In Australia, there is legislation at both the Federal and State government levels aimed to identify and recover proceeds of crime. Luxury motor vehicles are among the items on the shopping list of criminals who are looking to wash the cash from ill-gotten gains.
In New South Wales, a recent amendment to the Criminal Assets Recovery Act 1990 allows the NSW Crime Commission to apply to the Supreme Court for an Unexplained Wealth Order if the Crime Commission suspects that a person has acquired wealth through illegal activity. This change to the Act means that no crime needs to be committed before an application under the Act can commence.
Driven Women Magazine approached the NSW Crime Commission to determine the details of any luxury cars had been seized under Unexplained Wealth Orders. In response to this request, a Spokesperson from the NSW Crime Commission stated,
“The Crime Commission utilises its powers under the Criminal Asset Recovery Act 1990 (CARA) to restrain property that is suspected to be the proceeds of crime. At times, these restraining orders include luxury vehicles. The Commission then commences civil action under CARA to recover the proceeds of crime and return the value to the State. If the recovery of those proceeds includes property such as vehicles, the sale of that property is managed by the NSW Trustee and Guardian. The Crime Commission does not hold easily accessible information on the type and value of luxury vehicles seized.”
At the Federal Government level, AUSTRAC collects information from the thousands of entities they regulate as Australia’s financial intelligence unit. Their financial intelligence analysts use that information to identify financial transactions linked to crimes, including money laundering, terrorism financing, organised crime, child exploitation and tax evasion. An AUSTRAC spokesperson shared further details with Driven Women Magazine about their role in this area,
“High-value goods including cash, precious stones, vehicles and other luxury goods are attractive to criminals who seek to legitimise the profits they make from illicit activity.
AUSTRAC works with law enforcement and industry to ensure that Australia’s financial system is resistant to criminals. This includes generating financial intelligence that is shared with law enforcement agencies to support investigations, and regulating businesses to make it harder for criminals to exploit them.
AUSTRAC regulates over 17,000 reporting entities, including banks, credit unions, remittance service providers and casinos. The Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act) requires reporting entities to identify, mitigate and manage the risk that their products and services may be used to facilitate money laundering or other serious and organised crimes.
Under the Financial Transactions Reports (FTR) Act, motor vehicle dealers who provide insurance or act as insurance intermediaries must report any significant cash transactions of A$10,000 or more and suspect transactions. Under the FTR Act a suspect transaction report must be submitted to AUSTRAC in a number of instances, including where there are good reasons to suspect a transaction may be relevant to tax evasion, fraud or involve the proceeds of crime.”
Driven Women Magazine further questioned AUSTRAC about what happens if a motor vehicle dealer does not “provide insurance or act as insurance intermediaries” and if they are required to submit a suspect transaction report under the FTR Act and the AUSTRAC spokesperson stated,
“Motor vehicle dealers are not captured by the AML/CTF Act so are not required to submit suspicious matter reports under that Act.”
The Attorney-General has proposed reforms to extend the existing AML/CTF legislation to certain high-risk services, also known as tranche 2 services. This includes services provided by lawyers, accountants, trust and company service providers, real estate agents, and dealers in precious metals and stones, but there are no changes proposed to the requirements of motor vehicle dealers. When Driven Women Magazine questioned this, a Spokesperson from the Attorney General’s Department stated,
“The Government is committed to strengthening Australia’s anti-money laundering and counter-terrorism financing (AML/CTF) regime to ensure that it keeps pace with evolving illicit financing threats, and meets international standards set by the Financial Action Task Force (FATF) – the global financial crime watchdog.
The FATF does not require regulation of motor vehicle dealers, and motor vehicle dealers are not within the scope of these proposed reforms. There is a broader framework to prevent criminals from enjoying the profits of their illegal activity, disrupt criminal business models, and protect Australians.
The Proceeds of Crime Act 2002 provides a scheme to trace, restrain and confiscate the proceeds and benefits gained from Commonwealth indictable offences, and certain offences against state and territory law. This includes luxury motor vehicles purchased with illegally obtained wealth.
The Criminal Assets Confiscation Taskforce (CACT) led by the Australian Federal Police (AFP) works to identify and remove the profits from serious and organised criminal activity, including criminal wealth stored through the purchase of luxury motor vehicles. The CACT works in partnership with Commonwealth, state, territory and international law enforcement agencies to identify, investigate and litigate asset confiscation matters.
There are also a range of other regulatory or professional licensing and/or registration requirements that apply under state and territory legislation. For example:
- motor vehicle dealers have licensing requirements that impose a range of obligations, including a ‘fit and proper person’ assessment, professional conduct and record-keeping requirements, and
- motor vehicle dealer licensees in New South Wales, for example, also have a duty to report suspicions of stolen or unlawfully obtained goods.”
The CACT investigates criminal wealth by targeting the proceeds and instruments of crime in both Australia and overseas. Targeting the criminal economy and confiscating criminal assets is crucial to disrupting and deterring organised criminal activity. On the details about the motor vehicles seized by the CACT an Australian Federal Police spokesperson said,
“The Criminal Assets Confiscation Taskforce has restrained 119 assets categorised as ‘vehicles, vessels, other’ since 1 January, 2020. The assets have a combined total estimated value of $9.8 million. The combined estimated value of the ten most valuable restrained vehicles was more than $3 million and included a Lamborghini Urus, multiple Mercedes-Benz vehicles, a Porsche 911 and Cayenne, two Bentleys and a Ferrari Testarossa.”
The Australian illegal drug market is a lucrative and attractive target for transnational serious and organised crime (TSOC) groups. The Australian Institute of Criminology estimates that TSOC groups cost Australia approximately $60 billion a year, with up to $16.5 billion of this coming from illicit drug activity.
The Federal Chamber of Automotive Industries VFACTS Service June 2024 data shows that total new vehicle sales for the first six months of 2024 were 632,412 vehicles, a year-to-date increase of 8.7 per cent on last year and surpassing the previous June record of 605,522 in 2018. Multiple luxury car manufacturers also recorded higher six-month sales totals in 2024 compared to 2023.
The significant year-to-date milestone highlights the sustained demand for new vehicles across Australia. With higher interest rates, persistently high inflation, and the on-going cost of living pressures being faced by Australians the new car sales figures appear to defy these difficult economic conditions. So the number of vehicles seized by the NSW Crime Commission and the Criminal Assets Confiscation Taskforce may just be the tip of the iceberg?
“The NSW Crime Commission will continue to monitor suspicious purchases of luxury vehicles,” a spokesperson for the agency said.
Main photo by JL Merilles on Unsplash.