requirements of a production order.
Clause 49 sets out the powers of an authorised officer under a
production order.
Clause 50 allows for a person to whom a production order relates to
make an application to the Supreme Court for the variation of such an order.
Clause 51 provides that it is an offence to contravene a production
order without reasonable excuse for doing so.
Clause 52 provides that a person is not excused from complying with a
production order on grounds of self-incrimination or that to do so would be in
breach of some other obligation the person may have or that the information
is subject to legal professional privilege. However, any evidence obtained
through such disclosure cannot be used against the person in other criminal
or civil proceedings.
Clause 53 provides that a person about whom a production order is
made must not disclose the existence or nature of the order or any
information which would enable another person to infer anything about the
existence or nature of the order.
Clause 54 in the absence of an order of a Supreme Court otherwise,
an authorised officer who retains a document must allow a person who would
be entitled to it to inspect it and to take extracts of it or copy it.
Clause 55 provides for the application of search powers.
Clause 56 allows an authorised officer to apply to a magistrate for a
search warrant to search for a forfeitable crime related thing.
Clause 57 provides that a magistrate may issue a search warrant only
if satisfied there are reasonable grounds for suspecting the thing sought under
the warrant is at the place in question or is likely to be taken from the place in
the next 72 hours.
Clause 58 makes provisions as to what the search warrant must state.
Clause 59 sets out the powers an authorised officer has under a
search warrant.
Clause 60 sets out the powers of a person who is authorised under a
search warrant to seize a thing.
Clause 61 provides that the commission must take reasonable steps to
protect any property seized and under its control.
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Clause 62 makes provision as to when property seized under a search
warrant must be returned to the person from whom it was seized.
Clause 63 makes it an offence to obstruct a person executing a warrant
made under this division.
Clause 64 provides that if the consent of the occupier of a premises is
obtained, an authorised officer may enter the premises, search for any
property-tracking document and if found, seize such a document.
Clause 65 provides that if an authorised officer believes that a
property-tracking document will be on a premises in the next 72 hours, they
may apply to a Justice of the Supreme Court for a search-warrant. Such an
application must state the grounds on which the warrant is sought.
Clause 66 provides certain things that a Justice of the Supreme Court
must be satisfied of before issuing a search warrant.
Clause 67 sets out what a search warrant issued by a Supreme Court
Judge must state.
Clause 68 sets out the powers that a search warrant may confer upon
an authorised officer.
Clause 69 provides that a document that is subject to legal professional
privilege is not except from seizure under a search warrant. However, a
document that is seized that is otherwise subject to legal professional
privilege cannot be used against a person in any other criminal or civil
proceedings.
Clause 70 provides that an authorised officer may apply to a Justice of
the Supreme Court for a monitoring order which directs a financial institution
to provide information to the commission about the person in question. Such
an application must state the grounds on which the order is sought.
Clause 71 provides that a Justice of the Supreme Court may make
such an order only if satisfied that the person concerned has been, or is about
to be, involved in serious crime related activity or has acquired or is about to
acquire serious crime derived property or illegally acquired property.
Clause 72 sets out what a monitoring order must state.
Clause 73 provides that a monitoring order takes effect on the start of
the day that notice of the order is given to the financial institution.
Clause 74 provides an offence for a financial institution that has been
given notice of a monitoring order to contravene the order or give false or
misleading information pursuant to it.
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Clause 75 provides an offence for a financial institution that has been
given notice of a monitoring order to disclose the existence or the operation of
the order to a person other than the commission or its authorised officer, an
officer of the institution itself or a lawyer acting for the institution. Further, the
clause provides that a person to whom the existence of the order has been
disclosed, must not disclose it, other than in accordance with the above
provisions.
Clause 76 provides that if a financial institution believes that
information it holds may be relevant to an investigation of a serious crime
related activity or may otherwise be of assistance to the enforcement of this
Act, the financial institution may give the information to the commission. If this
is done, no action will lie against the institution or an officer of the institution
for their action.
Clause 77 provides for protection to a financial institution that is subject
to a monitoring order, from any offence relating to money laundering.
PART 5 GENERAL
Clause 78 provides that a proceeding under this Act must be dealt with
summarily before a magistrate. Exceptions relate to clauses 25 (contravention
of a restraining order), 74 (offence to contravene monitoring orders) and 75(1)
(existence and operation of monitoring orders not to be disclosed).
Clause 79 provides relevant standards of evidence to be observed in
proceedings under this Act.
Clause 80 makes provisions regarding responsibility for acts and
omissions of a representative of a person or body.
Clause 81 places the responsibility to ensure a corporation complies
with the provisions of this Act on the Executive Officers of that corporation.
Clause 82 provides that serious crime related activity can form the
basis of a number of orders that are provided for under this Act.
Clause 83 allows for orders to be made for the disposal of interests in
property which are not derived from serious crime related activities if it is
impractical to dispose of only the tainted interests in the property. in this
event, the court may make orders to compensate the person for any loss of
innocent interest in the property.
Clause 84 provides that a notice under this Act will be taken to have
been given if it is given to the legal representative of a person who is dead.
Further, any reference to property in relation to a person who is dead will be
taken to be made to the property that the person held immediately prior to
their death.
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Clause 85 provides that if a restraining order has been made with
respect to property that is vested in joint ownership and one party dies, this
does not operate to vest the property in the other joint owner.
Clause 86 gives the court power to declare void any scheme that was
put in place to avoid the operation of the provisions of this Act.
Clause 87 restricts both a proceeds assessment order being made
under this Act as well as a monetary penalty order under the Crimes
(Confiscation) Act, 1989. Nor can a restraining order be made under both Acts
to be in force at the same time.
Clause 88 allows a court to make orders it considers appropriate
relating to the publication of proceedings under this Act.
Clause 89 provides that it is not a ground to grant a stay in a
proceeding under this Act if a criminal proceeding has been started.
Clause 90 provides that no duty is payable under the Duties Act, 2001
in relation to the vesting of property under s 25 (exclusion of property from
restraining order and assets forfeiture order) and s 57 (orders can be
extended into innocent interests).
Clause 91 allows the Governor-in-Counsel to make Regulations under
this Act. However, such a regulation can only create an offence and prescribe
a penalty for the offence of up to 20 penalty units.