“(a) to deprive persons of the proceeds of, and benefits derived from, the commission of offences against the laws of the Commonwealth or the Territory;
(b) to provide for the forfeiture of property used in or in connection with the commission of such offences; and
(c) to enable law enforcement authorities effectively to trace such proceeds, benefits and property.”
The objects of the Act also include, in s. 3(2) of the Act:
(a) providing for the enforcement in the Territories of forfeiture orders, pecuniary penalty order and restraining orders made in respect offences against the laws of the States;
(b) facilitating the enforcement in Australia, pursuant to the Mutual Assistance Act, of forfeiture orders, pecuniary penalty orders and restraining orders made in respect of foreign serious offences; and
(c) assisting foreign countries, pursuant to the Mutual Assistance Act, to trace the proceeds of, benefits derived from and property used in or in connection with the commission of foreign serious offences.”
Section 43 of the Act gives the Director of Public Prosecutions (our District Attorney) the power to apply to a court for a restraining order, which may prevent the distribution of a defendant’s property and may also direct the Official Trustee to take custody and control of his property. An application such as this may be made upon conviction for any relevant Commonwealth indictable offence. Where the offence is a “serious offence” the court is obliged by s.44(1) to make a restraining order , subject to specific exceptions:
ss 44(3), (4), (7A), and (10).
Section 30 of the Act provides that where there has been a conviction for a serious offence and there is a restraining order in force six months after the date of conviction, the property which is the subject of restraining orders - and which is not the subject of an order pursuant to s.48(4) - is automatically forfeited to the Commonwealth at the end of a period of six months from the day of the conviction. The time for such forfeiture can be extended by application pursuant to s. 30A of the Act.
Section 48(4) of the Act provides that where a person has been convicted of a serious offence, and a court has made a restraining order against property in reliance on the conviction, the defendant, where he has an interest in that property, may apply to the court for a declaration that the restraining order relating to that property be disregarded for the purposes of s.30.
A declaration, under s.48(4), may be made if the court to which the application is made is satisfied that:
“….
(i) the property was not used in, or in connection with, any unlawful activity and was not derived, directly or indirectly, by any person from any unlawful activity; and
(ii) [his] interest in the property was lawfully acquired.”
“Unlawful activity” is defined in s.4(1) of the Act to mean
“an act or omission that constitutes an offence against a law in force in the Commonwealth, a State, a Territory or a foreign country.”
The words “any unlawful activity” are not limited. The offences encompassed need not be, or be equivalent to, the “serious” offence of which the applicant was convicted or an indictable offence: Director of Public Prosecutions (Cth) -v- Jeffrey (1992) 58 A Crim R 310.
The phrase “used ….in connection with” was interpreted by Hunt CJ at CL in Jeffrey as requiring:
“a substantial connection between the activity in question and the use of the property. It is not sufficient for there to be a mere accidental or incidental connection. The unlawful activity must be related to, or dependent upon, or could not have been committed without, or have resulted directly from, the use of the property.”
If the court is satisfied of the matters contained in paragraph (e) of s.48(4) the property will not be the subject of automatic forfeiture at the expiry of the relevant period.
The purpose of the Act is to confiscate proceeds of crime. The Act is expressed in the clearest of terms and the Act clearly sets out a power to bring proceedings to confiscate proceeds, and to only allow a benefit to the person guilty of a crime where it can be shown that those assets were lawfully obtained whether here or in other jurisdictions.
If I may cite a case which was heard some few months ago before me, our Italian friends may find it interesting to observe the complications of Federation, that the Commonwealth of Australia brings proceedings before a State judge in a State court to enforce a Commonwealth law. Indeed, the Commonwealth even prosecutes Commonwealth offenders in State courts, and people are incarcerated in State prisons by State judges for Commonwealth offences. This case, Department of Public Prosecutions v Spiteri indicates some of the developments that have occurred in our law.
Commonwealth DPP v Spiteri:
Spiteri was convicted of importing a prohibited drug, cocaine, of a quantity being not less than the commercial quantity. That offence is a “serious narcotics offence” as defined in s.7 of the Act. Spiteri was sentenced to 14 years imprisonment with a non-parole period of 8 years. The Commonwealth obtained a restraining order pursuant to s.43(2)(a) of the Proceeds of Crime Act, preventing Spiteri or any other person from dealing with any of his property which was to be forfeited pursuant to s. 30 of the Act unless a declaration was made pursuant to s.48(4) of the Act that the property or part thereof was otherwise excluded from the restraining order. Spiteri applied for the exclusion of his property.
The property to which the restraining order applied was:
1. Approx $(US) 20,000.00 held in Spiteri’s name with the Chemical Bank, New York, USA and other sums in various Maltese, Panamanian , U.S, and Australian bank accounts.
2. Two motor vehicles including a Mercdes Benz in Malta
3. Works of art and sculptures created by Spiteri which are located in the United States of America.
4. $4,000.00 (AUD) seized by the Australian Federal Police on 4 June 1996.
5. $250,000.00 (US) held in an account in Spiteri’s name with the Banca Nazionale Del Lavoro, in Roma Italy.
Spiteri’s case was that all of the property to which the application related was acquired lawfully from legitimately earned sources, investment in property, savings and earnings and interest on those earnings, the proceeds of the sale of works of art and sculptures made by the Spiteri, proceeds from the sale of various motor vehicles and real estate, and loans from members of his family.
Under s.48(4)(e) of the Act the onus of establishing that the property was not derived from any unlawful activity as described in the Act is clearly placed by the statute as being on the applicant. It is the applicant who bears the legal and ultimately the persuasive onus of satisfying the court of the factors in paragraph (e).
In order to establish the negative facts stated in sub-paragraph (i) of Section 48(4)(e) an applicant must not only to deny on oath in general terms that the subject property was used in or derived from unlawful activities but must also establish the activities it was in fact used in and derived from: per Hunt J in Jeffrey. Where an applicant swears a denial that his property was used in the commission of an unlawful activity, or derived from such unlawful activity, he has in fact set up a prima facie case. If his account is accepted by the court as being honest and accurate his onus is discharged.
The applicant submitted, and his evidence was, that all of the property identified had been not been used in or in connection with any unlawful activity, and was not derived directly or indirectly from any unlawful activity but was derived from his savings over a significant period of time from legitimate earnings, principally from paid employment, from loan funds obtained from relatives, and from the sale of his artistic items being various art works and sculptures.
I was not convinced by Spiteri’s story as to the acquisition of the assets, and eventually made orders which had the effect of Spiteri forfeiting all of his assets internationally, with the exception of the sum of $US 30,00.00 which I considered was a proper estimate of the assets that he had lawfully obtained. Assets in Europe, USA, Italy and Panama were not protected from Australian law.
Mutual Assistance in Criminal Matters Act (Cth) 1987
One of the Australian legislative measures that assists in recovery of international criminal assets was referred to by me in that judgment in Spiteri, that is the Mutual Assistance in Criminal Matters Act (Cth) 1987. This Acts sets up a scheme for the international assistance for enforcing offences under the criminal law of Australia, and for preventing money laundering and other international crime. The objects of the Act are to provide for international criminal assistance in other countries when a request is made by a foreign country for the taking of evidence, or the issue of warrants or recovery of pecuniary penalties in respect of a foreign serious offence, and the restraining of dealings in property that may be forfeited or confiscated. The Act facilitates the provision of
international assistance in criminal matters in Australia, and facilitates the obtaining by Australia of international assistance in criminal matters.
This Act obviously will incorporate treaties made between particular countries. Some of you may be aware, but some of you may not, that Australia and the Republic of Italy, desiring to promote collaboration in the field of assistance in criminal matters, have entered into such a treaty applying the Mutual Assistance Act, that treaty having been signed in October 1988, and regulations under the Act commenced that Mutual Assistance Treaty with domestic application in both counties on 1 April 1994. Those of you who have clients charged with criminal matters or who may be the sort who are likely to commit such offences may be reminded of the provisions of the legislation.
The Act provides that whether or not assistance is to be provided is determined by the Australian Attorney-General: s.9.
A request for assistance by Australia to a foreign country may only be made by the Attorney-General: s.10(1). Part II of the Act sets out what kind of requests can be made by Australia (s.12) to a foreign country and visa versa (s.13). Such requests may include the following:
· evidence to be taken in the foreign country in accordance with the law of that country;
· a document or other article in the foreign country to be produced in accordance with the law of that country.
Section 12(3) provides that when making any such request Australia may also request that an opportunity be given for the person giving evidence, or producing the document or other article, to be examined or cross-examined through video link from Australia.
Part III of the Act deals with requests for assistance in relation to search and seizure by Australia (s.14) and foreign countries (s.15). Part IV of the Act deals with the arrangements for persons to be extradited to give evidence or assist in investigations.
In conjunction with this Act or other Commonwealth Acts there are a number of Regulations that have been passed in addition to the Italian regulation. The Mutual Assistance in Criminal Matters (Traffic in Narcotic Drugs and Psychotropic Substances) Regulations for example, which were assented to on 9 December 1992 and which commenced on the date of the commencement of the Crimes (Traffic in Narcotic Drugs and Psychotropic Substances) Act 1990, list the countries to which the Act applies. Italy is listed as one of those countries.
International outreach of New South Wales Law:
NSW Crimes Act - Section 3A:
To give you an idea of the outreach of criminal law in my State, a new s 3A was inserted by the Crimes (Application of Criminal Law) Amendment Act 1992 to our Act, dealing with almost all crimes, in the words of the Minister introducing the Bill in his Second Reading speech, “to overcome the difficulties of establishing jurisdiction which arises in certain criminal cases where there is no evidence to indicate the place of commission of all of the elements of the crime or where different elements occur in different jurisdictions”. Section 3A relevantly provides as follows;
“Territorial application of the criminal law of the State
(1) An offence against the law of the State is commenced if:
(a) all elements necessary to constitute the offence (disregarding territorial considerations) exist; and
(b) a territorial nexus exists between the State and at least one element of the offence.
Section 3A has not been considered at great length by the courts in New South Wales but has been considered in two conspiracy cases: R v Catanzariti (1995) 81 A Crim R 584 and R v Issac and Others (NSW Court of Criminal Appeal, 5 February 1996).
I have myself, some little time ago, heard a case applying s.3A. That case was subject to an appeal which about two or three weeks ago was withdrawn, and my decision therefore stands.
In the case known as DPP v Martin, the facts were that
a Summons was issued seeking a determination of a Stated Case under s.101 of the Justices Act 1902 by way of appeal from a magistrate, who had entered judgment for the defendant, Martin, dismissing a charge against him under s.112 of the Independent Commission Against Corruption Act 1988 (“the ICAC Act”) on finding that the information laid against him under s.52 of the Justices Act 1902 was invalid.
The information laid against the Respondent alleged that Martin “on 20 August 1995 at Townsville in the State of Queensland did make a publication in contravention of a direction given under s.112 of the ICAC Act 1988, in that he did publish to a person the fact that another witness had given evidence at a hearing before the Independent Commission Against Corruption, such publication being in contravention of a direction given on 15 August 1995 at Redfern in the State of New South Wales by the Hon. B.S.J O’Keefe, AM QC, Commissioner”.
The I.C.A.C. Act 1988 was introduced by my government partly based on a similar Act in Hong Kong to combat systemic corruption within certain criminal areas of government, particularly the police force. It was a curious irony that the Premier of my then government, over a public service appointment, was being found to be corrupt by the Independent Commissioner Against Corruption who he had appointed. The matter went on appeal, but he was obliged to resign in the meantime. He was held on that appeal not to have been corrupt, but that was little consolation to him.
In DPP v Martin, Martin submitted that section 3A of the Crimes Act did not save the information, as there is no element of the offence having a territorial nexus with the State of New South Wales.
Counsel submitted that the offence was a “result offence”, the result occurring outside the jurisdiction of New South Wales;
Brownlie v State Pollution Control Commission (1992) 27 NSWLR 78 and Union Steamship Company of Australia v King (NSW Court of Appeal 3 November 1987, unreported). In Brownlie v State Pollution Control Commission, the Court defined the term “result offence” as one being:
“[t]he occurrence, or likelihood of occurrence, of a certain consequence is a necessary element of the offence” (at p.83).
Chief Justice Gleeson delivering the leading judgment of the Court then held that:
“…a New South Wales Court does have jurisdiction to try a person with a “result offence” where the result is one that occurs, or is likely to occur, in New South Wales, even though the acts bringing about that result took place outside New South Wales…” (at pp.83-84).
Counsel for the defendant in that case submitted that because the s.112(2) offence occurred in Queensland and not in New South Wales, courts in New South Wales did not have jurisdiction to hear the matter. I held that this was not the correct test to determine whether a territorial nexus exists.
Section 3A(2) of the Crimes Act sets out the test to determine whether a territorial nexus exists between the State and an element of an offence. The provision states that for a territorial nexus to exist the element of an offence must occur or must include an event occurring in the State: s3A(2)(a), or the element must occur or must include an event that occurs outside the State but while the person alleged to have committed the offence is in the State: s 3a(2)(b). A territorial nexus will thus exist if an element is or includes an event occurring in the State.
The word “element” in section 3A means “all elements necessary to constitute the offence”: s 3A(1)(a). “Event” is defined in s 3A(10) as meaning “any act, omission, occurrence, circumstance or state of affairs (not including intention, knowledge, or any other state of mind)”. The term “event”, it appears, has been given a broad definition.
I accepted and agreed with the submissions put to me by counsel for the Appellant, that the direction given by Commissioner O’Keefe on 15 August 1995 was clearly an element of the offence under s.112(2). In terms of the language of the section the direction must be a “circumstance” or “state of affairs”. I found that the direction, in being an element of the offence, was an “event” for the purposes of s.112(2)(a). The direction is not an element that is a state of mind (as was the case in R v Issac and Others cited above), which is nevertheless excluded from the definition of an event but is, in broad terms a “circumstance”: s.3A(10). The Australian Macquarie Dictionary defines the term “circumstance” to mean:
“1. a condition, with respect to time, place, manner, agent, etc.. which accompanies, determines, or modifies a fact or event..”
I found that the direction was a condition with respect to manner which accompanied an event, namely the giving of the evidence, and was thus a circumstance. The direction thus being a circumstance, is therefore by the definition of s.3A(10), an event.
I also found that the direction occurred in the State of New South Wales. This being so, a territorial nexus under s.3A(2) can be said to have existed, and s.3A is applicable.
It is therefore now a lot easier to commit an offence which is substantially an overseas offence, and thus which may have consequences in terms of a criminal conviction in New South Wales. This case is but one example of the way in which offences outside Australia can be punished in Australian courts.
Other Legislation:
In addition to the provisions of the Confiscation Acts which I have set out above, with its international ramifications, there is other legislation such as operated by our NSW Crime Commission with similar bodies in other States, which enforces confiscation of assets, and I cite in particular the NSW Criminal assets Recovery Act 1990. That act provides for the confiscation, without requiring a conviction, of the property of a person if the Supreme Court finds it more probable than not that the person has engaged in serious related activities, and to enable the proceeds of serious crime related activities to be recovered, and to enable law enforcement with the authorities to identify and recover crime.
Our sophisticated and indeed not so sophisticated perpetrators of crime may have their lives rendered a little more difficult. We may even deter a little crime, but we will have at least have recovered some of the enormous costs of law enforcement in the assets that we confiscate.
Child Sex Tours:
I just want to remind our Australians, and to enlighten others at this conference, that Australia has not just confined its activity to the recovery of property and punishing property and drug offences in its international outreach. I refer to the Commonwealth law, the Crimes (Child Sex Tourism) Amendment Act 1994.
The Commonwealth Parliament and to some extent the State Parliaments have set up procedures for the examination of legislation before it is introduced into Parliament. The Commonwealth Government, irrespective of which party has been in power, has had an impressive Parliamentary Select Committee procedure whereby evidence is taken in various States and reports are submitted on proposed legislation, and in many cases the legislation that is produced is much better and more effective legislation.
We have a problem in Australia that offences relating to the perpetration of sex offences against children, which were prohibited in Australia, could be carried out by Australians in nations in our region where children are readily available. This disgusting trade was a blot on Australia’s reputation and an indictment of the way Australians deal with the citizens of neighbouring countries. To this end legislation was introduced, with the support of all political parties, to stop this pernicious trade.
In my capacity as President of the Australian Section of the International Commission of Jurists (ASICJ) I was asked and happily gave evidence before that Parliamentary Select Committee pointing out a series of problems that the ASICJ found.
This Act specifically provides for the prosecution of sexual offences against children committed overseas, that is, not in Australia. In brief, the Act deals with who can be prosecuted for an offence committed overseas. Evidence can be taken by videolink and the conduct of the trial can take place in Australia.
The Act aims to ensure that crimes committed against children outside Australia which are not prosecuted in the country in which they were committed can be prosecuted effectively in Australia. The Act also deals with the activities of those who promote, organise and profit from child sex tourism. Provided they operate from Australia, or have a relevant link with Australia, they too will be able to be prosecuted for their contribution to the abuse of children in a foreign country.
This legislation was passed on the basis of Australia’s obligations to protect children, that is, as a signatory to the United Nations Declaration of the Rights of the Child.
Summary:
I have endeavoured to give an overview which demonstrates the recent Australian legal developments which have tipped the balance of law enforcement a little more in favour of the people of Australia against those who commit crime. That law is still developing and unfolding.
As you can see, it has international ramifications which can now easily extend to countries such as Italy, and there are now many overseas people who may have to consider whether their activities come within the purview of Australian laws. This will be an increasingly difficult task on which Australian and overseas lawyers may have to advise.
I hope I have been able to give you some insight into the way the law has developed in a country such as Australia. I hope that this conference will assist us all in learning from the experience of each other in carrying out our domestic and international obligations.
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