High Court declares frozen assets law illegal JOEL GIBSON LEGAL AFFAIRS November 13, 2009 TENS of millions of dollars of assets belonging to suspected criminals have been illegally frozen in NSW, according to the High Court, which has declared the NSW law that locked them up to be unconstitutional.
Two companies linked to the Vanuatu-based accountant, Robert Agius, and his alleged $100 million money laundering scheme succeeded yesterday in a bid to have the NSW law struck down.
The decision is a big setback for the Wickenby tax probe and means many of the more than 2000 orders totalling $173,105,916 for property frozen by the NSW Crime Commission since 1990 were invalid.
It may also affect assets frozen and confiscated by other states and the Commonwealth, which have similar laws and argued unsuccessfully in favour of the NSW legislation.
The NSW Government did not know the number of orders remaining or the total value of assets affected yesterday or how it would prevent them being returned to their alleged criminal owners.
It was working frantically with its lawyers to find a legislative solution last night but the Police Minister, Michael Daley, was adamant the Government would not allow the commission to fight serious criminals ''with one hand tied behind its back''.
A four to three majority of the High Court said section 10 of the NSW Criminal Assets Recovery Act allowed the commission to usurp the role of the court and was "repugnant in a fundamental degree to the judicial process". The law gave the commission power to apply to freeze a suspected criminal's assets without notifying them, and required the NSW Supreme Court to make the order if the commission presented reasonable grounds for its suspicion.
The Chief Justice of the High Court, Robert French, said: ''The section impermissibly directs the court as to the manner of the exercise of its jurisdiction and restricts the application of procedural fairness in the judicial process and conditions its full application upon a discretion exercised by the executive branch of the government of New South Wales.''
The decision frees up tens of millions of dollars held in 48 New Zealand bank accounts, one Australian bank account and two share trading accounts of two companies linked to Mr Agius, International Finance Trust Company and International Finance Trust Company Broking Services.
The commission says the accounts contain the proceeds of a tax avoidance scheme promoted by Mr Agius, who was charged last year, with 18 of his alleged clients and colleagues.
In a separate action against them by the Tax Office, the companies have promised the Federal Court they will not move the assets without giving 14 days' notice.
Criminal lawyer Chris Murphy said the NSW law had created an almost impossible burden for anyone to get back frozen property. ''Sadly for the police it means that they in future may be required to gather evidence and share it with the proposed defendant before they can impose a penalty like restraining their property. Imagine that - having to play fair and being forced to carry out investigations before imposing penalties!''
Mr Daley said organised crime should take no comfort in the decision as the Government would quickly fix the anomaly.
with Vanda Carson
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