Commissioner of Police v Otimi
[2012] NZHC 986
•10 May 2012
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2012-404-001936 [2012] NZHC 986
UNDER Criminal Proceeds (Recovery) Act 2009
BETWEEN COMMISSIONER OF POLICE Applicant
ANDGERARD TEOI OTIMI Respondent
Hearing: 9 May 2012
Appearances: J Pridgeon for Applicant
R A McKelvin for Respondent
Judgment: 10 May 2012
JUDGMENT OF VENNING J
This judgment was delivered by me on 10 May 2012 at 3.15 pm, pursuant to Rule 11.5 of the High
Court Rules.
Registrar/Deputy Registrar
Date……………
Solicitors: Meredith Connell, Auckland
Berman and Burton, Auckland
COMMISSIONER OF POLICE V OTIMI HC AK CIV-2012-404-001936 [10 May 2012]
Introduction
[1] The Commissioner seeks orders under the Criminal Proceeds (Recovery) Act
2009 (the Act) in relation to a sum of $27,530 cash.
[2] The Commissioner seeks a restraining order under s 24 of the Act and also a substantive asset forfeiture order under s 50 of the Act. The application for a restraining order was heard and argued during the course of the Duty Judge list. The Commissioner seeks a substantive fixture in relation to the application for forfeiture.
Background
[3] On 23 June 2009 Mr Otimi (the respondent) was interviewed by police following a number of complaints about his activities. The complainants said that he had misrepresented to them that stamps issued by him and recorded on their passports would permit them to remain in New Zealand.
[4] During the course of his interview with the police the respondent admitted stamping the passports of a number of persons who were illegally staying in New Zealand. He charged a fee of $500 per stamp. The respondent told the complainants that the stamps would allow them to remain in New Zealand until 2018. This was not the case. The respondent had no authority at law or otherwise to issue any form of immigration permit or visa.
[5] During the course of the police inquiry the respondent accompanied the police to an address at 582 Massey Road, Mangere. Two blue bags found there were uplifted by the police. One bag contained the various stamps used by the respondent and the other contained cash totalling $41,030.
[6] The respondent was subsequently charged with a number of offences under s 258(1)(a) of the Crimes Act 1961.
[7] Ultimately the respondent was convicted on 38 counts.
[8] In sentencing the respondent Judge Andrée Wiltens directed that $12,500 of the cash recovered was to be paid to the various complainants who had given evidence. He directed the balance $28,500 remaining should be the subject of an application by the prosecution under the Criminal Proceeds (Recovery) Act. In addition to the $12,500 paid in accordance with the Judge’s direction $1,000 was paid to two further complainants identified by the police. The balance of $27,530 remains in a police trust account. The account does not earn interest.
[9] The issue for the Court on the application argued today is whether an order should be made that the $27,530 not be disposed of or dealt with other than to come under the Official Assignee’s custody and control. It is intended that once the money comes under the Official Assignee’s control it will be deposited in a bank account and earn interest pending the outcome of the forfeiture hearing.
Grounds of opposition
[10] The respondent opposes the application on the following grounds:
(a) the Commissioner has failed to discharge the evidential burden of showing that the entirety of the proceeds are tainted;
(b) the proposed order will most likely diminish the value of the property; (c) the order amounts to an improper exercise of the Court’s powers;
(d) the respondent has appealed his conviction to the Court of Appeal. A
decision is awaited;
(e) a general fairness argument relating to reliance on the conviction;
(f) even if the respondent were not debarred from providing evidence challenging the criminality of his actions the underlying criminal charge means he is caught between giving the Crown advance notice of his defence or of having his assets frozen; and
(g) the making of the order will destroy evidence.
Decision
[11] I am satisfied that the order sought by the Crown is justified. On hearing an application for a restraining order relating to specific property such as the sum of
$27,530 cash this Court may, if it has reasonable grounds to believe that the cash is tainted property, make an order that it be not disposed of or dealt with other than provided for in the restraining order and order it come under the Official Assignee’s custody and control.[1]
[1] Criminal Proceeds (Recovery) Act 2009, s 24.
[12] Tainted property means any property that has wholly or in part been acquired as a result of significant criminal activity.[2] Significant criminal activity is defined in s 6 of the Act as follows:
[2] Section 5.
Meaning of significant criminal activity
(1) In this Act, unless the context otherwise requires, significant criminal activity means an activity engaged in by a person that if proceeded against as a criminal offence would amount to offending—
(a) that consists of, or includes, 1 or more offences punishable by a maximum term of imprisonment of 5 years or more; or
(b) from which property, proceeds, or benefits of a value of
$30,000 or more have, directly or indirectly, been acquired or derived.
(2) A person is undertaking an activity of the kind described in subsection (1) whether or not—
(a) the person has been charged with or convicted of an offence in connection with the activity; or
(b) the person has been acquitted of an offence in connection with the activity; or
(c) the person's conviction for an offence in connection with the activity has been quashed or set aside.
(3) Any expenses or outgoings used in connection with an activity of the kind described in subsection (1) must be disregarded for the
purposes of calculating the value of any property, proceeds, or benefits under subsection (1)(b).
[13] The fallacy underlying the respondent’s opposition on this point is his reliance on the fact he was only convicted on 38 counts. He argues that as he charged $500 a time for the stamps the most that could be said to be tainted property is $19,000. However, s 6 makes it clear that if the Commissioner can satisfy the Court there are reasonable grounds to believe that the money in issue was acquired as a result of significant criminal activity then it does not matter whether or not the respondent has been acquitted of offences in relation to the activity or even if his conviction has been quashed or set aside. In short, the issue is whether the evidence satisfies the Court the cash was obtained as a result of significant criminal activity, not whether the respondent was convicted.
[14] The actions of the respondent constitute an offence punishable by a maximum imprisonment of five years or more. The evidence satisfies me that the entire sum of $41,030 was obtained as a result of significant criminal activity. When the respondent was interviewed by the police he made a number of admissions:
Q. and for a fee of $500 you ah issue people with a receipt and a stamp in their passports to allow them to stay in New Zealand for a certain period of time.
A. (Nods head)
[15] And later:
Q. How much money do you think you’ve received, you and your
supporters?
A. Forty thousand. Forty thousand. Q. Forty thousand?
A. Could have been a hell of a lot more but it’s sitting there, it’s not mine, it’s not my money. I’ve got a bank remember. I give out money.
[16] The respondent then accompanied the police to the address at 582 Massey Road, Mangere where the two bags were located and handed to the police. The bag was counted to have contained the $41,030. The respondent had no authority to issue stamps as he did, nor to charge a fee for doing so.
[17] On the basis of that evidence I am satisfied that there are reasonable grounds to believe that the $41,030 was tainted property because it was received as a result of significant criminal activity by the respondent. The Commissioner has discharged the evidential burden on him. There is jurisdiction for the orders that the Crown seeks.
[18] I turn to the other grounds of opposition raised on behalf of the respondent.
[19] Mr McKelvin did not actively pursue his argument that the order would most likely diminish the value of the property. That must be right. There would be little expense incurred by the Official Assignee in receiving the funds and arranging for them to be deposited on an interest earning deposit through a bank account.
[20] Next, the order sought is not, contrary to Mr McKelvin’s submission, contrary to the purpose of the Act. It is in both parties’ interest that the money earn interest pending resolution of the application for forfeiture. In the event the application for forfeiture is unsuccessful any interest earned will be to the benefit of the respondent.
[21] Next, the fact an appeal has been brought and argued before the Court of Appeal seeking to overturn the convictions is not relevant. Largely for the reasons given above, as s 6(2)(c) provides, even if the application relied on the respondent’s convictions (which it does not) the fact that the conviction is quashed or set aside does not affect the ability of the Commissioner to prove in these civil proceedings that the property has been acquired as a consequence of significant criminal activity.
[22] Nor is there anything in the respondent’s argument that he is effectively debarred from adducing a defence because of the evidential status of the conviction. Again, that submission is premised on the basis that the Commissioner relies on the fact of convictions but for the reasons given above it is unnecessary for the Commissioner to do so.
[23] Next, the respondent argues that the application breaches his rights under the
New Zealand Bill of Rights Act 1990 to properly defend himself, in particular his
right to remain silent because he is required to file an affidavit to oppose the current application. That submission is misconceived in the circumstances of this case.
[24] The issue that Mr McKelvin refers was considered by the Court in Commissioner of Police v Burgess.[3] In that case the Commissioner applied for an examination order under the Act against Mr Burgess at a time when Mr Burgess was facing charges of receiving large quantities of stolen jewellery. The examination order would have permitted the Commissioner to require the respondent Mr Burgess and others to attend, answer questions, supply information and documents on matters
[3] Commissioner of Police v Burgess [2011] 2 NZLR 703.
relevant to inquiries under the Act. Asher J confirmed the basic features of the right to be presumed innocent and to a fair trial was that an accused should not be required to assist the Crown to achieve a guilty verdict. An examination order would have affected and limited the respondent’s rights under the New Zealand Bill of Rights Act 1990 to be presumed innocent and not to be compelled to be a witness or to confess guilt. However, notwithstanding that, the Judge found that the first two requirements of demonstrable justification as required under s 5 of the New Zealand Bill of Rights Act were satisfied. To force disclosure of sources of funds of assets from criminals who are adept at hiding them and thereby prevent and deter profits from crime was justifiable. Further, the power to compel answers designed to find those sources was rationally connected to that objective. The Judge, however, upheld Mr Burgess’ objection on the basis the Commissioner had already applied to restrain disposition of the assets until after trial. The objective of preventing criminal profits being used to finance crime would not be defeated by delaying the examination order until after the criminal proceedings. An examination order would have limited the respondent’s rights in a manner which could not be demonstrably justified. The application was declined at the time in the circumstances of that case.
[25] That case is, however, distinguishable from the present on a number of grounds. First, at this stage the Commissioner only seeks a restraining order. Next, and importantly, the respondent has already been tried. Finally, the respondent has already admitted obtaining the money. There can be no objection to a restraining
order being made at this time in the present case.
[26] Finally, Mr McKelvin submitted that the money would form part of the evidence at trial and if it was paid into a bank account by the Official Assignee it would be lost. When asked to explain that submission Mr McKelvin did not actively pursue it. Clearly if an appeal is successful and there is a retrial, the actual notes seized have already been mixed in the police trust account in any event. To the extent evidence concerning discovery of the money is required the Crown will be able to produce evidence that the respondent accompanied the officers to the address, that two bags were found at the address and that in one of the bags a number of sealed packages containing bank notes was discovered. There is a photographic record of that.
[27] For the above reasons none of the grounds the respondent raises in opposition to the restraining order can succeed.
Result
[28] As the Commissioner satisfies the Court that there are reasonable grounds to believe the balance of the sum of $27,530 is tainted property, I make an order as sought, namely, the money is not to be disposed of or dealt with otherwise than as is provided in the order and it is to be put under the Official Assignee’s custody and control.
The forfeiture application
[29] The application for forfeiture orders will be heard on 4 July 2012 at
10.00 a.m.
[30] The respondent is to file any further affidavits or make any further applications by 30 May 2012.
[31] The applicant Commissioner is to file any notice of opposition to any applications and/or affidavits in reply by 13 June 2012.
Costs
[32] As the respondent is in receipt of legal aid I make no order for costs.
Venning J
0
0
0