Commissioner of Police v Siloata

[2024] NZHC 3878

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2019-485-332

[2024] NZHC 3878

UNDER

the Criminal Proceeds (Recovery) Act 2009

IN THE MATTER OF

an application under ss 43, 44 and 49

BETWEEN

COMMISSIONER OF POLICE

Applicant

AND

ALI SILOATA

First Respondent

STEPHEN FRANCIS SKINNON

Second Respondent

Hearing (by VMR):	16 December 2024
Counsel:	H Savage for the Applicant
Judgment:	17 December 2024

JUDGMENT OF GWYN J

(Type 1 Assets Forfeiture Order)

[1]                 The Commissioner of Police (Commissioner) has applied for a type 1 assets forfeiture order pursuant to ss 43, 44 and 49 of the Criminal Proceeds (Recovery) Act 2009 (Act).

[2]                 The property the subject of the application is cash to the value of $2,440, along with any accrued interest, located and seized on 14 May 2019 from an address in Miramar, Wellington (the cash amount). The cash amount is currently held by the Official Assignee.

COMMISSIONER OF POLICE v SILOATA [2024] NZHC 3878 [17 December 2024]

[3]                 The Commissioner advises that neither of the respondents, Mr Siloata and Skinnon, has engaged in the proceedings to date.

[4]                 The Commissioner has filed a Memorandum setting out the factual and legal basis on which the Court could make the assets forfeiture orders sought.

Factual background

[5]                 The Commissioner has filed two affidavits from Detective Samuel Buckley in support of the application.

[6]                 In July 2018 the Wellington Police District Organised Crime Team began an investigation called Operation Bonito, which targeted the sale and supply of the Class A controlled drug methamphetamine, in the Wellington District by members of the King Cobras gang. The Police Central Asset Recovery Unit initiated their own investigation in support, referred to as Operation Token.

[7]                 The investigation identified Mr Siloata as sourcing methamphetamine for supply across the Wellington District and Mr Skinnon as facilitating related money laundering transactions. On 14 May 2019, Mr Skinnon was stopped while driving and his vehicle searched under the Search and Surveillance Act 2012. A suitcase belonging to Mr Skinnon and containing $190,170 in cash was located. A further cash amount of $4,975 was located in Mr Skinnon’s pocket.

[8]                 On the same day, Police executed search warrants at two addresses associated with Mr Siloata — one in Ōwhiro Bay and one in Miramar. At the former, Police located approximately two kilograms of methamphetamine, a .22 cut down bolt action rifle plus ammunition, digital scales, cell phones, plastic snap lock bags, several small bags of cannabis and various documents and receipts. Three Harley Davidson motorcycles were also located.

[9]                 At the Miramar property, which was Mr Siloata’s home address, Police located an AR-15 semi-automatic rifle as well as ammunition and magazines, a 9 mm pistol and ammunition, several small bags of cannabis, electronic scales, various plastic bags

Police found the $2,440 cash which is the subject of the present application in cash, in various denominations, inside a pair of pants in the master bedroom.

[10]Jewellery worn by Mr Siloata on his arrest on 14 May 2019 was also seized.

[11]             The declared income for Mr Siloata from 2012 to 2018 was $8,109.03. The declared income for Mr Skinnon between 2012 and 2018 was $55,841.14.

[12]             Detective Buckley’s evidence of 13 June 2019 calculates the minimum unlawful benefit figure that can be contributed to the respondents at the time of that affidavit. That figure is $624,575.

Procedural background

[13]             On 14 June 2019, the Commissioner applied under the Act for asset and profit forfeiture orders in this proceeding (the forfeiture application). The forfeiture application sought the forfeiture  of  assets  associated  with  the  first  respondent  Mr Siloata and the second respondent Mr Skinnon on the basis of alleged significant criminal activity.

[14]             On 23 July 2021, Mr Siloata pleaded guilty and was sentenced to seven years and six months’ imprisonment on the following charges in relation to offences identified during Operation Bonito:

(a)possession of methamphetamine for supply;1

(b)four charges of unlawful possession of a firearm;2 and

(c)Failing to carry out obligations in relation to a computer search.3

[15]             On 11 May 2022, the Commissioner applied for on notice for restraining orders and early sale orders over property.

1      Misuse of Drugs Act 1975, s 6(1)(f) and 6(2)(a). Maximum penalty life imprisonment.

2      Arms Act 1983, s 145(1). Maximum penalty three years’ imprisonment.

3      Search and Surveillance Act 2012, s 178. Maximum penalty three months’ imprisonment.

[16]             On 28 July 2022, Cull J granted the Commissioner’s application for restraining orders over the property identified in the Commissioner’s forfeiture application, listed at Schedule A of the judgment.4 Early sale orders were also made in respect of the restrained vehicles, listed at (a)–(c) of Schedule A.

[17]             On 1 February 2024, the Commissioner sought type 1 asset forfeiture orders in respect of the items listed at (g)–(n) of the schedule of restrained property in Cull J’s judgment. On 5 February 2024 the Court made those orders.5

[18]             The Commissioner considered that it would be premature to seek forfeiture orders for the property listed at (d)–(f) of schedule A because Mr Skinnon, who had yet to be criminally tried, could foreseeably claim an interest in the assets.

[19]             Subsequently, Mr Skinnon was convicted at trial and sentenced to eight months’ home detention on 17 September 20246 on three charges of money laundering.7

[20]             The sentencing Judge also ordered forfeiture of $195,145 cash under s 32 of the Misuse of Drugs Act 1975, which related to items (d) and (e) of the schedule in Cull J’s judgment.8

[21]             On 21 October 2024, Radich J made an order varying the restraining order to exclude from its terms the cash sums identified in (d) and (e) of schedule A to Cull J’s decision, in order for the Official Assignee to give effect to the forfeiture order made by the sentencing Court.9

[22]The restrained property listed at (f) of schedule A, being cash to the value of

$2,440.00, is the only property remaining subject to restraint.

4      Commissioner of Police v Siloata [2022] NZHC 1830.

5      Commissioner of Police v Siloata HC Wellington CIV-2019-485-332, 5 February 2024.

6      R v Mateparae [2024] NZDC 22639.

7      Crimes Act 1961, s 243. Two charges were under s 243(2), maximum penalty seven years’ imprisonment. One charge was under s 243(3), maximum penalty five years’ imprisonment.

8      R v Mateparae [2024] NZDC 22639 at [28].

9      Commissioner of Police v Siloata HC Wellington CIV-2019-485-332, 21 October 2024.

Law

[23]             Under s 50 of the Act, the Court must make a type 1 assets forfeiture order over property if it is satisfied on the balance of probabilities that the specific property is tainted property.

[24]“Tainted property” is defined in s 5 of the Act:

tainted property—

(a)means any property that has, wholly or in part, been—

(i)acquired as a result of significant criminal activity; or

(ii)directly or indirectly derived from significant criminal activity; and

(b)includes any property that has been acquired as a result of, or directly or indirectly derived from, more than 1 activity if at least 1 of those activities is a significant criminal activity.

[25]             There must be a traceable connection between the proceeds of crime and the property.10

[26]             Here, the Commissioner says the Court can be satisfied on the balance of probabilities that the subject property is wholly or in part, “tainted property”, in that it was acquired and derived from significant criminal activity: Mr Siloata was convicted and sentenced for offences including the possession of methamphetamine for supply.

[27]             That offending carries a maximum sentence of a term of imprisonment for greater than five years and accordingly is “significant criminal activity” for the purposes of s 6 of the Act.

[28]             Detective Buckley’s evidence in support of the application is that the cash seized on 14 May 2019, is the proceeds of Mr Siloata’s sale of methamphetamine, as it was located at his home address, together with other evidence connected to drug dealing.

10     Commissioner of Police v Drake [2017] NZHC 2919 at [110].

[29] Given those facts, there are no other persons who to the knowledge of Commissioner, have an interest in the property. The low level of income declared by the respondents (detailed at [11] above) indicates that it is highly unlikely that Mr Siloata acquired the cash legitimately.

[30]             In the Commissioner’s submission the $2,440 cash located at the Miramar property forms part of the unlawful benefit received by the respondents as a result of the sale of methamphetamine and is therefore tainted.

[31]             I accept on the evidence set out above that there are sufficient grounds to conclude on the balance of probabilities that the cash amount was wholly or partly derived from significant criminal activity. I therefore grant a type 1 assets forfeiture order in relation to the cash amount of $2,440.00, in the terms set out in the Commissioner’s application of 2 December 2024. That is, that the cash is:

(a)To vest in the Crown absolutely; and

(b)To be in the Official Assignee’s custody and control.

Gwyn J