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LEGAL AND CONSTITUTIONAL AFFAIRS LEGISLATION COMMITTEE
Australian Crime Commission
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LEGAL AND CONSTITUTIONAL AFFAIRS LEGISLATION COMMITTEE
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LEGAL AND CONSTITUTIONAL AFFAIRS LEGISLATION COMMITTEE
(Senate-Tuesday, 25 May 2010)
Australian Commission for Law Enforcement Integrity
Australian Crime Commission
Australian Customs and Border Protection Service
Rear Adm. Barrett
Australian Federal Police
Senator BOB BROWN
Mr Andrew Wood
National Capital Authority
- Australian Commission for Law Enforcement Integrity
- ATTORNEY-GENERAL PORTFOLIO
Content WindowLEGAL AND CONSTITUTIONAL AFFAIRS LEGISLATION COMMITTEE - 25/05/2010 - ATTORNEY-GENERAL PORTFOLIO - Australian Crime Commission
CHAIR —Welcome. Mr Lawler, do you have an opening statement you want to begin with?
Mr Lawler —No, we do not have an opening statement this morning.
Senator PARRY —I might start where I left off. Mr Lawler, you probably heard my questioning of the Australian Commission for Law Enforcement Integrity in relation to integrity testing. Do you believe that an integrity testing regime should exist within the Crime Commission?
Mr Lawler —Integrity testing more broadly has a role in law enforcement and in agencies such as the Australian Crime Commission. It needs to be seen as part of a broader suite of anticorruption measures in a holistic context. Certainly on arriving at the Australian Crime Commission, there was a range of other anticorruption strategies that in my view, and the view of executive of the ACC and in consultation with the integrity commissioner, deserved higher priority. Those matters included mandatory drug testing, declarations around financial statements, a more robust internal reporting regime and robust training around the values that are required to support anticorruption strategies.
I am pleased to report to the committee that those strategies have been put in place and, indeed, we have recently completed our first mandatory drug-testing regime for every person in the organisation, including myself. That relates to the high-risk staff working in the commission. I can report to the committee that there were no positive results in that context. But specifically around integrity testing, I think it does have a place. It is something I have not considered at this particular point in time for the reasons I have outlined. I would be happy to have discussions with the integrity commissioner in the fullness of time.
Senator PARRY —I gather from that answer there is no consideration of appropriation or additional funding for an integrity testing regime in addition to what you have outlined, which, while not insignificant, is a lower level form of integrity testing than is currently undertaken?
Mr Lawler —Indeed, that is right.
Senator PARRY —Can you explain the Australian Crime Commission’s role and additional funding that may be required for the new criminal intelligence fusion centre?
Mr Lawler —For the establishment of the criminal intelligence fusion capability and centre there is provided $14.461 million over four years. In the 2010-11 financial year, the total resourcing is $3.484 million. I am particularly delighted with this funding that has been provided to the Australian Crime Commission for intelligence fusion.
I am particularly pleased that across the broad spectrum of national security agencies, including the department, there has been strong support for this need. It is my firm view that this particular funding will deliver very significant benefits to a range of Commonwealth agencies in reducing risks to Commonwealth programs, but additionally will identify high risk, or serious and organised crime penetration, of high revenue streams. The funding is welcome. Planning is well under way to have the centre and the capability stood up by 1 July 2010. I would be happy to talk to the committee, if they so desire, on the ACC’s plans in that regard.
Senator PARRY —Is the ACC the lead agency?
Mr Lawler —Yes. The fusion capability will reside within the Australian Crime Commission, but will rely heavily on our already strong partnership arrangements with a range of Commonwealth and state agencies. The fusion of this intelligence provides the real benefit to the broader Australian community.
Senator PARRY —Do you believe the appropriation is significant enough to meet the demand and the intent and capability that the ACC has for the fusion centre?
Mr Lawler —Fusion capability has its genesis in the financial intelligence assessment team that is currently in operation within the ACC, of which you have some knowledge already. There is always an issue of scale. It was our judgment that it is best to solidify the capability. If there is a demonstrated demand and need for that to be increased at a future point in time, of course we have the option to go to government and make the case at that particular point.
Senator PARRY —I turn now to staffing levels in the ACC. What is the current capability? What are the full-time equivalents in the ACC presently?
Mr Lawler —If I may, if we could talk in the context of headcount.
Senator PARRY —Yes.
Mr Lawler —We have some detailed figures here to help the committee around the staffing. The total headcount for the Australian Crime Commission is 640. But as I have indicated to this and other committees, the ACC has quite a unique and in some ways complex staffing arrangement because we work in close collaboration with state and Commonwealth agencies, and we have a number of arrangements around seconded staff—some of which are funded by the ACC, some of which are funded by the jurisdiction or agency concerned—and we have members of joint task forces. These are members who are not formally seconded but who are working on ACC outcomes and ACC priorities. If it would assist the committee, I could go through those five separate categories as of 30 April 2010—they are quite recent figures.
Senator PARRY —Thank you.
Mr Lawler —As far as Australian Public Service staff are concerned—that is ACC staff principally—the number is 540; contractors, 12; and seconded APS Act and ACC Act staff, 22. That is a total number funded by the ACC at 574. Seconded staff funded by the jurisdiction is 18 and members of joint operations funded by the jurisdiction is 48, which gives the total of 640. Since 30 June 2009, that is an increase of eight per cent or 49 staff. In times gone by, there has been a different picture in the Australian Crime Commission around reduction of staff. Through savings and other measures we have been able to slowly increase that number, which I am very pleased about.
Senator PARRY —In relation to the joint operations staff not funded by the ACC—the figure of 48—does that fluctuate on a monthly, weekly, or annual basis depending on the operational issues at hand?
Mr Lawler —Yes, it does. It fluctuates year to year and it can fluctuate between weeks and days, depending on the operation. To give you an example of that, we had a recent operation in New South Wales where, working with our partners the AFP and New South Wales Police, an additional 200 staff joined the ACC in its priorities to effect a particular resolution of an operation. The task force numbers are very variable. As I said, I have a history of members of joint operations funded by jurisdiction going back to 2004, if that is helpful.
Senator PARRY —The 48 was at that single point in time on 30 April. If I had asked you this question at the time of the other operation, it would have been 248 or whatever?
Mr Lawler —Exactly, which is why we used the headcount number—to marry up with the annual report.
Senator PARRY —What sort of functions do the 12 contracting staff fulfil?
Mr Lawler —They are principally around information technology. I will ask Ms Bailey to give you some more details and the specific contracts we have.
Ms Bailey —There is an increase in our IT. You may have gained the impression that some of our forces, through our modest capital program, are investing in some upgrades. Most of those are short term, under three months.
Senator PARRY —Thank you. Is the 22 seconded staff figure fairly static, or does it vary greatly?
Ms Bailey —It has gone up and down over time, but that represents the police who join us on a two-year or 18-month basis rather than people who come on for short-term task forces. It is probably not as high as it has been, but we are actively recruiting more in that space now and seeking to increase those numbers over the coming months as well.
Senator PARRY —Is the difficulty one of budget or one of state jurisdictions being willing to allow their officers to be seconded to the ACC for a two or so year period?
Mr Lawler —We have very strong cooperation from the state police jurisdictions. Indeed, as recently as March the board of the Australian Crime Commission, including all the state and territory police commissioners and key Commonwealth agencies, reaffirmed their support for secondments to the ACC. Indeed, the ACC could not perform its work if these secondments were not made available to the agency. It is through those secondments that the police powers are brought to the commission. That having been said, historically, and I suspect in the future, there have always been competing priorities, particularly where state jurisdictions have found it difficult to recruit staff, particularly in buoyant times. This is always something that requires management.
There are specialist skill sets that are in keen demand, particularly in the area of surveillance. It is a difficult skill set to recruit for. There is strong support from the jurisdictions and from the Commonwealth agencies, but some practical difficulties.
Senator PARRY —So you would be desirous of increasing. Without putting words into your mouth, I think you would agree that it is beneficial not only to the ACC but also the sponsoring agency with facilitating greater cooperation between a federal and a state jurisdiction. Having said that, you would be desirous of increasing that number, subject to availability from state jurisdictions?
Mr Lawler —We certainly would, subject to budget of course, given that they are funded by the ACC. Your point is quite right, there are benefits all the way around here from seconded staff and jurisdictions understanding and being involved in the work of the commission. We see it as one of those classic win-wins.
Senator BARNETT —Commissioner, thank you for being here. I will ask the AFP questions about proceeds of crime, but I thought you might be able to assist in terms of the unexplained wealth provisions. Have they been used since the Crimes Legislation Amendment (Serious and Organised Crime) Act 2010 received royal assent? Are you able to make an observation regarding that? And perhaps you could advise if you are involved in any activities regarding unexplained wealth?
Mr Lawler —The ACC is yet to be involved in applications for unexplained wealth orders, but we are considering them as an option in our ongoing work. We have some cases in which we are considering the use of the new legislation. We are actively working with the Commonwealth Director of Public Prosecutions and the Federal Police to ensure that those provisions are effectively applied in the particular cases. Of course, you would understand that these are important provisions. But they are provisions that of course need to be properly applied, particularly given the legislation is new.
Senator BARNETT —Indeed.
Mr Lawler —There have been no applications at this point in time, but we are hopeful in the not-too-distant future to have applied that particular power in an appropriate way.
Senator BARNETT —Thank you very much for that. This question may be more properly directed to Mr Wilkins or his officers. I will check with Mr Wilkins if that is possible. I would like to know the current balance of the confiscated assets account and how much revenue has been paid into the confiscated assets account for the financial year 2009-10?
Mr Wilkins —As of 30 April 2010, the Insolvency and Trustee Service Australia advise that the confiscated assets account held $24,130,143.45 in distributable funds.
Senator BARNETT —That is greatly appreciated. Do you have a figure for 30 June last year?
Mr Wilkins —We can get it, but we do not have it here.
Senator BARNETT —How much revenue has been paid into the confiscated assets account for this financial year?
Mr Wilkins —We can get that.
Senator BARNETT —How much has been drawn from it for use under the Proceeds of Crimes Act for the same period?
Mr Wilkins —We will have to get that information for you.
Senator BARNETT —Have the unexplained wealth provisions been used since the Crimes Legislation Amendment (Serious and Organised Crime) Act received royal assent? If so, what is the approximate value of the criminal assets under the restraining order?
Mr Wilkins —To my knowledge, this was only commenced in February this year. Although there has been some preparatory work and strategy work, as the commissioner has pointed out, the AFP and AUSTRAC have been involved in some thinking about that. I do not think it has actually been utilised yet.
Senator BARNETT —If that could be confirmed, that would be great.
Mr Wilkins —Subject to what effect it might have on operational matters.
Senator BARNETT —Of course.
Senator PARRY —Would the proceeds from the new unexplained wealth provisions in the serious and organised crime bill also go into the confiscated assets account?
Ms Kelly —That is correct.
Senator BARNETT —Mr Lawler, there was a statement by the Minister for Home Affairs on 23 April regarding the government’s next steps in the fight against money laundering and people smuggling with the release of a discussion paper. Commissioner, have you been involved in that? You have considerable expertise and activity in both money laundering and people smuggling. Is that correct; can you clarify that?
Mr Lawler —Certainly, the ACC has a very significant involvement and a longstanding expertise in money-laundering investigations. The commission’s focus has been on the classic saying of following the money trail because it is our clear view that the greatest threats, serious and organised criminals, are the ones that are generating the most wealth. So it stands to reason that following the financial trails is an imperative.
That is a difficult endeavour and it is one we have a specific determination on. That has been approved by the board. It is our financial crimes determination. That is looking at a range of different money-laundering typologies. That is how the serious and organised criminals are moving their money.
Of course, a lot of serious and organised criminal activity is generating cash. Drugs are not bought with credit cards. As a result, that is the commission’s focus. I need to say to the committee that we do not do that in isolation. We work in partnership with our agencies at a Commonwealth and state level.
The secretary has spoken about AUSTRAC, which is very important in the context of money-laundering. We work with them to ensure we have strong, robust, contemporary financial intelligence. We do not currently have a determination in relation to people smuggling, but we do know that serious and organised crime is active in the people-smuggling space. Of course, our intelligence covers a broad range of criminality. We do identify issues and money laundering and people smuggling and other criminality in this context.
Senator BARNETT —I would like to draw you out on a couple of those. One is financing of terrorism activity. You have touched on people smuggling. It is not a direct remit for you at the moment, but you are obviously aware of the concerns. To what extent is there financing in this country by Australians and perhaps people within Australia of terrorist activity? Do you have a feel for that? To what extent can you comment on the financing of people-smuggling activity that you are aware of? If you can comment, good; if not, that is fine.
Mr Lawler —There are other agencies better able to comment than the Australian Crime Commission for the reasons that you point out—we do not have a specific determination and our intelligence assets have not been directed particularly at the area of counterterrorism and particularly counterterrorism financing. Of course, ASIO and the Australian Federal Police are well placed to do that. I understand in a broader context they have done very considerable amounts of work in this particular area. It is a difficult area.
That having been said, as I indicated earlier, given the sort of work the commission does in targeting highest threat criminal entities we invariably come across money-laundering, people smuggling and other criminal activity that we do not have a specific remit or determination to advance. Where we do find it, of course the information is shared in a comprehensive way with those agencies I have mentioned and others as the need arises. Of course, that is why ASIO is on the board of the Australian Crime Commission and why the AFP commissioner is the chair.
Senator BARNETT —I refer now to card skimming. I understand you have a relationship with the Australian Bankers Association and the Australian Retailers Association to combat card skimming. What is the extent? How bad is it in Australia? How serious a concern is it and what steps are being undertaken to combat it?
Mr Lawler —Card skimming is a serious problem in Australia. We know that serious and organised crime is targeting financial institutions and their customers in skimming their details and then fraudulently accessing their accounts.
You may be referring to a media release and press conference that the ACC had with the Australian Retailers Association and the Australian Bankers Association. There was a very specific reason for that—to alert retailers to the risk of card skimming and indeed the substitution of EFTPOS machines. We thought it was a very important step, an important engagement with industry and an important preventative strategy in making sure that the public, as best we can possibly do, and particularly the retailers, are alert to the threats that are posed.
Senator BARNETT —I get regular feedback from everyday consumers that they have been ripped off and had money taken out of their account, credit card or whatever. I see that you have estimated that this costs the Australian community $100 million.
Mr Lawler —That is an ACC estimate.
Senator BARNETT —Can you corroborate that? Is it pretty common? How many Australians are being affected each year? Do you have any statistics to support these statements?
Mr Lawler —I am very confident with the statements that have been made and that we can substantiate them. We have strong intelligence to support the sort of figures you have just quoted. Indeed, it would be my judgement that that could well be a very significant underestimation of the extent of the problem. This is why it is so important to work with the industry. Of course, the information is not held by the commission.
We need the information from the banks and financial institutions to gather that picture, particularly in relation to specific groups that are targeting Australia. These groups are typically international in their nature. The problem of organised crimes is a global problem. Because of that connectivity recently the Attorney-General’s Department brought together a serious and organised crime framework. The nature of the problem is beyond one jurisdiction and, indeed, beyond one country.
In summary, it is a very significant problem and it is ongoing. It is a problem that requires a range of treatments—some of them are law enforcement, some of them are in a preventive context relating to the customers and retailers, and some of them are around technology. We are in close dialogue on this particular issue with the Canadian authorities and the United Kingdom authorities. Indeed, we have them working at the commission at the moment looking at the global linkages that we are confronting.
Senator BARNETT —ATMs, pinching your PIN: I keep getting feedback from people who have lost their money. It is happening pretty regularly. ATMs are being used and abused. People can have their PINs pinched and then they lose their money. How prevalent is that? Is it a concern?
Mr Lawler —That is another form of card skimming. The skimming I have been referring to was the actual removal of the portable EFTPOS machines or the tampering with the portable EFTPOS machines. In relation to ATMs, there is a long history of those particular machines being tampered with and exploited by organised criminals.
Senator BARNETT —But it seems to be getting worse, not better.
Mr Lawler —The criminals are dynamic and they continue to change their methodologies. Technologies assist them. They are cooperating globally and accessing new technologies to exploit the development with these facilities that are open to our communities.
Senator BARNETT —Do you think it is getting worse?
Mr Lawler —Serious and organised crime is a big problem. In the context of getting worse, the fact that it is globalising and becoming more sophisticated means it is a more of a threat rather than getting worse.
Senator BARNETT —I move on now to the issue of cybercrime and the use of undercover agents. This is a question that I will ask the AFP, but I am not sure whether the ACC covers this area and I would like to know the extent of the problem and whether your remit goes to sex predators and to grooming on the internet. Do you, as the ACC, cover that in your remit to combat serious and organised crime?
Mr Lawler —No, we do not at the moment.
Senator BARNETT —Are you aware that there is significant trafficking and prostitution in Australia? Is part of your remit combating that, in the sense that serious and organised crime is involved in such a wretched industry?
Mr Lawler —Our remit extends to the extent of two areas. The first is in the area of the ACC’s responsibility for preparing the organised crime threat assessment for Australia. We had the responsibility of preparing a highly classified document that details the organised crime threats to this country. Included amongst that, as you would expect, are material and intelligence around child sex offences and like predatory behaviour. We also, as we spoke of with terrorism and terrorism financing, in the course of our serious and organised crime broader work, come across such intelligence. Where we do, we have a strict dissemination arrangement and material is disseminated to like agencies.
The ACC did have an undercover capacity, but it is one area where I believe the commission and, in particular, the AFP were duplicating effort. There was not a need to have two capacities, and we have entered into an arrangement with the AFP whereby we can draw down on their undercover capacity as required. We have used that resource that we have freed up in other areas. This is all about working collaboratively with others. The AFP and other agencies in this particular space could come to the commission for access to our intelligence holdings or, indeed, our coercive powers, if the board felt that was appropriate for it.
Senator BARNETT —I will be asking the AFP more about those matters when it comes before the committee. You talked about threat assessments and so on. Are you involved with the forthcoming visit of the President of the United States of America in providing threat assessments?
Mr Lawler —No, we are not.
Senator BARNETT —I wanted to ask you about your legal fees and the consultancy document that I have with me. There is a substantial amount of legal fees. I can understand that you would need to have outside advice for the work that you do, as it is very important, but it seems significant. I am looking at it from 2007 through to 2010 and there are hundreds and thousands of dollars.
Mr Lawler —Indeed.
Senator BARNETT —I just wondered whether the ACC had given thought to the merit of in-house counsel and the extent to which that is used currently and whether it could be used a bit more to ensure that you gain some cost efficiencies, and keeping costs at a minimum.
Mr Lawler —Your point is absolutely correct. We do have very significant legal costs. Indeed we see it regularly as a strategy of organised criminals that they will use the legal system to frustrate and try to distract the commission from its work. Often we have multiple challenges across multiple jurisdictions to the commission’s work, to its issuing of determinations and to the role of the board. We see that legal attack consolidated across organised crime groups and across jurisdictions where commonly very senior counsel are pitted against the commission to try to overturn or frustrate the legal basis on which the commission operates. We have undertaken some significant cost-cutting within the organisation, as is reflected in the budget statements. As a result of that cost-cutting, we have been able to employ more staff in the ACC. We have in-house counsel, and we have a strong legal team but, as you are probably—
Senator BARNETT —Can you tell us how many you have?
Ms Bailey —I think the team is of the order of about 19, but we can confirm that number.
Mr Lawler —Let me see whether I have a more precise figure for you. As at 31 December 2009, the legal unit comprised 24 out of staff of 640, which is quite a significant number. But in the context of legal litigation there are specialist areas, in particular around the application of the ACC Act, where we require specialist senior counsel to match up against the very formidable legal counsel that are brought against the ACC. I am confident that we have given sufficient administrative oversight to the legal unit and that, in fact, it represents good value for money.
Senator BARNETT —Fair enough. I just note that—and I do not want to target anyone in particular—it appears, based on these consultancy documents that I have, that you are paying over $200,000 per year for individual legal counsel, which obviously is a significant amount of money for individual advice.
Mr Lawler —I know the particular line item to which you are referring, and that is the in-house senior legal counsel for the ACC, who is responsible, as I have indicated, for litigating on behalf of the ACC in these high-end legal challenges that we are facing.
Senator BARNETT —I presume it is a he?
Mr Lawler —It is not in actual fact.
Senator BARNETT —It is a she?
Mr Lawler —Yes.
Senator BARNETT —So she is full time at the ACC but as a consultant.
Mr Lawler —She is on a retainer and then an appearance fee.
Senator BARNETT —But she works within the ACC, or does she work outside the ACC?
Mr Lawler —She works outside the ACC. She is retained counsel. What we find with the challenges to the ACC is that they often turn on complex legal arguments. We have found it very beneficial, particularly when the legal arguments are repeated or are slightly altered, to have counsel that is familiar with how the ACC operates, how the board operates and what documentation is available. In actual fact it turns out to be an efficient way of conducting this form of litigation.
Senator BARNETT —Thank you. My final question relates to an answer to question on notice No. 134, regarding redundancy packages by the ACC. I notice that they have cost over $1 million—$1,045,000. I do not know what period that is for, but that is as at 31 December 2009. It seems to me to be a substantial amount. Can you advise what that relates to?
Mr Lawler —Yes, I can. I have that question before me. I think it relates to the question that you asked:
d. How many redundancies have there been since December 2007?
I think the answer is then prefaced as at 31 December 2009, so it covers that two-year period for that amount, $1,045,106.06.
Senator BARNETT —Obviously you are happy with that figure.
Mr Lawler —Yes.
Senator BARNETT —Thank you.
Senator HUTCHINS —Referring to money, can you update the committee on what has been happening with Operation Wickenby and the outcomes there? Is Mr Brereton still in the country—anything like that?
Mr Lawler —Yes, I can. Might I say at the outset that both Operation Wickenby and the broader Project Wickenby have delivered some very positive benefits for the Australian community from the commission’s perspective. The project is the broader multi-agency operation involving a range of agencies, including the Australian Taxation Office, the AFP, the Australian Securities and Investment Commission, the Attorney-General’s Department, the Australian Government Solicitor, AUSTRAC and the Commonwealth DPP, and that joint agency approach has delivered, as I said, significant benefits.
I will take you to five key areas where Project Wickenby, as at 31 March 2010, has delivered for the Australian people: $727 million in additional tax liabilities have been raised; actual tax collections are at $177 million; there has been a beneficial compliance dividend of just on $300 million; there are a number of civil audits underway—675 in total; and the number of audits that have been completed are just on 1,200. And whilst I have been at pains to talk to committees not only in the context of people charged but in some much broader performance indicators in relation to the specific ACC operations, as at 30 April in this particular operation there have been 11 people charged; two people charged with ACC Act offences; a total of 25 charges preferred; 294 ACC examinations conducted—those examinations delivering high-quality intelligence to the tax office and others about how offshore tax havens are constructed; and 308 disseminations to partner agencies—those partner agencies that I have spoken about. In that particular operation the ACC’s work supported $308 million worth of tax assessments. That is against a total expenditure by the ACC on that project of $37.42 million, so it is nearly a 10 times return on investment for the $37 million invested by the Australian community.
I think it is a very strong and positive message for all agencies involved in Operation Wickenby and, as the major advertisements in the newspapers indicate, there is more to come.
Senator HUTCHINS —Senator Barnett referred to the two serious and organised crime bills that received royal assent. One of those bills allowed for increased powers for the examiners. To your knowledge, have they been used at this stage? Can you elaborate for the committee on what those increased powers will allow the examiners to do to assist us in combating serious and organised crime?
Mr Lawler —Thank you for the question. It was a point of significant frustration for the commission, particularly the board of the commission, that we were finding when serious and organised criminals were lawfully summonsed before the commission to answer questions—and we saw a large number of outlaw motorcycle gang members undertake this activity—they would refuse to co-operate with the commission. As I have said previously, effectively they were thumbing their noses at the commission. What would often happen following that is that there would be extensive litigation, as I have explained to Senator Barnett. Often many years would elapse before those matters were ultimately dealt with by the court. Indeed that delay frustrated the ACC’s ability to gather the evidence in the manner in which it was required to do.
As you know as Chair of the Parliamentary Joint Committee on the ACC, the committee, after being briefed on this difficulty, was supportive of what are called contempt provisions. They allow for examiners, through an arrangement, to refer people who fail to cooperate with the commission to be referred to the superior courts. I am pleased to report that just the fact that the legislation is now in existence has had the effect of those people cooperating when the examiners have advised witnesses of this provision. It has had a deterrent effect already. As a result there has not been the need to date for any persons to be referred to the superior courts, but there has been significant work done by the commission with the courts in each of the jurisdictions, particularly with their registrars, to ensure that the appropriate process is in place, in the event that legislation is required to be utilised. That ensures that the courts are fully briefed on the legislation and that we understand the administrative arrangements for giving that practical effect.
Senator HUTCHINS —As part of the 2010-11 budget, it was announced that there will be a criminal intelligence fusion centre. Can you elaborate for the committee what this new centre will do, over and above what you already do? Can you describe how it will operate?
Mr Lawler —Yes, I can. As I indicated to Senator Barnett, I was very pleased with the announcement of this additional funding, and indeed with the support we received across the broad bureaucracy for the fusion centre, particularly from the Attorney-General’s Department. I have some specific information before me on the fusion capability, but it is important to point out firstly that that was a key plank of the Commonwealth Organised Crime Strategic Framework. There was an acknowledgement that there needed to be enhancements to information sharing and the fusing of intelligence. That needed to be done within a strict regulatory and secrecy environment. The ACC has strict conditions around the release and dissemination of information, and it has very significant penalties indeed for ACC staff who do not comply with those provisions.
The new proposal provides for 18 ACC staff. The sort of staff we are talking about are investigational staff, but also specialist staff in the context of the management of financial data, data miners, data analysts and statisticians. This capability will allow a number of things to occur: it will allow agencies, properly authorised and lawfully, to access ACC holdings in the context of risk—this is serious and organised crime penetration of government programs and other revenue streams.
It will also allow us to fuse data around those serious and organised criminals making the most money. So AUSTRAC data, and being able to work with that data and match it against lists of serious and organised criminals who are known, will therefore generate lead information—target packages, or the irresistible intelligence I talk about—for our partner agencies. What we will see from the fusion capability is a lot more lead information, a lot more suspects identified and a lot more risk that is able to be treated within the range of Commonwealth government programs.
Senator HUTCHINS —Mr Lawler, I understand that the commission established a reconciliation plan in 2008. Can you advise the committee of the outcomes to date?
Mr Lawler —Yes, I can. Indeed the ACC’s reconciliation action plan was released in October 2008. It is part of the agency’s commitment to progressing reconciliation between Indigenous and non-Indigenous persons. The plan recognises the ACC as part of a whole-of-government response to closing the gap between Indigenous and non-Indigenous Australians. Indeed, I have just had the plan brought to my attention. I understand it is also on the ACC’s website for viewing.
The action plan is due to be reviewed: it is a biannual plan. Work is already under way to refresh the plan. We are committed to increasing our Indigenous workforce by 2.7 per cent by 2015. We are participating in the whole of the Australian Public Service, sponsored by the Australian Public Service Commission, the Indigenous Pathways Program in 2010 to employ cadets and offer training.
Importantly, as part of our plan, the work of our National Indigenous Intelligence Task Force plays a key role. I will take you to a couple of the actions that highlight that. One of the actions was that the NIITF community visits contribute to increased intelligence and NIITF objectives. You would be aware of a high-quality report that has been produced by the ACC, with the help of its partner agencies, on the depiction of crime in Indigenous communities. It relied on sworn testimony from over 500 people, which provided a first-time picture of the extent of crime in those communities. There has been very strong stakeholder feedback, both within government and from the Indigenous community, on the quality of that report.
It is not a pretty picture. But that having been said, it becomes a document that will assist in improving the disadvantage of Indigenous communities, particularly in the context of crime. At a practical organisational level, we are also involved in the welcome to country, which is part of our operating procedure. It is part of the procedure that the board adopts at each of its four meetings a year as part of that plan. A range of things is under way. I am pleased to report to the committee on the ACC’s reconciliation action plan.
Senator HUTCHINS —Thank you, Mr Lawler. You have been on record in the past as saying that the criminal activities in Australia contribute about $15 billion in turnover for serious and organised crime figures. Can you give us a snapshot of criminal activity in this country currently? Senator Barnett referred to areas that are concerning him, such as card skimming, prostitution, and cybercrime. Is the importation of illicit drugs still the major contributor to that $15 billion profit that organised crime is making in this country?
Mr Lawler —The answer is yes. Illicit drugs are a significant proportion. It is difficult to have precise figures but we think that close to 50 per cent of revenue is generated through illicit drugs. Indeed, we are seeing—
Senator HUTCHINS —That would be a $7.5 billion industry then, on that basis?
Mr Lawler —I think it is of that order. I do not know the exact figure. It is important for the committee to be aware that we are involved in a joint project with the Australian Institute of Criminology. I understand that Dr Adam Tomison is to appear before the committee today. We are doing some joint work to try to understand in more detail and depth the cost to the Australian community. The figures that the ACC has promulgated are figures based on the United Nations Office on Drugs and Crime figures around gross domestic product. They project between 1 per cent and 2 per cent of GDP is lost to serious and organised crime.
I think those figures are also supported more broadly by other institutions—for example, the World Bank. Based on Australia’s GDP, which in 2009 was a little over $1 trillion, that equates to between $10 billion and $15 billion if you took 1.5 per cent. Some countries, in particular the United Kingdom, believe that those figures are conservative.
That having been said, the work is under way. The spectrum of criminality is narcotics, identity crime, money laundering and key risks. Within narcotics we see cocaine as a potential rising threat and, in a broader context, fraud. This goes to Senator Barnett’s earlier question: those areas where there are large amounts of money, large amounts of revenue and large amounts of savings are attractive to serious and organised crime. They are attractive because that is what they are looking for and that is what they want to benefit from.
Work in the area around those money flows—which goes back to the question of the fusion centre and the importance of that investment in that area—helps to protect the Australian community from serious organised fraud, investment fraud, superannuation fraud, and the credit card skimming that we spoke about earlier in the hearing.
Senator HUTCHINS —Thank you.
CHAIR —Thank you very much. We have no further questions for the Australian Crime Commission. Thank you for your time and assistance this morning, Mr Lawler and Ms Bailey.
Mr Lawler —Thank you.
Mr Wilkins —Could Dr Popple just repeat what he said about the costs issue?
CHAIR —We will do that and then take the morning tea break.
Dr Popple —Senator Barnett, I am afraid I was out of the room this morning when you asked your question again, and you might have missed the answer, which I gave yesterday just after lunch. You wanted to know the year-to-date figures for Commonwealth legal services. The way in which the process works is that agencies are required, under the legal services directions, to provide to us their annual figures within 60 days of the end of each financial year. So the short answer is we do not have year-to-date figures.
We will have the figures for this current financial year by the end of August this year. The figures you had—the ones we tabled at the October hearings last year—are the most recent figures we have and, of course, they relate to the 2008-09 financial year.
Senator BARNETT —At the figure of $555 million?
Dr Popple —Yes.
Senator BARNETT —I would say, if I was the minister and I had made a promise to significantly reduce legal costs across the government, I would ensure either quarterly or six-monthly reports to ensure that those costs were being reduced. You are not the minister so you cannot answer that question or respond to it. It beggars belief that the minister does not have in his possession evidence to confirm that there has been a reduction in the cost of legal services across the government. I can accept at face value what you are telling me, and I have to accept that, so I thank you for answering the question. You are getting back to us on the Melbourne terrorists?
Dr Popple —Yes, we are preparing that.
Senator BARNETT —Thank you.
CHAIR —We will break for morning tea and come back at 10.45 am
Proceedings suspended from 10.28 am to 10.47 am