Money Laundering

Money laundering is an act or acts that conceal the fact that money is the proceeds of crime.

The offence

The Criminal Code Act 1995 states a person commits an offence if:

• the person deals with money or other property, and either
  • the money or property is, and the person believes it to be, proceeds of crime; or
  • the person intends that the money or property will become an instrument of crime.

Money laundering is a diverse activity that involves hiding, disguising or legitimising the origin of money used in or derived from criminal activity. Examples include

• splitting cash between bank accounts or making multiple deposits;
• shifting money via multiple transactions over a short period of time;
• shifting cash through a casino;
• channelling money through illegitimate businesses or “shell” companies (inactive businesses created to hide genuine business ownership).

What must be proven

The prosecution must be able to prove beyond reasonable doubt that:

• the accused dealt with money or property;
• it was reasonable to suspect that the money or property was the proceeds of crime.

The prosecution is not required to prove what crime the money or property was from.

Defences

A person can contest a money laundering charge by arguing, for instance, that:

• they were unaware that the money was the proceeds of crime;
• they did not receive, possess, conceal or dispose of the property;
• the property did not originate from a crime;
• they were acting under duress.

Penalties

The penalties for money laundering are severe. The courts can also freeze or seize assets that they suspect have been acquired illegitimately.

Under the Criminal Code Act 1995

At the top end of the penalty scale, if the value of the money or property is $1 million or more, the penalty is imprisonment for 25 years, or 1500 penalty units ($333,000) or both. If the person is reckless, the penalty is imprisonment for 12 years, 720 penalty units ($158,400) or both. If the person is negligent, the penalty is imprisonment for 5 years, 300 penalty units ($66,600) or both.

At the other end of the penalty scale, if the value of the property is worth less than $1000, the penalty is imprisonment for 12 months, or 60 penalty units ($13,320) or both. If the person is reckless, the penalty is imprisonment for 6 months, or 30 penalty units ($6660) or both. If the person is negligent, the penalty is 10 penalty units ($2200).

Under the Anti-Money Laundering And Counter-Terrorism Financing Act 2006

This Act contains offences used to prosecute money laundering, in particular:

• sections 53 and 55: movement of physical currency in and out of Australia;
• sections 136-141: providing false information, using false documents or using a false customer name;
• sections 142-143: conducting transactions to avoid reporting requirements.

If a person moves more than $10,000 in physical currency into or out of Australia without reporting the action, the penalty is imprisonment for 2 years, or 500 penalty units ($111,000), or both.

If a person gives false or misleading information to authorities such as police or customs, the penalty is imprisonment for 10 years, or 10,000 penalty units ($2,220,000), or both. They face the same penalty for producing false or misleading documents. If a person uses a false customer name, the penalty is imprisonment for 2 years, or 120 penalty units ($26,540), or both.

If a person conducts transactions to avoid reporting requirements, the penalty is imprisonment for 5 years, or 300 penalty units ($66,600), or both.

For advice or representation in any legal matter, please contact Armstrong Legal.