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King: Organised and Financial Crime Agency

King announces Organised and Financial Crime Agency

A new agency to combat serious and financial crime, the Organised and Financial Crime Agency New Zealand (OFCANZ), will be launched on 1 July this year, Justice Minister Annette King announced today.

Releasing the Government's plan to combat organised crime, Ms King said that Cabinet had also confirmed a broad programme of action, including an organised crime strategy and legislative reforms.

Ms King said the new agency will be located within New Zealand Police. "The functions and resources of the Serious Fraud Office (SFO) will be integrated into OFCANZ, whose mission is 'to improve the safety and security of New Zealand by combating serious and organised crime and serious or complex fraud through an inter-agency partnership approach'.

"Amalgamating the SFO and Police skills and experience will bring a new capability to tackle corporate fraud and sophisticated organised crime groups. Legislation will ensure that OFCANZ has the powers it needs to successfully investigate and prosecute offenders," she said.

"Current strong SFO powers, such as production orders and examination orders, will be carried over to the new agency, with safeguards to ensure they comply with the Bill of Rights legislation, which was passed after the SFO was established in 1990."

"Under the SFO Act, however, the privilege against self-incrimination cannot be claimed during an investigation, even though information gained this way cannot generally be used in any subsequent prosecution. When considering this issue, agencies agreed that this privilege added little to the ability of the SFO, and therefore that it would add little to OFCANZ's ability to successfully investigate and prosecute serious fraud."

Ms King said OFCANZ will consist of specialist taskforces to investigate various aspects of organised crime. "These taskforces will be established by the Police Commissioner depending on organised crime priorities at the time. However, one of the taskforces will be dedicated to serious fraud."

The organised crime strategy provides the framework for coordinated national action, and is the first in an on-going cycle of strategies to tackle this serious problem, she said. "The initial strategy, which will extend to June 2009, focuses on developing a whole-of-government approach to combat organised crime, and it will be followed by a cycle of ongoing three-year strategies," she said.

"The strategy comprises four strategic areas --- community, prevention, intelligence and enforcement --- and as well as providing a high-level focus for the work of OFCANZ and government agencies, it will provide a framework for practical actions to achieve a reduction in organised crime in New Zealand.

"One key strategic objective is to build community resilience and to empower communities. The strategy is broader than the work of OFCANZ, particularly in community areas where OFCANZ will have a limited role."

Ms King said oversight of the strategy will be provided by an inter-agency Chief Executive group, chaired by the Secretary for Justice, with the Police Commissioner as deputy chair.

The package announced today also includes legislative reforms, she said. "One of the reforms will provide wider identity protection to undercover officers giving evidence in organised crime related trials. This will ensure that these officers can continue to deliver their important function safely."

Ms King said she would be able to make further announcements in about a week on a comprehensive package of reforms relating to the exercise of search and surveillance powers by law enforcement agencies.

Contact: John Harvey (04) 471 9305; John Saunders (04) 470 6851.

Further Information on Organised Crime

The relevant organised crime Cabinet papers are available on the Ministry of Justice's website: www.justice.govt.nz.

Organised Crime Strategy The Organised Crime Strategy focuses on four action areas:  community,  prevention,  intelligence, and  enforcement.

The Strategy also includes the establishment of OFCANZ and legislative reforms.

Organised and Financial Crime Agency New Zealand The Organised and Financial Crime Agency New Zealand (OFCANZ) will work collaboratively with national and international law enforcement and intelligence agencies as well as border agencies, regulatory and financial authorities and a range of other government agencies. OFCANZ will be hosted by New Zealand Police and will be headquartered in Wellington. Police have been working with other agencies to prepare for the launch of OFCANZ and this process is well underway.

Organised Crime Legislative Reform The proposed package of Legislative reforms includes:

- Proposing amendments to Section 108 of the Evidence Act 2006 to appropriately expand the range of offences in which identity protection can be afforded to undercover officers who give evidence in organised crime related trials; and

- Introducing tighter controls over the availability of precursor chemicals – including over the counter pseudoephedrine-based medications.

- Reviewing ways of restricting the use of legal business methods (such as trademarks etc.) by organised crime groups to achieve their goals;

TECHNICAL QUESTIONS AND ANSWERS:

What is a Production Order?

A "production order" is a court order for an individual or company to provide documents, data or other recorded information to police by a specified date.

What is an Examination Order?

An "examination order" is a court order for an individual to attend an interview with police to answer questions that are relevant to an investigation.

What are the two types of examination orders being made available?

There will be a business context examination order that will be available to all police investigations and will apply to those in business relationships and providers of professional business services. These examinations will allow police to unravel complex financial dealings and business arrangements that may have been part of criminal behaviour.

There will also be a non-business context examination order that will be available to police investigations of organised crime or serious or complex fraud investigations. These examination orders will apply to social relationships and will be subject to greater restrictions than business context examination orders.

What safeguards are provided around the use of these powers?

Unlike the current SFO Act, both production and examination orders will be court orders that are granted by an independent District or High Court Judge having received an appropriate application from police with the necessary justifications for the requested order. The Commissioner of Police (or an appropriate delegate) must approve all applications to the District or High Court for an examination order. Applications for non-business context examination orders can only be for the investigation of organised crime or serious/complex fraud, and must be approved by the Commissioner of Police and the Secretary for Justice.

What is the privilege against self-incrimination?

The privilege against self-incrimination means that a person can refuse to provide specific information when that information is reasonably likely to lead to that person's criminal prosecution. The privilege does not apply in respect of pre-existing documents and cannot be claimed by corporations.

What is the current position regarding self incrimination with respect to supplying information to, or answering questions by the SFO?

The SFO Act does not allow the privilege against self-incrimination to be claimed as an excuse for withholding information from the SFO. However, the information can not be used in a criminal prosecution unless the evidence they give in court is inconsistent with the information given to the SFO under compulsion.

Is this going to change under OFCANZ?

Yes, the privilege against self-incrimination will be available in respect of investigations for serious and complex fraud as it is generally in respect of other criminal investigations.

Why has this been changed?

The privilege against self-incrimination is deeply embedded in the common law. The privilege is justified on the basis that it discourages the ill-treatment of suspects who would be compelled to confess, and discourages the production of dubious confessions. In both these circumstances the information received may not be seen as "voluntary", which in turn casts doubt on its accuracy. Therefore, at a practical level removing the privilege does not necessarily equate to receiving better information. This is because people can forget information, they can lie and they can refuse to answer. There is nothing unique about serious or complex fraud that requires a different approach than other serious crimes.

Where will OFCANZ be located?

OFCANZ will be located within Police.

What will OFCANZ's structure be within Police?

OFCANZ will be established as a discrete service agency within Police. It will have its own identity and branding, so that other national and international agencies involved in this area of work will see their involvement and interaction as being first and foremost with "OFCANZ" rather than "the Police". OFCANZ will have Police support in areas such as Information Technology, Human Resources, Legal, Public Affairs and Business Services.

How will OFCANZ work?

OFCANZ will have permanent core units, or taskforce groups, such as an intelligence hub. It will also have: • 'standing' taskforces, for example a serious fraud taskforce and a ready reaction taskforce; and • 'directed' taskforces, set up at any time for a specific purpose

How will the taskforces work?

Each taskforce will be set up under specific terms of reference. A taskforce will have several phases, starting with intelligence collecting and profiling through to execution, asset seizure whenever possible, and ending with evaluation and information provision back to the intelligence loop. OFCANZ-led taskforces will include a mix of secondments to OFCANZ and contributing personnel, assets and other capability from partner agencies. Where matters are not the subject if a OFCANZ taskforce, partner agencies will continue to lead operations in their own sphere and will be able to seek the assistance of OFCANZ.

What is ODESC?

ODESC stands for the Officials Committee for Domestic and External Security Coordination. It is a committee of government officials who are charged with providing strategic policy advice to the Prime Minister on security and intelligence matters.

What will the Organised Crime Strategy cover?

The Strategy outlines four strategic areas, each with specific initiatives. These strategic areas are Community, Prevention, Intelligence and Enforcement.

How long does the Strategy run for?

This first Strategy runs until June 2009. This allows for the establishment of OFCANZ, the disestablishment of the SFO and the first year of OFCANZ operation. From 2009 onwards, the Strategy will be produced in three year cycles.

ENDS


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