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The Police Association says proposed legislation that aims to strip gangs of their ill-gotten gains is long overdue, but it could have one glaring $30,000 hole.

Picture a gang president with 10 Harley Davidsons he bought with the proceeds of crime for a totally false valuation of $29,999 each. He then divvies out those bikes to entice young men to join his gang – all seemingly legally.

That is a scenario that could become reality under proposed new legislation around seizing illicit assets from criminals and their associates, the Police Association, Te Aka Hāpai, says.

It told the justice select committee in a written submission last month that it largely supports the intent of the Criminal Proceeds (Recovery) Amendment Bill, but it strongly opposed having a $30,000 threshold on the ill-gotten gains that could be seized.

In the case of the over-arching Act, the reference to $30,000 is to identify serious criminal offending that does not carry a penalty of five years’ imprisonment or more, not to create a threshold for exclusion from forfeiture, as the association submits the proposed amendment would.

The establishment of a limit would effectively create a tolerance for criminal gains, protecting illicit wealth, while stymying police efforts to deter future criminal behaviour, the association argued.

The Bill proposes the following changes:

  • New powers to seize property worth more than $30,000 from the associates of organised criminals when it is clear their legitimate finances were unlikely to have enabled them to acquire the assets. (The association said it was clear from police investigations that one of the most efficient ways to hide from current law is to hold assets in the name of associates or family members, even though control of the asset sits with the primary criminal.)
  • A new court order that will mean criminals based overseas with assets in New Zealand will face losing them, unless they can prove within two months that they obtained them legally.
  • Allow seized property to be held longer than 28 days while the court considers an application for a restraining order.
  • Allow funds in KiwiSaver schemes to be subject to civil forfeiture orders, so criminals cannot hide illegal funds in their KiwiSaver.

The association said its members knew firsthand the response required to stop the growth of organised crime. So, on their behalf, it argued that the $30,000 threshold had too great a capacity to upend the intent of the Bill and asked the committee to reassess this aspect.

It wasn’t about the money. The impact of such seizures on gang prospects was immediate because they saw the mobsters they wanted to become having their flash assets towed away by police.

Organised crime had an impact on all the social and lawbreaking issues facing New Zealand, the association said. Too often, this manifested in young people being attracted to join criminal gangs and their subsequent path to criminal offending, mental health issues exacerbated by illicit drug use, and family violence often driven by that addiction.

Confiscation of the proceeds of crime was recognised internationally as an important tool in the fight against organised crime. It sent a message to criminals that they would not be able to enjoy their illicit wealth after prison, and, as the United Nations Office on Drugs and Crime noted, criminals would not be able to park that wealth for families and associates to use while they were in prison. Confiscation combated organised crime and prevented it infiltrating the legal economy. It was also a highly visible Police activity that was appreciated by our communities.

Multiple assets

The Bill did not address the valuation of multiple assets in relation to the threshold, the association submitted. Individually, a selection of assets may be under the threshold, such as the bikes in the earlier scenario, but collectively they would be well above it.

If Parliament did choose to retain what the association considered an ill-conceived concept of a threshold, then the Bill needed to clearly identify that all items of property facing forfeiture were valued in their entirety, not individually.

The association said the complications outlined would adversely affect the efficiency of the Act and could even result in a reluctance from Police to act. Indeed, it might lead to fewer recoveries of proceeds rather than more.

Te Aka Hāpai asked the committee to take a minute to imagine, after months of hard work that should result in forfeiture of illicit wealth, you instead must stand back as multiple assets conveniently valued at $29,999 are deemed free to go.

The Bill should be an opportunity to discourage participation in organised crime and deter association with gangs and their expansion into crime, it said.

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