Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

I rise on behalf of the Parliamentary Joint Committee on Law Enforcement to present the report of the committee on Commonwealth unexplained wealth legislation and arrangements, together with the Hansard record of proceedings and documents presented to the committee.

Ordered that the report be printed.

I move:

That the Senate take note of the report.

Unfortunately, this is the second tranche in relation to the unexplained wealth legislation as the provisions that resulted from the bill's passage through the parliament have not proved to be workable in over two years of operation. So, to that effect, the committee has further examined the reasons why and widely consulted again in relation to unexplained criminal wealth assets. The consultation culminated with a meeting of all the state and territory police commissioners as well as the Australian Federal Police where we had a very frank and fruitful discussion. The aim now is to put some technical amendments through and make sure that the unexplained wealth legislation provisions are actually workable and police agencies can use them.

The primary purpose—and I have spoken about this on previous occasions—of unexplained wealth legislation is that, where we cannot prosecute serious criminal organisations because of lack of evidence due to the intricate and technical ways that serious criminal organisations and crime gangs avoid prosecution or detection, we aim to subvert that avoidance by simply going to the wealth, the assets, of the individuals who control and run or who are involved with these serious criminal organisation outfits. In other places in the world, this has proved to be very effective, and I quote the example of Ireland.

We took some evidence about the Irish model. In fact, some Irish officers attended this parliament and spoke to the committee at great length. When they implemented their unexplained wealth legislation they started to remove assets from criminals when they could not explain how they attained those assets and it was asserted those assets were gained unlawfully. Three crime families, if you like, left Ireland. So if we can have that same effect here, in Australia, that would be fantastic. A key aspect of this is to get harmonisation with the states. We do not want one state to be the weakest link and, therefore, have criminal organisations maybe relocating or associating themselves with the states that do not have the same provisions. So, to this end, the committee will work very hard with the Attorney-General's Department and other state and territory jurisdictions to ensure that there is harmonisation throughout the Commonwealth.

I am aware that there are other reports that need to be tabled this evening. There is a reasonable list. So I seek leave to incorporate the remainder of my tabling statement into Hansard.

Leave granted.

The statement read as follows—

Parliamentary Joint Committee of Law Enforcement

Tabling of the unexplained wealth report

Mr Speaker [President], I rise to present the Parliamentary Joint Committee on Law Enforcement's report for its inquiry into unexplained wealth legislation and arrangements.

Unexplained wealth laws represent a relatively new form of criminal assets confiscation, whereby serious and organised criminals who cannot account for the wealth they hold may be liable for forfeiture of those assets to the state.

The value of unexplained wealth provisions lays in their ability to significantly undermine the business model of serious and organised crime. The incentive behind organised crime is to make money. By removing unexplained wealth from serious and organised criminal networks and associated individuals, this incentive is removed.

Furthermore, confiscation of criminal profits removes funds that are used as capital for thither criminal enterprise. Removing these funds significantly disrupts the ability of criminal networks to operate.

The committee was therefore pleased to see the introduction of unexplained wealth provisions into Commonwealth proceeds of crime legislation in early 2010.

Unfortunately, the provisions that resulted from the Bill's passage through Parliament have not proved to be workable in over two years of operation. To date, no unexplained wealth proceedings have been brought before the courts due to a range of limitations.

The committee was therefore keen to examine these provisions more closely, and has made a number of significant recommendations in this report that will significantly enhance the effectiveness of the Commonwealth unexplained wealth provisions.

In particular, the committee has recommended major reform of the way unexplained wealth is dealt with in Australia as part of a harmonisation of Commonwealth, state and territory laws. While complementing the national strategic approach to organised crime, harmonisation may also allow the Commonwealth to make use of unexplained wealth provisions that are not linked to a predicate offence. This approach has been found to be the most effective, both in Australia and abroad.

The committee has therefore proposed that the Commonwealth seek a referral of powers from willing states and territories as part of a long term plan to develop a nationally consistent approach to unexplained wealth and organised crime. Harmonisation would also help to eliminate gaps that can be exploited between jurisdictions.

In addition, the committee has recommended a series of technical amendments that would ensure that unexplained wealth proceedings are efficient and fair, correcting deficiencies that were identified during the course of this inquiry.

Effective unexplained wealth legislation can take the profit out of criminal enterprise, undermining the business model of serious and organised criminal networks and protecting His, community from the damage caused by these individuals and organisations commend this report and its recommendations, and urge the government to ensure that crime doesn't pay.

The committee has a longstanding interest in securing effective unexplained wealth legislation, arising from the committee's study of international models to tackle organised crime during an overseas delegation in 2009. The committee heard from a number of jurisdictions that, while serious criminals may consider imprisonment to be an acceptable occupational hazard, taking their illicit profits was considered to be a far more serious blow.

Serious and organised crime, motivated by greed, power and money, has serious impacts, threatening the economy, national security and the wellbeing of Australians. The financial cost to the community is conservatively estimated to be around $15 billion a year.

As the Australian Crime Commission informed the committee, while serious and organised criminal groups continue to prove resilient and adaptable to legislative amendment and law enforcement intelligence and investigative methodologies, the reduction or removal of their proceeds of crime is likely to represent a significant deterrent and disruption to their activities.

Unexplained wealth legislation represents a new form of law enforcement. Where traditional policing has focussed on securing prosecutions, unexplained wealth provisions contribute to a growing body of measures aimed at prevention and disruption. In particular, unexplained wealth provisions fill an existing gap which has been exploited, where the heads of criminal networks remain insulated from the commission of offences, enjoying their ill-gotten gains.

The committee considered evidence regarding the requirement to link a Commonwealth scheme to a Commonwealth head of power, necessitating the inclusion of a link to a federally relevant offence. This is a significant limitation, as it undermines the most valuable aspect of unexplained wealth provisions — that they provide a means to target the heads of criminal networks who are often insulated from committing, or being implicated in the commission of offences themselves. Unfortunately, crime doesn't respect geographical boundaries or Constitutional restraints.

Summary of recommendations:

Given the intrusive nature of unexplained wealth provisions, the committee has sought to provide greater clarity and accountability for the use of the provisions. This includes:

Further support for unexplained wealth investigations in the form of:

Improving the operation of taskforces which involve the Tax Office through:

Streamlining the court process through:

Development of a consistent and effective national approach to unexplained wealth across Australia, through:

Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary for Northern and Remote Australia) Share this | Link to this | Hansard source

I seek leave to continue my remarks.

Leave granted.

Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

On behalf of the Parliamentary Joint Committee on Law Enforcement, I present the report on the examination of the 2010 and 2011 annual reports of the Australian Crime Commission and the Australian Federal Police, together with the minutes of proceedings of the committee and the transcript of evidence.

Ordered that the report be printed.

I move:

That the Senate take note of the report.

I seek leave to have the report incorporated in Hansard.

Leave granted.

The report read as follows—

Parliamentary Joint Committee on Law Enforcement

Tabling of the Report on 2010-11 Annual Reports of the Australian Crime Commission and the Australian Federal Police

Mr Speaker [President], I rise to present the Parliamentary Joint Committee on Law Enforcement's report on its examination of the annual reports of the Australian Crime Commission (ACC) and Australian Federal Police (AFP).

The Parliamentary Joint Committee on Law Enforcement has a statutory duty to examine the annual reports of the ACC and AFP. The committee has had a long-standing responsibility to examine the annual report of the ACC. However, this was the committee's second opportunity to examine the annual report of the AFP since the committee's jurisdiction was widened in 2010. The committee held public hearings with both the ACC and AFP and appreciates the ongoing level of engagement with committee proceedings demonstrated by both agencies. The committee congratulates them both on another successful year.

The committee recognises that close cooperation between law enforcement agencies across the various jurisdictions is fundamental to effectively combating crime. It was interested to gauge the nature of this relationship through the annual reports review process.

In terms of initiatives which provide for greater cooperation, the ACC has established a presence in each state and territory which enables state police agencies to be briefed on the ACC's capability, whilst also improving the flow of information to the ACC itself. The AFP also places emphasis on relationships with its counterparts. Part of the AFP's efforts to refocus its attentions on reinvigoration of investigation and operational capabilities in 2010-11 went to improving relationships with national and international counterparts.

The importance of cooperation is also reflected in the nature of crime investigations, with joint investigations increasingly common. Fifty-four per cent of serious and organised crime investigations were conducted under a formalised joint agency agreement as of January 2012. The remaining 46 per cent comprised joint investigations but without formal agreement. The committee recognises that cooperation in the fight against serious and organised crime has taken on a heightened importance given that Australia has become an attractive target for international criminal groups as it is no longer isolated from and immune to world trends.

Whilst considering trends and changes in criminal activity, the annual reports examination process also provides the committee with an opportunity to consider the efficiency of internal agency procedures. One area of interest to the committee in this regard is the timeliness of complaint handling by the AFP.

The committee appreciates that the AFP has taken measures to improve the time it takes to deal with complaints since the committee reported on the matter in its last annual report examination, however the Ombudsman's most recent report noted a continued deterioration in timeliness.

The committee is concerned about the deterioration in the average time-run of complaints cases and recommends that the AFP annual report include the average number of days taken to resolve cases for each category of complaint. The addition of this information will enable the committee to monitor the timeliness of complaint resolution.

The committee appreciates the advances made by the ACC and AFP over the year of review. I therefore commend the committee's report to the Senate.

Trends and changes in serious and organised crime

The committee has a statutory duty to examine trends and changes in criminal activity, practices and methods and pursued these areas as part of its examination of the ACC Annual Report.

Trends identified by the ACC in relation to serious and organised crime include:

- enable traditional crimes such as fraud, drug trafficking, theft of personal identity information and child exploitation; facilitate criminal activity, including through enhanced communication and money laundering;

- conduct criminal activity against computer networks;

Australian Crime Commission Intelligence Products

As Australia's national criminal intelligence agency, the ACC has developed a niche role over the past three years to deliver specialist capabilities and intelligence to the law enforcement community and broader government.

To realise its stated objective to reduce the threat or impact of serious or organised crime though analysis of and operations against national criminal activity, the ACC provided strategic criminal intelligence services to law enforcement and government agencies.

In 2010-11, the ACC delivered 1398 intelligence products including three reports: Illicit Drug Data Report, Organised Crime Threat Assessment, and Organised Crime in Australia report.

The effectiveness of ACC operations was measured through stakeholder feedback by way of Key Performance Indicators or KPIs. Whilst setting a target of 90 per cent for strategic intelligence products, the ACC achieved a result of 100 per cent for this KPI.

In terms of its second KPI, enhancing an understanding of serious and organised crime, the ACC achieved a 70 per cent result. The committee noted in its report that this result may indicate partner agency dissatisfaction with the ACC's contribution and expects to continue monitoring this KPI to ascertain the significance of the result.

ACC Annual Report highlights

Investigations and intelligence operations into federally relevant criminal activity

The ACC's investigations and intelligence operations underpin its criminal intelligence services by providing unique intelligence collection capabilities.

ACC investigations are conducted in partnership with law enforcement agencies with the objective of disrupting and deterring federally relevant serious and organised criminal activity. During 2010-11, the ACC conducted 10 special intelligence operations and five special investigations whilst also undertaking a number of projects and contributing to various task forces.

ACC achievements during the year include:

Notwithstanding these achievements, the committee appreciates that the ACC's real value in terms of organised crime may be in the area of harm reduction impacts which are difficult to measure.

It is also difficult to assess the impact of the ACC's intelligence products particularly in relation to broader investigations, whilst the trend towards joint investigations makes measuring the contribution of a single agency more complex.

In order to assess this broader contribution, the committee may consider how best to assess the annual report's commentary on qualitative outcomes.

Illicit firearms assessment

Since February 2012, the ACC has been conducting a National Intelligence Assessment of the illegal firearms market and its links to gang activity in Australia.

The committee was informed by the ACC that a black market in handguns has operated for decades and that in recent drive-by shootings handguns have predominately been used. Firearms also enable organised crime to exercise authority and control over markets and their organisations.

Ombudsman's reports—extending a controlled operation

The committee considered the process of extending a controlled operation beyond three months in cases where the scope of the operation changed. In a previous examination of the ACC's annual report, the committee recommended that where a variation is sought which would change both the scope and duration of a controlled operation, that the scope change be approved internally and duration change by the AAT.

However, at the time of the Ombudsman's most recent report on the inspection of controlled operations records, there was apparent disagreement between the Ombudsman and ACC about what constitutes a 'significant alteration'.

The committee understands that the ACC altered internal policies in relation to controlled operations to reflect an agreed position reached between it, the Attorney-General's Department and the Ombudsman. As this matter is of considerable interest to the committee, it intends to consider the 2011-12 inspection results of the Ombudsman before making any further comment.

National Criminal Intelligence Fusion Capability

The National Criminal Intelligence Fusion Capability brings together specialists from various government agencies including the ACC, AFP, and the Australian Customs and Border Protection Service.

Fusion is responsible for monitoring the most significant serious and organised crime threats. During 2010-11, it identified over 70 new persons of interest or high-threat targets though matching information already held by the Commonwealth.

Security breaches

The committee pursued questions concerning security breaches in relation to ACC documents. Since 2007, there have been 62 security breaches, including 18 in 2011. Of those, four were considered serious and related to the loss of information and in one case, a weapon. Whilst the committee was assured that the ACC has a strong self-reporting culture, it is concerned with the security breaches and will continue to assess the ACC's efforts to address the number of security breaches into the future.

AFP Annual Report highlights

In recent years, the AFP has increasingly focused on national and international operations in response to new and emerging challenges in areas such as counter terrorism, human trafficking and sexual servitude, cyber-crime, peace operations, protection and other transnational crimes.

Complaint handing

In relation to complaint handling, there were 920 complaints made against the AFP in 2010-11. This represented a 15 per cent increase compared to the previous year.

Of the complaints, there were 233 Category 3 complaints. These are serious misconduct matters that do not involve corruption but may give rise to termination of employment, breaches of criminal law and serious neglect of duty There were also 30 complaints related to corruption. The remaining 657 complaints were category 1 and 2 complaints relating to minor management, minor misconduct or unsatisfactory performance. Over half of all the complaints reported were made by another AFP member.

The timeliness of complaint handling was raised as a matter of concern by the committee in its last annual report and by the Ombudsman. In response, the AFP instituted measures to improve the time it took to deal with complaints. However, the Ombudsman's most recent report raised the matter again noting that the timeliness continued to deteriorate and that the measures taken by the AFP have not been effective.

Whilst appreciating that the AFP is currently reviewing the benchmarks for complaint handling timeframes, the committee raised concerns about the deterioration in the average run-time of complaints cases. In this regard, the committee made a recommendation that the AFP annual report include the average number of days taken to resolve cases for each category of complaint, to enable the committee to better monitor the timeliness of complaint resolution.

National security—policing

Key initiatives and programs undertaken by the AFP in relation to national security—policing include the:

•   successful prosecution of three people for terrorism offences,

•   establishment of a dedicated Terrorism Financing Investigations Unit; and

•   establishment of a Countering Violent Extremism Team.

In terms of counter-terrorism, 96 per cent of AFP time was spent on high-impact to very high-impact cases. Of these cases, 82 per cent of time was spent on operational activity resulting in a prosecution, disruption or intelligence referral outcome.

International deployments

AFP personnel are deployed internationally to contribute to Australia's United Nations commitments as well as to regional security and rule of law initiatives.

During 2010-11, AFP contributed to UN missions in Cyprus, Sudan, Timor-Leste and Afghanistan. The AFP also contributed to capacity development programs in Cambodia, Timor-Leste, Vanuatu and other members of the Pacific Island Forum as well as the Regional Assistance Mission to the Solomon Islands.

Operations—Policing

The AFP Crime Program has teams across Australia as well as operating internationally with teams in 30 countries. In 2010-11, Crime Program achievements included:

Drug Harm Index

At over $1 billion, the Drug Harm Index more than doubled its results from the previous year and exceeded its domestic target of $886 million.

Question agreed to.