Money Laundering & Criminal Proceeds (Recovery) Act 2009 Flashcards
Money Laundering Cycle
1) Placement
Description: Cash enters the financial system.
Example: An offender makes money from selling cannabis and then deposits these proceeds into an associates bank account.
2) Layering
Description: Money is involved in a number of transactions.
Example: The associate transfers the money into an account held by a ‘shell’ company that the offender is the director of.
3) Integration
Description: Money is mixed with lawful funds or integrated back into the economy, with the appearance of legitimacy.
Example: 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.
Elements of Money Laundering
s243 (2) Crimes Act 1961
1) in respect of any property that is the proceeds of an offence
[Property is defined to include both tangible and intangible property and interests in real or personal property whether within or outside NZ. Includes offences, acts, and omissions committed overseas that would be an offence in NZ if committed in this country].
2) engages in a money laundering transaction
[One must conceal property or enable another to conceal the property and then also deal with the property or assist with such dealing. This includes disposing or transferring the property; bringing or removing the property from NZ; or changing it from one form to another (eg. Purchasing a vehicle)
3) knowing or believing that all or part of the property is the proceeds of an offence
[Knowledge is proven via direct evidence (e.g. admission) and/or circumstantial evidence. Knowledge must exist when the property is dealt with (R v Kennedy).
4) or being reckless as to whether or not the property is the proceeds of an offence.
Recklessness is the conscious and deliberate taking of an unjustified risk (Cameron V R).
Assets forfeiture order
An Assets Forfeiture Order (AFO) is issued by the High Court on application. This order must be issued by the court on a successful application that shows on the balance of probability that specific assets which have been acquired have been tainted by significant criminal activity.
Investigative Procedure
It is important you consult with members of you local Asset Recovery Units when dealing with matters to do with money laundering and/ or proceeds recovery action.
Suspect Interview:
When interviewing a suspect about money laundering or where proceeds recovery action is to be consider the following points:
- suspects legitimate income.
- suspects illegitimate income.
- expenditure.
- assets.
- liabilities.
- acquisition of financial records, from banks, financing companies, loan sharks, family trust documents.
- clarification of documentary evidence located, as per above.
