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Forfeiture orders and automatic forfeiture orders under the Confiscation Act in Victoria – Crime

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If your property is “tainted” by alleged criminal
offending, the state may apply to permanently take it away from
you. The mechanism used to do this is called a Forfeiture Order, or
in the case of certain serious offences Automatic Forfeiture Order.
These orders can result in the loss of such assets as your house or
car. They are an important and often overlooked consequence of many
offences and can arise even once you have already been sentenced
and can sometimes even affect the property interests of people who
are not themselves accused of committing any crime. Strict
timeframes apply in applications to exclude property subject to
such orders and so it is important to speak to a lawyer straight
away if you think that you may be affected.

What are forfeiture orders?

A Forfeiture Order under the Victorian Confiscation Act
is an order that the state applies for to permanently deprive
individuals of their property when it is “tainted” by
criminal offending. A Forfeiture Order can be applied for when
someone has used property for offending, or derived property from
criminal activity and they are convicted of a charge under Schedule
1 of the Victorian Confiscation Act. For this reason,
Forfeiture Orders are also known as “Schedule 1
Forfeiture”. Most indictable offences are schedule 1 offences,
including many lesser-known offences for which you would not
necessarily expect to lose your property. If subject to a
Forfeiture Order, it is important to pay careful attention to the
relevant timeframes and tests that apply in order to prevent your
property from being lost forever.

What are automatic forfeiture orders?

An “Automatic Forfeiture Order” or “Schedule 2
Forfeiture Order” is a type of order where your property will
be automatically forfeited upon your conviction for an offence
listed in schedule 2 of the Victorian Confiscation Act.
Schedule 2 offences typically involve professional engagement in
criminal activity. Such offences include drug trafficking in a
commercial or large commercial quantity, or armed robberies in
which the amount stolen is $50,000 or more. If your property is
forfeited automatically, it is subject to a much stricter regime
than with regular Forfeiture Orders, and it is therefore especially
important to take steps prior to the order being made in order to
get your property back before it is in fact forfeited.

Could this apply to property that belongs to me?

Any property that has been “tainted” could be subject
to a Forfeiture or Automatic Forfeiture Order. Property becomes
“tainted” if it is either derived from or used or
intended to be used in the course of criminal offending. This has
the consequence that many people have interests in property that
may be subject to these orders whether or not they themselves have
committed or are even aware that any wrongdoing has taken
place.

Your property will be derived from criminal offending if the
alleged offending allowed you to obtain that property. The property
in question could be something that is stolen, or purchased using
money or profits obtained through criminal activity, and is in that
way effectively viewed as “
proceeds of crime
“.

Property can also be tainted purely by being used or intended to
be used in the commission of schedule 1 or schedule 2 offences.
Examples in which property may be tainted through its use include
houses in which people have cultivated or manufactured drugs.
People who are not themselves involved in the criminal offence, and
sometimes are not even aware of the way in which their property has
been used can sometimes lose their property forever if it is so
used. Other types of property also subject to being tainted through
its use include cars, for example if used in
drug trafficking
, police pursuits or robberies.

Sometimes, even property that has not been “tainted”
can be forfeited via a “Tainted Property Substitution
Declaration”. This occurs when someone owns some property, but
uses some other property that they do own as part of their
offending. If this occurs, the state may apply for an order to take
your untainted property as a substitute for the property that you
have tainted. This means that, for example, using someone
else’s house or car to commit a crime could result in the loss
of your own property, even if your property has nothing to do with
any criminal activity.

When will it be applied for?

Police or prosecutors will first make an application to a court
for your property to be restrained. This can occur before or after
you are charged and can even occur up to 60 days following your
conviction. Once your property is restrained, the state can then
apply for a Forfeiture Order for as long as 6 months after a
conviction. This unfortunately means that even after a matter has
finalised, people can be revisited by the consequences of offending
through often unexpected confiscation orders, sometimes resulting
in the loss of their important assets.

What is the law that allows this to happen?

Part 3 of the Confiscation Act 1997 (Vic) contains the
provisions that allow for and govern the operation of Forfeiture
and Automatic Forfeiture Orders.

Exclusion applications and important time limits

An application to exclude can be made before a Forfeiture or
Automatic Forfeiture Order is put in place by applying at the
Restraining Order stage for your property to be excluded. This
application can be by any person with an interest in the property,
including an accused person. The process and timeframe for applying
for exclusion from Restraining Orders are written about here.

Property subject to an Automatic Forfeiture Order will be
forfeited without further opportunity for you to apply for
exclusion once made. It is therefore essential in relation to
Automatic Forfeiture that exclusion is applied for at the
Restraining Order stage.

With Schedule 1 Forfeiture, as an accused person you will have a
further opportunity to apply for exclusion. This ordinarily takes
place in a plea hearing where your lawyer can argue that your
property should not be forfeited, generally because it will cause
some undue hardship to you or another person should forfeiture
occur. If no application for exclusion is made within either 60
days of conviction or 60 days since the forfeiture order was made
(whichever is later), your property will be forfeited. It is
important to be aware that entering a formal plea of guilty at
court will constitute a “conviction” in the confiscation
scheme, and your time to have your property excluded will start to
run from this point onwards.

Practical tips

  • Prior to any Forfeiture Order being made, you will be served
    with a Restraining Order. As soon as you hear anything about your
    property being restrained, make sure that you seek legal advice
    immediately.

  • If you think another person has an interest in the property
    that you are worried about losing, you should ask your lawyer about
    their property interest too. That person may be able to apply to
    have their interest excluded or to prevent the property from being
    lost.

  • If you think that your property is being used to commit a
    crime, it is important to take action and get legal advice right
    away. Even if you yourself are not committing a crime, you could
    still risk losing your property through the forfeiture scheme.

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