Proceeds of Crime (Amendment) Bill 1999: From the Seanad.
The Dáil went into Committee to consider an amendment from the Seanad.
Seanad amendment No. 1:
In page 9, section 12, but in Part 2, the following new section is inserted:
12. — The Principal Act is hereby amended by the insertion of the following sections after section 16:
16A. — (1) The following documents are admissible in any proceedings under this Act, without further proof, as evidence of any fact therein of which direct oral evidence would be admissible:
(a) a document constituting part of the records of a business or a copy of such a document;
(b) a deed;
(c) a document purporting to be signed by a person on behalf of a business and stating—
(I) that a designated document or documents constitutes or constitute part of the records of the business or is or are a copy or copies of such a document or documents, or
(II) that there is no entry or other reference in those records in relation to a specified matter, and
(ii) that the person has personal knowledge of the matters referred to in subparagraph (i).
(2) Evidence that is admissible by virtue of subsection (1) shall not be admitted if the Court is of the opinion that in the interests of justice it ought not to be admitted.
(3) This section is without prejudice to any other enactment or any rule of law authorising the admission of documentary evidence.
(4) In this section—
(a) an undertaking not carried on for profit, and
(b) a public authority;
"deed" means any document by which an estate or interest in land is created, transferred, charged or otherwise affected and includes a contract for the sale of land;
"document" includes a reproduction in legible form of a record in nonlegible form;
"public authority" has the meaning given to it by section 2(1) of the Local Government Act 2001 and includes a local authority within the meaning of that section;
"records" includes records in nonlegible form and any reproduction thereof in legible form.
16B. — (1) For the purposes of this section—
(a) a person is corruptly enriched if he or she derives a pecuniary or other advantage or benefit as a result of or in connection with corrupt conduct, wherever the conduct occurred;
(b) “corrupt conduct” is any conduct which at the time it occurred was an offence under the Prevention of Corruption Acts 1889 to 2001, the Official Secrets Act 1963 or the Ethics in Public Office Act 1995;
(c) “property” includes—
(i) money and all other property, real or personal, heritable or moveable,
(ii) choses in action and other intangible or incorporeal property, and
(iii) property situated outside the State,
and references to property shall be construed as including references to any interest in property.
(2) Where, on application to it in that behalf by the applicant, it appears to the Court, on evidence tendered by the applicant, consisting of or including evidence admissible by virtue of subsection (5), that a person (a "defendant") has been corruptly enriched, the Court may make an order (a "corrupt enrichment order") directing the defendant to pay to the Minister or such other person as the Court may specify an amount equivalent to the amount by which it determines that the defendant has been so enriched.
(a) the defendant is in a position to benefit others in the exercise of his or her official functions,
(b) another person has benefited from the exercise, and
(c) the defendant does not account satisfactorily for his or her property or for the resources, income or source of income from which it was acquired,
it shall be presumed, until the contrary is shown, that the defendant has engaged in corrupt conduct.
(4) In any proceedings under this section the Court may, on application to itex parte in that behalf by the applicant, make an order prohibiting the defendant or any other person having notice of the order from disposing of or otherwise dealing with specified property of the defendant or diminishing its value during a period specified by the Court.
(5) Where in any such proceedings a member or an authorised officer states on affidavit or, where the respondent requires the deponent to be produced for cross-examination or the Court so directs, in oral evidence that he or she believes that the defendant—
(a) has derived a specified pecuniary or other advantage or benefit as a result of or in connection with corrupt conduct,
(b) is in possession or control of specified property and that the property or a part of it was acquired, directly or indirectly, as a result of or in connection with corrupt conduct, or
(c) is in possession or control of specified property and that the property or a part of it was acquired, directly or indirectly, with or in connection with the property referred to in paragraph (b),
then, if the Court is satisfied that there are reasonable grounds for the belief aforesaid, the statement shall be evidence of the matters referred to in any or all of paragraphs (a) to (c), as may be appropriate.
(6) (a) In any such proceedings, on an application to it in that behalf by the applicant, the Court may make an order directing the defendant to file an affidavit specifying—
(i) the property owned by the defendant, or
(ii) the income and sources of income of the defendant, or
(iii) both such property and such income or sources.
(b) Such an affidavit is not admissible in evidence in any criminal proceedings against the defendant or his or her spouse, except any such proceedings for perjury arising from statements in the affidavit.
(7) Sections 14 to 14C shall apply, with the necessary modifications, in relation to assets or proceeds deriving from unjust enrichment as they apply to assets or proceeds deriving from criminal conduct.
(8) The standard of proof required to determine any question arising in proceedings under this section as to whether a person has been corruptly enriched and, if so, as to the amount of such enrichment shall be that applicable in civil proceedings.
(9) The rules of court applicable in civil proceedings shall apply in relation to proceedings under this section.'.".
This amendment was introduced in the Seanad on Committee Stage and inserts two new sections into the Proceeds of Crime Act 1996. The new section 16A relates to hearsay evidence in the context of admissibility of documents and the new section 16B is a corrupt enrichment order.
I will deal first with the hearsay provision. The need for the provision on hearsay evidence arises following the decision of the Supreme Court in the Hunt case, that is, the decision of the Criminal Assets Bureau against Hunt delivered on 28 February 2003. In that decision, the court took the view that the reference at the end of section 8(5) of the Criminal Assets Bureau Act 1996 to information, documents or other material obtained by bureau officers being admissible in future proceedings did not by-pass the rules of evidence but merely allowed such documents to be admitted, in accordance with the usual rules, notwithstanding their origin.
The effect of the decision is to oblige the Criminal Assets Bureau to prove bank records by means of the Bankers' Books Evidence Acts 1879 to 1959 and business and administrative records and transactions in relation to land and other property by means of oral evidence, thereby adding a considerable administrative burden to the workload of the bureau in preparing cases for court. The bureau has expressed concern about the added administrative burden in proving large volumes of business and administrative records and transactions in relation to land and other property arising from that decision.
The proposed amendment, which is restricted to proceeds of crime cases under the remit of the bureau, seeks to minimise the administrative burden in cases where there could be large volumes of routine documentary records to be admitted in evidence. It should be noted that the measure is available to both the applicant and the respondent or, indeed, a third party who might make an application under the Act.
I wish to clarify the detail of the provision. Subsection (1) sets out that certain documents are to be admissible in any proceedings as evidence of any fact of which direct oral evidence would be admissible without further proof. The documents concerned include a document which consists of part of a record of a business or a copy of that document, a deed and a document which purports to be signed by a person on behalf of the business and which states that either a designated document or documents constitute the record or part of the records of the business or is a copy or copies of such records or documents, or there is no entry or other reference in the records to the relevant matters, provided that, in both of those instances, the person has knowledge of those matters.
Subsection (2) contains a safeguard provision which sets out that a document is not admissible under subsection (1) if the court is of the opinion that in the interests of justice it ought not be admitted. Subsection (3) provides that the section is without prejudice to any other enactments or rule of law which authorises documentary evidence. Subsection (4) sets out definitions for the terms "business", "deed", "document", "public authority" and "records" which are used in the new section. The overall effect of this amendment is to facilitate the admissibility in evidence of large volumes of records which are generally of a routine nature and are not in dispute between the parties.
The new section 16B contains the new corrupt enrichment order provision which was flagged by the Minister on Committee Stage in this House. The purpose of this provision is to deal with the situation where someone, by means of some corrupt act, is able to benefit from the enhancement of value of property otherwise legally acquired. This amendment will provide for a procedure to go after the additional profit or enrichment generated by a corrupt act by obtaining what is termed a "corrupt enrichment order" against the individual concerned.
Subsection (1) of the provision defines the concept of unjust enrichment as meaning that a person derives a pecuniary or other advantage or benefit as a result of or in connection with "corrupt conduct". "Corrupt conduct" is then defined by reference to the Prevention of Corruption Acts, the Official Secrets Act and the Ethics in Public Office Act. "Property" is defined as money and all other property, real or personal, heritable or moveable, choses in action and other intangible or incorporeal property and includes property outside the State.
Subsection (2) provides that where it appears to the court on hearing evidence that a person has been corruptly enriched, the court may make what is termed a "corrupt enrichment order" which directs the defendant to pay to the Minister for Finance or other person specified by the court an amount equivalent to the amount by which the court determines the person has been enriched.
Subsection (3) provides, until the contrary is shown, for a presumption of corrupt conduct on the part of a defendant when three conditions are fulfilled. These are that the defendant is in a position to benefit others in exercising his or her official functions, that some other person has benefited and that the defendant does not account satisfactorily for his or her property or the resources or income from which it derived. Subsection (4) provides that the court has power to prohibit disposal of or dealing with the property concerned or prevent diminution of its value.
Subsection (5) sets out that the evidence to be furnished to the court by the Criminal Assets Bureau is a statement of its belief that the defendant has derived a specified pecuniary or other advantage or benefit as a result of corrupt conduct, is in possession or control of property acquired directly or indirectly as a result of or in connection with corrupt conduct, or is in possession or control of specified property and that the property was acquired directly or indirectly as a result of or in connection with the property already identified as having been acquired through corrupt conduct. The court must be satisfied there are reasonable grounds for the belief before the statement becomes evidence.
Subsection (6) provides for the court to make an order which directs the defendant to file an affidavit specifying his or her property or income or both and contains a safeguard that such affidavit is not admissible in criminal proceedings against the defendant or his or her spouse, except in perjury proceedings.
Subsection (7) applies the provisions of the new sections 14 to 14C relating to search warrants, orders to make material available, prejudicial disclosure and trusts to this provision of corrupt enrichment. Subsection (8) applies the civil standard of proof to the proceedings and subsection (9) applies the rules of court applicable to civil proceedings to proceedings under the section.
I support the approach that will allow the work of the CAB, of which I am a strong supporter, to proceed more smoothly. I admire the efforts of the bureau over the years. In principle, therefore, I am in favour of the provision on the admissibility of documents. I also support the principle of the introduction of a corrupt enrichment order. The Minister of State has made a reasonable case for the introduction of such a provision. Therefore, I will not oppose the amendments proposed by the Minister.
However, I wish to put down a strong marker in regard to my concern at the procedure adopted in the case of these amendments. It is not proper that issues of this type should be dealt with in this fashion, by means of a 30-minute slot in the Dáil schedule. We are talking about serious and fundamental points of law relating to not fully enforcing the procedures regarding hearsay evidence. We are also introducing a fundamental new power in the corruption enrichment order. I support the principle of these provisions but I cannot do my duty as a parliamentarian and spokesman for the main Opposition party without calling to attention that these are processes and procedures which should be teased out carefully.
This would be best done by recommittal of the Bill to Committee Stage so that there can be a proper teasing-out process. There is a worrying tendency on the part of the Minister for Justice, Equality and Law Reform to treat the Houses of the Oireachtas as a rubber stamp. This is a dangerous and foolish tendency. Apart from its undemocratic nature in not allowing Parliament to do its job properly, the consequence of such an approach may often be an appeal to the Supreme Court. I wish to put down a marker in regard to procedure. In the past, the Minister announced in one of his daily press releases that he would make amendments to Bills that constitute a radical change to the relevant legislation. I will no longer accept radical or other changes unless they have been properly debated in this House.
The issue of the admissibility of documents arises because of the view of the CAB and the Minister that a provision on hearsay is required in the wake of the Supreme Court decision in the CAB v. Hunt case. My instinct as a lawyer is that the rule on hearsay has been there for centuries and for a particular reason. We should tease out carefully any exceptions we are to provide to that rule. There is probably a case for the exception envisaged in the provision. The CAB has expressed concerns about the added administrative burden in proving large volumes of business, administrative records and transactions relating to land and other property arising from the Hunt decision.
If this provision had been included on Committee Stage, I would have liked to hear more about that. It is not desirable to breach an established principle of the law of evidence purely for the purpose of an administrative convenience. Given time to consider the provision, I would need to be convinced of its merits. However, I must take the case for it as presented by the Minister. I would like his absolute assurances on this as a fellow lawyer. He will understand my instincts as someone who practised in the courts for some time before I went into politics. The respect I have for the rules of procedure and evidence is based on their function to protect the rights of the individual. I require clarification from the Minister on this issue in circumstances where I am not in a position to tease out the points in great detail.
The same applies to the proposal for a corrupt enrichment order, which appears to be a good name. In principle I approve of the courts being able to deal with somebody who is able to benefit from the enhancement in property value, which was legally acquired but the enhancement of which arose as a result of a corrupt act. Again on the face of it, it appears to be a very good idea. We must stamp out corruption in every way we can. Obviously, one of the ways of doing so is by ensuring that people cannot improperly gain from corrupt acts.
While I am again in favour of it in principle, I believe this provision would be better if we had the opportunity to tease out the details on Committee Stage. As I do not have the opportunity to do so now, I must take it on the assurance of the Minister of State that this provision has been very carefully drafted and that as it stands it will withstand legal scrutiny.
In the first instance I agree entirely with what Deputy Jim O'Keeffe has said about the procedure under which this amendment from the Seanad has come before the House. This is not a Bill that was sprung upon us as a result of an emergency that occurred today or yesterday. This Bill has been in the pipeline for six years since 1999. For a Bill that long in the pipeline one of the most crucial amendments in the legislation should not be dealt with within half an hour as an amendment coming from the Seanad.
Why was this amendment not tabled in the Dáil? The Bill was introduced in the Dáil. It is expected that the major debate should take place in the House in which a Bill is introduced and that all the major provisions should already be contained. This did not happen and the Minister merely flagged the intention.
The major statement in the Government manifesto concerning proceeds of crime legislation and the Criminal Assets Bureau was a promise to introduce proceeds of corrupt acts legislation and deal with white-collar corruption. I believe the term used was "corruption assets bureau". This was two and a half years ago and yet the legislation went through both Houses until an emergency motion came at the end of proceedings in the Seanad. Why could we not deal with this properly? I would support the Bill's recommittal to Committee Stage for a proper discussion of its implication.
Having said that about the procedures, this is the way in which the Minister for Justice, Equality and Law Reform operates. He is a Minister who does not really introduce legislation; he introduces amendments. The corpus of amendments is always larger than the original Bill. It would be great to see the Minister abide by normal protocol. I always understood that the contents of this legislation were encompassed by the original legislation introduced ten years ago by the Labour, Democratic Left and Fine Gael Government of the day. After a very tragic incident, the murder of Veronica Guerin in 1996, it was determined in subsequent discussion that substantial action needed to be taken to deal with those who were enriching themselves through the proceeds of crime. The legislation as I understood it encompassed exactly what we are debating today. However, the Government that followed never sought to extend its compass to the proceeds of white-collar crime and enrichment.
The definition in the original Proceeds of Crime Act states:
"proceeds of crime" means any property obtained or received at any time (whether before or after the passing of this Act) by or as a result of or in connection with the commission of an offence;
I do not see what more is contained in the amendment before us today.
I ask the Minister of State to outline the details of the second part of the amendment. While white-collar corrupt enrichment has been going on all the time, neither the Garda nor the Criminal Assets Bureau has seen fit to pursue it. It is one matter to pursue a small time criminal or a drug pusher or even a large-scale criminal like Martin Cahill, who went to the welfare exchange and was unemployed. It is another matter to pursue somebody who is a pillar of society and has achieved pecuniary enrichment through so-called business activities.
How will this Act operate? I believe the provisions of the existing legislation were adequate to take proceedings to address this type of offence. It is very obvious when somebody goes to the labour exchange while living in a big house in Rathmines and driving a big car. However, it is different with a normal business person who through bribery or other corrupt acts has obtained further enrichment. How will the Garda operate this legislation? What will be the modus operandi? Will we trawl through the tribunal reports to see where bribes were given and where people enriched themselves, whether they have admitted it or not? What instructions will be given to the Criminal Assets Bureau and Garda to implement this legislation? The provisions already exist and the question is how they will be implemented.
Section 16A deals with hearsay evidence. As a non-lawyer, if it can be agreed that certain witnesses and certain documentation need not be produced in court, why should it be done? An argument exists in that respect. Otherwise time is being wasted on bureaucracy and research. Section 16A(2) states: "Evidence that is admissible by virtue of subsection (1) shall not be admitted if the Court is of the opinion that in the interests of justice it ought not to be admitted." This is a fairly stark statement. An opinion does not require much support. All of us have opinions which have little value or weight. The section does not even refer to a "reasonable" opinion. The caveat seems rather meaningless and the protection is rather meaningless. It will end up that in all cases hearsay evidence will be introduced and this will become the norm. It is unlikely the opinion of the court will be of substance because it does not have to be supported; it is discretionary.
I have no problem with these measures. It has taken a long time to initiate a process that was already included in the legislation. I do not know why there was a Bill in 1999 or why it has taken two and a half years for the Minister for finalise this. Why did he not introduce the amendment when the legislation was initially before the Dáil?
This year is the tenth anniversary of the Criminal Assets Bureau, an important tool in the fight against crime. The proceeds of crime come from deprived communities, not just in terms of drug money and money laundering but also in terms of planning corruption and other similar fraud, where long-suffering residents lose out from the pollution of their environment. This money should be earmarked for reinvestment in the community instead of going into the maw of the Department of Finance from which it will never emerge in any recognisable form. It should be redirected into areas where the damage is caused.
This important debate is relevant to modern Irish society and should focus in particular on areas of severe social, economic and educational disadvantage, where a substantial minority of the population live in very poor conditions. Children in that section of society live in extreme deprivation, with many of them going to school without proper breakfast, living in unsuitable accommodation and lacking family stability.
The debate on the proceeds of crime legislation is relevant to these children because all money confiscated should be spent in these areas. In this State, 60,000 children live in poverty and the money confiscated could be invested in the areas in which they live and the schools they attend. I encourage the Minister and the Cabinet to focus resources and help into disadvantaged schools. It is essential in tackling crime and poverty to connect with these children when they are between two and five years of age. Otherwise, when they reach the age of nine, ten or 11, they are already involved in anti-social behaviour and a section of them become involved in serious crime later in life.
We often lose sight of the fact that many people living in disadvantaged communities do not become involved in crime and we must take our hats off to them. We should praise those parents of families who live in blocks of flats where heroin is being pushed within 20 metres of their front doors. These families never become involved in crime and those parents should be commended. We should reward such people.
Section 1 of the Bill states that money realised on the making of disposal orders on the principal Act as amended by this Act shall be used for community development purposes in disadvantaged areas. This is the crux of the debate and it is vital that this be done.
Deputies mentioned the Criminal Assets Bureau. I have supported the CAB over the years and see it as essential in addressing crime. When talking about crime and dealing with its proceeds, however, the middle class who are involved in taking and distributing cocaine should also be targeted and they should not get an easy ride.
This amendment is important because it offers a way to do something for the most needy in our society.
I have heard the Minister for Justice, Equality and Law Reform described as many things but he is certainly not the creator of a rubber stamp. He participates in the proceedings of this House with vigour and enthusiasm. As Deputy Costello pointed out, he frequently introduces amendments to legislation he has introduced himself and he is to be commended for that.
He treats the House as a rubber stamp. That is the problem.
On the relaxation of the hearsay principle, Deputy Costello expressed concern about the use of the formula "in the interests of justice" that the courts will use to decide in their discretion. That is the canonical formula used in the Criminal Evidence Act 1992. The common law developed the rule that evidence is not admissible if the person submitting it is not available to give the evidence on oath and be subjected to cross examination. It is generally in the interests of justice that this should be so when persons are giving accounts of transactions of events from memory, but the application of that rule to the proof of documents has occasioned great inconvenience over the years.
In the proof of a document, the rule requires not alone that the original be produced in all cases but that the maker of the document or the person who kept it in the course of his business or calling should be available to prove it. If the document has been out of the possession of the person in the intervening period, the continuity of possession must be shown to the satisfaction of the court. The successive keepers or handlers of the document must be available to give evidence. There was a famous decision in Britain in the 1960s, Myers v. the Crown, where a prosecution of a stolen car ring collapsed because counsel was not in a position to call the makers of the records for the manufacturers who installed the relevant chassis numbers on the cars and could match them to registration details.
In the Criminal Evidence Act 1992, the Oireachtas provided for a substantial relaxation of the rule regarding documentary matters in the general law of evidence. In that legislation we also provided that ultimate discretion must exist for the courts because it is a matter of evidence. The formula "in the interests of justice" is included because in all these matters relating to the proffering of evidence, some residual or ultimate discretion must be left to the court to do justice between the parties in a particular case.
This procedure will empower the Criminal Assets Bureau to trace assets corruptly acquired. It will allow the bureau to deal with unexplained affluence.
I am required to put the following question in accordance with an Order of the Dáil of this day: "That the Seanad amendment is hereby agreed to and agreement to the amendment is accordingly reported to the House."
Question put and agreed to.