Anita Barraud: Hello, and welcome to the Law Report, I'm Anita Barraud. Sadly family and domestic violence is too often in the news, but less discussed is the insidious economic abuse.

Emma Smallwood: It can have really significant long-term impacts, and severing that relationship and trying to stop that control can be that much harder, because when the physical violence can't continue anymore, that might be the perpetrator's last avenue to continue to control and abuse, is through the economic avenues.

Anita Barraud: Later we'll visit a pilot program that helps women who have survived domestic violence recover their financial strength. First though to Western Australia.

Media montage [archival]:

After a two-year investigation, Australian Crime Commission officers this morning arrested John Kizon and investor Niger Mansfield…

…charges were laid after an investigation by the Australian Crime Commission…

…the two businessmen are accused of using inside information to purchase shares in companies AdultShop.com and My Casino Ltd…

...colourful Perth businessman John Kizon and his former financial adviser have been found not guilty of insider trading charges dating back to…

…Mr Mansfield has also been acquitted of all charges…

…says he is now seeking tens of millions of dollars in compensation because his assets were frozen under WA's tough property confiscation laws…

Anita Barraud: Last week lawyers for Mr Mansfield reached a confidential settlement with the WA Department of Public Prosecutions. It was just days before his compensation claim on the confiscation of his property was to be heard. Mr Mansfield has had no access to his extensive property for more than 12 years following a freeze order under the Proceeds of Crime legislation.

Dr Natalie Skead is Associate Dean and Senior lecturer at the University of Western Australia.

Natalie Skead: Mr Mansfield, together with his client (he is a sharebroker) were being investigated for insider trading, and it was pursuant to those investigations that his property was frozen. Ultimately Mr Mansfield was acquitted. That was only in 2014. After a multitude of court hearings, interlocutories, appeals et cetera, he was acquitted.

Anita Barraud: It was quite a lot of assets that were seized. There were properties, cars, I think four cars, all his share portfolio, his bank accounts, and even his wife's property too.

Natalie Skead: Correct, a significant amount of property. In the ensuing 12 years he didn't have access to his assets. I understand from reports that there were times where he couldn't afford to buy bread and milk in the morning. His marriage broke down, his child was not able to complete her schooling. It took an enormous toll on not just him but also those around him and those who are dependent on him.

Anita Barraud: This was a part of a big Crimes Commission sting operation. On what basis was the freezing order made?

Natalie Skead: The freezing order is not in fact against the person but rather the property, and there's no need to establish that the owner of the property, the holder of the property, is the person involved in that crime, assuming a crime has been identified. It is just necessary that there be a reasonable suspicion that the property itself was either crime used or derived from some criminal activity. This legislation is not conviction based. So there is no need to have a conviction in order to seize a person's property.

Anita Barraud: Earlier this year the WA police reported they had seized over $50 million in assets. They've issued 165 freezing notices in the past year, and that's in a population of about 2.5 million. That seems rather a lot.

Natalie Skead: Correct. It has become an increasingly important weapon against fighting crime in this state, and I think across Australia as well. And that's what the legislation was intended to do, and I don't think anyone can object to that as a fundamental rationale for introducing legislation. The difficulty is the harsh consequences that can flow from the implementation of the legislation.

Anita Barraud: And there was another case recently that doesn't have the same kind of high profile as the Kizon and Mansfield case. Let's hear about a case which involves a man who lives in a rural property in the south-west of WA near Bunbury. Rhett Williamson, he's a Perth barrister and solicitor and he acted for this man who had his property seized.

Rhett Williamson: Back in mid-2014 he had a Misuse of Drugs Act search warrant executed on his house down in rural south-west Western Australian. And there was no drugs found, no charges came about in relation to any allegation of any drug dealing or charges of that nature. However, they did find a large amount of cash, it was $112,000 cash that was in a locked toolbox in his bedroom. And they decided to freeze the cash under the Criminal Property Confiscation Act with a freezing notice.

Anita Barraud: So the police turn up at the house with a search warrant, find the money, and then they go back for a freezing notice?

Rhett Williamson: Yes. He has attended at the police station the following day and provided them the bank receipts from where the money has gone into the bank, that money actually having come from a court settlement in relation to a worker's compensation claim that he had. However, they did allege, based on the bold statement and the bold assertion of this police officer, that he suspected that this money was either crime used or crime derived. And importantly he did not stipulate what crime or criminal activity at all this money was allegedly linked to or derived from.

Anita Barraud: The police did find a few funny things, they found some ammunition, which was a box of bullets for a semiautomatic pistol. No gun though, was there.

Rhett Williamson: No. The ammunition belonged to his uncle. His uncle had been at the property and had left the box of bullets at the house. There was no allegation that there was any connection between the ammunition under the kitchen table or the cash.

Anita Barraud: And there was also some crystal salts claiming to be bath salts in a jewellery box, and the police suspected that this could be a cutting agent or something. Was that investigated?

Rhett Williamson: That was investigated and there was no drugs at all. The bath salts were indeed what they were, they were bath salts.

Anita Barraud: So it was essentially this money, there was over $100,000, tightly packed into PVC tubes and stuffed into what the police described as a thermos-like container, and then into a red toolbox. So many layers of storage. And he did explain this strange thing to the police. What was his explanation?

Rhett Williamson: Well, he'd gone through a rather acrimonious separation from his partner. His partner was also the mother of his only child, his son, and he intended that money to be left to his son rather than have his ex-partner go to court and try to take the money for herself.

Anita Barraud: And he had sole custody of his son too, didn't he?

Rhett Williamson: That's correct, since he was less than one-year-old he'd had sole custody of his son.

Anita Barraud: Isn't there a period of about 28 days that a person can object to the freezing?

Rhett Williamson: There is, they have 28 days to file their objection in court. Those objections were filed and the proceedings began in the district court and they were ongoing for about 6 to 8 months. Three of those proceedings I was able to subpoena the documents that were given to the Justice of the Peace by the police, and in that it was apparent that there was no allegation of any crime or criminal activity that they were linking to this cash, and no evidence to base a reasonable suspicion.

Anita Barraud: The police subsequently found that some of the money which your client said he had withdrawn in 1998, but some of the serial numbers were newer. Was he able to explain that?

Rhett Williamson: Yes, he'd had the money sitting in his toolbox in his house, and throughout the 15 years that had transpired he had dipped into it himself and then repaid the money back into the toolbox, or he'd also lent money to friends, to family, and then he'd ensure it was paid back and then returned.

Anita Barraud: You describe this case as an abuse of process.

Rhett Williamson: I do, because under the criminal code that we have in Western Australia there are provisions for charges to be brought under Section 428 for unlawfully obtained property such as cash if the police have reasonable suspicion that the cash is unlawfully obtained. That can go to court. And then the onus is on the state, quite properly, to prove that that money is in some way connected and has been obtained by some unlawful activity. But because my client had provided the police with these bank statements, they never charged him with this because they would be well aware they had no prospects of convicting him for unlawfully obtained property when he could quite clearly demonstrate that he had the bank statements and he could also explain the serial numbers on the banknotes coming in and out.

Anita Barraud: He was very lucky though, wasn't he, he was able to prove where the money came from, he kept his bank statements.

Rhett Williamson: That's correct. Banks are only required by law to keep bank statements for seven years, and after that they destroy the records and there's no way that you can go back to the bank and ask for records. Bear in mind it's not illegal to have cash. So given its draconian nature, that if they are going to interfere with someone's right to own property, there must be more than a de facto allegation of some criminal unlawful possession of that cash. They are placing a presumption of unlawfulness on the respondent. You prove to me that it's not obtained from criminal activity and we are not going to say what the crime is that we suspect you of being involved in, but if you can't prove that that cash is not obtained from criminal activity, then the state will confiscate it. And that I believe is an abuse of natural justice and it offends the rights of every citizen.

Anita Barraud: And barrister Rhett Williamson felt that the case was so unjust it warranted judicial review in the Supreme Court. But just before it got there, the freezing notice was cancelled and his client got his money back.

Dr Natalie Skead from the University of Western Australia, do you agree with Mr Williamson that this is draconian? He says the fact that police can confiscate someone's cash without anything to go on and give someone a 'please explain' is abhorrent.

Natalie Skead: I'd certainly agree that it is draconian. I should just say there is one section in the legislation that provides that where there is no longer a basis for a suspicion on reasonable grounds that the property is crime used or crime derived, the police officer can cancel the freezing notice.

Anita Barraud: And this didn't happen in this case.

Natalie Skead: And this didn't happen in this case.

Anita Barraud: I was intrigued that the police only needed a Justice of the Peace, a JP, which I always think of as the local postmaster or pharmacist, rather than a judge to authorise a freezing notice. Is this usual?

Natalie Skead: In Western Australia it is possible. In other jurisdictions the orders can only be made by a court or a judge. So that's not a common feature of the legislation nationally, no.

Anita Barraud: So how does it compare, how does WA compare to other states?

Natalie Skead: WA and the Northern Territory have schemes that are exceedingly harsh. There are very few instances in which the court has a discretion, so-called, required to make certain orders. In some instances it operates retrospectively, so in relation to conduct or property acquired long before the legislation came into effect. It shifts the onus of proof on to the defendant.

It is non-conviction based, so you do not have to establish that the defendant has as a matter of fact committed a crime in order to seize his or her property. The legislation in other jurisdictions, I think it's fair to say, is not quite as harsh as that, but regardless, in relation to the particular issue that's raised by both of these cases, the fact is even if they are protections, property can be frozen. Once frozen, it cannot be dealt with by any person. And there may be a lengthy period of litigation before a person is acquitted, before a person's objection application is heard. So during that period they don't have access to their own property. And the consequences not only for the defendants but for their families and for others who may be dependent on those assets or may have an interest in those assets can be dire.

Anita Barraud: And I understand they don't have access to legal aid to try and recover, not in WA.

Natalie Skead: No. There's no doubt that it does deny natural justice in many cases. There is no doubt that it is unfair and unduly harsh in many cases. In some instances it flouts basic principles of the rule of law, but it is the legislation. The issue is it needs to be changed at the source and that is with the legislature. The problem is it is a political power-ball, and it is most certainly a powerful political vote winning tool, so…

Anita Barraud: And also I think there's probably valid reasons, police do have to act swiftly to get these Mr Bigs of the illegal drug and money laundering in particular, before assets are sent into another jurisdiction or offshore. There are serious and valid reasons for these laws.

Natalie Skead: There's no question, they are there to ensure that crime doesn't pay, they are there as a deterrent, they're there to prevent the financing of further criminal activity. So there are cogent and justifiable reasons for the introduction of the legislation. What is sometimes lost though in the detail is the potential harshness of the operation on innocent people. So Mr Williamson's client was not convicted, he was not charged with any crime whatsoever, he did not have access to that money.

Anita Barraud: And if he'd had been in dire circumstances that would have put him into penury.

Natalie Skead: Absolutely, as it's been suggested Mr Mansfield was.

Anita Barraud: Dr Natalie Skead, associate dean and senior lecturer at the University of Western Australia.

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