Australia has some of the most onerous proceeds of crime legislation in the world.
Under the Proceeds of Crime Act 2002 (Cth) the court is granted the power to allow certain authorities to seize, freeze, restrain and forfeit assets which are suspected of being connected to illegal activity.
The most alarming and perhaps extraordinary part to this act is that it doesn’t necessarily require the person to be convicted of an offence in order for the proceeds to be seized, frozen, restrained or forfeited. These matters are usually initiated by the Commissioner for the Australian Federal Police.
What powers exist to remove alleged proceeds of crime from an accused person?
Seizure orders refer to the Commissioner for the Australian Federal Police to take physical possession of the items by removing them from the person who has possession of them. This may include cars, properties, boats, watches etc.
Freezing orders refer to the Commissioner for the Australian Federal Police applying for bank accounts to be frozen. This would restrict any money from going into or coming out of the nominated account.
Restraining orders has a much similar effect to freezing orders, usually the Commissioner will just apply to have the property restrained rather than frozen. In effect it means that the property (including money) to which the Commissioner alleges was derived from proceeds of crime cannot be dealt with in any way subject to the final determination of the court. However, applications can be made for exceptions to this such as where a person is living in the property or paying the mortgage out of their pocket when the property is occupied by a tenant.
Releasing property from a restraining order
Where the defendant asserts that property is derived from a legitimate source, they may apply to have the property released from the scope of the restraining order. This would mean that the Commissioner of the Australian Federal Police can no longer seize, freeze, restrain seek to have the asset forfeited. There are effectively three ways to seek orders of this kind:
- A Revocation Application: This is a cancellation of the restraining order. A person would apply for this where they can show that the restraining order should never have been made as the funds are legitimately sourced. The onus of proof is on the defendant to show this.
- Exclusion orders: This is where the owner of the property (whether that is the defendant or another person with an interest in the property) can show that the property is not connected with criminal activity. The effect of these orders is that select items can be excluded from the restraining order and dealt with as normal.
- Defending a forfeiture application: Once the Commissioner for the Australian Federal Police apply to have the restrained items forfeited, the defendant or another interested party may oppose the making of the forfeiture orders. When the AFP apply to have these orders made they bear the onus of proof to prove on the balance of probabilities that the items were derived from a relevant serious criminal offence.
Conviction based forfeiture is where a person is criminally convicted of a Serious Criminal offence. The relevant test is that all property derived from the serious criminal offence must be forfeited (automatically). The defendant or an interested person has six months to have property excluded from the forfeiture orders.
Non-conviction based forfeiture is where the AFP can satisfy the court on the balance of probabilities that a serious criminal offence was committed and that the property was used in the commission of the serious criminal offence.
Pecuniary penalty orders are similar to non-conviction-based forfeiture orders. They are used where the court isn’t necessarily satisfied that a serious criminal offence has been committed but they are satisfied that the benefit the defendant received has been derived from unlawful activity. The court will seek that the defendant pay the commonwealth an amount equal to the benefit they received.
Literary proceeds are extremely controversial and rarely used. They seek to prevent individuals from benefiting from criminal activity through the release of books, movies etc. The Commissioner for the Australian Federal Police will seek that all profits derived from the book, movie etc. is forfeited to the Commonwealth.
Unexplained wealth orders are where the court will seek an explanation from a defendant as to whether to make an unexplained wealth order against the person. An unexplained wealth order is an order requiring the person to pay an amount equal to the persons total wealth as the person cannot satisfy the court that the wealth is not derived or realised directly or indirectly from certain offences.
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