Navigation: Previous Page | Contents | Next Page
Powers and taskforces
Over the course of the inquiry the committee heard from numerous
witnesses and submitters about the value of multi-agency taskforces in
addressing certain jurisdictional issues.
This chapter examines the evidence relating to three specific areas, all
of which engage different aspects of Commonwealth law enforcement agency
Firstly, the committee heard about the impressive results of
multi-agency taskforces. Two taskforces, Project Wickenby and Taskforce
Eligo, were cited by Commonwealth law enforcement agencies as examples of
effective cross-agency collaboration, especially in instances where agencies
have different information gathering and sharing powers.
Secondly, this chapter addresses a specific example raised by
Commonwealth law enforcement agencies of inefficiency within a multi-agency
relationship. For example, officials from the Reserve Bank of Australia (RBA)
suggested that their relationship with the AFP could be strengthened through
administrative changes to processes for counterfeit note investigations.
Finally, this chapter examines the Momcilovic
decision that was queried by state and territory police as potentially raising
procedural legal questions for state and territory police in Australia.
Federal multi-agency taskforces
The ACC and AFP argued that multi-agency taskforces had played an
enormously beneficial role for Commonwealth and state and territory law
enforcement agencies. Further, the ATO argued one of the benefits of
multi-agency taskforces was the ability of agencies to share data under
prescribed circumstances. Normally, agencies, like the ATO, are prevented from
sharing certain information with other law enforcement agency partners for
privacy and other legal reasons.
This section examines some of the significant benefits of multi-agency
taskforces, while taking into account the announcement made in the 2015-16 Budget
to establish a Serious Financial Crime Taskforce.
Benefits and effectiveness of
One critical issue that emerged during the inquiry is whether the full
benefits of the taskforces are exploited over the longer term. This was largely
due to the limited duration of taskforces resulting in officers returning to
their 'home' agencies at the taskforces' conclusion.
One question often raised in evidence was whether taskforces should be
made permanent so as to retain the skills and expertise developed in fighting
financial related crime. This question is examined in detail below.
ASIC was supportive of multi-agency taskforces, noting they were an
effective method of investigating financial crimes, when specifically funded.
ASIC noted that under present arrangements, agencies are restrained in the
information that they may share with each other, whereas the use of prescribed taskforces
had allowed agencies to share information where authorised and appropriate:
At present, the general sharing of information between
agencies, such as ASIC and the Australian Federal Police (AFP) or the ATO, are
severely restricted by our respective obligations around the use and disclosure
of confidential information. The ATO, in particular, has significant
limitations in disseminating information to other agencies outside of matters
that are being investigated by prescribed taskforces such as Project Wickenby.
The ACC argued that the importance of cooperation in the fight against
financial related crime, facilitated through partnerships and taskforces,
cannot be underestimated. The ACC submitted that cross-agency collaboration
through joint taskforces is effective in combatting financial related crime:
The fight against serious financial crime is dependent upon
comprehensive partnerships between the law enforcement and regulatory
community, industry, academia, the broader public and the international
community. In the Australian context partnerships are often enhanced through
the establishment of key [taskforces] aimed at responding to thematic or
individual targeted serious financial crime threats. In recent years, numerous
taskforces have focused on addressing aspects of financial crime including a
key emphasis on the financial crime activities of organised crime groups
operating in Australia, such as [Taskforce] Eligo, the Criminal Asset
Confiscation Taskforce, Project Wickenby, and [Taskforce] Galilee.
The ATO addressed potential concerns surrounding the use of private
taxpayer information in joint taskforces. Under current arrangements, the ATO
is not allowed to disclose taxpayer information with other agencies unless
specific requirements are met:
Taxpayers entrust sensitive financial information to the ATO
in order to allow it to administer the tax system. Accordingly, the law treats
information about taxpayers in the ATO's possession as confidential
The legislative framework for this confidentiality, and the
limited exceptions under which protected information can be disclosed, is found
in...the Taxation Administration Act 1953 (Cth).
The ATO explained the restrictions around sharing of protected
information with other Commonwealth agencies:
Tax law allows protected information to be disclosed for the
investigation of an offence punishable by at least 12 months in prison.
Commonwealth, state and territory law enforcement agencies thereby use
protected information to investigate specific cases of financial crime such as
However, the use and on-disclosure of information disclosed
under this exception can only be used for that specific purpose. The
information cannot be obtained as part of criminal intelligence activities
before a specific offence is identified, nor can the information be used for
Further, the ATO submitted that protected information can also be shared
with members of taskforces for any of the taskforces purposes. In these
instances, criminal intelligence activities conducted as part of taskforce activities
enable a more proactive and effective approach. The ATO argued:
The more streamlined information-sharing environment created
by a prescribed taskforce offers a substantial advantage to the ATO in
supporting law enforcement agencies to deal with priority threats.
The prescribed taskforce provisions were modelled on a
specific legislative exception that exists for agencies involved in Project
The committee heard evidence from government agencies regarding information
sharing between agencies for the purposes of taskforces.
This report particularly examines two multi-agency taskforces, Project Wickenby
(Wickenby) and Taskforce Eligo (Eligo), both of which resulted in
significant advances in the detection and prosecution of financial related
Further details of the use and sharing of sensitive law enforcement
information and intelligence in the contexts of Wickenby and Eligo
are discussed below.
As mentioned above, Wickenby was specifically raised by
submitters as an example of an effective taskforce that drew together expertise
and staff from different agencies, working collaboratively to achieve common
For example, the ATO noted that Wickenby was successful insofar as it
recouped tax that had been avoided or evaded;
reduced funds flowing to secrecy jurisdictions; and
successfully prosecuted promoters and facilitators of abusive use
of overseas secrecy jurisdictions.
Wickenby was established in 2006 to 'protect the integrity of
Australia's financial and regulatory systems by preventing people from
promoting or participating in the abusive use of secrecy jurisdictions.'
Operations and activities carried out in Australia as part of Wickenby
civil audits and risk reviews undertaken by the ATO, and civil
investigations conducted by the ASIC;
criminal investigations conducted by the Australian Crime
Commission (ACC), Australian Federal Police (AFP) and ASIC;
prosecutions and other legal action undertaken by the
Attorney-General's Department (AGD), the Commonwealth Director of Public
Prosecutions (CDPP), and the Australian Government Solicitor (AGS)
administrative actions, including audits, banning people from the
financial services industry and using data from the Australian Transaction
Reports and Analysis Centre (AUSTRAC) to track money moving in and out of
proceeds of crime action, including action to restrain property
and seek its forfeiture.
Wickenby was composed of 7 federal agencies together with the ATO
as lead agency. The Wickenby partner agencies were AUSTRAC, ASIC, ACC,
AFP, AGD, AGS and the CDPP.
Notably, Wickenby was the first time the full range of Australian
Government resources were used to address illegal overseas schemes that posed
threats to the integrity of Australia's financial and regulatory systems.
As at 31 January 2015, Wickenby had resulted in numerous
successes, including having raised $2.163 billion in liabilities, and
completing 4848 audits. An additional 102 audits remain underway as at 4 June
Further, Wickenby resulted in charges being laid against 76
people and 44 convictions.
The total amount of money recouped by Wickenby to 31 January 2015
was $920.68 million.
The ATO's representatives spoke strongly in favour of the positive
impact of Wickenby, arguing it had demonstrated its effectiveness as a
template for Commonwealth agency responses to financial related crime. Mr Brett
Martin, Assistant Commissioner, Indirect Tax, Compliance Strategy and
Government Relations at the ATO, noted that as Wickenby was due to
conclude in 2015, it is important to ensure that its work continues in some
With Project Wickenby coming to a close [in 2015], we need to
work out how to keep the pressure on those who decide to engage in finance
related crime behaviours. To that end, the ATO has worked with the ACC and the
AFP to determine how best to use the existing resources and frameworks to
respond to specific instances of high-priority, serious financial crime in a
more coordinate and effective manner.
While emphasising the effectiveness of taskforces more broadly, ATO
officials also noted that it was necessary in certain circumstances to obtain
exemptions from some tax secrecy provisions, often cited by other law
enforcement agencies as problematic within their investigations:
Project Wickenby has a specific statutory authority exception
in tax secrecy provisions, allowing us to share information for the purpose of
that task force. That specific exception will cease on 30 June 2015. The
exceptions for disclosure to a prescribed taskforce will remain, but they will
rely on the prescription of a taskforce by regulation.
With law enforcement agencies, especially the ATO, arguing that access
to confidential information of taskforces is critical to their success, agencies
also reiterated that non-ATO agencies do not normally have exemptions from the
legal requirement of taxpayer confidentiality.
The ATO's submission provides an instance where the ATO was unable to
assist a police investigation relating to credit card and identity fraud:
This restriction has prevented the ATO from assisting law
enforcement on a number of occasions. In one example, state police were
investigating credit card fraud involving identity fraud. Police obtained
notices of assessment used as proof of identity to open bank accounts, which it
suspected of being forged. The ATO was prohibited by law from confirming to the
police whether the TFN actually belonged to the individual named on the forged
Law enforcement agencies argued that operating within a prescribed
taskforces meant that information could be shared between the ATO and non-ATO
agencies in a sensitive and appropriate way. Sharing information in this manner
would not be in conflict with provisions in tax law that prohibit the
disclosure of tax file numbers by the ATO to third parties.
The AFP submitted that it valued Wickenby-like methods to
inter-agency cooperation to achieve 'whole of government' approaches to the
detection, disruption and prosecution of financial related crime.
The AFP noted that the original request to establish Wickenby by
the Heads of Commonwealth Law Enforcement Agencies (HOCOLEA) had also required
the development of comprehensive and effective multi-agency taskforces 'that
can respond flexibly to threats from serious and organised crime impacting on
The AFP submission further strengthens the argument for the retention of
the effective taskforce model established by Wickenby:
In accordance with the [Heads of Commonwealth Law Enforcement
Agencies] task, and with the cessation of Project Wickenby funding in June
2015, the AFP, ATO and Australian Crime Commission (ACC) are working together
to identify cooperative multi-agency approaches, within existing resources and
frameworks, to enhance the Commonwealth’s ability to respond to specific
instances of high priority financial crime in a more coordinated and effective
Wickenby concluded on 1 July 2015.
The work of Wickenby will be continued through the establishment of the
Serious Financial Crime Taskforce, which is discussed below.
Another example of cross-agency collaboration is the Eligo National
Taskforce (Eligo), which was established by the ACC Board in December
Eligo involved the ACC, AUSTRAC and the AFP working together to
reduce risks inherent in the Alternative Remittance Sector (ARS) and other Informal
Value Transfer Systems (IVTS). Those systems are further examined in chapter 4.
AUSTRAC published the National Threat Assessment on Money Laundering
in 2011 that found the overall money laundering threat from the ARS was 'high'.
A joint analysis produced by the ACC, AFP and AUSTRAC in June 2012 concluded
that a nationally coordinated approach to identifying and responding to high
risk remitters was required. The ACC Board subsequently established Eligo:
...to take a coordinated and collective approach against
high-risk remitters and IVTS operating in Australia to reduce their adverse
impact on Australia and its national economic wellbeing.
Eligo was intended to disrupt remitters and IVTS operators who
were assessed as posing a high money laundering risk, and 'to implement crime
prevention strategies aimed at optimising the use of the current Anti-Money
Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF) regime.'
The ACC argued that Eligo, by focusing on instances where ARS and
IVTS were being used to launder proceeds of crime, was able to identify
criminal activities and criminal groups previously unknown to law enforcement
Results of Eligo
Since its establishment, Eligo has restrained more than $580
million worth of drugs and assets, including $26 million in cash. It has also
disrupted 18 serious and organised crime groups, and identified 128 criminal
targets previously unknown to law enforcement agencies.
Serious Financial Crime Taskforce
On 5 May 2015, the Hon Joe Hockey MP, the Treasurer, announced that the
Commonwealth Government would establish a new taskforce to fight serious and
organised financial crime. The taskforce would include officers from the ATO,
ACC, AFP, AGD, AUSTRAC, ASIC, CDPP and ACBPS. The Treasurer's media release
The Taskforce will build on the good work already done by
Project Wickenby which finishes in 2015. It will enable the best practice and
experience gained to be continued, and for agencies to extend their cooperative
work across the broader serious financial crime risk.
The Serious Financial Crime Taskforce will have an
unquantifiable positive benefit on the financial wellbeing of members of the
community who, without the Taskforce, may be victims of financial crime. It
will also help ensure all taxpayers pay their fair share of tax.
Budget Paper No. 2 outlines the financial allocation for the taskforce
over four years will total $127.6 million,
with an additional $3.2 million GST component to be paid to State and Territory
Further, the paper notes:
The measure is estimated to increase revenue by $419.7
million and expenses by $130.8 million with a net improvement to the Budget of
$288.9 million in fiscal terms over the forward estimates period.
The committee notes the clear advantages of multi-agencies taskforces,
and believes that agencies have demonstrated the effectiveness of taskforce
arrangements in appropriately sharing information and intelligence that may not
be possible in non‑taskforce settings.
The committee recognises the significant results from both Project
Wickenby and Taskforce Eligo, and believes these multi-agency
taskforces have clearly demonstrated the enormous benefit to the Australian
community of law enforcement agency collaboration. The committee agrees that
the advantages of multi-agency taskforces are significant, and generally far
outweigh the administrative costs associated with their establishment. Indeed,
the projection that the establishment of the Serious Financial Crime Taskforce
will yield the Australian tax payer nearly $300 million over a four year
period clearly demonstrates that this approach has multiple benefits for both the
Australian Government and community.
The committee is however concerned that disbanding taskforces may not adequately
build on the skills and benefits of such collaborative work. Therefore, the
committee strongly supports the creation of the Serious Financial Crime
Taskforce and believes it will build on the significant successes of Wickenby.
Had the government not established the Serious Financial Crime Taskforce, given
the outstanding achievements of Wickenby, the committee would have
recommended that such a taskforce be formed.
Noting that this new taskforce will generate net revenue for the
government of almost $300 million over four years, the committee is of the view
that the taskforce should continue for as long as it is detecting, disrupting
and prosecuting financial related crime.
To fully capture the long-term benefits of multi-agency taskforces, the
committee supports the introduction of a standardised review process for
taskforces prior to their conclusion. This review process would involve an
examination of the operations and outcomes of each law enforcement taskforce
approximately 12 months prior to its conclusion in order to determine whether
it should be made an ongoing arrangement.
The committee recommends that the government review the operations and
outcomes of each law enforcement taskforce approximately 12 months prior to its
conclusion in order to determine whether it should be made an ongoing
Counterfeit note double handling
The committee heard evidence relating to the complex administrative
arrangements in place for investigations of counterfeit bank notes by the Reserve
Bank of Australia (RBA) and AFP. The RBA noted that it had raised this issue
with the AGD in 2009 during the review into the Crimes (Currency) Act 1981.
The RBA noted that while other reforms have taken precedence, it is committed
to streamlining the investigation of counterfeit bank notes.
The RBA explained that since 2009 it has undertaken much of the
administrative work relating to counterfeit bank note investigations, whereas
the AFP was originally responsible for administration and investigation. Mr
Keith Drayton, Deputy Head of the Note Issue Department, RBA noted that:
...we still have this situation where under the legislation all
the counterfeits have to go to the AFP, which essentially means that the AFP
has to act as a post box collector and emptier. The counterfeits go to a post
box and the AFP has to empty it and deliver it to [the RBA], which detracts
them from their investigative obligations.
While current legislative arrangements require that an AFP officer is
posted to the RBA, there would be significant efficiencies achieved if the
relationship between the RBA and AFP was re-examined. Mrs Michelle Bullock, the
Assistant Governor (Currency) at the RBA explained:
...[the AFP] are best at investigating and enforcing, and
anything that takes their focus away from that—administrative, data entry and
that sort of thing—is not good. It is better if we work as a team with them. We
take on the administration and we take on all the boring bits and we feed them
the information in a timely fashion, which they can then investigate.
The AFP noted that the administrative arrangement was being examined by
the AGD, and agreed that it did not support the current arrangement. The APF's preference
was for a streamlined approach that allowed the RBA to act as 'post box' for
counterfeit note investigation processing.
The committee agrees with the evidence presented by the RBA and AFP that
the administrative arrangement should be re-worked. It seems illogical to
continue to require 'double handling' of counterfeit notes when that has the
potential to delay or frustrate law enforcement investigations or the collection
of counterfeit currency.
The committee believes this would free up AFP resources to focus on
investigative tasks, as opposed to administrative ones.
The committee agrees that the arrangement should be streamlined through
legislative change to the Crimes (Currency) Act 1981.
The committee recommends that the government introduce amendments to the
Crimes (Currency) Act 1981 to give the RBA administrative
responsibilities and the AFP law enforcement responsibilities with respect to
counterfeit note collections and investigations.
Jurisdictional issues (the Momcilovic case)
Several witnesses raised the complexity of jurisdictional issues of
financial related crime, both domestically and internationally. One example
raised by Northern Territory Police (NT Police) and the Victoria Police was the
effect of the Momcilovic
case, in which the High Court was required to rule on whether there were inconsistencies
between federal and state offences for drug trafficking.
The Victorian Government Solicitor's Office has stated:
A majority of the Court allowed the appeal brought by Ms
Momcilovic, setting aside her conviction of drug trafficking and remitting the
matter to the County Court of Victoria for a retrial. The decision has
implications for the trial of drug trafficking and possession offences in
Victoria, the operation and application of the Charter Act and the operation of
s 109 of the Commonwealth Constitution where conduct is an offence under both
State and Commonwealth laws.
The NT Police submitted concerns with respect to the interplay of
Commonwealth and territory law relating to drugs offences, arguing that there
was uncertainty as to which legislation should ultimately be used to lay
...we have some concerns around issues...legislative primacy,
particularly with offences that are committed or potentially committed in the
Territory but involving Commonwealth interests and then what legislation bears
The NT Police specifically raised the Momcilovic matter in the
committee's hearing, and outlined the issues the decision has raised:
What the Momcilovic case provided was that an offence
can be committed. If we use the Territory as an example, because this case, I
believe, was in Victoria. Should an offence be committed here in the Northern
Territory and we use Territory powers to execute search warrants, we use
Territory powers in order to interview offenders and to [proffer] charges, it
may well be the case that, through the decision of Momcilovic, we should
have used Commonwealth legislation, because of the way the monies may have been
held in trust, because of who the true victim of the crime was and how the
offence was perpetrated. We are still working through some of those issues,
particularly when it comes to financial crime, and trying to make that
determination about whose jurisdiction it really rests in, particularly when
looking at this ruling of the High Court. As I say, we are currently in a state
of flux where we are examining how this affects us in the Northern Territory
and what legislative provisions we need alter.
Victoria Police expressed similar concerns with the Momcilovic
While noting that Commonwealth legislation overrides state or territory
legislation, Assistant Commissioner Fontana argued that Victoria Police were
encouraged by the decision to charge persons under Commonwealth legislation:
...Commonwealth legislation does override. We do have the
authority to use Commonwealth legislation, but it is an issue, particularly in
the joined-up arrangements, when you are looking at the constitutional
arrangements. It is quite important to get your head around that if you are
looking at, say, introducing a national approach for dealing with unexplained
wealth. You need to look at the implications of the Constitution and that needs
to be tailored for any laws that you are drafting.
The AGD did not agree with the evidence presented by some witnesses, that
the Momcilovic decision encouraged state and territory police to use
Commonwealth legislation to charge and prosecute for certain offences. In
answers to Questions on Notice, the AGD noted that the Momcilovic
...has been considered by the Standing Council of
Attorneys-General (SCAG) and the Standing Council on Law and Justice (SCLJ),
and by justice agency officials through the National Justice CEOs forum
(NJCEOs) and the National Criminal Law Reform Commission (NCLRC).
At the meeting of the Standing Council on Law and Justice in
April 2012, Ministers asked the NCLRC to undertake work to review existing
means for avoiding constitutional inconsistency between Commonwealth, State and
Territory criminal laws, and, if necessary, develop new proposals for avoiding
In June 2013, following advice from the NCLRC, the NJCEOs
agreed that this project required no further consideration on the basis that
the risk of inconsistency was low.
Accordingly, the AGD did not agree that Momcilovic requires a
national policy response.
The committee notes that while NT Police and Victoria Police both raised
concerns with respect to the findings in Momcilovic, the National
Criminal Law Reform Commission, and the National Justice CEOs disagreed, finding
the risk of inconsistency was low.
The committee agrees with the evidence presented by the AGD that Momcilovic
does not require a national policy response.
Navigation: Previous Page | Contents | Next Page