Criminal Assets Confiscation (Prescribed Drug Offenders) Amendment Bill

Introduction and First Reading

Received from the House of Assembly and read a first time.

Second Reading

The Hon. G.E. GAGO (Minister for Employment, Higher Education and Skills, Minister for Science and Information Economy, Minister for the Status of Women, Minister for Business Services and Consumers) (16:21): I move:

That this bill be now read a second time.

I seek leave to have the second reading speech and explanation of clauses inserted in Hansard without my reading it.

Leave granted.

The prosecution of the activities of outlaw motor-cycle gangs and their members is a high priority for government. Outlaw motor-cycle gangs and their members are notoriously involved in drug trafficking. The Government is pledged to attack them with all means at its disposal.

Labor's 2010 Serious Crime election policy stated that 'This proposal will amend the Criminal Assets Confiscation Act … to target persistent or high level drug offenders to provide for total confiscation of the property of a 'Declared Drug Trafficker'. The policy details were:

New powers will be given to the Director of Public Prosecutions to allow criminal drug dealers who commit three prescribed offences within a span of 10 years to be 'declared a drug trafficker.

Under this proposal, which targets high level and major drug trafficking offenders, all of a convicted offender's property can be confiscated, whether or not it is established as unlawfully acquired and whether or not there is any level of proof about any property at all. Property and assets could also be restrained pending prosecution of matters before the court.

The legislation will attack repeat drug offenders. The offences that will attract the declaration if committed 3 or more times within a span of 10 years include:

Trafficking in controlled drugs;

Manufacture of controlled drugs for sale;

Sale of controlled precursor for the purpose of manufacture;

Cultivation of controlled plants for sale;

Sale of controlled plants; and

Any offence involving children and school zones.

The Bill, with an exception based on legal advice, fulfilling this election pledge was introduced into Parliament on 18 May 2011. It was passed by the House of Assembly on 28 July 2011. Once in the Legislative Council, though, the opposition, with the support of a majority of the cross-benchers, effectively defeated all of the operative parts of the policy by amendments to the Bill. At the end of 2011, Parliament was prorogued.

The Bill was re-introduced on 14 February 2012. The same thing happened in the Legislative Council. The usual procedures were followed where the Houses disagree, and it appeared that the Bill was destined to go to deadlock conference.

At that point, the Bill was split into two parts—the first, a Bill containing the operative provisions of the policy as described above, the second, a Bill containing a group of unrelated miscellaneous amendments to the principal Act that were uncontroversial. The latter passed without controversy.

The prescribed drug offenders Bill was introduced into the House of Assembly on 16 October 2012, and passed that day. It reached the Legislative Council on 18 October 2012. And there it sat. On 18 October 2013, the opposition moved that the second reading be deferred for six months. That effectively killed the Bill, since six months took it past the election and another prorogation.

The Labor Election Policies for 2014 included a pledge to pursue this initiative and bankrupt the Mr Bigs of the drug trade.

The general opposition to this proposal in South Australia seems to be based on the idea that this is a new and unprincipled proposition that is unparalleled in the known universe. In fact, it is enacted and operating in a more drastic form (for some time) in Western Australia, the Northern Territory and Queensland. Arguably, a combination of provisions in New South Wales has similar effect. This is not a re-invention of the wheel.

The Liberal Opposition repeatedly opposed the introduction of this measure in part, so it said, because of doubts over its constitutional validity. It is true that, by majority, the Northern Territory Court of Criminal Appeal ruled against the validity of that jurisdiction's scheme: Emmerson v DPP (2013) 225 A Crim R 409. But that doubt is now gone. In April 2014, the High Court delivered judgment on an appeal from that decision and in Attorney-General (NT) v Emmerson [2014] HCA 13, a majority of 6/1 held the Act and scheme valid. There is no longer that excuse for opposing this policy.

The idea that all of the property of certain drug traffickers (known as prescribed drug offenders) should be confiscated, whether or not it has any link to crime at all and whether or not legitimately earned or acquired, originated in the Western Australian Criminal Property Forfeiture Act 2000. If a person is taken to be a declared drug trafficker under either s 32A(1) of their Drugs Misuse Act or is declared under s 159(2) of the Confiscation Act, then, effectively, all of their property is confiscated without any exercise of discretion at all, whether or not it is lawfully acquired and whether or not there is any level of proof about any property at all.

The Bill reflects the Western Australian scheme, with minor modifications.

The two prescribed situations are a convicted drug trafficker of a certain kind and an absconding accused. The first category is the most general.

An absconding accused aside, there are two situations catered for. The first is the repeat offender. The second is the major offender (whether repeat or not).

(a) The repeat offender is caught if he is convicted on a third (or more) offence for nominated offences within a period of 10 years.

(b) The major offender is caught if he or she is convicted of a commercial drug offence. A commercial drug offence is one of certain extremely serious offences in the Controlled Substances Act 1984, or any of the serious drug offences that involves a commercial amount of the controlled drug.

The extremely serious offences nominated are: trafficking, manufacture for sale, selling or possession with intent to sell a large commercial quantity or a commercial quantity of controlled substances or controlled plants and cultivation of a large commercial quantity or a commercial quantity of controlled plants.

As a sidenote, the Northern Territory Criminal Property Forfeiture Act contains very similar provisions, obviously modelled on the Western Australian Act. However, the Northern Territory Act contains only the repeat offender version of the first category and the second category (death and absconding). It does not contain what is described above as the major offender category. The Queensland Criminal Proceeds Confiscation Act 2002 contains a scheme that is similar in intent but different in complicated ways as to details.

Under the legislation in Western Australia and the Northern Territory, all of the declared drug trafficker's assets are subject to forfeiture. This would include such things as baby clothes, washing machines, garden hoses, children's toys—the lot.

In order to ameliorate the harshness of the scheme and possible forfeiture to the Crown of goods and chattels that are worthless, encumbrances or otherwise not worth the trouble, the Bill states that the prescribed trafficker forfeit everything except what a bankrupt would be allowed to keep. These are to be found in r 6.03 of the Commonwealth Bankruptcy Regulations 1996. The lists are extensive, but the general principle is stated in this way: section 116(1) of the Act does not extend to household property (including recreational and sports equipment) that is reasonably necessary for the domestic use of the bankrupt's household, having regard to current social standards.

The Queensland Criminal Proceeds Confiscation Act 2002 adopts the same principle.

High Level or Major Traffickers

Whether or not a person can be presumed to be, in common usage, a high level or major trafficker will depend largely, but not wholly, on the amount of the drug with which he or she is associated. The table below illustrates various amounts for the more commonly prosecuted controlled substances. The S.A. amounts were prescribed as a result of a national consultative process fixing amounts and methods of calculation. The nationally agreed amounts were settled on the basis of research across Australia on the actual activities of the illicit drug markets informed by police expertise.

Repeat Offenders

The legislation also attacks repeat offenders. The key to this category is settling the offences to which it applies—that is, what offences will attract the declaration if committed 3 or more times within a span of 10 years. It is suggested that the offences to which it should apply are any serious drug offences that are indictable. These are those offences listed in that part of the Controlled Substances Act 1984 under the headings 'Commercial offences' and 'Offences involving children and school zones'.

The Fund

The proceeds from the existing criminal assets confiscation scheme must be paid into the Victims of Crime Fund (after the costs of administering the scheme are deducted). It is proposed that funds raised by the application of this initiative be devoted to another fund, to be called the Justice Resources Fund. This Fund will be devoted to the provision of moneys for courts infrastructure, equipment and services, the provision of moneys for justice programs and facilities for dealing with drug and alcohol related crime and for the provision of funding for justice reform initiatives. Disbursements will not overlap with those made from or eligible for moneys from the existing Victims of Crime Fund.

Other Aspects of the Scheme

The Western Australian scheme has been modified so that a court has a discretion to ameliorate the harsh and inflexible application of this scheme if the offender has effectively co-operated with a law enforcement agency relating directly to the investigation or occurrence or possible occurrence of a serious and organised crime offence. For these purposes, a serious and organised crime offence is defined in a way that mirrors the definition in the Australian Crime Commission (South Australia) Act 2004. Every encouragement should be given to serious criminals to inform on their co-offenders and any criminal organisations to which they belong or are party.

As is the case with the WA and NT legislation, a person is a prescribed drug offender where there is sufficient evidence to conclude that a person would have been liable to be a prescribed drug offender and the person either absconds or dies.

The Bill also adopts the Northern Territory innovation that the time period of 10 years in relation to the repeat offender does not run if and while the offender is imprisoned.

I commend the Bill to Members.

Explanation of Clauses

Part 1—Preliminary

1—Short title

2—Commencement

3—Amendment provisions

These clauses are formal.

Part 2—Amendment of Criminal Assets Confiscation Act 2005

4—Amendment of long title

This clause amends the long title of the principal Act to reflect the changes made by this measure.

5—Amendment of section 3—Interpretation

This clause amends section 3 of the principal Act to include, or to consequentially amend, definitions of terms used in respect of the amendments made by this measure.

6—Insertion of section 6A

This clause inserts new section 6A into the principal Act. It sets out what is a prescribed drug offender, namely a person who is convicted of a commercial drug offence after the commencement of the proposed section, or who is convicted of another serious drug offence and has at least 2 other convictions for prescribed drug offences, those offences and the conviction offence all being committed on separate occasions within a period of 10 years. However, the 10 year period does not include any time spent in government custody. The proposed section makes procedural provision in respect of the convictions able to be used in determining whether a person is a prescribed drug offender. The proposed section also defines key terms used in respect of prescribed drug offenders, including setting out what are commercial and prescribed drug offences.

7—Amendment of section 10—Application of Act

This clause makes a consequential amendment to section 10 of the principal Act.

8—Amendment of section 24—Restraining orders

This clause inserts new subsection (5a) into section 24 of the principal Act, which prevents a court from specifying protected property (the definition of which is inserted by this measure) in a restraining order unless there are reasonable grounds to suspect that the property is the proceeds of, or is an instrument of, a serious offence.

9—Amendment of section 34—Court may exclude property from restraining order

This clause amends section 34 of the principal Act by inserting new subparagraph (ia), adding to the list of matters a court must be satisfied of before it may exclude property from a restraining order. The subparagraph is divided into parts dealing with where the suspect has, and has not, been convicted of the serious offence to which the restraining order relates.

The first such matter is that the court can only exclude property where the suspect has not, or would not, become a prescribed drug offender on conviction of the serious offence. Alternatively, the property may be excluded if the court is satisfied it is not owned by, nor under the effective control of, the suspect in the circumstances spelt out in the provision (even if the suspect is, or will be upon conviction of the relevant offence, a prescribed drug offender).

The power to correct an error in respect of the inclusion of the relevant property when making the restraining order is given to the court because the property restrained in respect of prescribed drug offenders is not necessarily proceeds nor an instrument of crime.

10—Amendment of section 47—Forfeiture orders

This clause amends section 47(1)(a) of the principal Act to include the fact that a person is a prescribed drug offender as a ground for the making of a forfeiture order under that section (provided that the relevant property was owned by or subject to the effective control of the person on the conviction day for the conviction offence).

11—Amendment of section 57—Relieving certain dependants from hardship

This clause makes a consequential amendment due to the amendment of section 47(1)(a) by this measure.

12—Amendment of section 58—Making exclusion orders before forfeiture order is made

This clause amends section 58 of the principal Act to provide that property sought to be excluded from a forfeiture order must not, in the case of a forfeiture order to which section 47(1)(a)(ii) applies (ie a prescribed drug offender order), at the relevant time be owned by, or under the effective control of, the prescribed drug offender (unless it is protected property of the person).

13—Amendment of section 59—Making exclusion orders after forfeiture

This clause amends section 59, consistently with clause 15, to provide that property sought to be excluded from a forfeiture order must not, in the case of a forfeiture order to which section 47(1)(a)(ii) applies (ie a prescribed drug offender order), at the relevant time be owned by, or under the effective control of, the prescribed drug offender (unless it is protected property of the person).

14—Insertion of section 59A

This clause inserts new section 59A into the principal Act. That section allows a person to apply for property to be excluded from a restraining order because the person has cooperated with a law enforcement authority in relation to a serious and organised crime offence, be it one that has occurred or may occur in future.

The mechanisms and procedures in relation to an order excluding the property are similar to other such provisions in the principal Act.

15—Amendment of section 62A—No exclusion or compensation where forfeiture taken into account in sentencing

This clause makes a consequential amendment to section 62A.

16—Amendment of section 76—Excluding property from forfeiture under this Division

This clause amends section 76 to prevent exclusion of property owned by or under the effective control of a prescribed drug offender (other than protected property).

17—Insertion of section 76AA

This clause inserts a provision similar to the provision in clause 14 allowing for exclusion from forfeiture based on cooperation with a law enforcement agency.

18—Amendment of section 76A—No exclusion where forfeiture taken into account in sentencing

This clause makes a consequential amendment.

19—Substitution of section 203

This clause amends the structure of section 203 of the principal Act to reflect the changes made by this measure.

20—Amendment of heading

This clause is consequential.

21—Amendment of section 209—Credits to Victims of Crime Fund

This clause is consequential.

22—Insertion of section 209A

This clause provides for the establishment of the Justice Resources Fund, to be administered by the Attorney-General, and for the proceeds of confiscated assets of prescribed drug offenders to be paid into the fund.

23—Amendment of section 224—Effect of confiscation scheme on sentencing

This clause amends section 224 to provide that a sentencing court must not have regard to any forfeiture or pecuniary penalty order that might result from the conviction if it results in the defendant becoming a serious drug offender (within the meaning of this measure) and the property to which the forfeiture or order relates was owned by, or subject to the effective control of, the defendant on the conviction day for the relevant offence.

Debate adjourned on motion of Hon. D.W. Ridgway.

At 16:22 the council adjourned until Tuesday 1 July 2014 at 14:15.