Adams Amy: Organised Crime and Anti-corruption Legislation Bill — Second ReadingText is incorporated into the Bound VolumeAdams Amy: Organised Crime and Anti-corruption Legislation Bill — Second Reading[Sitting date: 20 May 2015. Volume:705;Page:3508. Text is incorporated into the Bound Volume.]Hon AMY ADAMS (Minister of Justice): I move That the Organised Crime and Anti-corruption Legislation Bill be now read a second time. This bill reflects the Government’s ongoing commitment to combat organised crime and corruption both in New Zealand and globally. Can I take this opportunity to thank the Law and Order Committee for its work on the bill. I understand the committee received 20 submissions and has recommended that the bill proceed with a number of amendments mostly of a minor and technical nature.This bill addresses a serious issue faced by societies around the globe. Organised crime is a corrupting influence worldwide undermining public safety economic development good governance and national security. New Zealand has robust legal frameworks to combat organised crime and corruption and high levels of international engagement in responding to these threats. However we are not immune to organised criminal activities such as money-laundering identity theft people-trafficking and a range of conduct that constitutes bribery and corruption. This bill tackles such conduct in a number of ways. It enhances New Zealand’s ability to collaborate with international efforts to disrupt organised crime and ensures that law enforcement agencies are able to quickly and effectively respond to new challenges. Measures in the bill will also increase New Zealand’s compliance with a number of international agreements.One of New Zealand’s core assets internationally is its reputation as one of the least corrupt countries in the world. However we can never afford to be complacent. This bill will send a strong signal that New Zealand values having and is committed to maintaining corruption-free institutions. This is vital for maintaining New Zealand’s reputation as a reliable trading partner and enhancing our influence in international fora. The 2011 all-of-Government response to organised crime outlined a range of measures that this Government had introduced to target and disrupt organised crime. However we also recognised that more work could be done and identified a range of areas for improvement. This bill implements many of these reforms by making a number of key changes.I will begin by outlining two important amendments to the money-laundering offences under the Crimes Act. Firstly the bill removes the requirement that the proceeds of money-laundering be generated from offending punishable by 5 years’ imprisonment or more. This requirement places the police in the position of having to establish that the proceeds of crime are generated solely from such offences. This burden is both difficult to meet and inconsistent with the reality of these crimes as the proceeds are often intermingled and arise from a range of criminal activities.The second change simply clarifies that the prosecution need not prove that a defendant had intent to conceal the proceeds of crime although this may result from the money-laundering transaction. This is a return to early case law on the money-laundering offence which held that intent to conceal was not an element of the offence. More recent decisions however have required the prosecution to prove that element creating unnecessary hurdles to successful prosecution. Removing this requirement will help deter those who exploit the current limitations and responds to the concerns raised by the Financial Action Task Force which sets the international best practice for combating money-laundering.In addition the bill introduces new reporting requirements under the Anti-Money Laundering and Countering Financing of Terrorism Act for two high-risk classes of transactions that we know criminals use to launder money and finance terrorism. Under the new requirements financial institutions will need to report international wire transactions of over $1000 and all physical cash transactions of $10000 or more to the financial intelligence unit within the police. This amendment will improve our ability to detect and investigate money-laundering and align New Zealand with international best practice for combating money-laundering. The fact that the banks are already required to collect identity information from their customers means that the public should not notice any change as a result of these new requirements.The bill also addresses the issue of identity theft. Identity theft and the misuse of personal information is estimated to impact over 190000 New Zealanders each year and this bill deals with gaps in New Zealand’s identity crime framework by adding new offences of selling or distributing unlawfully obtained identity information and of making or possessing goods intended to facilitate identity crimes such as credit-card skimming devices. By addressing the gaps in our identity crime framework we will ensure that a full range of identity crimes can be prosecuted.Other important amendments in the bill expressly provide police with the power to share personal information including fingerprint information with their international counterparts. This amendment will allow implementation of the Agreement on Enhancing Cooperation in Preventing and Combating Crimewith the United States. The Law and Order Committee has recommended inserting a new requirement in this part of the bill for the Commissioner of Police to consult with the Privacy Commissioner before entering into international information-sharing agreements. This was already a requirement in accordance with a Cabinet decision. However including the consultation in the bill will ensure that the oversight role performed by the Privacy Commissioner is more transparent. In addition the bill makes an amendment to allow information stored in the DNA Databank to be provided to assist criminal investigations and prosecutions overseas subject to the Attorney-General’s authorisation. I have great confidence in New Zealand’s law enforcement agencies which have a successful history of prosecutions against those who engage in organised criminal activities. The measures I have outlined will further enhance international law enforcement cooperation and capability.A range of amendments in the bill will also strengthen New Zealand’s ability to combat bribery and corruption. These will enable the Government to ratify the United Nations Convention Against Corruption which is the first global instrument to address corruption in both the public and private spheres. Although New Zealand already broadly complies with the convention the bill contains a number of legislative amendments that are required before we can formally ratify it. These changes include increasing the penalties for private sector bribery and corruption offences under the Secret Commissions Act 1910 to bring them into line with public sector bribery and general fraud offences.The bill also creates new offences to address gaps in our anti-corruption framework. The new offences criminalise the acceptance of a bribe from a foreign public official and the acceptance of a bribe in return for using one’s influence over an official. Other amendments in the bill will enhance compliance with the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. The foreign bribery offence is amended to ensure that it applies to bribery in relation to the provision of international aid and clarifies the circumstances in which a company is liable for foreign bribery. The Law and Order Committee recommended a further amendment to make specified fines available as sanctions for foreign bribery in addition to a term of imprisonment. The amended penalties reflect the serious nature of foreign bribery and send a very clear message that those who engage in corrupt behaviour will be meaningfully held to account.A final amendment to the foreign bribery offence addresses the existing exception for small payments made to foreign public officials for the sole purpose of expediting a service to which the payer is already entitled commonly known as facilitation payments. It is important to note that this exception has been part of our law for many years and is important to ensure that New Zealanders acting in good faith are not unintentionally criminalised. However the bill tightens this already narrow exception such that it will not now apply to payments that provide an undue material advantage to the payer or an undue disadvantage to anyone else. This maintains compliance with the UN convention which requires parties to criminalise payments that provide the recipient with an undue advantage. This measure combined with a new requirement for companies to record such payments in their books will ensure that the exception is not open to abuse. I note that this is consistent with the treatment of such facilitation payments in Australia in the US and in South Korea and with operational practice in the UK.Let me conclude by outlining three final sets of reforms in the bill. The bill extends the Crimes Act offence of people-trafficking to ensure it applies to trafficking within New Zealand and not just in or out of the country. The revised section also expands the trafficking offence to include the movement of a person for exploitative purpose—for example prostitution or slavery. These amendments enhance our compliance with the UN anti-trafficking protocol bringing us into line with best practice. The bill also amends the Criminal Proceeds (Recovery) Act to allow foreign restraining orders to be registered without notice and enable the court to extend the registration of these orders more than once if necessary. A further amendment recommended by the select committee ensures that extensions are not limited to extradition cases. Finally the Law and Order Committee recommended a minor amendment to the Extradition Act to ensure that the police are able to take identity information from those arrested under that Act in relation to offences committed overseas.Collectively the amendments in the bill will ensure that New Zealand has a robust legislative framework that complies with best practice. The bill will ensure that those engaging in organised or corrupt criminal activities will be subject to the full force of the law by removing current limitations in domestic law and enhancing New Zealand’s ability to internationally cooperate. I commend the bill to the House.