Michael Keenan (Stirling, Liberal Party, Shadow Minister for Justice, Customs and Border Protection) Share this | Link to this | Hansard source

I rise to speak on the Mutual Assistance in Criminal Matters Amendment (Registration of Foreign Proceeds of Crime Orders) Bill 2011. The coalition supports the purpose of this bill, which is to address potential constitutional issues with Australia's current legislative framework for registering proceeds of crime orders. We support the aim of the amendments, which is to ensure that the framework for providing assistance to foreign countries, international tribunals and the International Criminal Court in registering proceeds of crime orders issued by them continues to operate as intended.

It is no secret that the whole purpose of organised crime is to generate profit. It has been estimated that organised crime costs the Australian community approximately $15 billion a year, according to figures from the Australian Crime Commission. The coalition has a strong history of targeting serious and organised crime and continues to place priority on the ACC as a crime-fighting body. At the federal level, the former Howard government established the Australian Crime Commission in 2002. Through the ACC, state and federal police work together to investigate serious and organised crime.

However, since coming to power, Labor have cut the funding to the ACC and have reduced its staff over the years. In their latest budget, brought down in May, they are axing another 23 staff from the ACC. The Gillard Labor government have also axed a further 90 staff from the Australian Customs and Border Protection Service on top of the 250 cut in the previous year's budget. Customs plays an integral role in stopping the importation of illicit goods smuggled into the country by organised criminal syndicates through our ports and airports. In the latest budget, Customs revealed that the number of reported consignments of air and sea cargo has gone up significantly and that that number is forecast to go up even further over the next four years. Despite this, Labor have not increased the amount of air and sea cargo that is inspected or examined, which means even less cargo will be properly checked under their new, pared down regime.

In the 2009-10 budget, Labor cut the budget for Customs cargo screening by a staggering $58.1 million. Labor's cut resulted in a reduction of 75 per cent in air cargo inspections—that is, 75 per cent less air cargo is being inspected when it comes into the country. In the recent Customs annual report, it was revealed that only 4.3 per cent of sea cargo is X-rayed and only 0.6 per cent of sea cargo is physically examined. Even less cargo will be inspected and examined now that there is an increase in the volume of cargo coming into the country. So we have a significant increase in the volume of cargo coming in through both our seaports and airports, yet the government is continually slashing funding—the end result being that so much less of that cargo is actually being examined for contraband, whether that be precursors for drugs, drugs themselves, illegal weapons or other things we would like to keep out of the country. Clearly the government is not doing all it can to combat organised crime when it has been so lax and so disastrous for our border protection regime in so many ways.

By reducing the amount of cargo that is checked, Labor are making our airports and ports significantly more vulnerable to organised criminal syndicates, who are taking advantage of the lax conditions to smuggle in drugs, weapons or other contraband. Labor have also weakened our national security by cutting funding for Australia's premier crime-fighting agency, the Australian Federal Police. They have cut AFP staff numbers at a time when the AFP are stretched beyond capacity and under unprecedented pressure to respond to the chaos within our immigration detention network. These diversions from the core crime-fighting tasks, caused by Labor's mismanagement of our borders, only serve to give organised crime a helping hand. Working together with appropriate resources, the Australian Federal Police, Customs and the Australian Crime Commission would have been the weapon of choice against serious and organised crime in Australia. Labor's budget cuts in this area are a slap in the face for our law enforcement agencies and the Australian public, who these agencies are tasked to protect. The coalition believes our key law enforcement agencies need to be appropriately resourced in order to stop organised criminals from growing their business.

It should be acknowledged that the Commonwealth Proceeds of Crime Act 2002 was introduced and passed under the former coalition government. The act provides a scheme to trace, restrain and confiscate the proceeds of crime against Commonwealth law. The act allows in some circumstances for it to be used to confiscate the proceeds of crime against foreign law or the proceeds of crime against state law. The act also permits confiscated funds to be given back to the Australian community in an effort to prevent and reduce the harmful effects of crime in Australia. The act was the result of a review which found that the inclusion of civil forfeiture at the federal level would vastly extend the capacity to recover funds from breaches of federal law. The coalition supports the strategy of being able to confiscate assets and profits which are the result of crimes committed overseas.

Australia has a well-developed system for cooperating with foreign countries and restraining and confiscating benefits derived from foreign criminal offences where those assets are located within Australia. Part VI of the Mutual Assistance in Criminal Matters Act 1987 enables an Australian court to register and enforce orders raised by a foreign court. These foreign orders comprise restraining, confiscation and pecuniary penalty orders over property derived from serious criminal offences. Once a foreign order is registered in Australia it is able to be enforced as though it were an Australian order made under the Proceeds of Crime Act. Provisions in the International Criminal Court Act 2002 and the International War Crimes Tribunals Act 1985 expand upon the regime in the Mutual Assistance Act and allow an Australian court to register and impose forfeiture orders issued by the International Criminal Court and designated international war crimes tribunals.

The High Court in the case of International Finance Trust Co. Ltd v New South Wales Crimes Commission 2009 found provisions in New South Wales legislation which allowed for the making of a restraining order ex parte were consti­tutionally invalid because they infringed the constitutional integrity of the New South Wales Supreme Court in a way that was inconsistent with its status as a chapter III court under the Constitution. The court had no discretion whether to hear from a person affected by the order and there was no statutory provision available which allowed the person affected to challenge the making of the order. In particular, the decision reinforced that courts must be authorised to exercise control over the making or enforcement of proceeds of crime orders.

As noted in this bill's explanatory memorandum, the amendments aim to ensure the legislative arrangement providing a court with the power to register and enforce foreign orders continues to function as intended. This bill will make minor but important amendments to the Mutual Assistance Act, the International Criminal Court Act and the International War Crimes Tribunals Act. The amendments will allow a court greater discretion when deciding whether a foreign order should be registered and enforced in Australia and whether or not to hear an application for registration on an ex parte basis. The amended provisions will necessitate a court to register a foreign order unless it considers that it would be contrary to the interests of justice do so. In deciding whether registration of a foreign order is in the interests of justice, the court is to give due regard to the primary intention of the system.

The bill will also insert an object clause into subdivision A of part VI of the Mutual Assistance Act in order to clarify the intention of the system. The purpose of this subdivision is to allow Australia to give effect to foreign orders in circumstances where a property related to serious foreign offences is located within Australia. The amendments aim to bolster reciprocity as the basis of international crime cooperation. It aims to ensure Australia is able to provide the same level of assistance to other countries as we would expect from them.

I turn to a very serious proceeds of crime matter that I believe the government needs to take action on, and that is the proceeds of crime that might accrue to Mr David Hicks as a result of the publication of his book Guantanamo: My Journey. This issue has been raised in the Senate by my colleague Senator Brandis, and he and I, and I suspect all of the opposition, would urge the government to undertake appropriate action to ensure that Mr Hicks does not make a substantial financial gain specifically out of the crimes that he himself has admitted that he committed. This is somebody who has admitted that he consorted with Lashkar-e-Taiba, which is a diabolically bad terrorist group responsible for killing literally hundreds of people, and killing two Aust­ralians. Now this man is going to perhaps earn up to $350,000, by some conservative estimates, based on those crimes—crimes which, I again remind the House, he has pleaded guilty to.

Senator Brandis has been particularly persistent in pursuing the government over this matter. As far as the opposition is concerned, it should be very straight­forward—Mr Hicks has admitted his crimes and he should not be able to profit from them. I asked the Attorney questions about this in the House last week, and all he would say was that he has commenced an investigation into the applicability of the legislation to Mr Hicks's publication that details his support of and participation in a terrorist organisation.

Part 2-5 of the Proceeds of Crime Act provides for the making of a literary proceeds order where a person has committed an indictable offence against either Australian or foreign law and the court is satisfied that the person has derived literary proceeds in relation to the offence. The offence to which Mr Hicks pleaded guilty under the Military Commissions Act clearly falls within a definition of a foreign indictable offence under the Proceeds of Crime Act. It is symptomatic of this government that they would sit on their hands and not take more sensible action against Mr Hicks in what is clearly an open and shut case of somebody standing to profit very significantly from his crime. In the case of Mr Hicks, of course, the crimes for which he has pleaded guilty are incredibly serious. Indeed, it is very difficult to believe that there are many crimes worse than consorting with terrorists, particularly really vicious terrorists such as Lashkar-e-Taiba. So I urge the government to finally take some action on this matter and not let it stand that any Australian citizen could profit from their criminal activity.

The coalition support the passage of the Mutual Assistance in Criminal Matters Amendment (Registration of Foreign Proceeds of Crime Orders) Bill 2011. We always support measures that ensure Australia is not seen as a safe haven for criminals and that limit the ability of criminals to profit from their crimes. I commend the bill to the House.

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

I also rise today to support the Mutual Assistance in Criminal Matters Amendment (Registration of Foreign Proceeds of Crime Orders) Bill 2011. On the face of it, the bill may be seen by some to be a minor amendment, but it is an amendment that has enormous implications for clarifying the process of foreign orders and it provides a mechanism by which we can strengthen our fight against international crime.

Australia has always been dedicated to its international obligations, and that includes cooperation with other nations when it comes to criminal matters. I have often spoken in the House about how crime knows no boundaries. When we have discussions about police and law and order is a folly for us to talk about state or territory policing, because the truth is that none of the criminals out there read the Constitution or look at the geography when they seek to participate in criminal endeavours. They look for loopholes and opportunities, and the same applies when we are looking at international crime.

One thing that always sticks in my mind, and it is refreshing to hear it from a lot of the younger people in law enforcement these days, is that it is about not only catching the crook but also putting these people out of business. I am often attracted to comments about how we have to look at criminal activity as a business. It is no doubt a nefarious business, but it is still a business with a profit motive and we need to do all we can to put those businesses out of business. This bill goes to the heart of that.

In my time acting for various police organisations, and more recently in my dealings with the Australian Crime Commission and the Australian Federal Police as a parliamentarian, I have learned that the proceeds of crime invested in Australia are not necessarily from crimes that were committed in Australia. Not all that long ago I had the opportunity as part of a parliamentary delegation to visit a number of countries to discuss the contemporary efforts being deployed against serious and organised crime by leading law enforcement agencies. I was looking at one of the reports we wrote where we quoted from the head of the Italian national police, Mr Rafael Grassi. He highlighted to our committee the importance of going after the money and depriving criminal groups of their assets. As a member of the Italian national police, he was very much at the forefront in the fight against the Mafia. He indicated to us that Mafia members are prepared to spend time in prison and conduct further criminal activity outside prison, but what really harms them is going after their assets. Essentially, that is what we are trying to do through this legislation. We are trying to make it more conspicuous and to make it easier for the Australian courts to assist in the process.

Wherever crime occurs it is obviously detrimental to a community. If criminal assets are being invested in Australian businesses it is detrimental to this country. Every individual has the right to have their property protected. It is the responsibility of our government to ensure that our police have the resources they need and the legislative support they require to do their jobs and achieve the objective of putting criminals out of business. This bill indicates that we will not tolerate criminal activity and we will use every opportunity to make it more onerous to pursue criminal endeavours, even if they are investing those moneys abroad.

Since ratifying both the United Nations Convention against Transnational Organized Crime and its protocols in 2004 and the United Nations Convention against Corruption in 2005, this country has worked to develop a comprehensive and transparent framework to ensure the seizure and confiscation of assets held as a result of criminal activities. A foreign proceeds of crime order is an order that restrains or confiscates the proceeds or instruments of a foreign offence, or orders a person to pay a certain amount equivalent to the benefits they have derived from a criminal activity, as determined by a foreign jurisdiction.

The confiscation of assets held as a result of criminal activity achieves two objectives. Firstly, it deprives the criminal of the benefits of their crime—the profits of their business, if I can put it that way. In doing so, it reduces the motivation for engaging in a criminal endeavour, because they know at some stage they may have all of their so-called hard-earned cash taken away from them. So the objective is to reduce the motivation for engaging in criminal activity by essentially attacking the business model underpinning criminal endeavours. The second and no less important aspect is that it removes assets that would ordinarily be available to be reinvested into other criminal endeavours. That is also significantly attractive and a laudable objective.

One thing we have learnt is about the amount of criminal activity occurring in Afghanistan. Whilst Afghanistan has the vast majority of the world opiate trade—somewhere about 97 per cent, I think—we know that it is finding its way to not just the criminals who underpin that trade, Colombians and others; it is also supporting terrorism. There is a clear link in respect of that, as Antonio Costa made clear to me when we visited him at UNODC, the United Nations Office on Drugs and Crime. They are certainly single-minded on the fact that foreign countries must be cooperating to the maximum to ensure that the proceeds of criminal endeavour are confiscated and not allowed to be kept in one foreign country in some form of safe haven.

I know there are countries that do accept investments provided that it cannot be proved that the investment was derived from a criminal activity. We need to be far more proactive than that. We are not going to be silenced on receiving foreign benefits from crime and using this country as a safe haven so it can be reinvested or simply transferred back to other criminal organisations. Australia must be on the front foot doing what it should be doing as part of its obligations in the international law enforcement community and doing everything possible to shut down serious and organised crime.

The Australian Institute of Criminology has stated that by confiscating stolen assets we are helping to combat international money laundering, particularly money laundering to finance international terrorism. This legislation is not just another technical amendment proceeding through this place; this is something that has very serious ramifications. Like all aspects of business, crime is constantly changing. We need to ensure that our laws meet the challenge of criminal enterprises thinking it is a feasible objective to operate in this country, whether directly in criminal activity or by investing their proceeds of crime in this country.

In the wake of the issues raised by the High Court in the International Finance Trust Company Ltd v New South Wales Crime Commission in 2009, these amendments must be made to the Mutual Assistance in Criminal Matters Act 1987, the International Criminal Court Act 2002 and the International War Crimes Tribunal Act 1995 to ensure greater success in the prosecution of international criminals. In this case, the High Court found a New South Wales scheme that required a judge to determine and hear an ex parte application for a restraining order which was unconstitutional. That is why we need to act to bring in these supportive amendments. This case in New South Wales highlighted the fundamental importance of ensuring that the functions and powers imposed on our judges by legislation do not conflict with the integrity of the functions provided for under chapter III of the Constitution. Under the current structure, the courts have no discretion as to whether to hear from a person affected by an order. There is also no statutory provision available to allow for the person affected by the order to have the challenge reviewed. This amendment ensures that the general framework of providing assistance to foreign countries, international tribunals and international criminal courts in registering proceeds of crime orders issued by them continues to operate as intended in this country.

The changes to the mutual assistance act will give judges discretionary power to refuse to register a foreign order if it is in conflict with the interests of justice to do so and allows them to refuse to hear an application for the registration on an ex parte basis. By articulating the overarching purpose of subdivision A, this amendment also provides assistance to judicial authorities in their interpretation of these provisions, which provide a comprehensive scheme for facilitating international cooperation in the registration and enforcement of foreign orders in Australia. As it stands, without this amendment there is a standstill in the processing of many criminal cases which involve property to the value of many hundreds of millions of dollars in this country. One such example involves the United Kingdom authorities. Despite their request for the registration of orders from the proceeds of pension fraud and share fraud to the value of tens of millions of dollars, under the current legislation and the decision of the High Court, Australia has not yet been able to proceed on these requests. Without the passage of this bill, there will likely be further delays in the registering of foreign orders. As a result of this loophole in our system there is already a risk that these assets will be moved offshore. They will be moved offshore as proceeds of crime to reward those who undertake criminal endeavours and, more importantly, will be available to be reinvested in future criminal activity.

For too long criminals have been under the impression that, if they hide their assets abroad, they will escape the notice of the authorities. This amendment bill makes it abundantly clear that no criminal act will be tolerated and that law enforcement is not limited to the bounds of any one nation. It lets the criminals know that Australia unequivocally supports the foreign courts when it comes to confiscation, restraining and pecuniary orders of stolen assets. I am very proud to support this amendment bill and I commend it to the House.

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

I rise in support of the Mutual Assistance in Criminal Matters Amendment (Registration of Foreign Proceeds of Crime Orders) Bill 2011. It is always a pleasure to follow the former member for Werriwa and current member for Fowler. It is interesting to note that the three speakers from the coalition side are all from Western Australia, the engine room of our economy at present. All crime is abhorrent, from graffiti and antisocial behaviour through to more serious assaults and the taking of lives. Crime is perpetrated by people in the community who do not want to live by or respect the standards that have been set to maintain law, order and peace in our society. However, there is something deeply disturbing and concerning about organised crime, which can spread quickly and undetected without tough policies and the resolve to tackle it. If left unchecked it can rapidly undermine the rule of law and break down societies. You do not have to look too far to see troubling examples around the world.

Organised crime costs nations financially as well as socially. The Australian Crime Commission puts the cost of organised crime to Australia at between $10 billion and $15 billion every year—a staggering amount of money that suggests this is an issue which government needs to tackle. The Constitution gives the federal parliament some degree of responsibility to take the fight to organised crime, and it is the federal government that must be held to account for action in this area.

When we talk about organised crime we are talking about a range of offences that include activities as varied as identity crime, environmental crime and fraud. People smuggling is of course classified as organised crime, and the coalition has spoken about this on many occasions before. Stopping the people-smuggling business is a major priority for the coalition. We stopped the boats before and have the record to prove it. Yet the Labor government takes a different approach—boat after boat, policy mess after policy mess. The Minister for Justice in his second reading speech stated:

In an age where borders are increasingly permeable, effective and efficient international crime cooperation is increasingly important.

It does not have to be this way, Minister. The reason that our borders have become increasingly permeable is this government's failed policies. Opening the doors to the people smugglers has led to an inhumane situation where people are risking their lives to come to Australia. Why doesn't this government go back to the policies of the coalition, the policies of the Howard government, which stopped the boats? Why doesn't the Prime Minister pick up the phone to the President of Nauru? The people of my electorate of Swan are rightly concerned at the collapse of our border security and the numerous lives that have been lost at sea under laws that this government has set in its approach to people smuggling. The government stands condemned by both houses of parliament for its ineffective people swap deal with Malaysia.

I now want to discuss a particular type of organised crime that is significant in Western Australia and in my seat of Swan—that is, clandestine laboratories. Clandestine laboratories, or 'clan labs', are used for the manufacture of illicit drugs, in the majority of cases the dangerous methylamphetamine. They can be particularly dangerous facilities and are often run in residential areas. The Australian Crime Commission reports that more and more clandestine labs are being detected across the country, but the largest shift in detection numbers has occurred in Western Australia, from 30 labs in 2007-08 to 78 in 2008-09—a reported increase of 160 per cent.

Western Australians have been noticing this trend with some alarm, thanks to several high-profile incidents that have occurred over the last few months. Members may be aware that on 20 March WA was shocked to learn that a high-profile policeman's son was involved in a drug lab blast in Bishopsgate Street in Carlisle, in my electorate of Swan. One of the dangers of drug labs is explosions and fires caused by highly reactive chemicals, and that is why it is so important that they are eliminated from our suburbs. Just a few days ago there was another high-profile incident where the man arrested over the death of a grandfather in a road accident in Gosnells was discovered to be operating a drug lab. One of my constituents reported a suspected clandestine drug lab to me at one of my recent mobile offices. I subsequently reported this to the police and the Minister for Police, and the premises were raided a few days later.

I appreciate that some action has been being taken at a national level to better coordinate action against clandestine laboratories. The National Organised Crime Response Plan 2010-13 has been agreed to by all states and territories, and Western Australia Police has produced its own Serious Organised Crime Strategy, which is aligned to it. The WA strategy has five aims:    target high-impact crime and influential participants, stifle and disrupt business, undertake joint operations across WA Police with other agencies, restrict opportunities for organised crime groups to use legitimate business enterprises to facilitate criminal activity, and confiscate profits of crime.

The bill we are considering today pertains to the last of these aims, to confiscate the profits of crime. Confiscating the proceeds of crime is important. It is also a means of achieving some compensation for the community. A great example of this is the funding round run by the Liberal-National state government on the proceeds of crime. In May a total of $150,000 was provided for a new south-east train line patrol to be operated by the Nyoongar Patrol System and $199,836 has been allocated to the trustee of the Save the Children Australia fund to address the presentation of vulnerable young people aged eight to 15 in Northbridge and the suburbs serviced by the Perth-Armadale train line. Both projects have been funded under the Criminal Property Confiscation Grants Program and, because of reforms made to the program under the Liberal-National state government, the recipient organisations will be contributing additional funds, at least 50 per cent of the total project, in cash or through in-kind services. The Thornlie-Armadale Train line is consistently reported to be the most dangerous line in Perth, and as members would be aware I have been campaigning for measures to address this. Whilst the CCTV network in Perth is extensive, people wanted to see security and foot patrols on the ground. This funding is a step in the right direction and will help address the problem of gangs of youths hanging around stations causing trouble and committing crimes. It demonstrates the cost to society of organised crime and is a great example of how the proceeds of crime, in this case those seized by the police and the Director of Criminal Prosecutions, can be redirected to benefit the public.

Debate interrupted.