Unexplained Wealth Orders in New South Wales

A joint investigation into unexplained wealth by the State Crime Command’s Organised Crime Squad and the NSW Crime Commission has led to more than $7 million worth of property, luxury cars, gold bullions and high-end handbags being seized.

Detectives with assistance from Raptor Squad executed search warrants at properties in Padstow, Yagoona, Bankstown, Picnic Point, Peakhurst, and Drummoyne, on 15 September 2023.

During the searches, police located and seized 14 luxury handbags including Hermes, Chanel, and Louis Vuitton, five luxury ‘man bags’, cartier jewellery, $10,000 cash, and four luxury watches by Rolex, Breitling, and Cartier, at the Padstow residence.

Officers also located a case of gold bullion estimated to be worth $80,000 in Yagoona, a 2021 Lamborghini Aventador in Drummoyne, and a 2021 BMW S1000R motorcycle, a 1971 Mazda RX2, a 1983 Holden Gemini, a 2018 McLaren MA3 Coup and over $20,000 in cash in Bankstown.

Earlier this year in February, amongst the white collar crime laws, powers to target and confiscate unexplained wealth and assets were strengthened by the NSW Government.

It essentially now means that the NSW Crime Commission does not need to wait for a criminal conviction to occur before confiscating property, with it instead based on whether the Supreme Court finds it “more probable than not” that the property or assets are the result of serious criminal activity.

Organise Crime Squad Commander, Detective Superintendent Peter Faux, said: “we know those at the top end of organised criminal networks follow the money – so having improved powers to target that money means we’re able to get to those right at the top,”

“The big players tend to enjoy the wealth whilst keeping their heads down and their hands clean, but now we have the authority to put them before a court to show us how they made their money – something many of them will struggle to do.”

Executive Director of the New South Wales Crime Commission, Darren Bennett also commented: “police no longer need a specific offence to be able to seize and freeze wealth and assets – we now only need evidence and intelligence.

“The next step is civil court, where the owner of those assets is required to justify the goods were acquired through legal income. If they can’t do that, the assets are ultimately returned to the people of New South Wales,”

In New South Wales, unexplained wealth laws enable the state government to seize the assets of individuals who are unable to account for the wealth they hold.

The rationale of such provisions has been linked to their ability to significantly undermine the business model of serious and organised crime.

The Australian Federal Police have previously noted how unexplained wealth provisions are particularly valuable as they can target criminals who derive an income from criminal activity, but due to their ‘high up’ position in the enterprise and their lack of proximity to the offences committed, cannot be pursued through criminal prosecution or traditional proceeds of crime action.

The Criminal Assets Recovery Act 1990 (NSW) outlines unexplained wealth laws in New South Wales. The New South Wales Crime Commission can apply to the Supreme Court for unexplained wealth orders, which essentially require someone to pay the state Treasurer an amount which has been assessed as the value of their unexplained wealth, as per section 28A.

The Supreme Court is required to make an unexplained wealth order against a person if the Court finds that there is a reasonable suspicion that the person:

• engaged in a serious crime related activity, or
• acquired serious crime derived property from another person’s serious crime related activity, whether or not the person knew or suspected the property was derived from illegal activities.

It is also required that the person has current or previous wealth that exceeds the value of their lawfully acquired wealth by $250,000 (for money) or $2,000,000 (otherwise).

The court is not required to be satisfied based on a reasonable suspicion as to the commission of a particular offence and this can instead be based on a reasonable suspicion that some offence constituting a serious crime related activity was committed.

What is ‘unexplained wealth’ will be assessed with reference to the whole or any part of the current or previous wealth of the person that the Supreme Court is not satisfied on the balance of probabilities is not or was not illegally acquired property, or the proceeds of an illegal activity.

The burden of proof in proceedings rests on the person whom the unexplained wealth order is sought against. This means that they are required to prove that their current or previous wealth is not or was not illegally acquired property or the proceeds of an illegal activity.

It is important to note that the quashing or setting aside of a conviction for a serious crime related activity does not affect the validity of a proceeds assessment order or unexplained wealth order.

Once unexplained wealth order is made, the amount becomes a debt payable by the person to the Crown and is recoverable as such.

The Supreme Court can refuse to make an unexplained wealth order or may reduce the amount that would otherwise be payable, if it thinks it is in the public interest to do so.

Furthermore, when assessing the amount payable or to be seized, the Supreme Court may deduct the reasonable necessities of life of the person subject to the order, and their dependents, if it considers it necessary.

By Poppy Morandin.

Print