Northern Territory Second Reading Speeches

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CRIMINAL CODE AMENDMENT (MONEY LAUNDERING) BILL 2004


Bill presented and read a first time.

Dr TOYNE (Justice and Attorney-General): Madam Speaker, I move that the bill be now read a second time.

This bill is part of a national initiative to stem money laundering and organised crime networks. At the Leaders Summit on Terrorism and Multi-Jurisdictional Crime in April 2002, the Chief Minister, along with other leaders, resolved to reform the laws relating to money laundering including a possible reference of power to the Commonwealth, if necessary, for effective offences. The Joint Working Group on National Investigation Powers was tasked with the facilitating the implementation of their resolution and has recommended a framework for money laundering offences that will create an effective national response to money laundering. The offences are to be inserted in the Criminal Code by this bill, following the Joint Working Group’s recommendations, and have the support of all other state and territory Attorneys-General.

Money laundering is undertaken for a number of reasons. Firstly, because the proceeds of crime provide a direct link to the offence itself. Money laundering allows criminals to distance themselves from the criminal activity that generated the profits, making prosecution for substantive offence more difficult. It also removes the likelihood of the profits being confiscated if the criminal is caught by removing the link between the profits and the offence. Money laundering assists criminals to enjoy the benefits of the profits without drawing attention to themselves. It allows criminals to reinvest those profits in legitimate business and, perhaps most significantly, in future criminal activity.

There are three stages to laundering money. The first step is that the money launderer introduces illegal profits into the financial system. Large amounts of cash may be split into less conspicuous, smaller amounts and then deposited directly into a bank account, or used to buy a series of financial instruments such as cheques or money orders that are then collected and deposited into accounts at other locations. Once the funds have been placed into the financial system, the launderer can then engage in a series of conversions or movements to distance them from their original source. For example, funds might be channelled through the purchase of investment instruments or by wiring money through a series of accounts at various banks, perhaps disguising the transfers as payments for goods and services. Once these stages are complete, the money launderer then proceeds to have the funds re-enter the legitimate economy, for example, investment in real estate or business ventures.

The problem of money laundering is one with enormous and far reaching impact. If effective laws are not created to check money laundering activities, not only will large amounts of criminal assets be protected from confiscation, but of greater significance, those assets become capable of investment in further criminal activity. In the context of global terrorist activities, effective money laundering laws may be seen as a key measure in preventing the sponsorship of terrorist groups and activities.

The bill creates an offence dealing with the proceeds of crime. The offence arises where a person who deals with money or other property, that is the proceeds of crime, either knew or had the belief or suspicion or should have reasonable grounds for a suspicion that the money or property was the proceeds of a crime.

The bill also creates an offence of dealing with property that is being used or is intended to be used in the commission of or to facilitate the commission of a crime but which cannot be proved to have been derived from crime. This offence fills a gap in existing money laundering laws in Australia. In 1999 in its report Confiscation that Counts: a review of the Proceeds of Crime Act 1987, the Australian Law Reform Commission found that a significant case could be made out for reforms that would extend money laundering offences to a wider range of activity in order to catch people who receive, possess, conceal or dispose of any money or other property in preparation for the commission of an offence.

Without an offence of this nature, a person who is detected dealing with property or money to set up an offence cannot be prosecuted. Like the money laundering offence, this offence applies where a person who deals with money or other property either knew had a belief or suspicion or should have had reasonable grounds for a suspicion that the money or property was being used or intended to be used for the commission of or to facilitate the commission of an offence.

In order to ensure that laws cover cross-jurisdictional criminal activity, ‘offence’ has been defined in the bill to include offences against a law of the Commonwealth or another state or territory or a foreign state if those offences would be an offence if committed in the Territory.

Both offences rely on proof that the money or other property was either derived from or used in the commission of some offence. The bill does not require, however, that the prosecution need to prove the specific offence concerned. It is enough if facts can be proved that constitute one or more offences. For example, if a person is apprehended in possession of a large amount of money that they admit to be the proceeds of a drug deal but refuse to provide the specifics of the transaction, it may not be possible to prove the actual offence that took place or who was involved in it. Alternatively, in some cases it may be clear that the money has been derived from one or more offences but it is not possible to say from which of the offences it was obtained.

The bill clarifies that this degree of specificity is not required. These offences are not intended to capture innocent persons who may have innocently owned or handled property that was later used in a crime. It is intended to prevent the activities of people who finance or otherwise facilitate the commission of crimes. In order to safeguard against any inappropriate use of the new laws and to ensure that they are directed at the intended targets, the consent of the Director of Public Prosecutions is required before a prosecution for any of these offences can be commenced.

This bill reflects the government’s commitment to ensure an effective national regime to prevent money laundering. Madam Speaker, I commend the bill to honourable members.

Debate adjourned.




 

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