This document discusses asset recovery from a law enforcement perspective. It outlines the purpose of asset recovery as denying criminals the profits of crime, acting as a deterrent if their family is left unsupported or they have no assets after release from prison. Asset recovery also prevents organized crime groups from using ill-gotten assets to further criminal objectives. The document provides examples of what constitutes proceeds of crime and discusses how proceeds can be restrained and confiscated under relevant ordinances in Hong Kong law.

1. Asset Recovery the Law Enforcer’s Viewpoint Gavin Shiu Head of Asset Recovery Senior Assistant DPP

2. Attitude Repay victims Organised and Serious Crimes Ordinance, Cap 455 (OSCO) Drug Trafficking (Recovery of Proceeds) Ordinance, Cap (DTROP) Restraint and Confiscation

3. Crime should not Pay “ The heart of an effective anti money laundering regime is the ability to : seize restrain confiscate proceeds and instrumentalities of money laundering and other predicate offences in order to remove them from the financial system ” . APG-2005

4. Purpose of Crime Asset Recovery Deny fruits of crime Disincentive if family unsupported Disincentive if on release there are no assets to enjoy Prevents use of property by organised crime to further objectives of crime groups

5. Proceeds of Crime Only money or property that directly or indirectly represents proceeds NO See s 2(6) OSCO Proceeds is not the ordinary man’s understanding of the term It has a special meaning under OSCO

6. Proceeds of Crime Property includes payments or other awards received at any time in connection with an offence (s2(6)(a)(i)) a payment before the commission of the offence Award has a broad meaning

7. Proceeds of an offence Pecuniary advantage connected to an offence (s2(6(a)(iii)) Wide and flexible meaning 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

8. Proceeds of Crime Examples: A fraud facilitates a transaction and professional fees are generated relating to the transaction not the fraud Money is utilised to facilitate a fraud

9. What can be restrained? Tracing of defrauded or stolen or laundered money/assets – Why? Money / assets is it the proceeds of a crime or the benefit (proceeds) gained by a defendant?

10. Section 8(4) OSCO Confiscation: the actual proceeds of crime? No Court shall determine whether the person has benefited from the specified offence And if he has whether his proceeds of that offence total at least $100,000

11. Section 8(6) OSCO If court determines he has benefited to an amount of at least $100,000 THEN in accordance with Section 11, the court shall determine the amount to be recovered and A confiscation order shall then be made for that amount

12. Section 11 OSCO The amount to be recovered by the confiscation order 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

13. Value Based 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 The order is not asset based and not based on actual stolen or defrauded monies

14. White money or Black money? This is why for criminal asset recovery there is no difference in white or black 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

15. Examples of realisable property Property acquired through inheritance Property acquired through a legitimate business Property acquired through savings from earlier legitimate employment Property acquired through share trading or other market investments

16. Change the mind set In every case of specified offences is there a benefit? Should we not deny him of it? Tracing of Black money some value Prove offence and if easily confiscated should be a target of restraint and confiscation

17. Joint Enterprises If 2 or more benefited should the benefit be split? (divided between Ds) Not necessarily, depends on evidence Can be joint and several (ie one accused owes all of a joint benefit) Can be split if reasonable evidence of a division

18. Questions to ask in every case What is his benefit from the crime? (not what was stolen or defrauded or laundered, necessarily) How large is it? That is, what would be the value? What assets does he have? Which are the easiest to restrain and confiscate?

19. More questions to ask Have other defendants benefited that may not be obvious at first glance? Should restraint of assets be done before the case goes overt or simultaneously? Risk of dissipation. Are there assets overseas? Are there victims?

20. Why do this? Emphasise denying the fruits of crime It is not a revenue raising exercise It is part of the penalty (purpose of appeal deemed to be part of a sentence, Section 8(8A)) It is punishment, deterrence and prevention of serious crime

21. Powerful Tool OSCO and DTROP are powerful Underused, but why? Mind set, includes training to prosecute core offences Troublesome- bank docs, account recs Hard work Need to increase awareness and use