Monday, April 04, 2016

The obvious question

There's an obvious question which arises from the recent money laundering exposes and the repeated revelation that New Zealand companies and foreign trusts are being used by powerful offshore networks for tax cheating, corruption and money laundering: why isn't the government seizing those companies and trusts and their assets?

Seriously. The Criminal Proceeds (Recovery) Act allows property to be restrained if there are reasonable grounds to believe that it is wholly or in part derived from "significant criminal activity" (which means "any crime which makes you more than NZ$30,000"), and forfeited on the balance of probabilities of same. Corruption, money laundering, and tax evasion are all crimes, and given that there's no real legitimate use for offshore banking arrangements other than these criminal enterprises, such reasonable grounds exist for every NZ-domicilsed offshore arrangement for which there is not an obvious, legal purpose. So why not seize them?

Or, to give a specific example: Unaoil exists to channel bribes in the international oil industry. Taking a cut of those bribes is how they make their profits. And they've made a damn sight more than $30,000 from it. That media report alone constitutes reasonable grounds to believe that the company itself is tainted property, derived wholly or in part from significant criminal activity. Better: Unaoil is owned by a shell company in New Zealand. So why don't we restrain that shell company, and put the entire criminal network out of business?

I think the government owes us an answer on this.

I don't like asset forfeiture laws. But the government does. So why do they only use them against the little guy rather than the 1%? Why do they punish only minor league criminals, while letting the real criminals, the international super-wealthy, walk free?