Introduction

For those who strike gold after pulling off a crime, the party is certainly over after they are caught. Asset forfeiture is a critical legal mechanism in New South Wales that prevents individuals from benefiting from the proceeds of criminal activity and ensures holistic justice. It is a powerful tool used by authorities to disrupt criminal enterprises and ensure that offenders do not profit from their illicit actions. This process involves the confiscation of assets, such as cash, property, or other valuables, that are linked to criminal conduct, thereby upholding the integrity of the justice system and protecting society from further harm.

This guide provides a comprehensive overview of asset forfeiture in NSW, focusing on the key legal frameworks, types of orders, and their implications for individuals affected by criminal proceedings. It explores the various orders, such as restraining orders and forfeiture orders, and explains how they operate to prevent the disposal of assets suspected to be tainted by criminal activity. By understanding these mechanisms, individuals can better navigate the complexities of asset forfeiture and appreciate the importance of legal compliance in maintaining justice and fairness.

Overview of Asset Forfeiture in NSW

Key Points About Asset Forfeiture in NSW

Asset forfeiture in New South Wales is a legal process designed to prevent individuals from benefiting from the proceeds of criminal activity. The law achieves this by allowing authorities to seize, freeze or forfeit assets suspected to be connected to crime. This mechanism is crucial in disrupting criminal enterprises and ensuring that offenders do not profit from their illegal actions.

Some key points to know are:

• Preventing Criminal Profits: The primary goal is to deprive criminals of financial benefits derived from illegal activities. This includes cash, real estate, vehicles and other assets obtained through criminal conduct.
• Legal Framework: Governed by the Confiscation of Proceeds of Crime Act 1989 (NSW) and the Criminal Assets Recovery Act 1990 (NSW), these statutes provide the legal foundation for various orders to manage and seize tainted assets.
• Role of the Director of Public Prosecutions (DPP): The NSW DPP can apply for restraining orders, forfeiture orders and pecuniary penalty orders to prevent disposal of assets and to seize property linked to criminal activity.
• Court Considerations: When issuing forfeiture orders, courts assess whether the property was used in or connected to a serious offence and whether it was obtained directly or indirectly through criminal activity.
• Public Interest: By targeting the financial foundation of criminal enterprises, asset forfeiture plays a critical role in public safety and upholding the integrity of the legal system. It also deters potential offenders, who know they will not be able to retain the benefits of their crimes.

Types of Orders Used in Asset Forfeiture in NSW

Restraining Order

A restraining order is a legal measure that prevents an individual from dealing with or disposing of specific assets suspected to be proceeds of crime. It is typically issued by the Supreme Court when there is reason to believe that the assets were acquired through criminal activity or used in connection with a serious offence.

Breaching a restraining order is a criminal offence under section 58L of the Victims Support and Rehabilitation Act 1996 (NSW), punishable by:

• a fine
• imprisonment
• or both

Asset Forfeiture Order

An asset forfeiture order is a court-issued directive that allows state authorities to seize assets believed to be proceeds of crime. It is made under section 18.1 of the Confiscation of Proceeds of Crime Act 1989 (NSW) and typically follows a conviction for a serious offence.

Before granting this order, the court must be satisfied, on the balance of probabilities, that the assets were derived from criminal activity.

Pecuniary Penalty Order

A pecuniary penalty order requires an offender to pay a financial penalty equal to the value of the benefits gained from criminal activity. This order is assessed based on:

• the money or property acquired by the offender or another person at their request

Moreover, if a forfeiture order has already been made, the penalty amount may be reduced by the value of the forfeited assets.

Drug Proceeds Order

A drug proceeds order is a specific type of order used in cases involving drug trafficking offences. Under section 29 of the Confiscation of Proceeds of Crime Act 1989 (NSW), the court can order the offender to pay a penalty equal to the value of the benefits derived from drug trafficking activities. This order is made following a conviction for a drug trafficking offence.

Freezing Orders

Freezing orders are precautionary measures that prevent the disposal of assets suspected to be proceeds of crime before a conviction is obtained. While they are not the primary focus of asset forfeiture, they play a crucial role in preserving assets pending the outcome of legal proceedings.

Criteria for Courts Applying Forfeiture Orders in NSW

Evidence of Tainted Property

To ensure fairness and justice, courts must first establish that the property in question is “tainted” before issuing a forfeiture order. Tainted property includes assets directly or indirectly involved in, or derived from, criminal activity. Specifically:

• Property used in criminal acts: Assets employed to commit or facilitate offences, such as a vehicle used in drug trafficking.
• Proceeds from crime: Money or goods obtained as a result of illegal activities, like funds from a robbery.

Moreover, the court must be satisfied on the balance of probabilities that the property is tainted. This requires clear evidence linking the assets to criminal conduct.

Assessment Factors Used by Courts

In deciding whether seizing assets is appropriate and proportionate to the alleged criminal activity, courts consider several factors:

• Proportionality: Ensuring the value of the property corresponds to the severity of the offence.
• Hardship: Assessing the potential financial impact on the individual or their family if the assets are seized.
• Property Source: Determining whether the assets were lawfully acquired or obtained through illicit means.
• Public Interest: Preventing criminals from benefiting from illegal activities and deterring future offences.

Together, these factors help guarantee that forfeiture orders are fair and do not unjustly punish individuals or their families.

Impact of Asset Forfeiture on Accused & Asset Restrictions

Restrictions on Asset Disposal

Asset forfeiture orders impose significant restrictions on an individual’s ability to manage or dispose of their assets. Specifically, these orders prevent the accused from:

• selling assets suspected to be proceeds of crime,
• transferring ownership, or
• otherwise dealing with them.

For instance, if a vehicle is believed to have been used in a drug trafficking offence, the accused may be prohibited from selling or transferring that vehicle until the legal proceedings are resolved.

Moreover, breaching an asset forfeiture order is a serious offence under section 58L of the Victims Support and Rehabilitation Act 1996 (NSW). Penalties for such breaches can include:

• fines,
• imprisonment, or
• both.

The severity of the penalty depends on the value of the property involved and the jurisdiction in which the case is heard.

Allowances for Reasonable Living Expenses

While assets are frozen, the law allows for limited withdrawals to cover essential living expenses. This provision ensures that individuals can meet basic needs—such as food, housing, and utilities—during the forfeiture period. However, these allowances are typically capped at a specific weekly amount and always require court approval.

If the allowed amount is insufficient, the individual can apply to the court for an increase. This process may require providing detailed financial documentation to justify the request. Additionally, in some cases, reasonable legal expenses may be permitted, though such withdrawals are not guaranteed and may be subject to specific conditions or caps.

Options & Defences to Challenge Forfeiture Orders

Application to Exclude Property

Individuals facing asset forfeiture can apply to exclude specific property from being forfeited if they can demonstrate that the property was acquired legally. This process typically involves:

• Submitting evidence to prove the legitimacy of the property’s source
• Providing documentation showing acquisition timeline (e.g., if a vehicle was purchased before any alleged criminal activity)

The court will thoroughly review all evidence to determine if the property should be excluded, thereby ensuring fairness and proportionality in the forfeiture process.

Negotiating Settlement With Authorities

Another option is to negotiate a settlement with the authorities, which can reduce the impact of a forfeiture order. This approach offers several advantages:

• May involve surrendering only a portion of the assets in exchange for retaining others
• Often less confrontational than court proceedings
• Can provide a quicker resolution, allowing individuals to move forward without prolonged legal battles

Expert legal representation is crucial in these negotiations to ensure a fair outcome that protects your interests as much as possible.

Conclusion

Asset forfeiture in New South Wales is a powerful legal tool designed to prevent individuals from benefiting from the proceeds of criminal activity. It involves various orders, such as restraining orders and forfeiture orders, which aim to seize assets linked to criminal conduct. These mechanisms play a crucial role in disrupting criminal enterprises and upholding justice by ensuring that crime does not pay.

If you or someone you know is facing asset forfeiture proceedings, it is essential to seek expert legal advice. Contact Daoud Legal, a trusted criminal law firm in Sydney, to navigate the complexities of the system and protect your rights effectively. Acting promptly can make a significant difference in achieving a favourable outcome.

Frequently Asked Questions