Proceeds of Crime I

Background

The courts have inherent powers in theft and related offences to return the property to its rightful owners.  In addition, they have the power to order compensation.  In the mid-1990s, under international Conventions and domestic “gangland” crime,  legislation was enacted providing for the confiscation and forfeiture of the proceeds of crime.  Previously, the most that could be done was the confiscation of unlawful or illicit substances, the subject matter of the proceedings concerned.

European Union legislation has been significant in this area.  The money laundering legislation is derived from an EU directive.  It puts obligations on all EU member states to ensure that customers of financial institutions and other service providers are identified, adequate records are kept of transactions, and that suspicious transactions are reported.

The framework decision of the EU required member states to put in place legislation in respect of freezing, confiscation, and forfeiture of the proceeds of crime and their value.  It required international recognition of confiscation orders.  This provision was further strengthened by a comprehensive framework decision requiring legislation providing for asset recovery, agencies, international cooperation and enhanced powers.

Proceeds of Crime Legislation

Initially, the Irish legislation dealt with serious crime and, in particular, drug trafficking offences. The same provisions now apply to other crimes tried on indictment, where the DPP makes such an application.

The proceeds of crime legislation is separate and that it operates independently of criminal proceedings.  The confiscation is not linked to a conviction.

Where criminal proceedings for such an offence have been or are about to be instituted, the High Court may issue a freezing order restraining a person concerned from dealing with any assets. That person may apply to have the order varied.  The High Court can appoint a receiver to take possession of the property and manage it.

Where a person has been convicted on an indictment of a drug trafficking offence, the court must decide whether he benefited from the offence, the extent of the benefit, and the amount of assets available to discharge a confiscation order.  The court makes an order for the sum that may be realised.

In drug trafficking cases, the payments received for drug trafficking or in connection with it constitute benefits that may be the subject of a realization.  In other cases, the assessment is limited to the offence of which he is convicted.

It is presumed that assets received by the accused in the six years before in a drug trafficking case constitute the receipts of drug trafficking.

A confiscation order is deemed a debt due by the accused.  There are penalties for non-payment, including further imprisonment.  The penalties are related to the amount of money confiscated.

The 2016 Act amends Principal Act to reduce the threshold value of property subject to the Act from €13,000 to €5,000.

CAB

The Criminal Assets Bureau is a multidisciplinary body consisting of revenue officials, customs officials, Department of Social Protection officials, members of the Garda Síochána, legal, administrative and technical staff.  The Agency deals with all criminal activity.  It has a particular focus on drug trafficking.  It has close links with its equivalent bodies in Great Britain and Northern Ireland.

There have been several challenges to the proceeds of crime legislation and CAB procedures.  These have largely upheld the procedures as compliant with the Constitution and the European Convention on Human Rights.  Broadly, they have been held to be proportional and legitimate limits on the interests of persons, in the interests of the common good.

CAB’s function is to identify assets derived directly and indirectly from criminal activity and take appropriate steps to deprive or deny the relevant persons of the assets concerned.  They may pursue such investigations and proceedings as are appropriate arising out of their investigations.  CAB takes action under the confiscatory legislation and also under taxation and social welfare legislation.  Many of CAB’s more effective actions have procured significant tax liabilities and debts of persons who have benefited from the proceeds of crime.

Powers

Subject to certain protections, CAB is entitled to use all the powers and remedies available to the Revenue Commissioners and Social Protection authorities.  There are provisions in relation to disclosure and sharing of information by and with those authorities.

CAB may enforce Revenue and social welfare legislation itself in respect of individuals who have benefited from crime. CAB may raise Revenue assessments and enforce them.  Irish taxation legislation has permitted the taxation of profits of unknown and even illegal sources for almost 40 years.  .  CAB can recover social welfare overpaid.

There are provisions to prevent the disclosure of the identity of CAB officers.  They are not required to identify themselves.  They may be accompanied by members of An Garda Síochána.