Proceeds of Crime & Confiscation Law

Madison Branson are leading legal experts in Proceeds of Crime and Confiscation Law.  We specialise in matters arising pursuant to the Proceeds of Crime Act 2002 (Cth) and the Confiscation Act 1997 (Vic).   If you’re affected by property restraint or forfeiture, it’s imperative that you seek legal advice from an experienced proceeds of crime lawyer as early as possible.

It is important to note that you may be affected by proceeds of crime law and confiscation law even if you are not a suspect in a criminal matter, charged or guilty of any offence and even if you have no knowledge of any crime being committed.  Madison Branson Lawyers takes the time to understand the entirety of your circumstances to ensure you achieve the best possible outcome.

Application of the Proceeds of Crime Act 2002 (Cth) and the Confiscation Act 1997 (Vic)

Whilst both Acts function for the similar purpose of depriving offenders from the profits of their crimes or from any property connected with offending, each Act operates under a different jurisdiction.  The Confiscation Act is Victorian legislation, whilst the Proceeds of Crime Act is Federal legislation.  This means that the nature and circumstances of any alleged offences will determine which Act will be applied in your case. 

The term ‘property’ can include tangible and intangible property.  We’ll cover which types of assets may fall under this category a little further down. Property can also be restrained for the purpose of compensating victims of crime. Both Acts contain very strict time limitations which, if not observed, may lead to property being irretrievably forfeited without compensation to you.

Simon Tsapepas, Director of Madison Branson Lawyers, chats about the application of the Proceeds of Crime Act & Confiscation Law and explains the importance of acting quickly when dealing with these matters.

Potential Orders

    There are several types of orders that can be made against you that fall within the scope of the Proceeds of Crime or Confiscation Acts.  It is essential that you’re aware of the details surrounding these orders and the steps that can be taken to remedy them, as strict time limits apply.  If time limits have expired, you may be at risk of having your property forfeited to the State or Commonwealth, depending on the circumstances of offences alleged. 

    Restraining Order

    It is open to a Court to make restraining orders under both the Proceeds of Crime Act and the Confiscation Act.   The general objective under both forms of legislation is to restrict a person from disposing of or dealing with their property.

    For example, pursuant to the POCA, restraining orders can be made under five discrete sets of circumstances, such as pursuant to:

    • Section 17 – if you’ve been charged with or convicted of an indictable offence;
    • Section 18 – if authorities have reasonable grounds to suspect that you have committed an offence (even without charges);
    • Section 19 – where there are reasonable grounds for authorities to suspect that your property is the proceeds or an instrument of an offence (also without charges);
    • Section 20 – where there are reasonable grounds to suspect that you have derived literary proceeds from the exploitation of any indictable offence (also without charges); and
    • Section 20A – where there are reasonable grounds to suspect that you have unexplained wealth.

    Restraining Order (Confiscation Act)

    Restraining orders can also be made under Victorian legislation as set out in section 14 of the Confiscation Act.  Such orders under these circumstances can apply to any and all property belonging to the person the order is served on, and may include specified property of another person.  Restraining orders under the Proceeds of Crime Act and the Confiscation Act typically operate as a prelude to forfeiture orders or in an effort to protect or preserve the property for future confiscation.  Additionally, property may be subject to both a restraining order and other orders (such as civil forfeiture orders or unexplained wealth orders).

    Restraining orders under the Confiscation Act can also operate to preserve property to make it available to compensate victims of crime in Victoria, as per section 15(1)(e).  This means that property may be restrained for the purposes of satisfying any order for compensation that a court makes under the Sentencing Act  1991.

    Restraining orders are almost always obtained ex parte, meaning you won’t even be aware of its existence until it is served on you, after the order has already come into effect.  A restraining order taken out on your property serves to prohibit the disposal of or dealings with that asset.

    Forfeiture Order

    Asset forfeiture orders are effectively a ‘worst case scenario’ and what any litigant in this area of law is ultimately seeking, above all else, to avoid.  Such orders are available to the Court to make under both the Confiscation Act and POCA. A forfeiture order can permit the relevant authority to permanently deprive you of your property, without any compensation to you. You will no longer own the asset and you will not receive any proceeds of its sale, nor will you be entitled to receive any benefits derived from it.  

    There are different types of forfeiture orders that can be made against the property of an offender under the Confiscation Act, depending on the nature and knowledge of the offence.   

    Freezing Order

    The authorities may apply to the court for a freezing order.  This type of order is one which can compel financial institutions to prohibit them from allowing a person to make withdrawals from any account to which they are a named account holder and any other account which they may have an interest in.  The objective of a freezing order is to stop an offender from dealing with or disposing of their assets in order to preserve the funds so that a restraining order and forfeiture order can be pursued.  Much like with restraining order, a freezing order will generally always be applied for ex parte.

    Examination Order

    Examination orders exist under both the Confiscation Act and Proceeds of Crime Act.  The Act that will apply to your case will depend largely on the nature of offences alleged, as well as potentially the State or Territory that the offending occurred in.  

    For example, section 98 of the Confiscation Act provides that the Court may order an examination of any person convicted of an offence OR for any other person whom it deems appropriate to make an examination order.  It is worth noting that even if you are not charged or convicted of any crime, you still may find yourself the subject of an examination order.  If you are made the subject of such an order, the examination will oversee your financial and other affairs, including nature and location of any of your property or assets involving any income, expenditure or liabilities in relation to the property.  It will be mandatory for you to present to the examination and answer in full all questions asked of you. 

    Pecuniary Penalty Order

    A pecuniary penalty order requires an offender to repay a sum of money to the State or Commonwealth (depending on the jurisdiction that the offence is covered by) in the amount equivalent to that received through the course of their offending.  Pecuniary penalties survive a bankruptcy order and the moneys accrue interest until the day that they are paid in full.  This means that even if you declare bankruptcy, you will still be liable to pay the pecuniary penalties associated with an offence.

    Property Substitution Declarations

    Where an accused had available to them an asset which could have been used in the course of their offending but they instead chose to utilise the property of a third party, a court may make a tainted property substitution declaration.   In order for applications of this nature to be successful, the court must be satisfied that the third party’s property is not available for forfeiture and that the party had no connection to any offending that occurred.  Where such a declaration is made, the accused’s own property will be forfeited in place of that of the third party.

    How Do I Protect My Assets?

    If your assets are at risk of being restrained or forfeited, you will need to seek legal advice urgently to ensure your best possible chances of avoiding asset forfeiture.  This is a complex area of law with intertwining State and federal jurisdiction that requires a specialist lawyer who is well-versed in proceeds of crime law and confiscation law.

    Exclusion Application

    Your legal team can assist you in making an application to the Court for an exclusion order under both the Proceeds of Crime Act and the Confiscation Act in order to protect your assets from the operation of a restraining order or forfeiture order.

    Exclusion Orders (POCA)

    Under the Proceeds of Crime Act, it is imperative that an application for an exclusion order is made before a forfeiture order is made.  Exclusion orders will only be made where the Court is satisfied that the applicant’s interest in the property is not through proceeds of unlawful activity and that the property was not used as an instrument of a serious offence, in addition to other conditions.

    There are few limited circumstances where an exclusion order can be made after the forfeiture order has come into effect, however these are rare.

    Exclusion Orders (Confiscation Act)

    There are very strict timeframes that apply with respect to exclusion applications under the Confiscation Act.   You or a separate party with interest in the restrained property may make an exclusion application to prevent the asset from confiscation, however this needs to be done within 30 days of a restraining order being made and within 60 days of a forfeiture order application being made.  For the exclusion application to be successful, the person applying must be able to prove, on the balance of probabilities, that the asset was lawfully purchased using lawfully earned funds.

    Revocation Order

    Revocation orders are incredibly rare under Proceeds of Crime law.  s42(5) of the Proceeds of Crime Act provides that the Court may only revoke a restraining order if satisfied that:

    (a)  there are no grounds on which to make the order at the time of considering the application to revoke the order; or

    (b)  it is otherwise in the interests of justice to do so. 

    Justice Shaw, at p14 in DPP (Cth) v Tan [2003] NSWSC 717, noted that given the relatively low statutory basis required for a Court to make a restraining order, establishing that there were no grounds to do so would be an exceptionally tough test for any applicant to meet.

     

    Assets Subject to Confiscation

    Though the term ‘property’ is commonly used, all of your assets – both tangible and intangible – can  be restrained.  If you have been directed to comply with such a Court order, this may include real estate, cash, digital currencies, personal items such as cars, jewellery, luxury clothing and handbags and any other asset deemed appropriate by authorities.  This also applies to any asset which you may have a vested interest in, such as a vehicle or home that you may have gifted to another party.  Even if that other party is not named in the confiscation order and even if they have no knowledge of any offences that are under investigation, the property given to them by you is still liable to be affected by the order.  

    Whilst transferring your funds into an asset abroad (international investments, bank accounts or to another party) may seem like a safe option to avoid confiscation in Australia, you need to be aware of the implications of mutual cooperation legislation.  Essentially, there are international treaties in place that give Australia power to engage with foreign law enforcement agencies and judicial systems to investigate unlawfully held international assets.

    Proceeds of crime act

    What if I’m unable to pay my general living costs because my assets are restrained?

    If all or most of your assets are restrained by authorities, it is reasonable that you may have concerns about meeting your day to day financial obligations such as rent, food and other necessities.  Both the POCA and Confiscation Act make allowances to ensure that the reasonable living expenses of offenders and their dependents are paid for.

    Section 14(4) of the Confiscation Act provides that:

    A restraining order may, at the time it is made or at a later time, provide for meeting—

    (a) the reasonable living expenses (including the reasonable living expenses of any dependants); and

    (b) reasonable business expenses—

    of any person to whose property the order applies if the court that makes or made the order is satisfied that these expenses cannot be met from unrestrained property or income of the person.

    This means that, with appropriate application to the court, a notation can be made in the restraining order to allow for means to be made available to you from the restrained assets in order to meet reasonable personal and business expenses for yourself and, if applicable, your spouse and children.

    Whilst laws differ between jurisdictions in Australia, in Victoria a restrained asset cannot be used to pay for any legal fees, whether in relation to the restraining order or otherwise.

     

    Protection from Damages

    The Confiscation Act affords protections to those with restrained property by way of requiring the State to provide an undertaking to the court that they will reimburse for any damages that may arise from a restraining order, should their pursuit for a forfeiture order ultimately fail.   This principle will not apply if you’re deemed to have committed the illegalities that brought about the restraining order.

     

    Madison Branson’s Notable Cases

    AFP v Surinder Kaur [2016] VSC 423;

    Guo v Commissioner of Australian Federal Police [2017] VSC 269;

    Commissioner of the Australian Federal Police v Wen & Ors [2017] VSC 391;

    Commissioner of the Australian Federal Police v Wen & Ors (No 2) [2017] VSC 502.

    How can Madison Branson help?

    If you’re in a situation where Proceeds of Crime laws might risk your assets being confiscated (whether you’ve been involved in a crime in any capacity OR you’re 100% innocent) the main objective is obviously to avoid forfeiture and to ensure your property remains in your possession where feasible.  The single most effective step you can take towards setting yourself up with the best chance of success is to get representation early.  If you choose to ignore any official correspondence of orders in these circumstances, your property will be forfeited to the State or Commonwealth.  Madison Branson’s team of experienced Proceeds of Crime and Confiscation Lawyers will assist by making any relevant applications to the court and guide you through the initial process of preparing a response affidavit.  We are experts in this incredibly complex area of the law and will ensure your case is in the most capable of hands.  We take pride in assisting our clients to achieve a favourable outcome.  Contact us today to discuss any concerns, even if legal action has not yet ensued.  As specialists in the area, we’ll treat the matter confidentially and respectfully to ensure great prospects for your case.