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Following the money trail: Corruption watchdog says reforms needed to tighten net on 'unexplained wealth'

Crime

Organised criminals recruit professional “enablers” to expertly hide assets in complex business models, frustrating investigations.

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Queensland laws enabling authorities to confiscate ill-gotten gains would benefit from substantial reform to target “professionalised” criminal networks, according to the state’s corruption watchdog.

The Criminal Proceeds Confiscation Act (CCPA) is under the Queensland Crime and Corruption Commission’s microscope. The CCC is calling for public submissions for its review on the state’s key powers to undermine the profits from serious and organised crime. The legislation’s last major amendment was a decade ago.

The review warns sophisticated and “professionalised” criminals are more likely to hire “specialist facilitators” to create structures to conceal the true ownership of assets from authorities.

“Organised crime groups of all kinds are heavily involved in illicit market activities with strong links to global support chains through international networks and facilitators. Often these groups operate using sophisticated business models and expertise to produce significant financial return for those involved.

“Facilitators and enablers may be respected professionals within the community, who offer their expertise on a fee-for-service basis. They are typically recruited by organised crime groups through pre-existing networks which have a global reach, requiring national and international law enforcement collaboration and coordination,’’ the CCC review said.

The review also identified critical gaps in the confiscation laws which are no longer “fit for purpose in the current criminal environment, particularly for digital assets like cryptocurrency.

“As cryptocurrencies are being used pervasively in organised crime, the inability to seize digital assets is a critical gap in Queensland’s asset confiscation regime.”

Offshore networks are also difficult to investigate particularly when criminal assets are digital, including decentralised financial transactions, making it difficult to trace and seize, the review said.

“While operational responses to this complex criminal environment exist, they require novel thought, cross-agency collaboration, and significant investment. They also require legislation that is flexible enough to respond to a highly adaptive criminal environment.”

The review said Queensland’s approach to unexplained wealth is more stringent than other jurisdictions like South Australia, the Northern Territory and West Australia.

“So it offers less ability to confiscate the unexplained wealth of people who can hide their criminal activity,’’ the review said.

In the other states, the burden of proof is on the accused to prove they obtained their wealth lawfully.

“In Queensland, that burden only shifts to an individual once the State has satisfied the suspicion that their wealth was unlawfully acquired,” the review said.

The CCC recommended the government consider removing the link between unexplained wealth and criminal activity, which can be difficult to prove.

“Those who make the most profit from organised crime often have the greatest ‘distance’ from those who are the most likely to be detected for offences. Therefore, there is an increasing set of circumstances where Queensland’s unexplained wealth orders are not meeting the complexities of the contemporary criminal environment.”

The CCC held a series of workshops with practitioners in which a “multitude of challenges” were identified in Queensland’s confiscation laws.

These included:

The CCC said the volume and type of cases targeted for asset forfeiture is pivotal to disrupting crime.

The workshops also included suggestions for Queensland to consider joining the National Cooperative Scheme on Unexplained Wealth which helps law enforcement to trace, identify and seize assets that cannot be connected to a lawful source.

“Specifically, the increasingly complex and borderless nature of organised crime makes information sharing and collaboration critical.

“Queensland does not participate…. since 2018, there has been rapid change to the criminal environment and technology that enables organised crime, so there is benefit in re-examining Queensland’s position,’’ the CCC said.

Queensland’s Attorney-General Yvette D’Ath did not answer questions from InQueensland about whether the government will consider reversing the onus to criminals to prove unexplained wealth.

Ms D’Ath said the government notes the CCC’s review is ongoing its current consultation will inform any final recommendations.

“The government will continue to work with the CCC on any future potential changes,’’ said Ms D’Ath who is also the Minister for Justice and Minister for the Prevention of Family and Domestic Violence.

 

 

 

 

 

 

 

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