Asset Recovery the Law Enforcer’s Viewpoint  Gavin Shiu Head of Asset Recovery Senior Assistant DPP
Attitude <ul><li>Repay victims </li></ul><ul><li>Organised and Serious Crimes Ordinance, Cap 455 (OSCO) </li></ul><ul><li>...
Crime should not Pay <ul><li>“ The heart of an effective anti money laundering regime is the ability to : </li></ul><ul><u...
Purpose of Crime Asset Recovery <ul><li>Deny fruits of crime </li></ul><ul><li>Disincentive if family unsupported </li></u...
Proceeds of Crime <ul><li>Only money or property that directly or indirectly represents proceeds </li></ul><ul><li>NO </li...
Proceeds of Crime <ul><li>Property includes payments or other awards received at any time in connection with an offence (s...
Proceeds of an offence <ul><li>Pecuniary advantage connected to an offence (s2(6(a)(iii)) </li></ul><ul><li>Wide and flexi...
Proceeds of Crime <ul><li>Examples: </li></ul><ul><li>A fraud facilitates a transaction and professional fees are generate...
What can be restrained? <ul><li>Tracing of defrauded or stolen or laundered money/assets – Why? </li></ul><ul><li>Money / ...
Section 8(4) OSCO  <ul><li>Confiscation: the actual proceeds of crime?  No </li></ul><ul><li>Court shall determine whether...
Section 8(6) OSCO <ul><li>If court determines he has benefited to an amount of at least $100,000  </li></ul><ul><li>THEN i...
Section 11 OSCO <ul><li>The  amount  to be recovered by the confiscation order </li></ul><ul><li>Shall be what the court a...
Value Based <ul><li>Therefore, the confiscation order is for the value of what the court assesses is the benefit (proceeds...
White money or Black money? <ul><li>This is why for criminal asset recovery there is no difference in white or black </li>...
Examples of realisable property <ul><li>Property acquired through inheritance </li></ul><ul><li>Property acquired through ...
Change the mind set <ul><li>In every case of specified offences is there a benefit?  Should we not deny him of it? </li></...
Joint Enterprises <ul><li>If 2 or more benefited should the benefit be split? (divided between Ds) </li></ul><ul><li>Not n...
Questions to ask in every case <ul><li>What is his benefit from the crime? (not what was stolen or defrauded or laundered,...
More questions to ask <ul><li>Have other defendants benefited that may not be obvious at first glance? </li></ul><ul><li>S...
Why do this? <ul><li>Emphasise denying the fruits of crime </li></ul><ul><li>It is  not  a revenue raising exercise </li><...
Powerful Tool <ul><li>OSCO and DTROP are powerful </li></ul><ul><li>Underused, but why? </li></ul><ul><li>Mind set, includ...
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The Mind Set4

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The Mind Set4

  1. 1. Asset Recovery the Law Enforcer’s Viewpoint Gavin Shiu Head of Asset Recovery Senior Assistant DPP
  2. 2. Attitude <ul><li>Repay victims </li></ul><ul><li>Organised and Serious Crimes Ordinance, Cap 455 (OSCO) </li></ul><ul><li>Drug Trafficking (Recovery of Proceeds) Ordinance, Cap (DTROP) </li></ul><ul><li>Restraint and Confiscation </li></ul>
  3. 3. Crime should not Pay <ul><li>“ The heart of an effective anti money laundering regime is the ability to : </li></ul><ul><ul><li>seize </li></ul></ul><ul><ul><li>restrain </li></ul></ul><ul><ul><li>confiscate </li></ul></ul><ul><li>proceeds and instrumentalities of money laundering and other predicate offences </li></ul><ul><li>in order to remove them from the financial system ” . </li></ul><ul><li>APG-2005 </li></ul>
  4. 4. Purpose of Crime Asset Recovery <ul><li>Deny fruits of crime </li></ul><ul><li>Disincentive if family unsupported </li></ul><ul><li>Disincentive if on release there are no assets to enjoy </li></ul><ul><li>Prevents use of property by organised crime to further objectives of crime groups </li></ul>
  5. 5. Proceeds of Crime <ul><li>Only money or property that directly or indirectly represents proceeds </li></ul><ul><li>NO </li></ul><ul><li>See s 2(6) OSCO </li></ul><ul><li>Proceeds is not the ordinary man’s understanding of the term </li></ul><ul><li>It has a special meaning under OSCO </li></ul>
  6. 6. Proceeds of Crime <ul><li>Property includes payments or other awards received at any time in connection with an offence (s2(6)(a)(i)) </li></ul><ul><li>a payment before the commission of the offence </li></ul><ul><li>Award has a broad meaning </li></ul>
  7. 7. Proceeds of an offence <ul><li>Pecuniary advantage connected to an offence (s2(6(a)(iii)) </li></ul><ul><li>Wide and flexible meaning </li></ul><ul><li>May include being able to use a position to make a gain, even if gain itself is not illegal if there is the connection to the offence </li></ul>
  8. 8. Proceeds of Crime <ul><li>Examples: </li></ul><ul><li>A fraud facilitates a transaction and professional fees are generated relating to the transaction not the fraud </li></ul><ul><li>Money is utilised to facilitate a fraud </li></ul>
  9. 9. What can be restrained? <ul><li>Tracing of defrauded or stolen or laundered money/assets – Why? </li></ul><ul><li>Money / assets is it the proceeds of a crime or the benefit (proceeds) gained by a defendant? </li></ul>
  10. 10. Section 8(4) OSCO <ul><li>Confiscation: the actual proceeds of crime? No </li></ul><ul><li>Court shall determine whether the person has benefited from the specified offence </li></ul><ul><li>And if he has whether his proceeds of that offence total at least $100,000 </li></ul>
  11. 11. Section 8(6) OSCO <ul><li>If court determines he has benefited to an amount of at least $100,000 </li></ul><ul><li>THEN in accordance with Section 11, the court shall determine the amount to be recovered and </li></ul><ul><li>A confiscation order shall then be made for that amount </li></ul>
  12. 12. Section 11 OSCO <ul><li>The amount to be recovered by the confiscation order </li></ul><ul><li>Shall be what the court assesses to be the value of the defendant’s proceeds of the specified offence(s) of which he was convicted </li></ul>
  13. 13. Value Based <ul><li>Therefore, the confiscation order is for the value of what the court assesses is the benefit (proceeds) derived by a convicted person from his specified offence </li></ul><ul><li>The order is not asset based and not based on actual stolen or defrauded monies </li></ul>
  14. 14. White money or Black money? <ul><li>This is why for criminal asset recovery there is no difference in white or black </li></ul><ul><li>The confiscation order should be looked on as a determination by the court of what a criminal owes Hong Kong – he is obliged to pay us from whatever sources </li></ul>
  15. 15. Examples of realisable property <ul><li>Property acquired through inheritance </li></ul><ul><li>Property acquired through a legitimate business </li></ul><ul><li>Property acquired through savings from earlier legitimate employment </li></ul><ul><li>Property acquired through share trading or other market investments </li></ul>
  16. 16. Change the mind set <ul><li>In every case of specified offences is there a benefit? Should we not deny him of it? </li></ul><ul><li>Tracing of Black money some value </li></ul><ul><li>Prove offence and if easily confiscated should be a target of restraint and confiscation </li></ul>
  17. 17. Joint Enterprises <ul><li>If 2 or more benefited should the benefit be split? (divided between Ds) </li></ul><ul><li>Not necessarily, depends on evidence </li></ul><ul><li>Can be joint and several (ie one accused owes all of a joint benefit) </li></ul><ul><li>Can be split if reasonable evidence of a division </li></ul>
  18. 18. Questions to ask in every case <ul><li>What is his benefit from the crime? (not what was stolen or defrauded or laundered, necessarily) </li></ul><ul><li>How large is it? That is, what would be the value? </li></ul><ul><li>What assets does he have? </li></ul><ul><li>Which are the easiest to restrain and confiscate? </li></ul>
  19. 19. More questions to ask <ul><li>Have other defendants benefited that may not be obvious at first glance? </li></ul><ul><li>Should restraint of assets be done before the case goes overt or simultaneously? Risk of dissipation. </li></ul><ul><li>Are there assets overseas? </li></ul><ul><li>Are there victims? </li></ul>
  20. 20. Why do this? <ul><li>Emphasise denying the fruits of crime </li></ul><ul><li>It is not a revenue raising exercise </li></ul><ul><li>It is part of the penalty (purpose of appeal deemed to be part of a sentence, Section 8(8A)) </li></ul><ul><li>It is punishment, deterrence and prevention of serious crime </li></ul>
  21. 21. Powerful Tool <ul><li>OSCO and DTROP are powerful </li></ul><ul><li>Underused, but why? </li></ul><ul><li>Mind set, includes training to prosecute core offences </li></ul><ul><li>Troublesome- bank docs, account recs </li></ul><ul><li>Hard work </li></ul><ul><li>Need to increase awareness and use </li></ul>

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