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Hansard (debates)

Criminal Proceeds (Recovery) Bill — In Committee


Criminal Proceeds (Recovery) Bill

In Committee

  • Debate resumed from 10 March.

Part 1 Preliminary provisions (continued)

CHESTER BORROWS (National—Whanganui) : The purpose of the Criminal Proceeds (Recovery) Bill is articulated as being “to make more effective provision for the confiscation of property that either represents the profits of criminal offending or was used to facilitate the commission of crime”. In thinking of what examples of that might be, and noting some of the points that have been raised by other speakers in respect of this, we think about land.

A point was raised by the honourable member Te Ururoa Flavell in respect of jointly owned land—Māori freehold land, and Māori customary land—but it applies equally to any land. Co-owners who may be in the position of losing their interest in a piece of land can easily be called to mind. We could take as an example somebody who allows a property, like a flat, to be used by extended family—or a family bach or some rural land. A young person may grow cannabis on that land for profit, without the knowledge of the co-owners, and, as a result of a subsequent police operation, the young person is caught and is prosecuted. Perhaps the land is sublet to somebody who grows cannabis on it without the knowledge of other co-owners.

So an action is commenced by the recovery body to have that land forfeited. Obviously, a co-owner who makes an application has the right under clause 33 to appear before the court and to adduce some evidence. The co-owner can eventually make an application against that forfeiture, because the co-owner should not be deprived of his or her co-ownership of, or interest in, that land by the activities of a third party or another co-owner, if he or she did not have any idea that the activity was going on. So if someone is doing something on land that is co-owned, and other people with an interest in that land do not know about it, then it does not mean that the land will be forfeited at the expense of those co-owners’ interests.

Vessels and vehicles that are used in the commission of crime are frequently forfeited. Other people could have interests in a vessel or vehicle that has been used for a drug-dealing offence, and that is the subject of a forfeiture application. It could well be that other people—maybe the spouse or the children—rely on that vehicle to go about their business. They similarly could make application and be heard, or have someone else make application on their behalf and be heard, in argument against that forfeiture.

Thirdly, there is the issue of money in the bank. If money in the bank is going to be confiscated, then there needs to be a provable track of the illegitimacy of that money. If money has been stashed away in some form—in a TAB account, in a bank, or stuffed in a mattress somewhere—and if the recovery body is able to prove the illegitimacy of that money and the fact that it is there, then it would be the subject of an action before the court for forfeiture.

Just returning to the issue of land for a moment, it is important to make the point that, in respect of Māori land, the claimant’s interest would be captured under the legislation as it is written now. The National Government has indicated that it will not be supporting Supplementary Order Paper 5, in the name of Te Ururoa Flavell, in respect of Māori freehold land and Māori customary land, because we believe that the protection is already contained within the legislation as it is written.

Another point that has been made is that Supplementary Order Paper 7, which is being promoted by the Minister of Justice, talks about foreign restraining orders to attack those who have unlawfully benefited from significant crimes.

RAYMOND HUO (Labour) : It is a great pleasure to stand in support of the Criminal Proceeds (Recovery) Bill. I like this bill because, as my Labour colleagues have said earlier in this House, it has real teeth. I note the amendments moved by the Hon Simon Power last night, and I also note that the bill will be divided into three bills. I have no problem with those amendments, and I will focus on them in this debate.

With reference to what Simon Bridges said last night in his speech on this bill, I think we need to reiterate that the reason we are supporting the bill is that it is a good bill and it has real teeth.

Lynne Pillay: And it was a Labour bill.

RAYMOND HUO: Of course.

To tackle crime, particularly organised crime, and to address the relevant issues, we need bills of real substance and ones that are not just examples of window dressing. We are getting measures that are internationally condemned as failed models—for example, the boot camp bill and the “three strikes and you’re out” bill. I do not know how to describe the “three strikes and you’re out” bill, but I note that it is one that has a 20-year implementation period. As for the boot camps, the headline of a Dominion Post story on 2 March says it all: “Judge puts boot into boot camps”. The judge who was being referred to is the Principal Youth Court Judge, Andrew Becroft. He was quoted as saying that the traditional boot camp for young offenders was “arguably the least successful sentence in the Western World.” He said: “It made them healthier, fitter, faster, but they were still burglars, just harder to catch,”.

Therefore, I am very pleased to see that the Government has decided to progress the Criminal Proceeds (Recovery) Bill, which, according to a press release published in 2007, is legislation designed to hit gangs where it hurts. I congratulate the Hon Mark Burton, a former Minister of Justice, who introduced the bill in March 2007, and Mr Martin Gallagher, who chaired the Law and Order Committee. Both have done excellent work on this bill. I also thank the Hon Simon Power for including the bill in the National Government’s 100 days of action. I am glad that the Government rated this bill as more worthy than other measures that have been talked about in the media over the last couple of months, including the ones I have mentioned above.

The bill is based on the principle that crime must not pay. It provides for a new forfeiture regime for the proceeds of crime. It deals with organised crime and allows us to tackle gang leaders who do not get their own hands dirty but enjoy the benefits of their fellow gang member’s illegal activity. Instead of applying the standard of “beyond reasonable doubt”, the bill gives the Crown the power to confiscate profits and assets obtained through criminal activity on the civil standard of proof, which is the balance of probability. No criminal conviction will therefore be required before forfeiture can occur.

The bill establishes two orders to deal with the removal of the profits of crime from a person. One is the profit forfeiture order and the other is the assets forfeiture order. I also note that the Law and Order Committee report mentions points in respect of the issue as to where the recovery body might be located, which would help to clarify where the recovery body should lie.

I agree with the amendments moved by the Hon Simon Power last night. Labour believes this bill finds an appropriate balance between targeting the proceeds of crime and protecting personal and property rights. Thank you.

AMY ADAMS (National—Selwyn) : Along with my fellow members of the House who have spoken on the Criminal Proceeds (Recovery) Bill I can say that it is a great pleasure to speak on the bill and on its Part 1, which has the purpose clause and the like in it. It really is pleasing as a member of the House to be able to stand and hear, from around the House, support for what is good legislation. It will give some real teeth to the crime-fighting initiatives in this country.

I acknowledge that the bill was introduced by the previous Labour Government, and I commend it for doing that. I would have been more impressed if Labour had got around to passing it, but none the less that is something we will rectify.

As we have heard, the bill, in its essence, creates a new civil forfeiture regime for property that has been acquired through crime. Although we already have the Proceeds of Crime Act, it has become apparent that that Act is not sufficient to get to where the real money is being made in crime today. We know that a lot of money is being made through advanced criminal organisations, many of which are the motorcycle gangs and similar gangs that we see, and we know that it is simply not enough to have a forfeiture regime that necessitates the linking of the owner of the property and the actual committing of the offence.

Here we have a bill that sets out to establish a forfeiture regime that enables property to be taken not just from those directly involved in the committing of the offence—and that is the important point—but from anyone who has directly or indirectly profited from that crime. In doing that we are able to really strike at the heart of the people who are making a massive industry from crime.

The clauses that really set out the overall tenor of the legislation are clause 3, which is the purpose clause, and clause 4, which sets out the general overview of restraint and forfeiture of property. But there are some other key clauses in Part 1 that I think are worth touching on. Certainly, the lawyer in me is always drawn first, in a bill like this, to look at the interpretation clause. Anyone who has worked in law understands that that is often where the real teeth and meat of the provisions are.

There are a couple of clauses that I really want to highlight. My friend Chester Borrows has already talked about one of the provisions, which is the definition of “property”. That is an important point. Too often we forget that property is far more than just property in the common parlance, meaning land; it is any form of property, including cash, shares, Harley Davidsons, and debts—any form of property at all.

Hon Member: Dope.

AMY ADAMS: Well, quite often it is dope. Equally, it is not necessary for there to be whole ownership of that property. This measure cannot be defeated simply by having joint ownership with a spouse, a girlfriend, the guy down the road, or whomever. Those are important points to note.

It is also important to comment on the definition of “relevant period of criminal activity” in clause 5. This bill will set up a forfeiture provision that can look back 7 years, and if there has been relevant criminal offending in that time, then the provisions can apply. Relevant and significant criminal offending in this sense includes offences where the maximum term of imprisonment is 5 years or more or—and this is important—offences from which the proceeds or benefit amount to a value of $30,000 or more.

When a person has unlawfully benefited from that type of offending over that 7-year period and has knowingly directly or indirectly benefited from that offending, and, just as important, whether or not he or she was involved in undertaking the committing of the offence, then this provision will kick into gear.

Anybody who seriously suggests that we do not need this sort of reach-through provision in our proceeds of crime legislation needs to think again. By way of example I offer the Killer Bees and Tribesmen sting last year in Auckland and the Waikato that was much written about, which resulted in 51 arrests and the seizure of $200,000 in cash, 538 grams of pure methamphetamine with a street value of more than half a million dollars, 400 grams of cannabis, 15 vehicles, and 12 firearms.

Certainly, the extent, power, and influence that gangs are gaining through this profitable trade cannot be understated, but those sorts of seizures should not fool us into thinking that the legal system we have is working. We know that the seizures of property, under the existing Proceeds of Crime Act, has fallen away considerably, both in number and in value. That tells us that we need reach-through provisions such as those we have in this bill.

LYNNE PILLAY (Labour) : It is a pleasure to stand and take a call on the Criminal Proceeds (Recovery) Bill. I join with my colleague Raymond Huo in acknowledging that this bill has been brought forward from the previous Labour Government. If we look at the 100 days of action, this bill is up there in that it achieves a great deal. It is not window dressing and it does not deal to the most vulnerable in our society, so on that basis I speak very strongly in support of this bill.

The purpose of the bill, as previous speakers have acknowledged, is to reform the existing law by repealing the Proceeds of Crime Act of 1991. I think we all acknowledge and accept that life has become more sophisticated in many ways, and certainly in terms of being accountable for crime in this country. Under the current Act, property that either represents the profits of criminal offending or is used to facilitate the commission of a crime can be confiscated once the criminal conviction is secured. The major change in this bill is that a criminal conviction will no longer be required for the confiscation of property that represents the proceeds of crime or the value of unlawfully derived income. In a nutshell, this bill is based on the principles that crime should not pay and crime must not pay. Labour members certainly believe that this legislation helps to uphold this very, very important principle.

I acknowledge Martin Gallagher, who chaired the Law and Order Committee. The report from that select committee recommended a number of changes. [Interruption] The peanut gallery over there has a few things to say, but I suggest to those members that they might like to acknowledge the members of the select committee in the previous Parliament who were committed to legislation in terms of competency and scrutiny. The member interjecting, Paul Quinn, sits on the Justice and Electoral Committee that I sit on. He has much to learn in terms of applying his thinking to bills that come before the committee and trying to rationalise things, but I guess those are things he will find difficult. I can see members on the other side of the House thinking “Tell us about it. He is a challenge.” I can see Chester Borrows nodding wisely and thinking “You think you’ve got problems, mate.” We agree with Chester.

Paul Quinn: I raise a point of order, Mr Chairman. I suggest that the member is right off the topic of the purpose of this bill. She is giving a running commentary on the behaviour of the Justice and Electoral Committee.

The CHAIRPERSON (Hon Rick Barker): That is not a point of order; it is a point of process. The debate has been in quite good humour. People have wandered off the track, and have often been encouraged to wander off the track by interjections from members on one side or the other. I suggest the member should let the debate go on, and we will have an interesting conclusion.

LYNNE PILLAY: Thank you, Mr Chairman; that is very sensible.

As I said, I acknowledge the Law and Order Committee. I think the Minister in the chair, Simon Power, will acknowledge that a number of the recommended changes have been taken up. I can see him nodding wisely—if he could just do that again. Yes, we can all see that. It is very effective. I would like to run through some of those recommendations. The first is that the police should be the recovery body—a very, very sensible recommendation—and that the definition of the owner of property is extended to include those who may have an interest in it. That extends what I think was a key part of the original bill. That definition clarifies a very important part. The amendment to instruments of crime is to include the proceeds from the sale of property. Again, if we are drawing in and making sure that everything is encapsulated, it is a very, very sensible amendment. Certainly, the clarification of the circumstances in which property is acquired, after a restraining order was made, is very important.

RAHUI KATENE (Māori Party—Te Tai Tonga) : I rise to take a brief call to explain the concerns of the Māori Party about the Criminal Proceeds (Recovery) Bill and its effect on Māori land. We all know that Te Ture Whenua Maori Act 1993 was enacted to halt the alienation of Māori land. However, just last year, contrary to that principle, in considering a situation under the existing legislation a District Court judge decided that the existing legislation overrode Te Ture Whenua Maori Act, and that Māori land was available for seizure. In that case the judge considered that Parliament wanted the court to confiscate Māori land. I do not know where he could have possibly got that idea from, but he thought that Parliament wanted the court to confiscate Māori land. That judge thought that the existing legislation on the proceeds of crime should override the principle that Māori should retain the small amount of Māori land remaining to us.

In its current form, this bill does not correct that view. Mr Flavell’s Supplementary Order Paper provides the opportunity to us at Parliament to correct what, I hope, is a mistake in perception. If we do not do that, there is a chance that more Māori land will be at risk. Last evening the Minister told my colleague Mr Flavell that he had been advised by officials that innocent owners would be able to make application to the court that the land should not be sold. Let me explain to members how that will work. I have an interest in a Māori land block on Rangitoto ki te Tonga / D’Urville Island. I live in Christchurch, work in Wellington for 3 or 4 days of most weeks, and travel around my electorate the rest of the time. I never get to Rangitoto, no matter how much I yearn to. I do not know what is happening on that land block from day to day, or even from month to month, but I am spiritually attached to that block because it is the only speck of land left from the vast landholdings that my iwi held years ago. It is where many of my tūpuna are buried.

However, suppose, unbeknownst to me, one of my distant whanaunga was suspected—not convicted, but suspected—of cultivating weed on the block. If that whanaunga was arrested, under this bill the land would be seized. There would be no court case, and therefore no resultant publicity. The alleged offender would be too whakamā to say anything about it to any of the other owners, and the land would be sold—bang! It would be too late to apply to the court. When would I have the chance to stop this confiscation? When would any of the innocent owners have the chance to go to court to prevent this sale? If I, like most Māori land owners, could not afford to make this application or to pay for a lawyer, who would pay to make this application? The advice the Minister has received is worth less than this paper that I am reading from. The only other way we could make a change to this provision is to make an amendment to Te Ture Whenua Maori Act. I invite the Minister to take a call to respond to our concerns.

Hon SIMON POWER (Minister of Justice) : In response to the concerns raised by the member who has just resumed her seat, I say that I went over this territory last night in respect of advice I have received. The advice was that Māori who have multiple ownership structures in place for land, when they are innocent of an alleged offence that has been committed on the land in which they have an interest, have instruments available to them to exercise their rights. That does not mean that those rights will necessarily or automatically accrue, but a process is in place. I can say to the member that I will watch carefully to see how the provision is utilised, and I give her an assurance that I will monitor the situation carefully.

JOHN BOSCAWEN (ACT) : It had not been my intention to take a call in this debate. However, I feel honour-bound to stand up and respond to some of the comments that came from the Labour member Raymond Huo.

Mr Huo seems to think that if he continues to repeat a mistruth, it might somehow gain credence in this Chamber and in this community. In addressing the Committee, Mr Huo talked about the internationally failed ideas of the “three strikes and you’re out” legislation. Those were his words. He also said that he did not know how to describe it. Well, if Mr Huo does not know how to describe it, I would be very happy to explain it to him.

Hon Steve Chadwick: I raise a point of order, Mr Chairperson. It would be nice if members tried to pronounce names correctly. That is not the correct pronunciation. The pronunciation is “Haw”.

JOHN BOSCAWEN: Speaking to the point of order—

The CHAIRPERSON (Hon Rick Barker): There is no point of order. Would the member just continue with his speech.

JOHN BOSCAWEN: Thank you, and my apologies to Mr Huo.

The member said he did not know how to describe the “three strikes and you’re out” legislation. Let me just explain. ACT’s “three strikes” bill is not a failed idea. It seeks to clamp down on criminals in New Zealand who commit serious violent crimes on a repeated basis—on a repeated basis. The people of New Zealand do not need to be protected from shoplifters or petty burglars. They need to be protected from people who commit serious violent crime. When Parliament starts to look at the victims of crime and addresses how we make society safer, we will start to make progress in society. The way the “three strikes” bill will operate—as proposed by the ACT Party—is that if a person commits a serious violent crime, he or she will be sentenced for whatever term the court awards—

The CHAIRPERSON (Hon Rick Barker): The member has had ample time to respond to what I think was a passing comment made by Mr Huo. This debate is about another bill; this is not an opportunity to speak up about other aspects of the ACT Party policy. I invite the member to address the bill, please.

JOHN BOSCAWEN: I will conclude my remarks by just saying that I was not prepared to sit here and have a mistruth go unchallenged. Thank you.

  • The question was put that the amendment set out on Supplementary Order Paper 5 in the name of Te Ururoa Flavell to clause 5 be agreed to:

A party vote was called for on the question, That the amendment be agreed to.

Ayes 14 Green Party 9; Māori Party 5.
Noes 108 New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Progressive 1; United Future 1.
Amendment not agreed to.

A party vote was called for on the question, That Part 1 be agreed to.

Ayes 108 New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Progressive 1; United Future 1.
Noes 14 Green Party 9; Māori Party 5.
Part 1 agreed to.

Part 2 Criminal proceeds and instruments forfeiture regime

SIMON BRIDGES (National—Tauranga) : It is good to take a call in relation to Part 2 in the Committee stage.

I agree with Lynne Pillay that the Criminal Proceeds (Recovery) Bill stands for a great purpose—that crime should not pay. Part 2 achieves that purpose. It puts it into play and implements it. Part 2 is also the lion’s share of the bill—approximately 220 clauses. They provide for the restraining orders and for the civil forfeiture orders.

  • Progress reported.
  • Report adopted.