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Thursday, 4 June 1987
Page: 4025


Mr LEE(4.35) —My first comment is to praise the honourable member for Lowe (Mr Maher). I am sure that he will return to this House with an increased majority because of his reputation as one of Parliament's greatest advocates of tougher action against those involved in organised crime and welfare fraud.

The Cash Transaction Reports Bill will require institutions such as banks to report cash transactions involving $10,000 or more when they take place within Australia. If a transaction of $5,000 or more is made between Australia and another country, whether in dollars or in foreign currency, that transaction must also be reported to the Government. The Government believes that law enforcement authorities should have access to that information because it is well known that those involved in organised crime and major tax scandals use cash transactions to hide and to launder the proceeds of their criminal activities. This legislation is long overdue, and it is a credit to the Attorney-General (Mr Lionel Bowen) that it is before the House today.

This is not the only Bill that this Government has introduced in seeking to combat criminal activities. In this session it introduced the Proceeds of Crime Bill that will ensure that if people are involved in the sale and distribution of narcotics and drugs, the assets that they accrue from those illegal activities can be forfeited to the Crown. In addition, at this very minute, legislation that will alter the law that provides for telephone interceptions is before the other chamber. We hope that, in a short time, it will resolve its mind on that legislation. The Government has advocated that the Australian Federal Police be allowed to carry out telephone intercepts in new areas to ensure that those who are committing offences are brought before the courts.

In addition, the Government has provided additional resources to the Australian Federal Police and ensured that the number of trained and skilled police officers has been increased. Those additional resources-for example, the installation of new computer facilities-have resulted in the Australian Federal Police having a greater capacity to track down those involved in organised crime.

The legislation provides for cash transactions to be reported by the financial institutions to a Cash Transaction Reports Agency. The information that is accumulated by that authority will be available only to people such as the Commissioner of Taxation, the Australian Federal Police, the Department of Customs and the National Crime Authority. That is quite appropriate, because if we expect our law enforcement authorities to track down those guilty of ripping off the system and laundering the proceeds of organised crime and the sale of drugs, we must give them the weapons to follow the money trail, locate the guilty people and, most importantly, to ensure that the police can obtain sufficient evidence to obtain a conviction in the courts. This legislation will go a long way towards ensuring that that is the case.

The legislation is the result of the Government considering the recommendations of many reports. The honourable member for Lowe mentioned the McCabe-Lafranchi report on the criminal tax evasion schemes. The Costigan Royal Commission on the Activities of the Federated Ship Painters and Dockers Union, while intending only to investigate the painters and dockers in Victoria, found out that a large number of other criminal activities needed to be exposed. The Stewart Royal Commission of Inquiry into Drug Trafficking inquired into the Mr Asia drug ring and Mr Terrence John Clark's in some cases successful techniques for laundering money and for obtaining large sums of money from the proceeds of the sale of drugs. Last but not least, we had the Joint Select Committee on an Australia Card which was set up by the Parliament to investigate the proposed Australia Card legislation. I am pleased to see in the chamber one of the members of that Committee, the honourable member for Charlton (Mr Robert Brown).


Mr Price —An excellent member.


Mr LEE —He is an excellent member, as the honourable member suggests. He, along with his colleagues on the Joint Select Committee, thoroughly investigated the Government's plans to introduce an Australia Card. Of course, it is well known throughout the Australian electorate that the Australia Card was blocked by the combined vote in the Senate of the Liberal Party of Australia, the National Party of Australia and the Australian Democrats. I know that there are thousands of Australians who will use election day, 11 July, as an opportunity to let the Liberal Party, the National Party and the Australian Democrats know what they think of their, to date, successful attempts to stop the Australia Card from becoming a reality. The Australian people support the introduction of an Australia Card. They are sick and tired of people ripping off the taxation system. They are sick and tired of the welfare cheats being allowed to use false identities because the Liberal Party and the National Party will not allow the Australia Card legislation through.

This legislation will provide for financial institutions to verify the identity of people opening bank accounts. In addition, the Government is providing that over the next two years the owners of all existing accounts will have to be verified. That is long overdue. How many of us have read newspaper articles and heard stories about the welfare cheats who have opened dozens of bank accounts in false names, perhaps by obtaining false drivers licences, using them to prove their identity in order to open a bank account and then seeking to claim unemployment benefits under each of those dozens of names. In some cases those people who have opened those bank accounts in false names have ripped off the welfare system for hundreds of thousands of dollars.

The question I ask is: Why are the Liberal and National parties protecting those people who are ripping off the welfare system? Who are they really trying to protect? Are they trying to protect those people who claim unemployment benefits under false names and use false bank accounts? Are they seeking to protect the people involved in the sale and distribution of drugs and who seek to launder their funds by placing phoney bets at the races and then claiming that they have won large amounts? Are they seeking to protect those people and allow them to launder their funds through false bank accounts. This legislation will go a long way towards ensuring that the welfare cheats and money launderers are brought to justice.

What is the Opposition's response to our legislation? In the grand tradition of Yes Minister the Opposition has advocated sending the legislation to a committee. The Senate has already sent the Australia Card legislation to a committee, and the Opposition has had a year to consider that report and to debate the proposals. What does the Opposition want us to do today? It wants us to send this legislation to another committee. I can think of nothing more pathetic.

This legislation will allow the Government to combat tax evasion, to combat money laundering and also to combat other forms of organised crime. This legislation deserves the full support of all members of this House. The Opposition has spoken against this legislation on the ground that it believes that it will cost too much money to establish the authority to which the banks will report information of cash transactions. The Attorney-General has clearly responded to those arguments. He has explained that the total operating cost to the Federal Government will only be $2m a year. Of course, that is the direct cost to the Commonwealth. But we will obtain immediate benefits. The Australian Taxation Office has already estimated that that cost of $2m will be more than made up for by the Australian Taxation Office obtaining an increase in revenue from the people with bank accounts under false names. The Australian Taxation Office has estimated that this legislation will reap an additional $30m. Every dollar that the Australian Taxation Office obtains from those who have bank accounts opened under false names and who are ripping off the tax system is one less dollar that it has to get from ordinary, decent, honest working class Australians. That is why the legislation deserves the full support of everyone in this House.

The Opposition has also jumped on the band-wagon of some of the banks and claimed that, while it will cost the Federal Government only $2m a year to run, it will cost the banks a great deal more. The banks have a reputation for being very conservative and in that tradition they believe that the Government's legislation is unnecessary. The Opposition is bowing to this pressure from the banks. There is no reason at all for the banks to object to this legislation. The banks already have a voluntary code for the opening of new accounts. Under the Australian Bankers Association's voluntary code, a person has to produce a document such as a current passport to prove identity before opening an account. But, as I have already explained, it is quite common for people who are seeking to obtain unemployment benefits under false names to use false drivers licences. I must say at this point that I commend the New South Wales Government for taking the tough decision to introduced in New South Wales a drivers licence with a photograph.


Mr Cunningham —And Victoria.


Mr LEE —As the honourable member for McMillan has interjected, the progressive Victorian Labor Government has already introduced a similar system of drivers licences with photographs. So, in future, as a drivers licence will have a photograph of the holder, it will be much easier for bank tellers to ensure that people are not opening bank accounts under false names. That is why I supported the Government's plan to have a photograph on the Australia Card. It would provide greater security for the different bodies relying on the Australia Card. If I had an Australia Card with my photograph on it and someone stole my wallet or I lost my wallet, no one else could use my Australia Card if it had my photograph on it. That is why the overwhelming majority of Australians support the Government's proposals to bring in an Australia Card which includes a photograph.

Returning to the Opposition's claims that the introduction of this legislation will lead to significant increases in costs for the bankers, it should not be forgotten that when similar legislation was proposed in the United States of America the American Banks also expressed concern that it would create cost increases for them. Yet, after several years of operation in the United States, that legislation has been a great success. I quote from the Assistant Secretary of the United States Treasury, Mr Francis Keating, who gave evidence to a Senate committee of the United States Congress. He made the following remarks:

Mr Chairman, the Bank Secrecy Act has proven beyond all doubt its effectiveness as a law enforcement tool against drug trafficking, organised crime, and the illicit financial activity that supports it. The investigations that the departments of Justice and Treasury have conducted, particularly those under the President's Organised Crime Drug Enforcement Task force Program, have relied upon the Bank Secrecy Act Data and the analysis of these data that Treasury has prepared-

and this is the important point which I wish to emphasise-

In approximately three years of full operation, these Task Forces have initiated 1,350 cases and resulted in the indictments of 8,649 individuals, 3,678 which have been convicted.

So similar legislation in the United States resulted in more than 3,500 American citizens being convicted for criminal activity. I believe that this legislation will ensure that people who are involved in illegal activity, such as money laundering and the sale and distribution of drugs, will no longer be able to launder their funds. This legislation has my full support. It is my hope that, when the Senate completes its deliberations on the Telecommunications (Interception) Amendment Bill at a later hour this day, this Parliament will have another piece of armour to deliver to the law enforcement agencies to ensure that the crooks and the welfare cheats can no longer escape detection.