On 19 July 2018, Rothman J of the New South Wales Supreme Court published reasons in Commissioner of the Australian Federal Police v Wu [2018] NSWSC 1108, dismissing the application made by Ms Wu to exclude the proceeds of sale of a property under s.29 of the Proceeds of Crime Act 2002 (POCA) from a restraining order.
The relevant property had been purchased with the assistance of a loan from NAB. In the loan application, the Applicant had made false declarations as to her assets and income. Specifically, Ms Wu had falsely declared that she was working full-time as a marketing manager in China, that she worked full-time as a manager at a company called Bob Power Tech Pty Ltd, that her home address was in China, that she owned a Toyota Camry worth $24,000 and that her gross monthly income was HK$51,369.83. In the course of an examination conducted under s.180 of the POCA, Ms Wu had admitted various falsehoods in her loan application.
Rothman J observed (at [23]):
The aforementioned admission means that the obtaining of the loans (which are a financial advantage) was dishonestly by deception, an offence contrary to s.192E(1) of the Crimes Act 1900 (NSW) (hereinafter “the Crimes Act”). Further, the provision of false information to obtain financial advantage is also an offence, contrary to s.192G of the Crimes Act.
As a consequence, at least, the loan moneys, which are the substantial amounts utilised for the purchase of each of the properties, were provided by virtue of the commission of an offence and are “the proceeds of an offence”.
Rothman found (at [53]) that:
As a consequence, the loans and amounts she received from the ANZ and NAB were the proceeds of her unlawful activities; the proceeds of crime and an instrument of serious crime.
The decision highlights yet again that property purchased with funds obtained through a fraudulent loan application constitutes proceeds of crime and, it would appear also, an instrument of crime. There may be arguments as to why such funds ought not be regarded as instruments, but merely proceeds, a distinction which is critical when one considers the compensation provisions which permit an applicant to obtain a payment from the Commonwealth where the Court is satisfied that a proportion of the value of the applicant’s interest was not derived or realised, directly or indirectly from the commission of any offence, provided that the Court is also satisfied that the applicant’s interest is not an instrument of any offence: see sections 77 and 94A of the POCA.
