Commissioner of the Australian Federal Police v Tjongosutiono

The case before the court involved the Commissioner of the Australian Federal Police, who sought to revoke a restraining order placed on a bank account under the Proceeds of Crime Act 2002 (Cth). The defendant, Tjongosutiono, contested the revocation on the grounds that the property in question had ceased to be proceeds of a crime and was acquired for sufficient consideration. The dispute hinged on the interpretation of the relevant provisions of the Act and the nature of the chose in action.

The court was tasked with determining whether the property in question, which was a bank account identified as an interest, had ceased to be proceeds of crime. The account was funded through a money laundering scheme known as ‘cuckoo smurfing’. Additionally, the court had to ascertain whether the Commissioner, as a third party, acquired the property for sufficient consideration and whether it served the interests of justice to revoke the restraining order. The interaction between sections 19 and 22 of the Act was central to the court’s analysis.

The court found that the bank account did not cease to be proceeds of crime as the laundering scheme was ongoing and the funds retained their illicit origins. The Commissioner did not acquire the property for sufficient consideration as the scheme's illegality tainted the transaction. Furthermore, the nature of the chose in action was such that it remained a property interest subject to the restraining order. In light of these findings, the court determined that it did not serve the interests of justice to revoke the restraining order. Consequently, the Commissioner’s application was dismissed.

The court’s decision underscored the importance of maintaining restraining orders on properties tainted by criminal activities until the illegality is fully addressed, ensuring that proceeds of crime are not inadvertently legitimised through third-party transactions.