Joe Ludwig (Queensland, Australian Labor Party, Manager of Opposition Business in the Senate) Share this | Hansard source

In the interests of dealing with this efficiently, I seek leave to move opposition amendments (1), (2) and (4) to (7) on sheet 5199. That would leave opposition amendment (3) to be moved separately.

Leave granted.

I move:

(1)    Schedule 1, page 6 (after line 6), after item 13, insert:

13A  Subsection 6(7)

Repeal the subsection.

(2)    Schedule 1, page 8 (after line 20), after item 19, insert:

19A  At the end of Part 6

Add:

79B  Deregistration and register of deregistered providers

        (1)    The AUSTRAC CEO may, by written instrument, deregister a provider from the Register of Providers of Designated Remittance Services.

        (2)    A provider may be deregistered if:

             (a)    the provider is found to be not of good character; or

             (b)    the provider is convicted of a criminal offence against the Commonwealth, a State or a Territory with a penalty of 2 years or longer; or

             (c)    the provider ceases to be able to provide the service.

        (3)    A written instrument in accordance with subsection (1) is a legislative instrument.

        (4)    The AUSTRAC CEO must maintain a register for the purposes of this Part, to be known as the Register of Deregistered Providers of Designated Remittance Services.

        (5)    The register is not a legislative instrument.

        (6)    The AML/CTF Rules may make provision for and in relation to either or both of the following:

             (a)    the correction of entries in the Register of Deregistered Providers of Designated Remittance Services;

             (b)    any other matter relating to the administration or operation of the Register of  Deregistered Providers of Designated Remittance Services.

(4)    Schedule 1, page 14 (after line 5), after item 51, insert:

51A  Subsection 199(4)

After “currency” (twice occurring), insert “or a thing”.

(5)    Schedule 1, page 14 (after line 5), after item 51, insert:

51B  Subsection 199(5)

After “currency” (twice occurring), insert “or a thing”.

(6)    Schedule 1, page 14 (after line 5), after item 51, insert:

51C  After subsection 200(12)

Insert:

Officer may seize other evidence

   (12A)    If a police officer or a customs officer has reasonable grounds to suspect that a thing found in the course of an examination under subsection (12) or (13) may afford evidence as to the commission of an offence against subsection 53(1) or 59(3), the officer may seize the thing.

(7)    Schedule 1, page 14 (after line 10), after item 52, insert:

52A  Subsection 251(1)

Omit “7”, substitute “4”.

Similar amendments were moved when the earlier bill was before us. They were moved because at that time the then minister wanted the bill through parliament before Christmas so he could come back and deal with amendments or any other matters post that. This is the opportunity to do that. Although we understood the minister’s intent at that time, Labor informed him that we would still take the opportunity to move our amendments then, even though we were not going to have an opportunity to look at some of his amendments, and that we would give the minister another look at them when the next opportunity arose.

So it is not a case that we are not dealing with the substantive bill—in other words, the charge could be levelled at us that we are dealing with amendments that do not go to this bill. I reject that. This is a case where I could argue that the sloppy and ill-conceived way these amendments and the original bill were brought forward has necessitated this response by Labor, and we are now in the position of having to move our amendments twice to give the government the opportunity of considering them in the principal bill. I will not make that allegation, although I probably just have.

This also goes to comments made by the minister in relation to the second reading amendment that was moved in the House. It is still relevant—that is, both the second reading amendment moved in the House and these amendments to this bill—because of the process that had been undertaken by the then minister, Minister Ellison, when he introduced the legislation. Labor did understand the reasoning for that, although we did not agree with or accept it.

Labor’s view on this has always been that the government has done this in a piecemeal way. I could go through the examples of where bandaid upon bandaid has been applied, but I will not take that course now. I think I have made those points a number of times. As best I can I will deal with these amendments in short form, given that I have spoken to them before. The minister at that time indicated that he was not going to look at any amendments. He would have had an opportunity to look at these amendments since we last moved them until now. Labor was not to know that the minister was going to move on to bigger and better things and that a new minister would take the reins. Given that, I think it would be helpful to now go through them again but in precis form. I am sure the staff have already advised the new minister of these amendments and that they have been considered before, but sometimes the opportunity of hearing them can persuade. It is a slim chance, Minister, but you might be persuaded to accept them—at least, if not now you might be persuaded at some future time to consider why you did not.

Amendment (1) on sheet 5199 is in line with recommendation 4 in the report of the Senate Standing Committee on Legal and Constitutional Affairs. It seeks to strike out clause 6(7), which gives the power through regulation to effectively override and amend the act. This is known as a Henry VIII clause. In putting forward recommendation 4 it is the view, and has been the view of many committees of the Senate, including both the Scrutiny of Bills Committee and the Legal and Constitutional Affairs Committee, that Henry VIII clauses should, from the point of view of good governance, be opposed unless very sound reasons are provided. Those sound reasons are not in this bill. It has not been well argued or put forward by the government to substantiate the need for a Henry VIII clause. In fact this process we are going through now, with technical amendments and the inclusion of ASIS, is a good example of where, if there are requirements to amend the principal act, you can undertake that in a relatively short time, bring them forward and amend the legislation accordingly. I think the government’s argument for flexibility is overstated in this instance.

Amendment (2) on sheet 5199 picks up recommendation 5 in the committee’s report that a separate register be set up for persons prohibited from supplying a designated remittance service. I do want the minister to consider this amendment a bit further. When you set up a register of designated remittance services and it stays as a continuously updated register, you put new designated remittance services providers on that list. For the sake of argument, let’s take the informal, traditional or ethnic based remittance services known as hawala and the like: you might find at certain times a person who has committed repeat offences against the act or who is otherwise an undesirable person to have channelling money overseas. Under the regime that will be set up under this bill such a person would simply remain on the list of designated remittance service providers. So even where you have an offender under the legislation or a person who might be undesirable in a broad sense—they might be associated with a range of members of the criminal underworld, for example—they still remain on the list. Of course, the argument was that you know where they are. I am not sure that is the retort I would want to hear. We think it is a pretty dumb idea to leave them on the list. Human nature being what it is there may be mistakes. It seems quite strange to us that you would have a regime in which persons can be enrolled or qualified to do a particular thing, in this case provide a designated remittance service, yet when it is no longer desirable for the person to retain that qualification, when you have come to a conclusion that they should not actually continue in that role, you have no power under the legislation to take them off. So they sit there as a designated remittance service provider. It seems to be half baked; it does not seem to be a full scheme.

What Labor proposed was to set up, in effect, a separate register of prohibited persons. That way the AUSTRAC CEO would have the power to strike off a registered person who breaks the law and move them across to a separate register of deregistered designated service providers. In that way, if you wanted to know where they were then they would be clearly known to people; they would be on a list of deregistered providers of remittance services. So they would not disappear into the ether either. The previous minister—wrongfully, in my view—rejected this approach because he was setting up a registration scheme and not a licensing scheme. However, no-one is suggesting that a licensing scheme can disavow the current minister of that view. It is just a matter of what we could say is common sense.

If you were to look at some of the experiences in overseas jurisdictions, it might also help. This problem—where people have set up registers in good faith and find, particularly in this area, that for a range of reasons you might want to strike them out but you have no power to—is not new. It seems sensible under a range of circumstances to have that power to be able to blueline them—or redline them, as the case may be—so that they are removed from the register. The argument is that they then disappear into the underworld, so to speak. Put them on a deregistered list and track that. In that way you are also providing a public service and know who you should not be dealing with because they are not a registered provider.

Amendments (4), (5) and (6) on sheet 5199 did not arise from an issue raised in the committee’s report but were raised in relation to the power given to Customs officers under the act. I can deal with them in short form. At present the act gives power to Customs officers to search persons for currency and bearer negotiable instruments when leaving Australia but does not appear to give them the right to seize anything other than the currency or bearer negotiable instrument. If there was a bearer negotiable instrument and with it a list of all of the bearer negotiable instruments and a document with signatures on it demonstrating that it was attached to the bearer negotiable instruments but not part of them or something which might otherwise describe them, that may not be able to seized as evidence in that way. It would seem sensible to ensure that bearer negotiable instruments can be seized as well as any evidence that might be attached to them.

Recommendation 28 of the FATF provided:

When conducting investigations of money laundering and underlying predicate offences, competent authorities should be able to obtain documents and information for use in those investigations, and in prosecutions and related actions.

Section 199 of the act, which deals with unlawful cross-border movement of physical currency, and section 200, which deals with unlawful cross-border movement of bearer negotiable instruments, as presently constructed, in Labor’s view, fails to meet that test. Recommendation 28 has not been implemented in total. Presently, when you look at sections 199 and 200, you see that they permit an officer—for example, a Customs officer—to seize physical currency and bearer negotiable instruments that afford evidence of the offence under sections 53(1) to 59(3). They do not allow an officer to seize any other thing which may afford evidence of the offence under sections 53(1) to 59(3).

To put it another way, when an officer forms a reasonable suspicion that an offence has been committed, they may only seize the physical currency or the bearer negotiable instrument itself and not any other evidence of the commission of that offence. It would seem sensible to have that logical extension. It might be that the government advisers say that there is a general power under the Customs legislation to seize that evidence. I cannot find that general power, so if it is there then perhaps you could direct me to it. But, in this instance, even if there were a more general power, you would need a specific power to ensure that evidence could be obtained. It is also one of those ways in which you can avoid having an argument about whether the additional document that was taken at that time was legitimately taken or not.

It is easy to imagine instances in which a power would be required. As I have said, all of the instructions which might go to how you conceal that there are negotiable instruments—where you put them or where they are now hidden, for instance—might be helpful to demonstrate that the excuse given by the person as to why they have got the bearer negotiable instruments is not a valid one. (Extension of time granted) As I have said, the government may argue that there is a general power. I do not think the general power exists but I am happy to be corrected.

Amendment (7) on sheet 5199 is based on committee recommendation 13 to reduce the review time from seven years to four. Labor’s view is that for a piece of legislation such as this one, where we have already seen amendment upon amendment, a technical correction and an addition, seven years is too long. The argument that has been put in response to that by the government is that by the time the rules, regulations and guidelines are put in place and the scheme gets under way, seven years might be about the right balance. By that time, I suspect that it will have gone too far if any substantive issues arise that the government does not want dealt with. Early is better for the business, the financial institutions and AUSTRAC to make sure that everything is on track, that it is operating effectively and efficiently, that it is not creating a burden on business and that is not creating a burden on government in terms of the regulatory scheme.

It makes more sense to ensure an early review to get the balance right, because in Labor’s view we do not want a situation where a raft of issues jam up and wait and do not get resolved until the seven-year point. Bureaucracy as it is often responds to businesses by saying, ‘The review is in seven years’—or such and such a date—‘so we’ll put it on tick and wait until then.’ In the business world it needs to be resolved early, and the earlier review will give that opportunity. The other matters and the sheer amount of delegated authority this regime imposes militate against a long review. The capacity for regulations to amend the legislation, where you may then take that opportunity of amending the legislation, means that you should take that course. AUSTRAC are relatively inexperienced, and let us not underestimate their task. They have grown and doubled in size, effectively overnight. I understand the CEO is pleased in that sense and takes the challenge well, and I have full confidence—and Labor has full confidence—in his ability. But it is still a bureaucracy that he has to manage as a regulator. Going from financial intelligence, or FIU, to being a regulator-enforcer, he has to undertake a range of other tasks, as well as having to deal with the legislation and the legislative process. The problem is the ill-effects for business if you get it wrong.