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Tainted Property & Money Laundering

Potts Lawyers > Criminal Law & Offences  > Tainted Property & Money Laundering

Tainted Property & Money Laundering

In Queensland there are a number of offences aimed at stopping people from possessing or using money or other property that has been acquired by, or from, the commission of a criminal offence. These include offences under Queensland state legislation as well as Commonwealth offences under federal legislation.

What is tainted property?

Tainted property is defined separately under a number of pieces of legislation in Queensland. In essence it includes:

  • any property obtained from the commission of an offence; or
  • any property obtained by converting or exchanging property obtained from the commission of an offence.

For example, property that is stolen from a store during a break-in would be tainted property. If that property were then exchanged for money, that money would also be tainted property.

When is possessing tainted property illegal?

Section 433 of the Criminal Code states that any person who receives tainted property, and has reason to believe it is tainted property, commits a crime.

This section requires not just that the person has received tainted property, but that at the time they received the item they also had some knowledge that would have caused them to believe the property was tainted.

Section 252 of the Criminal Proceeds Confiscation Act goes slightly further. Under this section it is an offence to receive, possess, dispose of, bring into Queensland, conceal or disguise property that may reasonably be suspected of being tainted property.

This imposes an objective test, requiring only that it be reasonable in the circumstances to suspect that the property was tainted property, rather than requiring the defendant themselves to have the suspicion.

Relevantly, section 252(2) declares it is a defence to a charge under section 252 if the defendant can satisfy the court that they had no reasonable grounds for suspecting that:

  • the property was tainted property; or
  • that it was derived from any form of unlawful activity.

 

What is money laundering?

Queensland Legislation

Money laundering is defined under section 250 of the Criminal Proceeds Confiscation Act as including:

  • Engaging, directly or indirectly, in a transaction involving money or other property that is tainted property;
  • Receiving, possessing, disposing of or bringing into Queensland money or other property that is tainted property; and
  • Concealing or disguising the source, existence, nature, location, ownership or control of tainted property.

This is a broad definition that can capture a wide range of conduct.

The scope of the offence is made even broader by section 250 which creates an offence for both knowingly engaging in money laundering, and recklessly engaging in money laundering.

Section 250 (2A) states that a person knowingly engages in money laundering if the person does one of the acts mentioned above in relation to property and the person knows, or ought reasonably to know, that the property was tainted.

The wording of this section again incorporates an objective question of what it is reasonable to expect the person to have known in the circumstances, in addition to the question of what they actually knew.

Section 250 (2B) states that a person recklessly engages in money laundering if the person does one of the acts mentioned above in relation to property and:

  1. the person is aware there is a substantial risk that the property is tainted or derived from some form of unlawful activity; and
  2. having regard to the circumstances known to the person, it is unjustifiable for the person to take the risk.

This again involves a consideration of not just the actual knowledge that a person has, but what is objectively reasonable in the circumstances.

Commonwealth Legislation

The Commonwealth Criminal Code also contains a number of offences for money laundering activity.

Under the Commonwealth legislation an offence is committed if a person deals with money or other property, and either:

  1. the money or property is, and the person believes it to be, the proceeds of indictable crime; or
  2. the person intends that the money or property will become an instrument of crime.

‘Dealing with’ money or other property is defined to include:

  1. Receiving, possessing, concealing or disposing of money or other property;
  2. Importing money or other property into Australia;
  3. Exporting money or other property out of Australia; or
  4. Engaging in a banking transaction relating to money or other property.

The definition also extends to doing an act that causes another person to deal with money or property in some circumstances.

Sections 400.2B to 400.8 of the Commonwealth Criminal Code create a number of offences for dealing with different values of money or property that is the proceeds of crime.

In contrast to the Queensland money laundering provisions, for an offence under these sections it is necessary for the prosecution to prove that the person actually knew or believed the money or property to be the proceeds of crime, at the time they dealt with it.

However, the Commonwealth legislation also contains separate offences for dealing with money or property in circumstances where it is simply reasonable to suspect that the money or property is the proceeds of indictable crime. Similarly to the Queensland legislation, these provisions do not require proof of actual knowledge that the money or property was proceeds of crime, just that it was reasonable to suspect that it was in the circumstances.

In what circumstances are people charged with money laundering?

 

Due to the broad definitions in both the Queensland legislation and the Commonwealth legislation with respect to money laundering, the offences are capable of applying in a wide range of circumstances.

Recent published decisions for offences of this nature include instances of:

  • people making cash deposits into bank accounts on behalf of others;
  • people accepting deposits into their bank accounts and then distributing the funds upon instruction; and
  • businesses accepting payments from clients without conducting enquiries as to the source of the funds.

These are just a few examples of the kinds of conduct that can be captured under the various money laundering offences.

For more detailed advice about these offences contact our office to arrange a conference with one of our criminal lawyers.

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