David Feeney (Batman, Australian Labor Party, Shadow Minister for Justice) Share this | Link to this | Hansard source

I rise to speak on the Crimes Legislation Amendment (Proceeds of Crime and Other Measures) Bill 2015. This bill amends the Proceeds of Crime Act 2002, the POC Act; the Criminal Code Act 1995, the Criminal Code; the Anti-Money Laundering and Counter-Terrorism Financing Act 2006, the AML/CTF Act; and the AusCheck Act 2007, the AusCheck Act. It contains five schedules which will implement a range of measures to improve and clarify Commonwealth criminal justice arrangements, including amending the POC Act to clarify the operation of the non-conviction based proceeds of crime regime in response to recent court decisions; amending the Criminal Code to insert two new offences of false dealing with accounting documents and amending the serious drug offences in part 9.1 of the Criminal Code to clarify the definitions of the terms 'drug analogue' and 'manufacture' and ensure that they capture all relevant substances and processes. It will clarify and address operational constraints identified by law enforcement agencies with the AML/CTF Act and expand the list of designated agencies authorised to access AUSTRAC information so that it includes the Independent Commission Against Corruption of South Australia. Finally, it will clarify and extend the circumstances under which AusCheck can disclose AusCheck background check information to the Commonwealth and to state and territory government agencies performing law enforcement and national security functions.

Labor will continue to support the government in building stronger laws that tackle criminal kingpins and take the profit out of crime. Schedule 1 will amend the POC Act to clarify the operation of the non-conviction based confiscation regime provided under that act. The non-conviction based forfeiture scheme is an essential tool under the POC Act, which is designed to target those who distance themselves from the commission of offences but profit as a result of illegal activity. Under the POC Act, a proceeds of crime authority—the Commissioner of the Australian Federal Police or the Commonwealth Director of Public Prosecutions—may apply to restrain property that is reasonably suspected of being the proceeds of crime without requiring any person to be charged. The restrained property may later be forfeited if the court is then satisfied, on the balance of probabilities, that the property is indeed the proceeds of crime. The non-conviction based regime operates in addition to the conviction based forfeiture scheme. Section 319 of the POC Act provides that the fact that criminal proceedings have been instituted or have commenced, whether or not under the POC Act, is not a ground on which a court may stay proceedings under this act that are not criminal proceedings. This reflects the parliament's intention that the non-conviction based scheme could operate even where criminal proceedings are on foot. The measures in schedule 1 of the bill address issues relating to the non-conviction based forfeiture scheme raised in two court decisions in 2015: the Commissioner of the Australian Federal Police v Zhao and in the matter of an application by the Commissioner of the Australian Federal Police.

Schedule 1 of the bill contains amendments to the POC Act following these decisions to clarify the principles a court may consider when granting an application for a stay of proceedings under the POC Act, including providing grounds on which a stay is not be granted; strengthen protections against disclosure and use of material related to the confiscation proceedings in subsequent criminal proceedings and clarify that, where an exclusion application has been made pursuant to division 3 of part 2-1, which deals with restraining orders under the POC Act, this application must be heard and finalised prior to the hearing of a forfeiture application.

Schedule 2 will amend the Criminal Code to create two new offences of false dealing with accounting documents. These offences implement Australia's obligation as a party to a convention of Organisation for Cooperation and Development, OECD: the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. Article 8 of the convention requires parties to create offences of false accounting for the purposes of concealing or enabling bribes to a foreign public official. The two new offences are inserted in a new division of the Criminal Code titled 'Division 490 False dealing with accounting documents' in a new part titled 'Part 10.9 Accounting records'. The first of the two new offences, at section 490.1 of the Criminal Code, applies where a person makes, alters, destroys or conceals an accounting document or a person fails to make or alter an accounting document that the person is under a duty to make or alter, with the intention that the person's conduct would facilitate, conceal or disguise the receiving or giving of a benefit that is not legitimately due or a loss that is not legitimately incurred. The second offence, at section 490.2, applies in the same circumstances as the first offence but where the person is reckless as to whether the benefit or loss would arise.

Schedule 2 provides for penalties proportionate to the differing fault element structure of each offence. The offence at section 490.1 imposes a maximum penalty for an individual of 10 years imprisonment, a fine of 10,000 penalty units—that being $1.8 million—or both. The maximum penalty for a body corporate is the greater of (a) 100,000 penalty units, (b) where the court can determine the value of the benefit, three times the value of the benefit obtained by the body corporate and any related body corporate from the offence and (c) where the court cannot determine the value of the benefit, 10 per cent of the annual turnover of the body corporate during the 12 months ending at the end of the month during which the conduct constituting the offence occurred. For the second offence at section 490.2, to which the lower fault element of recklessness attaches, the penalties are half of the penalties for the offence at section 490.1.

The offences will apply both within Australia and overseas, in prescribed circumstances where constitutional power permits. Section 490.6 provides it is necessary to seek the Attorney-General's consent to commence proceedings where the alleged conduct occurs outside Australia and where the alleged offender is not an Australian citizen, an Australian resident or a body corporate incorporated by or under a law of the Commonwealth or of a state or territory. This requirement to seek the Attorney-General's consent should ensure that, in circumstances where the nexus between the offending conduct and Australia may not be obvious, the Attorney-General is given the opportunity to review relevant considerations concerning international law prior to deciding, at his or her discretion, whether to consent to the commencement of proceedings. It is intended that the office of international law in the Attorney-General's Department would be consulted prior to seeking the Attorney-General's consent.

Schedule 3 will amend the serious drug offences in part 9.1 of the Criminal Code to clarify the definitions of the terms 'drug analogue' and 'manufacture' and ensure that they capture all relevant substances and processes. The schedule makes two amendments to the definition of 'drug analogue' in section 301.9 of the Criminal Code. First, it clarifies that the terms 'addiction' and 'replacement' have their ordinary meaning, not their scientific meaning. This change is necessary to remove ambiguity in the section and ensure that it operates to capture all substances that are structurally similar to listed controlled and border controlled drugs. Secondly, the schedule clarifies that a substance will be a drug analogue of a listed controlled drug even if that substance is also listed as a border controlled drug and vice versa. These amendments are necessary to remove ambiguities in the section, as has been highlighted by the decision of the ACT Supreme Court in R v Poulakis. The schedule also amends the definition of the term 'manufacture' in section 305.1 to ensure that it applies to processes where a substance is converted from one form into another, but which do not necessarily create a new substance or change the chemical structure of the substance. These changes are necessary to remove ambiguities in the definition, which have been highlighted by the decision of the Victorian Court of Appeal in Beqiri v R (2013) 37 VR 219.

Schedule 4 will amend the AML/CTF Act to clarify and address operational constraints identified by law enforcement agencies, and enable a wider range of designated officials and agencies to access and share information obtained under the AML/CTF Act. These amendments will, firstly, list the Independent Commissioner Against Corruption of South Australia (ICAC SA) as a 'designated agency' under section 5 of the AML/CTF Act, which will then enable it to access AUSTRAC information, subject to the requirements of section 126 of that act; secondly, it will enable the AFP and the ACC to share AUSTRAC information with the International Criminal Police Organisation (INTERPOL) and the European Police Office (Europol), and provide for a regulation-making power to enable additional international bodies to be prescribed in future; and, thirdly, it will clarify the circumstances in which entrusted investigating officials of the Australian Federal Police (AFP), the Australian Crime Commission (ACC), the Department of Immigration and Border Protection (DIBP), and the Australian Commission for Law Enforcement Integrity (ACLEI) may disclose information obtained under section 49 of the AML/CTF Act.

Schedule 5 will make amendments to part 1 and division 1 of part 3 of the AusCheck Act to clarify and extend the circumstances under which AusCheck can share AusCheck scheme personal information. Specifically, the amendments in schedule 5 will enable AusCheck to directly share AusCheck scheme personal information with a broader range of Commonwealth agencies and with state and territory government agencies performing law enforcement and national security functions. AusCheck scheme personal information is defined in subsection 4(1) of the AusCheck Act and includes information relating to an individual's identity and information obtained as a result of an AusCheck national security background check. The purpose of these amendments is to support Commonwealth and state and territory agencies performing law enforcement and national security functions by providing access to AusCheck scheme personal information, as appropriate.

AusCheck is a branch within the Attorney-General's Department (AGD) that provides national security background checking services for the Aviation Security Identification Card (ASIC), Maritime Security Identification Card (MSIC), and National Health Security (NHS) check regimes. This background check is intended to identify individuals who should not be allowed access to secure areas of Australia's airports or seaports or to security sensitive biological agents (SSBA). A background check, defined in section 5 of the AusCheck Act, is an assessment relating to an individual's identity, criminal history, security assessment, citizenship status, residency status or entitlement to work in Australia. Background checks are conducted under the Aviation Transport Security Act 2004 (ATSA), the Maritime Transport and Offshore Facilities Security Act 2003 (MTOFSA), or other primary legislation or legislative instruments.

AusCheck undertakes background checking activities within a legislative framework comprising the AusCheck Act and the AusCheck Regulations 2007. This framework is supported by guidelines for accessing information on the AusCheck database (AusCheck guidelines). AusCheck uses information provided by an applicant for an ASIC, MSIC or NHS clearance to request a security assessment from the Australian Security Intelligence Agency (ASIO), a criminal history check from CrimTrac and, if necessary, a citizenship status check from the Department of Immigration and Border Protection. Providing a centralised government background checking mechanism for these sectors means that private organisations and industry bodies do not need to deal with sensitive information, including personal and criminal history information. The vast majority of AusCheck activities relate to the ASIC and MSIC schemes, which are established under the Aviation Transport Security Act 2004 and the Maritime Transport and Offshore Facilities Security Act 2003. The Department of Infrastructure and Regional Development administers these schemes.

The information handling provisions in AusCheck's legislative framework are primarily addressed at obtaining, using and disclosing information for purposes connected to background checking. There is some scope for information sharing for other purposes—section 14(2)(b)(ii) and (iii) allow AusCheck to use or disclose information in responding to a national security incident and for law enforcement or security intelligence purposes by the Commonwealth, or by Commonwealth authorities with law enforcement or national security functions. AusCheck is limited in its ability to share AusCheck scheme personal information. Currently, AusCheck can share with Commonwealth and relevant Commonwealth authorities with functions relating to law enforcement or national security. These restrictions limit the flow of relevant information to other Commonwealth agencies dealing with national security and crime threats. They also prevent AusCheck from sharing relevant information with Commonwealth agencies which are not traditionally considered to be law enforcement agencies but which may require access to the information for law enforcement or national security purposes. AusCheck is also unable to directly share information with state and territory agencies with functions relating to law enforcement or national security, including state and territory police.

These restrictions are at odds with the significant role these agencies play in law enforcement and national security, and the collaborative approach that is necessary to combat the cross-border threats of terrorism and serious crime. This also causes particular challenges for agencies that undertake law enforcement and national security operations at secure airport and maritime port areas, such as state and territory led police taskforces targeting drug importation. In order to address these challenges and support the efforts of agencies performing law enforcement and national security functions, schedule 5 to the bill amends the AusCheck Act to enable AusCheck to directly share information with state and territory authorities and with a broader range of Commonwealth authorities. This sharing will continue to be limited to the performance of functions relating to law enforcement or national security, and it will be subjected to strong safeguards.

Appropriate safeguards are in place to protect the disclosure of AusCheck scheme personal information under the AusCheck Act. Criminal offences are included in section 15 of the AusCheck Act, which makes it an offence to unlawfully disclose AusCheck scheme personal information. An offence under this section is punishable by up to two years imprisonment. These offences provide additional protections for information obtained by AusCheck and create an obligation on AusCheck staff to ensure information is shared appropriately at all times. AusCheck issues privacy notices to applicants advising them how their information will be used and to acquire consent for the collection and disclosure of their personal information. Each applicant receives a privacy notice and the privacy policy is also published on the AusCheck webpage.

The Secretary of the Attorney-General's Department issues the AusCheck guidelines under regulation 15 of the AusCheck regulations which establish a compulsory framework for AusCheck staff to consider in determining the legality of requests for personal information under subparagraph 14(2)(b)(iii) of the AusCheck Act. The AusCheck guidelines implement recommendation 46 of the AusCheck privacy impact assessment for the development of a protocol relating to the disclosure of AusCheck scheme personal information.

The AusCheck guidelines are developed in consultation with agencies that will be receiving information, to ensure appropriate contact officers and authorisations are in place. The AusCheck guidelines are published on the AusCheck webpage. They require Commonwealth agencies seeking access to AusCheck scheme personal information to be a 'recognised Commonwealth authority' or accredited as an 'authority to use information for law enforcement and national security purposes'. In order to be so accredited, agencies must provide information to AusCheck establishing its law enforcement or national security functions and the legislative or other authority supporting this function. Information is only shared with nominated senior executives, and written undertakings outline the law enforcement or national security purposes for the information. The AusCheck guidelines will continue to apply how information is shared with Commonwealth authorities under subparagraph 14(2)(b)(iii). To ensure appropriate accreditation and protections for information shared with state and territory authorities under new subparagraph 14(2)(b)(iiia), state and territory authorities will also be subject to AusCheck guidelines established under regulation 15 of the AusCheck Regulations.

AusCheck has memoranda of understandings in place with relevant authorities that set out the key principles and obligations relating to the sharing of AusCheck scheme personal information. The MOUs outline the purposes for which AusCheck information may be shared, and they place obligations on receiving agencies to manage and control access to AusCheck information at all times so as to protect the privacy of individuals and the confidentiality of the information received. These safeguards will continue to apply to information disclosed under new subparagraphs 14(2)(b)(iii) and (iiia) to ensure AusCheck scheme personal information is only accessed by Commonwealth, state and territory agencies performing law enforcement or national security functions, and this information is dealt with appropriately within these receiving agencies. Agencies that receive AusCheck scheme personal information are also required to comply with all relevant privacy, recordkeeping, records disposal, auditing and reporting requirements. We thank the minister for briefing the opposition on the measures found in this bill.

In conclusion, to ensure the proper scrutiny of this bill, Labor will be referring it to the Senate Legal and Constitutional Affairs Legislation Committee. This will ensure that the bill receives a proper level of scrutiny from interested stakeholders, and will ensure that the legislation that goes forward is indeed meeting the intent of this parliament. We will carefully consider the views expressed to the committee and the final committee report when it is released in due course. Labor has championed legislation in both government and opposition to ensure that our law enforcement agencies have the powers they need to confiscate unexplained wealth from criminal figures. This is a critical weapon to enable our law enforcement agencies to crush criminal organisations in Australia. Labor will support the measures in this bill, which will improve and clarify criminal justice arrangements pending any negative outcomes reported by the Senate committee. I commend the bill to the House.

Karen McNamara (Dobell, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Crimes Legislation Amendment (Proceeds of Crime and Other Measures) Bill 2015, a bill which improves and provides further clarification to Commonwealth justice arrangements. The bill makes important amendments to the Proceeds of Crime Act 2002, the Criminal Code Act 1995, the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 and the AusCheck Act 2007. The amendments are a multi-faceted approach to improvements that will, through the five schedules included, further enhance the abilities of Commonwealth investigative and prosecutorial bodies to operate and gather intelligence, target and confiscate proceeds of crime, and provide overall improvements to their administrative efficacy.

Schedule 1 of the bill will amend the Proceeds of Crime Act 2002—the POC Act—to elucidate the functions of the non-conviction based confiscation system provided for in this act. The non-conviction based scheme of forfeiting proceeds of crime was introduced in 2002 after the Confiscation that counts report by the Australian Law Reform Commission noted the Commonwealth's conviction-based proceeds of crime laws were deficient. Through advanced technology and globalisation, people at the head of criminal organisations could separate themselves from individual acts of crime, thereby avoiding criminal conviction and keeping their profits from crime out of reach of conviction based laws.

The POC Act provides for a scheme to trace, restrain and confiscate the proceeds and instruments of, and benefits gained from, Commonwealth and foreign indictable offences, as well as certain offences against state and territory law. The confiscated property may later, if a court is satisfied on the balance of probability that the property consists of proceeds of crime, be forfeited. The non-conviction based scheme will operate in addition to the conviction based forfeiture scheme. Within the POC Act, new subsections under section 319 clarify whether a court may or may not grant a stay. The provision is a particular reflection of the parliament's intention that the non-conviction based scheme may operate concurrently with criminal proceedings in motion. Concurrent civil and criminal proceedings are possible and therefore require specific consideration of the individual circumstances and associated risks of prejudice in order to determine if a stay is able to be granted. The amendments to the POC Act also reinforce protections against the disclosure and use of material related to the confiscation proceedings in subsequent criminal proceedings. There are safeguards against prejudice where a person is facing both proceeds of crime and criminal proceedings.

Schedule 2 of the bill makes amendments to the Criminal Code Act 1995—that is, the Criminal Code—to create new offences that relate to the falsification of accounting documents. The two amendments have been implemented to ensure we fulfil our obligation as party to the Organisation for Economic Cooperation and Development's Convention on Combating Bribery of Foreign Public Officials in International Business Transactions—more simply known as the OECD antibribery convention. Article 8 of the OECD antibribery convention requires that parties create offences of false accounting for the purposes of concealing or enabling bribes to a foreign public official.

To date, Australia has relied upon section 286—that is, the obligation to keep financial records—and section 1307 on the falsification of books of the Corporations Act 2001 and similar state and territory offences to combat false accounting and demonstrate adherence to article 8 of the convention. Upon review in 2012, however, it was found that Australia was not fully implementing the requirements of article 8 as the OECD's working group on bribery found that the provisions either did not apply to a wide enough range of circumstances or did not apply adequate sanctions.

There are two new offences in the new division 490 of the Criminal Code that enforce dealing with accounting documents. They apply in instances where a person makes, alters, destroys or conceals an accounting document or where a person fails to make or alter an accounting document that the person is under a duty to make or alter with the intention that the person's conduct would facilitate, conceal or disguise the receiving or giving of a benefit that is not legitimately due or a loss that is not legitimately incurred. The second offence allows for the same as the first offence; however, it takes into consideration 'recklessness' as opposed to 'intention'. The penalties for these offences are proportionate to the seriousness of the offence—namely, the penalty for recklessness is half that of intentionally falsifying accounting documents.

Schedule 3 of the bill amends the Criminal Code part 9.1 in relation to serious drug offences. The amendments to the definition of 'drug analogue' will remove ambiguities to ensure the integrity of serious drug offences. It also clarifies that the terms 'addition' and 'replacement' have their ordinary meaning, not their scientific meaning.

Listed controlled and border controlled drugs are substances listed by their chemical structure. This alteration is necessary to ensure that all substances that are structurally similar to listed controlled and border controlled drugs, known as 'drug analogues', are captured. It ensures that the manufacturers of listed controlled and border controlled drugs are unable to avoid prosecution under the Criminal Code.

The Criminal Code contains offences relating to the manufacture of controlled drugs, defining 'manufacture' to be any process by which a substance is produced other than the cultivation of a plant and states that the processes of extracting or refining a substance and of transforming one substance into another are included in the meaning of 'manufacture'. The amendments contained in schedule 3 of this bill, however, will make it clear that a process which converts a substance from one form into another will fall within the meaning of 'manufacture'. This means that the Criminal Code will capture processes that change the form of a substance—for example, from a liquid to a powder or from a powder into a pill—but do not necessarily change the chemical structure of the existing substance.

The changes included in schedule 3 are a continuation of the government's commitment to take a tough stance on serious and organised crime, particularly drug crime. The current epidemic of the drug ice in Australia, about which I have spoken on many occasions, is testament to the necessity of these changes. We in government need to do everything we can to ensure that the manufacturers and peddlers of illicit drugs are able to be prosecuted with the full weight of the law.

Continued vigilance and support for our law enforcement and prosecution agencies is essential to being tough on people who commit crimes. The more we equip Australia's law enforcement and prosecution agencies, the more they can work to thwart the supply and manufacture of the illicit drugs that are causing so much destruction in communities.

That includes communities such as my electorate of Dobell, where I regularly hear of the destruction of families and relationships due to the use of illicit drugs, particularly ice. The family and friends of a 25-year-old woman are mourning the loss of her life after she consumed ecstasy at the Stereosonic festival in Sydney. Another woman, aged 22, escaped with her life after she was rushed to hospital in a coma. She had likewise consumed ecstasy. Despite a heavy police presence at the festival, these young people, along with many others, still rolled the dice with illicit drugs and risked their lives. Another 120 young people were treated at the festival for the effects of illicit drugs. As a government, we are committed to doing everything we can to stop the manufacture and supply of illicit drugs, because one less manufacturer could mean a life saved.

Schedule 4 of this bill provides further explanations to and addresses operational constraints that have been identified by law enforcement agencies in relation to the Anti-Money Laundering and Counter-Terrorism Financing Act 2006. The amendments enable a wider range of designated officials and agencies to access and share information obtained under the AML/CTF Act. Specifically, the definition of 'foreign law enforcement agencies' will be extended to include Interpol and Europol. There is a provision for a regulation-making power to enable additional international bodies to be prescribed in the future, although this will remain subject to parliamentary scrutiny.

This is to the benefit of Australia's relationship with foreign countries and international organisations, enabling efficient and effective cooperation in the investigation of transnational and multijurisdictional crime. The present definition of 'foreign for enforcement agency' means AUSTRAC information is only able to be shared with the government body that has responsibility for law enforcement in a foreign country or part thereof. It does not extend to international law enforcement coordination and cooperation bodies that are comprised of multiple member countries. The amendments included in schedule 4 of the bill address these issues.

The bill also amends the secrecy and access provision of the AML/CTF Act to ensure that entrusted investigating officials have clear authority to make external disclosures of information and documents obtained under the act where such disclosure is done for the purposes of or in connection with the performance of the duties and functions of their office. This includes investigative purposes such as disclosures in relation to obtaining warrants. It enables certain designated persons to obtain further information and documents through written notice, implementing international standards set by the Financial Action Task Force requiring competent authorities to obtain documents and information for use in investigations, prosecutions and related actions pertaining to money laundering and terrorist financing.

Schedule 5 of the bill makes amendment to the AusCheck Act 2007, specifically enabling AusCheck to directly share information with state and territory government agencies and a broader range of Commonwealth agencies which are performing law enforcement and national security functions. This rectifies present restrictions where AusCheck is unable to share information with Commonwealth authorities that have functions relating to law enforcement or national security.

State and territory agencies are presently unable to access AusCheck information, which is contradictory, given the significant role these agencies play in law enforcement and national security. The government recognises the necessity of having a collaborative approach to law enforcement and national security, particularly given our present high terror-threat rating. We need to combat threats across state and territory borders and ensure that the relevant law enforcement and national security operations have access to the information they require.

AusCheck scheme personal information includes information relating to an individual's identity and information obtained as a result of an AusCheck national security background check. This information can include criminal history, matters relevant to a security assessment under the Australian Security Intelligence Organisation Act 1979 and information relating to an individual's citizenship status, residency status and entitlement to work in Australia. Naturally, the disclosure of this information will remain subject to robust safeguards and guidelines, including the criminal offences outlined in section 15 of the AusCheck Act for the unlawful disclosure of AusCheck scheme personal information, which carry penalties of up to two years imprisonment.

AusCheck issues privacy notices to applicants advising them about how their information will be used and to acquire consent for the collection and disclosure of their personal information. AusCheck has memoranda of understanding in place with relevant authorities that include the key principles and obligations relating to the sharing of personal information. The sharing of information will still be limited to functions that relate to law enforcement or national security.

This bill is a sensible approach to ensuring that we, as a government, have clear legislative frameworks to enhance the ability of Commonwealth and other agencies to work effectively to combat crime and prosecute criminal offences. The sharing of relevant information between relevant agencies will enhance our law enforcement across state and territory borders and ensure that we remain ever vigilant in matters of national security and the war against illicit drugs.

I congratulate the Minister for Justice for his extensive work in presenting this bill, and I commend this bill to the House.

Stephen Jones (Throsby, Australian Labor Party, Shadow Parliamentary Secretary for Regional Development and Infrastructure) Share this | Link to this | Hansard source

What a pleasure it is to be speaking on the Crimes Legislation Amendment (Proceeds of Crime and Other Measures) Bill 2015, which deals with, amongst other things, the proceeds of crimes legislation—legislation that we support. We supported it in government. We built on it in government and support it in opposition because we are committed to ensuring that there are strong laws that will tackle the kingpins of crime and remove their ill-gotten gains. However, we think it is important to refer the bill to a Senate inquiry so that the parliament can be satisfied that the bill achieves its stated objectives without any untoward or perverse consequences. We have championed the legislation in both government and opposition to ensure that our law enforcement agencies have the powers that they need to confiscate unexplained, ill-gotten wealth from criminal figures. We will continue to support these sorts of bills.

The bill amends the Proceeds of Crime Act, the Criminal Code Act, the Anti-Money Laundering and Counter-Terrorism Financing Act and the AusCheck Act. It will implement a range of measures to improve and clarify Commonwealth criminal justice arrangements, including a number of technical changes, such as amending the proceeds of crime legislation, to clarify the operation of the non-conviction based proceeds of crime regime. These measures come in response to a series of recent court decisions.

In some circumstances there can be a stay of confiscation proceedings, and that should always remain the case. But what this bill does is make sure that this cannot be used as a tool to delay what is always going to be the inevitable. A court may still opt to stay proceedings, if it is in the interests of justice to do so—a provision which we strongly defend. However, the person who faces having their assets confiscated cannot just say that they may face charges or have to give evidence in a related criminal trial at some future date as a ruse to avoid confiscation of their ill-gotten assets.

The bill also amends the criminal code to insert two new offences of false dealing with accounting documents. This allows us to strengthen our compliance with the OECD anti-bribery convention. Under the changes in this bill, conduct that involves altering, destroying or concealing an accounting document will be criminalised. These are straightforward, sensible changes, and I welcome them. They will improve and clarify criminal justice arrangements, pending the report of the Senate committee.

It would be remiss of me if I did not take the opportunity to assess, during the course of a parliamentary debate on a bill that deals with the proceeds of crime, to reflect upon the record of the Abbott-Turnbull government when it comes to the disbursement of funds which have been confiscated through the Proceeds of Crime Act. It would not come as a surprise to anyone in this chamber that many of the proceeds of crime relate to drug trafficking and related crime. It is estimated that crime—that is all crime—costs Australia nearly $36 billion a year. Drug-related crime represents a significant proportion of this cost and is of increasing global concern. What some may not be aware of, however, is that money from the scheme's Confiscated Assets Account—that is, the account into which confiscated moneys go prior to disbursement—allows for payments to be made under a program approved by the Minister for Justice. The money may, for example, be put towards crime prevention, law enforcement or diversionary measures and also measures relating to the treatment of drug addiction. This is something that, as a shadow minister in the Health portfolio, I am very interested in. This is a sensible scenario. It takes the proceeds—the ill-gotten gains—from the criminals who prey on vulnerable members of society, and it directs that money into efforts to steer people towards a better life, particularly in relation to rehabilitation. Workers on the front line in the treatment sector need all the support that they can get, because every extra dollar will count. Grants from this account can really go a long way to helping with substance misuse problems. It helps them turn their life around.

When Labor were in government, we used the proceeds of crime scheme's Confiscated Assets Account to fund projects which would support alcohol and illicit drug treatment and rehabilitation as well as prevention strategies. In fact, we spent around $5.8 million supporting treatment workers on the front line. I will give a couple of examples: $149,000 was given to a project developing and implementing an alcohol and drug program for women in prison; another nearly half a million dollars was given to the Inside Out through care program, which assisted inmates affected by drug and alcohol use to accept support and treatment services so that they could successfully rejoin the community; and another $145,000 went to the Getting It Together project, which addressed drug and alcohol use within the Coonamble community in the remote central western plains of my own state of New South Wales.

It was not only the previous Labor government which adopted these strategies. Deputy Speaker Vasta, you have been in this place quite some time. You are probably familiar with the fact that the Howard government had a similar idea. They dedicated funds to projects of real use to workers on the front line and the communities that they support. Deeply regrettably, the Abbott and Turnbull governments have ignored the sector and instead dedicated funds from the account to support projects within their own electorate. It is perhaps not unkind of me to suggest that this was, in many instances, a pork-barrelling exercise in the lead-up to a federal election.

I think that the justice minister is truly committed to this area of public policy, but he can do a lot better. He can do a lot better when it comes to disbursement of funds. I remind you, Deputy Speaker, that this is a man who said earlier this year—and this goes to the nub of the problem—in relation to methamphetamine use that, 'We are not going to police our way out of this. We're going to need to look at the health and education programs if we are going to turn this problem around.' You would expect that a man who held that conviction in his heart would put that conviction into practice when it came to disbursing funds from this account. Regrettably, under the Abbott government and under the Turnbull government, this has not been the case.

If we are going to get on top of drug related crime, we need to get to the source of the problem. We need to look at the demand side as well as the supply side of the problem. These services need all the help they can get. We know that demand is rising and many within the sector feel abandoned by this government—not without reason. Over $800 million has been cut from funds which support alcohol and illicit drug treatment services. This is having a devastating impact. Not only have there been cuts to the funds which support these services; there has been a delay in funding and uncertainty around funding and program streams. This means that services are laying staff off; they cannot plan about what services they are going to be offering in the next financial year. It is an untenable situation.

Against this backdrop, the need could not be greater. That is why I use the opportunity of this important debate to say quite clearly to the government and to the minister: we need to be doing better. If we are confiscating funds from drug dealers, from drug importers and from those who are involved in the illicit drug trade—if we are confiscating the ill-gotten wealth from these individuals—then surely some of that money could be better directed towards minimising the demand for these deadly products in the first place. We should be using the opportunity of the funds amassed through the proceeds of crime legislation and direct that money towards drug and alcohol treatment services. As the minister himself admits—and as former commissioner Ken Lay himself admitted in statements after his around the country tour as a part of the National Ice Taskforce—this is not a problem that we can arrest our way out of.

To take that a step further, we need to look at this as a health related problem. If there are extra dollars available to the Commonwealth and we have a choice about where we allocate those extra dollars, then some of them should be allocated towards drug and alcohol treatment services. Nothing is more effective than taking a person from a life of addiction, which may also involve a life of crime, and rehabilitating that person to ensure that they can turn their life around and become a productive member of society. I argue that that is a very effective investment of Commonwealth money—more effective if we are confiscating money off the criminals in the first place and redirecting it towards the victims of those crimes so that they can turn their lives around. Once rehabilitated, that person is not only contributing in a positive way to the community; they are not engaging in the crimes, whether they are property related crimes or other related crimes, which tie up so much of our precious police resources, both state and federal.

Deputy Speaker, if you are not moved by compassion, then you might be moved by accounting on this particular issue. It is an effective investment. As we are debating a bill which deals with the issue of proceeds of crime, it is an opportunity for us to say, 'Let's learn the lessons of the past.' The Howard government got it. The Rudd and Gillard governments got it. This is a call out to the Abbott-Turnbull government to revisit this issue, because we can be doing so much more and so much better than what we are doing—using this fund as a cynical honey pot in the lead-up to an election, for nothing more than cheap pork-barrelling exercises. I think that it behoves us all to ensure that we are using the proceeds of crime and confiscated moneys in a much more socially useful way. With those comments, I commend the legislation to the House, noting that, when it goes to the other place, it will be referred to a Senate committee to ensure that there are no unintended consequences of the bill.

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

It gives me great pleasure to rise this evening to speak on the Crimes Legislation Amendment (Proceeds of Crime and Other Measures) Bill 2015. About 230 years ago the great economist Adam Smith wrote:

It is not from the benevolence of the butcher, the brewer, or the baker, that we can expect our dinner, but from their regard to their own interest.

That is a fundamental point of our economy: when we encourage individuals to engage in economic activity that creates real wealth they benefit themselves and make a profit but the ultimate winner is the society. That is the point that Smith was trying to make. That is why we need to ensure that our laws encourage people to take up activities that create wealth and benefit our society. When people go down a path of crime they are not actually adding wealth; they are stealing from others, causing damage not only to the people they steal from but to our entire society.

I was trying to explain to a school group recently how government works and how it raises and prints money. One of the students came up to me and said, 'If you can print money, why don't you just print money and give everyone a million dollars?' I can see the member for Moreton over there smiling and nodding, and I am sure there would be many on the other side who would think it is a good idea to fire up the printing presses and hand out a million dollars to everyone. I am sure that that young gentleman has a great future in the Young Labor movement—unless we can correct his ways of thinking!

These kids were about 11 years old; they were in fifth class and going into sixth class. Compared to when I was an 11-year-old they actually have been given a million dollars. If you look at the opportunities that they have, and the lower cost and greater variety of goods and services, they actually have a million dollars. That wealth has been created because people in our society have taken up wealth-making opportunities.

I have a few examples. Mr Deputy Speaker Vasta, you may be a few years younger than I am—you are nodding your head—or maybe a decade or two, but let's compare the things we had when we were 10 or 11 to what students have now and the lower cost and the benefits of that. Firstly, think of travel. When we were kids, going to Melbourne or Brisbane for a weekend away was unaffordable. Today, in our society, you can fly from Sydney to Melbourne or Brisbane for $100. The possibility that you can actually afford to jump on an aeroplane and go for a weekend away is the extra wealth that the kids and families of today have.

Think of the lower cost of communications and the opportunities kids have on their iPhones today—things like music. I am sure, Mr Deputy Speaker, that you would have saved up your pennies to go and buy an old vinyl record. Today, kids can download those same songs on their iPhones and, rather than having to play them on an old record player in one particular room in the house, they can carry them around and play them through earphones. When we were kids, to do that would have cost thousands and thousands of dollars.

Or think of motor vehicles. I am sure you can remember when you bought your first car, Mr Deputy Speaker; it was probably still a couple of thousand dollars. We know that the cost of many cars today is the same in dollar terms as it was 30 years ago. But it is not only that; you get a safer, better and more fuel-efficient car.

And it even goes to food. I was in one of the food courts in the Sydney CBD the other day. For $10 I could buy any variety of food from 20 different expert chefs from around the world—Chinese, Japanese, Korean, Mexican, Vietnamese and so on. In past generations, this was not available to us.

It goes on and on and on. But the best thing we have given these kids is greater life expectancy. Through the innovations and medical breakthroughs that we have made, kids in high school today have 10 to 15 years greater life expectancy than my generation had.

All of this has come about because we have an economic system that has encouraged people to go out and create real wealth. But if we allow a system where people can actually build up wealth through criminal activities, we undermine that in its entirety. With our proceeds of crime legislation we send the message out there that, if you think you are going to create your wealth from criminal activity, the government is coming after you. But if you create your wealth through real wealth-creating activities that benefit society, you deserve everything that you get and all the success that you have.

The previous speaker, the member for Throsby, talked about the problems we have with drugs, particularly methamphetamines, on the supply and demand side. I would like to talk about how we have to work on supply and demand in relation to criminal activities. I have great concern about the talk of raising the price of cigarettes to $40 a packet, because that is not going to kill off demand. If we were to raise the price of cigarettes to $40 a packet, I am sure some people would still find the money to buy them, but it would be a boon to the bootleggers and the black marketeers. In most Asian countries, you can buy a packet of cigarettes for the retail price of $1. That is the retail price, not the wholesale price. If you can buy them lawfully overseas for $1 but you make the retail price in Australia $40, all you do is create a great gulf where you encourage criminal activity. We are already seeing it. If any of us in our electorates were to go around to small tobacconist shops, we would see that they are selling black-market cigarettes. There are people selling home-grown tobacco. If we increase the price of cigarettes to $40, whatever benefit there is to society from the reduction in smoking, there will be at least the same problem, if not more problems, with illegal activity in that space.

I turn to the specific provisions of the bill. Schedule 1 of the bill contains amendments to the Proceeds of Crime Act to clarify the operation of that act's non-conviction based confiscation scheme in light of recent court decisions. That is where there may not yet have been a conviction but the court can put an injunction on someone's assets. Schedule 2 creates two new offences of false dealing with accounting documents. It will strengthen Australia's compliance with the OECD anti-bribery convention. The offences will criminalise conduct where a person makes, alters, destroys or conceals an accounting document or fails to make an accounting document that the person is under a duty to make; and either intends or is reckless to the fact that this conduct would facilitate, conceal or disguise the offender or any other person receiving or giving a benefit, or another person incurring a loss, where that benefit or loss is not legitimately due. Schedule 3 makes amendments to improve the clarity of serious drug offences.

Schedule 4 makes several amendments to the Anti-Money Laundering and Counter-Terrorism Financing Act to remove operational constraints that have been identified by a number of law enforcement agencies. We need those provisions to be very strong. We do not want to see wealth earned in this country diverted into terrorist activities. We do not want to see people who have engaged in criminal activities being able to use our institutions to launder money. We do have a problem in this area. There is overseas legislation that is similar to our Anti-Money Laundering and Counter-Terrorism Financing Act. As a result, we have seen the banks closing down many small businesses in what is called the home remittance industry. You generally find that the people running these businesses are from ethnic communities, where they are the pillars of trust and confidence. People trust them to give them their money to organise it, to transfer it to a friend or relative overseas. Even though these people comply with all the legislation, with all the red tape and with all the antiterrorism requirements, they are 90 per cent cheaper than the banks. It is often thought that you need to be big to be efficient. This is an example where you think, 'How could these people do it more efficiently than the banks?' Yet they are able to run these businesses, organise money transfers overseas and charge one-tenth of what the banks are charging. The banks are closing them down, whether for convenience or whether the banks think there is some genuine risk.

At the moment, when money goes through this small home remittance industry, everything is documented and detailed through AUSTRAC. Where money is diverted for a terrorist activity or to criminal activity, the system, through AUSTRAC, works. The system picks up these people. The last thing people in the home remittance industry want to do is have their businesses closed down because they have not complied with the legislation. But their accounts are being closed down. We had a reasonably transparent system, but an unintended consequence of enforcing this legislation is that the banks are closing down their accounts. The money is now being transferred under the counter. We heard examples in committee hearings of people taking hundreds of thousands of dollars in cash on aeroplanes because the banks have closed down accounts. So we are losing the transparency that we had. There are so many ways for people to transfer assets overseas. In closing down a legitimate sector of business, a sector that is complying with legislation, that is reporting any suspicious activity, the legislation is having the reverse effect to what it was trying to achieve. This is something that we need to look at as a government because for many third-world nations it makes up a huge proportion of their GDP.

It is the work that people do here in Australia and then transferring that money back to their families—$60 billion. That is more than 10 times our official government foreign aid. That private foreign aid is sent directly to a family to start up a small business or to help someone who needs it. This is something that we need to address. We cannot let these people close down and be driven out of business.

With that, I am very pleased to hear that the opposition is supporting this bill and I commend it to the House.

Jane Prentice (Ryan, Liberal Party) Share this | Link to this | Hansard source

The coalition is committed to doing whatever we can to combat terrorism and organised transnational crime. Recent events across the world have highlighted that it is not difficult to conduct an attack and that the time frame between planning and execution is shrinking. In this environment the ability to share information quickly between those who need it is critical to prevent the loss of innocent lives.

I welcome the Crimes Legislation Amendment (Proceeds of Crime and Other Measures) Bill 2015, which will amend Australia's anti-money-laundering and counter-terrorism-financing regime to enable financial intelligence to be shared with key international bodies, including INTERPOL and Europol. Specifically, the financial intelligence information obtained by the Australian Transaction Reports and Analysis Centre—AUSTRAC—plays a central role in identifying and preventing terrorist and criminal activity. By enabling information to be shared faster and more easily, these amendments will maximise intelligence value and assist regional and international partner agencies in the early identification, targeting and disruption of terrorism and transnational crimes, where time is often of the essence.

The Australian Crime Commission recently said that as counter-terrorism efforts throughout Australia are enhanced, linkages between terrorism and broader organised crime are being identified. These linkages include, but are not limited to, Australians who finance terrorist activities, Australians who leave Australia to support terrorist causes and who may return to Australia with the intent of inflicting harm on the Australian community or Australians who may be recruited by organised crime groups seeking the specialist skill sets they have developed in foreign conflicts.

In the current Australian environment, serious and organised crime is exploiting three specific key capabilities. Firstly is organised crime's ability to conceal criminal activity by integrating into legitimate markets; secondly are their increasing technology and online capabilities; and thirdly, there is the globalisation of organised crime.

Serious and organised crime has become interwoven with our economic, social and political environments. Although organised crime has continued to operate in traditional illicit markets, such as illicit drug markets, it has been innovative in infiltrating legitimate industries to yield and launder significant criminal profits, including by setting up businesses within the transport, resources and investment sectors.

Serious and organised criminals have proven themselves adept at identifying and exploiting new and emerging technologies to facilitate their crime, to expand their reach and to provide them with the anonymity and distance from their crime which makes it difficult for law enforcement to detect and identify them.

Transnational organised crime groups have capitalised on the high level of demand in Australia for methylamphetamines, particularly for crystal methylamphetamine—better known as 'ice'. And while significant production is still occurring domestically, there has been a sharp increase in detections of methylamphetamine at the Australian border recently.

Our approach to criminal surveillance, monitoring and dealing with criminal activity should be strong, agile, creative and innovative, capable of quickly recognising and then adapting to and disrupting increasingly sophisticated criminal networks. We must better address law enforcement issues and national security risks through improved information sharing and we must continually improve the efficiency and effectiveness of various laws relating to the administration of criminal justice.

Serious and organised crime diverts funds out of the legitimate economy and undermines the profitability of lawful business. Serious and organised crime removes large amounts of money from the Australian economy that could be otherwise used to fund services, roads, hospitals and schools. This money is instead lining the pockets of criminals. This bill will enhance the ability of Commonwealth agencies to investigate and prosecute criminal offences and ensure that Australian law enforcement agencies can effectively target and confiscate proceeds of crime.

The government is committed to using the dirty money from proceeds of crime and unexplained wealth proceedings to fund strategies to tackle organised crime and the illicit drug trade. The Proceeds of Crime Act provides for a scheme to trace, restrain and confiscate the proceeds of crime against Australian law. The act can also be used in some circumstances to confiscate the proceeds of crime against Australian law in conjunction with a foreign jurisdiction under their laws.

The Australian Federal Police are responsible for investigating whether the Proceeds of Crime Act can 'capture' a person's profits and then determine whether to commence a literary proceeds action. In layman's terms this is an action to recover the benefit that a person derives from the commercial exploitation of others. These proceeds can then be returned to the Australian community to fund anticrime initiatives.

Labor deposited proceeds-of-crime money in the Confiscated Assets Account and used these funds to boost their budget bottom line instead of boosting crime-fighting capacity at the frontline. At the last election, the coalition said that proceeds of crime would be directed into crime prevention and related work. And we are doing what we said we would. We are delivering on our commitment to the Australian people.

In Brisbane, for example, from round 1 of the Safer Streets program, $780,000 from the proceeds of crime has been redirected into the Brisbane Safer Streets project, to implement safety enhancements for crime hot spots so as to reduce antisocial behaviour and improve community safety. About $890,000 in proceeds of crime money has gone into upgrading closed circuit television capabilities at some of our busy airports by providing wide-angle surveillance and digital videorecording capabilities, including Brisbane, Gold Coast and Cairns international airports. More than $650,000 has been used to help OzCare provide a non-residential, integrated drug rehabilitation service in Brisbane, and about $150,000 has gone into supporting Brisbane City Council's Walls and Colours project, which targets some of the most frequently and severely hit graffiti hotspots.

Criminal profits confiscated and held by the government in the proceeds of crime account will also be directed into fighting ice, including $9.8 million over two years to establish a new National Criminal Intelligence System that will redevelop Australia's criminal intelligence systems and database infrastructure to strengthen information and intelligence sharing across law enforcement agencies and jurisdictions; $5 million over four years to deploy transnational crime analysts to organised crime and drug importation hotspots including the United States, Canada, Dubai and Hong Kong; and $3.4 million over two years to boost the Australian Crime Commission's capability to target money laundering activities and undermine the business models of transnational criminal syndicates that are profiting from the misery caused by the illegal ice trade.

The coalition is delivering on our commitment—working hard to keep Australians safe and secure in increasingly uncertain times and using the proceeds of crime to support our fight. I congratulate and thank the minister for bringing this bill forward, and I commend the bill to the House.

John Cobb (Calare, National Party) Share this | Link to this | Hansard source

The Crimes Legislation Amendment (Proceeds of Crime and Other Measures) Bill 2015 includes numerous measures that will clarify and improve Commonwealth criminal justice arrangements. Schedule 1clarifies the operation of the non-conviction based confiscation regime provided under of the Proceeds of Crime Act 2002; schedule 2 inserts two new offences of false dealing with accounting documents into the Criminal Code Act 1995, the Commonwealth Criminal Code; and schedule 3 amends the definitions of 'drug analogue' and 'manufacture' in the serious drug offences in part 9.1 of the Criminal Code to ensure that they capture all relevant substances and processes. It will clarify and address operational constraints identified by law enforcement agencies with the Anti-Money Laundering and Counter-Terrorism Financing Act 2006, and expand the list of designated agencies authorised to access AUSTRAC information to include the Independent Commissioner Against Corruption of South Australia, in schedule 4. Schedule 5 extends and clarifies the circumstances under which AusCheck can disclose AusCheck background check information to Commonwealth, state and territory agencies performing functions related to law enforcement and national security.

With the rise of terrorism Australia needs to ensure it has the best measures in place to keep our nation safe. This bill will see stronger information sharing to address law enforcement issues and combat corruption. Enhanced information sharing will enable the federal government to do everything in our power to detect and deal with organised transnational crime and terrorism. Recent world events remind us that very little planning and time is needed to conduct an attack. The time frame is shrinking but the impact of an attack is catastrophic and long lasting. The images coming out of Paris will stick in the minds of everybody across the globe. That does not mean we have to let these things paralyse us—it certainly does not mean that we have to accept these occurrences as the norm and not deal with them. Sharing information has become critical in these situations—agencies involved in the prevention of such attacks need to be able to share information between more quickly. It is information that could save lives.

The financial intelligence information obtained by the Australian Transaction Reports and Analysis Centre plays a central role in identifying and preventing terrorist and criminal activity. This bill will amend Australia's anti-money laundering and counter-terrorism financing regime to enable financial intelligence to be shared with key international bodies including Interpol and Europol. The bill will maximise intelligence value through assisting regional and international partner agencies. It will allow intelligence to be better utilised in the early identification, targeting, and disruption of terrorism and transnational crimes.

The measures will also amend the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 to enable the Independent Commission Against Corruption of South Australia to access AUSTRAC's financial intelligence data holdings. Allowing access to this financial intelligence will enhance the commission's ability to investigate serious and systemic corruption and misconduct in public administration.

There are also changes to drug offences. This bill includes new laws making drug offence provisions clearer, more effective and stronger. As drugs continue to trouble Australia—none of us are exempt, whether it is my electorate of Calare or anywhere else in Australia or the world in general—the federal government is committed to stamping out the manufacturing, selling and buying of dangerous illegal substances. Under these laws it will be more difficult for drug traffickers and manufacturers to supply these substances. The bill will ensure that the serious drug offences apply to all substances that are structurally similar to illicit drugs, called 'drug analogues', and all manufacturing methods, including those that do not create a new substance. The coalition will continue to reduce serious drug offending in our communities as the result of substance abuse as it continues to trouble our local police and communities. To do this we must have effective and strong frameworks to stop drug traffickers and organised crime in a bid to reduce Australia's growing addiction to illicit drugs like ice.

Debate interrupted.