Unexplained Wealth (Commonwealth Powers) Bill

Second Reading

Adjourned debate on second reading.

(Continued from 12 May 2021.)

Mr ODENWALDER (Elizabeth) (17:10): I rise to speak on the Unexplained Wealth (Commonwealth Powers) Bill and indicate that I will be the lead speaker for the opposition in this place. As members will know, Labor in South Australia has always taken a tough line on serious and organised crime. In addition to a range of laws focused on outlaw motorcycle gangs, Labor acted to confiscate criminal assets when it passed in 2005 the Criminal Assets Confiscation Act.

Labor again showed leadership in this area when it passed the Serious and Organised Crime (Unexplained Wealth) Act 2009. Under this law, of course, the Director of Public Prosecutions may authorise the Crown Solicitor to apply to the Supreme Court of South Australia for an Unexplained Wealth Order. This can happen when there is a reasonable suspicion that a person or an incorporated body has unlawfully acquired wealth. This law was updated in 2013 to make it easier for investigations to use a wider range of information.

Members may know that most other jurisdictions passed laws in the 1990s and early 2000s, also to do with unexplained wealth, and in 2012 the report of the commonwealth's Parliamentary Joint Committee on Law Enforcement found that the commonwealth’s unexplained wealth legislation was not working as it was intended. It further found that a national approach to unexplained wealth legislation would be a more effective response to organised crime.

The committee recommended a referral of powers from the states and territories to the commonwealth, and in 2013 several jurisdictions formed a working group to consider a national approach to unexplained wealth, and South Australia joined them in 2015. Notwithstanding the significant amount of time that has passed, the bill before us today is essentially the outcome of those earlier recommendations and the working group.

The bill seeks to adopt certain laws of the commonwealth relating to unexplained wealth and information gathering. It also seeks to refer certain related matters to the commonwealth under section 51(xxxvii) of the Australian Constitution. At a local level, the bill proposes amendments to the Criminal Assets Confiscation Act and the Serious and Organised Crime (Unexplained Wealth) Act. It is intended that the expanded operation of the commonwealth law is designed to operate concurrently with South Australia's existing unexplained wealth provisions.

The bill would allow the commonwealth to make limited amendments to its unexplained wealth legislation without requiring further legislative amendment in South Australia. Under the proposed national scheme, equitable sharing arrangements will be implemented regarding seized assets where multiple jurisdictions contributed to an investigation and confiscation. The bill also creates a new definition of 'unexplained wealth', being property or wealth that might not have been lawfully acquired.

The proposed national scheme comprises a commonwealth act, intergovernmental agreement and legislation in each participating jurisdiction. New South Wales has passed its legislation and, if passed, the South Australian bill would make us the second jurisdiction to completely join. This scheme grants new information gathering powers, such as compelling the production of relevant information or documents anywhere in Australia through production orders and notices to financial institutions and allowing the use of lawfully intercepted information on unexplained wealth matters that will assist in identifying assets and persons of interest.

As noted earlier, the national scheme will operate concurrently with state laws, and we understand that it will, if required, permit the states to roll back amendments made to commonwealth laws as they apply to their jurisdiction. Labor will be supporting the passage of this bill through this house, but I understand that, due to the manner in which it was introduced last time, we reserve the right between the houses to consult with stakeholders and further examine it and perhaps make changes in the other place. We reserve that right, but certainly we will not hamper its progress through this place.

The Hon. V.A. CHAPMAN (Bragg—Deputy Premier, Attorney-General, Minister for Planning and Local Government) (17:13): I acknowledge and thank the member for Elizabeth for his indication of support and indeed sharing our view that, as quickly as possible, this matter be dealt with through this parliament.

Although I was unable perhaps to elicit any areas of concern that might already be clear to the member that I might be able to address to assist in any committee stage, what I propose to do is invite the member in committee to identify any questions or raise any concerns that he has and, as much as I am able, I will answer.

Any information that I cannot provide to the committee at the member's request, I assure the house that we will attempt to provide him whatever can be provided between the houses, if that is the way the member would be happy to proceed. Alternatively, we will just adjourn at clause 1. If the member is happy to proceed, I will not make any further contribution.

Bill read a second time.

Committee Stage

In committee.

Clause 1.

Mr ODENWALDER: My questions are simple. As we went through before, they are exploratory at this stage, and we will reserve our right to formulate more questions between the houses and perhaps examine the bill a bit more closely. My first question, Attorney, is: what concerns were raised when the Crown Solicitor, the DPP and the Solicitor-General provided feedback and suggestions on the technical aspects of the bill, and how were they addressed?

The Hon. V.A. CHAPMAN: It seems so long ago I can hardly remember them all, to be frank. When it was agreed that we would advance support for a national scheme, which seemed to be moving at glacial pace, some other issues became apparent, not just as to the enforcement but new issues such as how we should share the money if we are going into a national scheme. Two or more states might be instrumental in securing an unexplained wealth windfall, if I can describe it in that way.

I recall one case where parties were traversing the state of South Australia and apparently had some history in crime and were the subject of confiscation conduct. In particular, South Australian police were diligent enough to be alert to the fact they were coming through South Australia. They stopped the car and asked them to open their boot and found a considerable amount of money. I think it was about $2 million.

Having secured it in South Australia, they get all the money. South Australia was happy about that, of course. Equivalent officers in Victoria were saying, 'These are our criminals and this is our money and we should be getting a share of it.' I am just paraphrasing, but you the gist of it. It did start a bit of a national conversation about how we might equitably share these windfalls. Nowadays, as I am sure the member would be aware, much more than I would be, there is also international and national support in the catching of criminals. It might be someone who is sitting on a computer in Switzerland who actually identifies somebody, which results in an arrest and the securing of proceeds in this sort of environment. The conversation was quite extensive.

What I can do is indicate to the member that the principal parties for consultation on the bill, which went out in July 2020—and obviously we have had COVID in between as well to interrupt some of this—are the usual suspects that you would expect in these consultations. Firstly, there was the Hon. Peter Dutton, who was the Minister for Home Affairs, and that office continues to have ongoing consultation and discussions at officer level between the AGD and Home Affairs to ensure that the bill was properly drafted and contained all the necessary provisions.

There is no problem in that regard that I am aware of. I think the member mentioned that New South Wales is one state that has already passed its legislation to support this national scheme, so I am sure that it would have come to light if there were difficulties in that regard. In October last year, the Commissioner of Police gave an indication that they were supporting it in principle but that they needed three months' lead time to the commencement, so that was really a machinery of operation request from them.

The Crown Solicitor received advice on specific questions that were asked in August last year. The DPP made comments on the form of amendment reference. I think from memory that related to the transfer of powers reference, but if that is not the case I will get that information between the houses. The Solicitor-General was also consulted in August 2020. His advice related to the constitutional aspects of the bill, together with the intergovernmental agreement. I think it is fair to say that South Australia has had quite a history in the development of its serious and organised crime law.

I was here in the time of the Hon. Michael Atkinson era and legislation was drafted, redrafted, argued over, proceeded with, passed and challenged in the High Court and it came back again. I think there was one dissenting judgement. I heard a very persuasive case, which did not persuade anyone in the end, that the minority judgement or one of the High Court ought to be listened to. I think there were four or five outnumbering this dissenting judgement.

It had to come back—I think it was the Totani case originally—to challenge the legislation, and it really confirmed the principle of the time, which remains; that is, courts are not there to be rubber stamps. They have to be able to make an assessment of their own and they are not there to conduct an administrative act but to have a judicial role. All that legislation really failed and we had to start again.

Since then, quite a bit of attention has been given by the former government and ours to making sure that these laws that support the closing down of serious criminal activities—fortress laws, non-association laws, etc.—have developed, along with extra sanctions in relation to the confiscation of assets and unexplained wealth laws. They have grown in the last 20 years and there are some differences around the country.

We did have significant advice and support from the Solicitor-General to ensure that we are able to transfer powers where required, have the benefit of being in a national scheme and be able to protect our interests in the sense of whatever share we might have from this. In a general way, we have listened to that advice and are presenting this bill now as something that is both consistent with the scheme and complying with our legal position within the jurisdiction of South Australia.

I do not have any other detail, but it certainly went back and forth for us to get that right in continued consultation with the commonwealth. To date, I certainly have not received any indication from the Attorney-General's Department that, as a result of the passage of the New South Wales legislation, there has been any identified weakness that we need to remedy and, accordingly, there are no other amendments being presented.

I will just quickly check, but I do not think there was any other significant party in this. My recollection is that the courts were also consulted but, unless there was any problem or they were not party to nutting out the procedure, I think you can assume there was not any identified risk in that regard.

Mr ODENWALDER: I thank the Attorney for her detailed and lengthy answer; in fact, it renders some of my other questions answered. I want to go back and revisit some of the things you said just to clarify. New South Wales have passed their legislation. That legislation has passed and been enacted. Can you tell me when that was? You say there have been no issues that you are aware of that have been reported back to the commonwealth. Does that mean that the envisioned scheme has been enacted within the New South Wales jurisdiction? Does it apply?

The Hon. V.A. CHAPMAN: I would not think so, but I will just confer. I should say that, as Attorney-General, I get briefings and updates about what happens as we are progressing this type of legislation. I do not recall any issue being raised at our most recent attorneys-general meeting to bring it to our attention and it had not been put on the agenda. I would expect that I would be advised by my department if there had been any indication that there was a problem with New South Wales in being the lead group and, secondly, that the commonwealth identified some weakness. I will just check if I can assist the committee.

I am not sure what has happened with any commonwealth legislation, but I doubt that has happened. It may be that it is all operating under the memorandum of agreement that has been referred to. The New South Wales legislation passed in 2018, I am advised. There has been nothing brought to my attention.

Mr ODENWALDER: As a supplementary to that, when you say no issues have been identified, is that in the structure of the legislation? We do not know that there are no operational difficulties until it is put into operation, so I want to clarify that.

The Hon. V.A. Chapman: Absolutely.

Mr ODENWALDER: Forgive my ignorance, but how many jurisdictions have to join before the scheme is activated and before it becomes a national scheme?

The Hon. V.A. CHAPMAN: I am advised that the scheme is already activated even though it appears that only one party has signed the legislation. It may well be that it is only with themselves, so they have transferred their power to the commonwealth and they can share that arrangement with the commonwealth. Apparently the scheme itself is operational and we just need to get into it.

Mr ODENWALDER: If an organised crime arrest or operation is done in New South Wales and if there is some money or assets seized in New South Wales, are they then subject to this new regime, and shared?

The Hon. V.A. CHAPMAN: That is as I understand it. Again, as the member would be much more familiar from his prior work than I am, say there were a significant drug haul coming through a port in New South Wales, for example, I expect that both the local constabulary, the Australian Federal Police and probably some customs people and others would all be crawling all over that and claiming some expanded contribution probably to the success of any operation. I assume from that it would mean that they actually can enter into negotiations to be able to share the proceeds.

Mr ODENWALDER: Can I just have one more question on clause 1 to clarify? I promise it will be brief.

The ACTING CHAIR (Mr Cowdrey): A point of clarification, yes.

Mr ODENWALDER: I understood that the Attorney was being generous in her exploration of the bill before we get to the upper house so we can identify some of these issues more quickly. My last question on this clause is a bit of a clarification of the national nature of the scheme. We are in the process of signing up and New South Wales have signed up. Do you understand what the reluctance, if any, is of other states, like Victoria, to sign up?

The Hon. V.A. CHAPMAN: Again, I am not aware of anything else as to a delay, but I know from our point of view COVID certainly interfered with our being able to get on with this. Obviously, some of that is because the personnel we are consulting with have been extremely busy with COVID and other issues, not the least of which is that the Solicitor-General has been fighting away in the High Court on matters, and of course we have the police commissioner dealing with COVID, and the Crown Solicitor has been tied up with that.

We have moved it as giving it the priority we can. The commonwealth Proceeds of Crime Act 2002 is already in force. At this stage, nothing has been brought to my attention as to why Victoria or Western Australia—Northern Territory I know has an unexplained wealth regime. I am pretty sure Queensland does. I am not sure if Tasmania does. But if there is anything else I can help with in that regard, I will make sure it is provided before it gets to the other place.

They all have different means of operation and use. In that sense, I mean confiscation of assets law, which is another body of work, is more commonly used in some other jurisdictions, including our own. But this is one where you have unexplained wealth which is triggered by being convicted of another offence as distinct from proving that the extra multimillion-dollar house you have has actually come from an armed robbery. I am sure you understand all that.

Clause passed.

Clauses 2 and 3 passed.

Clause 4.

Mr ODENWALDER: While this is at clause 4 now, it directly follows on from some comments made in the Attorney's answer to my first question, and that is to get some clarification. This is probably the nub of it all, which is to get some clarification about how any distribution of assets or proceeds, or however you want to explain it, would be equitably or proportionally handed out when there are two or more jurisdictions—or, as you suggest, international jurisdictions.

The Hon. V.A. CHAPMAN: I have asked that question myself. My understanding is that they are yet to broker that. It is not in clause 4, but it relates further to the provisions in 209F—Net amount:

Forfeiture proceeds that are shareable with the Commonwealth or another State or Territory under the national cooperative scheme are to be reduced by any amount that is payable under—

(a) an order of a court under this Act…

That could be as determined by a court and somewhere here is the provision which was, as I read it, in default, you share equally unless you can agree some other specified proportion. I would have to find it.

Firstly, good news: the NT and ACT, I am advised, have indicated they want to be part of the scheme, so that is a good thing. The memorandum agreement does have the provision for the presumption that it is fifty-fifty or 33½ per cent or whatever if it is three unless it is agreed otherwise.

Mr ODENWALDER: That is surprising. Just by way of comment, I would have thought that some of these agencies would have been quite territorial and they would say, 'I have done the lion's share of the work,' and the other jurisdiction that has done a little bit of the work comes in and claims 50 per cent. But the jurisdictions that have signed up to this have presumably assessed that that is an equitable way to do it.

The Hon. V.A. CHAPMAN: At the moment, it seems to me a bit of a lucky dip. If you happen to have the crooks in your territory and you arrest them, you get the lot. It just seems to me, and I think to the nation, firstly, we need to deal with the fact that serious and organised crime operates outside our own state boundaries. That is the first thing. So if you are going to work cooperatively, firstly, you need to have some incentive among the players to have a share of this enterprise.

When we are dealing with serious and organised crime, which is really what we are dealing with here, we are talking about people who are operating in a national way. They might be importing product, selling drugs in another state, storing and having assets in other jurisdictions. One might be identifying where assets are, another one might assist in an arrest and others might be tracing the drug trafficking arrangements that might flow from it.

I am trying to indicate that these things are multifaceted. Everyone who is joining up to this scheme understands that it is in their interest to share, otherwise you lose out on the intelligence and you lose out on the capacity to have that cooperation and to share. Somebody in South Australia might be on their way out of the state and they need to be able to contact their people in Victoria and say, 'This particular bikie gang is heading to Ballarat and we need your assistance to support an arrest, etc.'

This is why it has come about after quite considerable negotiation, that if we are really going to be effective in this area, in this space of serious and organised crime, bikie gangs, etc., then we need to cooperate and give some incentive to do that.

Mr ODENWALDER: I think this will be my final question. Since you raised it, there are international aspects to organised crime as well, of course. What is your understanding of how the commonwealth legislation currently treats those international joint operations, for want of a better term, and will that change? Will there be some inclusion of international partners in this legislation?

The Hon. V.A. CHAPMAN: I am not aware of that. I did ask that question, but I cannot even remember what the answer was. The case I gave at the time was to ask what will happen in a circumstance where there might be a multimillion dollar bank account in Switzerland, which holds the proceeds of child pornography and which has been identified in Switzerland and somebody sitting in Germany on a computer, and then South Australia Police here identifies somebody who is sitting at a university running the show. Do you see what I mean?

Mr Odenwalder: Yes.

The Hon. V.A. CHAPMAN: We have had, for example, the successful investigation and conviction of Shannon McCoole. I use that as a high-profile case because everyone knows about it. Clearly, there were overseas agencies monitoring people online for a very long time who were able to assist the police to deal with it. There is obviously another case that I think is in a similar category, the one where someone in the upper house was ultimately prosecuted.

Crime is now international. We understand that. I am not sure exactly what the arrangements are. It may be more informal in relation to arrangements with countries where we have some reciprocity and enforcement of orders. I suspect there are countries in the world with which we have no arrangements because they do not cooperate in any way. We are used to that.

Clause passed.

Remaining clauses (5 to 12), schedule and title passed.

Bill reported without amendment.

Third Reading

The Hon. V.A. CHAPMAN (Bragg—Deputy Premier, Attorney-General, Minister for Planning and Local Government) (17:39): I move:

That this bill be now read a third time.

Bill read a third time and passed.

At 17:40 the house adjourned until 8 June 2021 at 11:00.