A Senate committee has just given the Turnbull government the green light to nationalise a scheme that allows government to seize citizens’ assets unless their legitimate origins can be explained, even if the owner of the wealth hasn’t been charged with let alone convicted of an offence.
On 6 August, the Senate Legal and Constitutional Affairs Legislation Committee recommended that the federal government pass the Unexplained Wealth Legislation Amendment Bill 2018 without any changes.
Unexplained wealth laws currently exist in every Australian jurisdiction, but the new scheme provides a broader model allowing for federal and state authorities to work in collaboration across jurisdictional borders to target serious and organised crime.
“The scale and complexity of this criminal threat has necessitated an enhanced focus on cooperative, cross-jurisdictional responses by Australian governments,” home affairs minister Peter Dutton said in the second reading speech of the bill.
However, critics of the scheme warn that existing unexplained wealth laws undermine the rule of law and broadening their scope will lead to a further erosion of civil liberties. And while these laws are meant to target untouchable crime bosses, they’re actually being used against petty criminals.
Presumption of guilt
“These beefed-up laws bring down all the secret surveillance and the swapping of scuttlebutt masquerading as intelligence on everyone in Australia,” Civil Liberties Australia CEO Bill Rowlings told Sydney Criminal Lawyers®.
“The unexplained wealth laws completely overturn the presumption of innocence, which is part of our rule of law in Australia,” he continued. “They are sneaky laws which declare you as guilty in the eyes of the law the minute the police say you are guilty.”
Unexplained wealth laws are a recent development in Australia. But, unlike other proceeds of crime laws that allow for the confiscation of assets derived from prosecuted criminal acts, unexplained wealth places the onus upon the individual to prove their wealth was legally acquired.
“People don’t understand, under these laws the government can confiscate your assets even if you haven’t been found guilty of anything,” Mr Rowlings stressed.
Broadening the reach
The current Commonwealth unexplained wealth laws were introduced in 2010 via amendments made to the Proceeds of Crime Act 2002 (Cth) (the Act).
These laws apply where there are “reasonable grounds to suspect” an individual’s assets have been derived from a committed federal offence, “a foreign indictable offence or a state offence that has a federal aspect.”
There are three sorts of orders that can be sought in relation to unexplained wealth. Section 20A of the Act provides that a court can issue an unexplained wealth restraining order, which is an interim order that restricts an individual’s ability to dispose of property.
Section 179B of the Act allows for the issuance of a preliminary order, which requires a person to appear in court to prove their wealth is legitimate. And under section 179E, an order can be issued requiring that the payment of an amount of wealth deemed unlawful be made to the government.
The new legislation amends sections 20A and 179E, so that these orders can be issued in respect to relevant offences of participating states, as well as in relation to territory offences. Relevant state offences will be outlined in state legislation that enables participation in the national scheme.
Sharing it around
The legislation broadens the access authorities have to an individual’s banking information in relation to an unexplained wealth investigation.
Section 213 of the Act allows certain authorised Commonwealth officers to issue access notices to financial institutions. This provision will now be extended to states and territory law enforcement agencies.
Proposed section 297C of the Act outlines how federal, state and territory governments will divvy up the seized wealth. A subcommittee will be established to distribute the money. And while any state that opts out of the scheme will be eligible for a share, it will be a less favourable amount.
The legislation also makes amendments to the sharing of information provisions contained in the Telecommunications (Interception and Access) Act 1979.
Currently, lawfully obtained information in relation to unexplained wealth proceedings can be shared when there’s a linked offence. But, the amendments will ensure that this information can be shared without the need to prove any link to a crime.
The laws are misapplied
“Ministers said in parliaments, when these types of laws first came in, that they would be used to tackle the Mr Bigs of crime,” Mr Rowlings explained. “In fact, they’ve been used against little guys for growing 24 marijuana plants for their own use.”
The civil liberties advocate pointed to a 2017 review of the Tasmanian unexplained wealth confiscation scheme. It concluded that the laws were not confined to senior organised crime figures, but are applied to anyone who may have profited from crime or whose wealth is unexplained.
The review “found that the unexplained wealth laws have been used to recover amounts of as little as $3,000,” Mr Rowlings said. He added that rather than tackling crime bosses, who haven’t been convicted of an offence, petty criminals are being caught up in the scheme.
Backdoor revenue raising
The NSW government has already introduced legislation into parliament, which enables that state to participate in the national scheme. The legislation sets out that the relevant offences the laws apply to are set out in section 6(2) of the Criminal Assets Recovery Act 1990.
NSW police minister Troy Grant told parliament that the legislation allows the state to refer matters to the Commonwealth, which then authorises the Australian federal police to use certain NSW offences as a basis for the confiscation of unexplained wealth.
But, Mr Rowlings states that the nationalising of the scheme will actually streamline a process that sees the unwarranted confiscation of wealth to prop up government coffers.
“The cash seized is paying for extra government lawyers to help seize more cash,” Mr Rowlings made clear, “so it’s a devious upward spiral where more and more unconvicted people will have their assets taken, and then have to prove their innocence or the government gets their assets.”