Association offences (Money laundering)

Question 1

Definition of “Conceal”:

Answer 1

To conceal or disguise the property
Includes:
To convert the property from one form to another:
To conceal or disguise the nature, source, location, disposition or ownership of the property or of any interest in the property

Question 2

Definition of “Deal with”:

Answer 2

To deal with the property in any manner and by any means
Includes:
To dispose of the property, whether by sale, purchase, gift or otherwise
To transfer possession of the property
To bring the property into NZ
To remove the property from NZ

Question 3

Definition of “Interest”:

Answer 3

A legal or equitable estate or interest in the property; or
A right, power, or privilege in connection with the property

Question 4

Definition of “Offence”:

Answer 4

Means an offence (or any offence described as a crime) that is punishable under NZ law, including any act, wherever committed, that would be an offence in NZ if committed in NZ

Question 5

Definition of “Proceeds”:

Answer 5

In relation to an offence, means any property that is derived or realised, directly or indirectly, by any person from the commission of the offence.

Question 6

Definition of “Property”?

Answer 6

Means real or personal property of any description, whether situated in NZ or elsewhere and whether tangible or intangible; and includes an interest in any such real or personal property.

Question 7

What is the title of Section 243 Crimes Act 1961?

Answer 7

Money Laundering

Question 8

What is stated under Section 243(2) Crimes Act 1961?

Answer 8

Subject to S244 and S245

7 years imprisonment

• Anyone who
• in respect of any property that is the proceeds of an offence
• engages in a money laundering transaction
• knowing or believing that all or part of the property is the proceeds of an offence
• or being reckless as to whether or not the proeprty is the proceeds of an offence.

Question 9

What is stated under Section 243(3) Crimes Act 1961?

Answer 9

Subject to S244 and S245

5 years imprisonment

• Anyone who
• Obtains or has in his possession
• any property
• being property that is the proceeds of an offence committed by another person
  (a) with intent to engage in a money laundering transaction in respect of that property; and
  (b) knowing or believing that all or part of the property is the proceeds of an offence, or being reckless as to whether or not the property is the proceeds of an offence.

Question 10

When does someone “Engage in a money laundering transaction”?

Answer 10

Section 243(4) Crimes Act 1961

A person engages in a money laundering transaction if, in concealing any property or by enabling any person to conceal any property, that person -
(a) deals with that property; or
(b) assists any other person, whether directly or indirectly, to deal with that property.

Question 11

When someone “Engages in a money laundering transaction” what does that prosecution not have to prove?

Answer 11

The prosecution is not required to prove that the defendant had intent to
- Conceal any property or
- Enable any person to conceal any property

Question 12

What does the prosecution not need to prove for an offence against Section 243(2) and (3)?

Answer 12

Section 243(5) Crimes Act 1961

It is not necessary for the prosecution to prove that the defendant knew or believed that the property was the proceeds of a particular offence or particular class of offence.

Question 13

What is not a defence for Section 243(2) and (3)?

Answer 13

Section 243(5) Crimes Act 1961?

It is no defence that the defendant believed any property to be the proceeds of a particular offence when in fact the property was the proceeds of another offence.

Question 14

What does Section 243, 244 or 245 not limit?

Answer 14

Section 243(6) Crimes act 1961

Nothing in this section or in sections 244 or 245 limits or restricts the operation of any other provision of this Act or any other enactment

Question 15

Section 243A Crimes Act 1961 - What is the title?

Answer 15

Charges for money laundering

Question 16

When may someone be charged under Section 243(2) or (3)?

Answer 16

A person may be charged with money laundering for any property that is the proceeds of an offence even though the person who committed the offence
Has not been charged with that offence; or
Has not been convicted of that offence

Question 17

What does Section 245 set out?

Answer 17

It sets out a defence to a charge of money laundering.

Question 18

Section 245(1) Crimes Act 1961 provides the following:
(1) Section 243 applies to an act that has occurred outside NZ and that is alleged to constitute an offence resulting in proceeds only if -

Answer 18

(a) the act was an offence under the law of the place where and when it occurred, or
(b) It is an act to which Section 7 or 7A of this Act applies; or
(c) an enactment provides that the act is an offence in NZ, and no additional requirement exists for the act to be an offence in the place where and when it occurred.

Question 19

What is presumed in a charge under Section 243?

Answer 19

Section 145(2) Crimes Act 1961

If a person is charged with a charge under Section 243 and subsection (1)(a) applies, it is to be presumed, unless that person puts the matter at issue, that the act was an offence under the law of the place where and when it occurred.

Question 20

What is the meaning / definition of money laundering?

Answer 20

Money laundering is the process of dealing with the proceeds of criminal activity in such a way as to make the proceeds appear to have been legitimately acquired.

Question 21

What are the three stages of the Money Laundering Cycle?

Answer 21

Placement
Layering
Integration

Question 22

What is the description of “Placement” for the money laundering cycle?

Answer 22

Cash entering the financial system

Question 23

What is an example of “Placement” for the money laundering cycle?

Answer 23

An offender makes money from selling cannabis and then deposits these proceeds into an associates bank account

Question 24

What is the description of “Layering” for the money laundering cycle?

Answer 24

Money is involved in a number of transactions

Question 25

What is an example of “Layering” for the money laundering cycle?

Answer 25

The associate transfers the money into an account held by a ‘shell’ company that the offender is the director of

Question 26

What is the description of “Integration” for the money laundering cycle?

Answer 26

Money is mixed with lawful funds or integrated back into the economy, with the appearance of legitimacy

Question 27

What is the example of “Integration” for the money laundering cycle?

Answer 27

The money is declared as revenue for the company, tax is paid, and then the offender pays himself director fees or a salary out of the company account

Question 28

What are the elements of money laundering?

Answer 28

• In respect of any property that is the proceeds of an offence
• Engages in a money laundering transaction
• Knowing or believing that all or part of the property is the proceeds of an offence
• Or being reckless as to whether or not the property is the proceeds of an offence

Question 29

What does “Engages in a money laundering transaction” (element of money laundering) mean?

Answer 29

One must conceal property or enable another to conceal the property and then also deal with the property or assist with such dealing.

Question 30

What does “Engages in a money laundering transaction” (element of money laundering) include?

Answer 30

Disposing or transferring the property
Bringing or removing the property from NZ
Changing it from one form to another (e.g. purchasing a vehicle)

Question 31

What should the “Money laundering cycle” be used as?

Answer 31

A guide to understanding the overall process - it should not be used as a basis for all decisions about whether the elements of the offence of money laundering have been fulfilled.