Money Laundering & Criminal Proceeds Flashcards
Money Laundering Legislation
Section 243, Crimes Act 1961
243(2) 7yrs imprisonment
• any property that is 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
243(3) 5yrs imprisonment
• obtains of has in his/her possession any 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 of believing that all or part of the property is the proceeds of an offence
243(5)
In any prosecution for an offence above
(a) 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 a particular class of offence
(b) no defence the the defendant believed any property to be the proceeds of a particular offence when in fact the property was the proceeds of another offence
Section 243(4) A person engages in a money laundering transaction if in concealing any property or by enabling any person to conceal any property that person.....
- deals with that property or
- assists any other person whether directly or indirectly to deal wth that property
Prosecution not required to prove that the defendant hand an intent to
• conceal any property
• enable any person to conceal any property
Definition of Conceal (money laundering)
to conceal or disguise the property and includes
• convert the property from one form to another
• conceal or disguise the nature, source, location, disposition or ownership of the property or of nay interest in it
Definition of DEAL WITH (money laundering)
deal with the property in any manner and by any means and includes:
• dispose of the property, whether by sale, purchase, gift, otherwise
• transfer possession of the property
• bring the property into NZ
• remove the property from NZ
Definition of INTEREST (money laundering)
- a legal or equitable estate or interest in the property
* a right, power or privilege in connect with the property
Definition of PROCEEDS (money laundering)
in relation to any offence means any property that is derived or realised directly or indirectly by any person from the commission of the offence
Definition of PROPERTY (money laundering)
real or personal property of any description wither situates in NZ or elsewhere and whether tangible or intangible and includes an interest in any such real or personal property
Definition of OFFENCE (money laundering)
any 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
Can a person be charged with money laundering if the person who committed the offence (for which the property has come from) has not been charged or convicted
S243A, CA1961
yes
Defence to money laundering
Section 245 CA1961
Section 243 applies to an act that has occurred outside NZ and that is alleged to constitute an offence resulting in proceeds only if
- the act was an offence under the law of the place where and when it occurred or
- it is an at to which section 7 or 7A of this act applies pr
- an enactment provides that the act is an offence in NZ and no additional requirements exist for the act to be an offence in the place where an when it occurred
What is money laundering
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
What are the three stages of the Money Laundering Cycle
PLACEMENT
Cash enters the financial system
eg. offender makes money from selling drugs then deposits the proceeds into an associates bank account
LAYERING
Money is involved in a number of transactions
eg. the associate transfers the money into an account held by a “shell” company that the offender is the director of
INTEGRATION
Money is mixed with lawful funds or integrated back into the economy with the appearance of legitimacy
eg. 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
What is the purpose of the Criminal Proceeds Recovery Act 2009
To establish a regime for the forfeiture of property:
- that has been derived directly or indirectly from significant criminal activity or
- that represents the value of a persons unlawfully derived income
What four things does the criminal proceeds and instruments forfeiture regime propose to do
- eliminate the chance for persons to profit from undertaking or being associated with significant criminal activity
- deter significant criminal activity
- reduce the ability of criminals and persons associated with crime or significant criminal activity to continue or expand criminal enterprise
- deal with matters associated with foreign restraining orders and foreign forfeiture orders that arise in NZ
What term of imprisonment makes an offence qualify for instrument forfeiture
5yrs or more
Includes attempts, conspiracy, accessory if the penalty is 5yrs or more
$30,000 or more involved in assets
Definition of Tainted property
means any property that has wholly or in part been
- acquired as a result of significant criminal activity
- directly or indirectly derived from significant criminal activity
Includes any property that has been acquired as a result of or directly or indirectly derived from more than 1 activity if at least 1 of those activities is a significant criminal activity
Who’s responsibility is it to notify the courts of any relevant property that is an instrument of crime so that forfeiture can be considered
the prosecutor
- house used to manufacture meth in
- vehicle used to deliver drugs
What must the prosecutor notify the courts of for instrument forfeiture
Notify in writing
- details of the property
- name and identifying details of any person (other than offender) who to the knowledge of the prosecutor has an interest in that property
Who’s responsibility is it to notify the crown that there is property that is instruments of crime
O/C file
Request that they file a Prosecutors Notice
If considering a restraint order for property to be held if you believe it will be CADD what 4 things must you assess before making the application
- value of the asset
- equity in the asset
- any third party interest in asset
- cost of action in respect of the asset
Consult financial Crime group (they pay costs for storage)
Complete affidavit outlining • O/C • Offender, charges, convictions • search warrant - nature of offending • admissions made by offender • property description and ownership
Seek guidance from asset recovery unit
Court must have REASONABLE GROUNDS FOR BELIEF that property is tainted
Who may apply for restraining orders in relation to asset forfeiture and profit orders
Assist recovery unit members only
Instruments of or crime related restraining orders can be made by anyone
In relation to all or part of respondents property for an order to be made under the criminal proceeds recovery act that court has to be satisfied that it has reasonable grounds to believe what two things….
- respondent has unlawfully benefited from significant criminal activity
- respondent has an interest in the property to be restrained
In relation to instruments of crime for an order to be made under the criminal proceeds recovery act what two criteria must be met…..
- respondent must have been charged with a qualifying instrument forfeiture offence (or be changed with one within 48hrs)
- be satisfied that it has RGTB that the property subject to the order was used to commit or facilitate the commission of the qualifying offence
How long is a restraining order valid for
1 year from the dates the order is made
court may issue an extension before expiry of the original order
extension valid for 1 year
What 7 things should you consider when interviewing suspects about money laundering or proceeds recovery action is being considered
- suspect’s legitimate income
- suspect’s illegitimate income
- expenditure
- assets
- liabilities
- acquisition of financial records from banks, financing companies, loan sharks, family trust docs
- clarification of documentary evidence located as per above
