The variety of criminal activities that come under the definition of
“white collar” means there are several agencies that are responsible for
investigating and prosecuting white collar crime in Australia.

White collar crime is also notoriously difficult for authorities to deal
with, due in part to how easily these types of crimes can be covered up by the
perpetrators.

What are some Potential issues with enforcement of white collar crime?

The challenges authorities face in dealing with white collar crime
include:

·        
High evidentiary standards (even in civil proceedings).

·        
Difficulty detecting and subsequently establishing the commission of
crimes – particularly in circumstances where perpetrators are often able to
cover their tracks.

·        
Poor corporate compliance and cooperation with the agencies responsible
for investigation and enforcement.

 

In ordinary civil proceedings, most parties are motivated by the sheer
expense of participating in litigation to resolve matters expeditiously.
However, this incentive may be irrelevant to the types of wealthy individuals
or companies who often commit corporate crimes.

In practice, this leads regulatory bodies to settle prematurely to avoid
the ongoing drain of financial resources in prosecuting futile actions.

Although the usual civil burden of proof of a “balance of probabilities”
is unchanged in non-criminal white collar proceedings, the Briginshaw principle
dictates that the more serious an allegation (and the concomitant potential
penalties), the higher the standard of proof required to prove the allegations.

This effectively means that the burden of proof for many white collar
crimes is close to the criminal burden of “beyond reasonable doubt”.

A related difficulty is the disparity in the way in which evidence is
treated by courts in different states, given the absence of national uniformity
in evidence law and court procedure.

As a new Senate report Lifting the fear and suppressing the
greed: Penalties for white collar crime and corporate and financial misconduct
in Australiapoints out, the enforcement challenge is therefore that
judgments and punishments across Australia are not always consistent with each
other, despite potentially relating to very similar crimes.

Which agencies are responsible for investigating white collar crime?

As the corporate watchdog, many white collar offences come under the
Australian Securities and Investments Commission’s (ASIC) purview.

ASIC has the power to:

·        Take administrative action including banning or disqualifying people
from running companies or corporations or cancelling/suspending terms of a
financial services licence.

·        Issue civil proceedings on behalf of those who have suffered loss with a
view to obtaining compensation or seeking to compel compliance with the law.

·        Pursue wrongdoers through federal courts seeking to impose monetary
civil and criminal penalties including imprisonment and community service
orders.

 

ASIC Chairman Greg Medcraft has previously criticised the penalties
which can be imposed on white collar criminals. In October 2016, an ASIC
Enforcement Review Taskforce was announced by the federal government. It is
anticipated that the review will examine relevant legislation and provide
commentary on the adequacy of ASIC’s punitive and interventionist powers.

With a similar rationale to ASIC’s powers of enforcement and
investigation, the Australian Taxation Office (ATO) also has the ability to
impose and collect financial penalties in relation to crimes or offences
committed under the taxation or superannuation legislation.

Like ASIC, the ATO can take action including:

·        
Imposing civil penalties for breaches of applicable legislation.

·        
Issuing administrative penalties.

·        
Pursuing summary offences in relation to “minor” breaches of taxation
law.

·        
Seeking criminal prosecution and appropriate penalties for significant
tax crimes.

 

The Australian Competition and Consumer Commission (ACCC) is another
Commonwealth body with a significant role to play in dealing with white collar
crime. Unlike ASIC and the ATO, the ACCC cannot itself determine breaches of
legislation or impose penalties. However, it is able to join civil actions as a
plaintiff, and can refer matters to the Commonwealth Department of Public
Prosecutions (CDPP) for criminal prosecution.

What is the role of the Australian Federal Police (AFP)?

The majority of white collar crimes committed in Australia breach
federal legislation and laws, such as the Corporations Act 2001 (Cth),
the Australian Securities and Investments Commission Act 2001 (Cth)
and the Superannuation Industry (Supervision) Act 1993 (Cth).

Accordingly, police investigations are run by the AFP. The AFP is also
entitled, in conducting its investigations and preparing briefs for
prosecution, to seek to recover ill-gotten funds in accordance with the
provisions set out in the Proceeds of Crime Act 2002 (Cth), as
recently strengthened by the Crimes Legislation Amendment (Proceeds of
Crime and Other Measures) Act 2016 (Cth).

The Australian Transaction Reports and Analysis Centre (AUSTRAC) also
has a role in investigating white collar crime, and passes on relevant
information to the AFP and to prosecuting bodies.

Who prosecutes alleged white collar offenders?

Once investigated, crimes committed under federal legislation are
prosecuted by the Attorney-General’s Department  (AGD) and the
Commonwealth Director of Public Prosecutions (CDPP), although some minor
regulatory matters may be prosecuted by ASIC directly.

The AGD is responsible for administering offences under the Criminal
Code Act 1995, which include money laundering, forgery, bribery and
Commonwealth Government fraud.

In addition to these Australian agencies, there are numerous
multi-agency bodies, such as the Serious Financial Crime Taskforce (SFCT) which
combine resources with a view to reducing and ultimately eliminating the
presence of white collar crime. SFCT has powers to investigate international
crimes including phoenix activities and tax evasion, while cooperating with
international law enforcement bodies.

 

Conclusion

In attempting to tackle the apparent prevalence of white collar crime in
Australia, there are many agencies with the power to investigate and prosecute
those suspected of illegal white collar activities. Depending on the outcome of
the ASIC review and the reforms proposed in the Senate report, significant
changes to how white collar crime is dealt with may also be on the horizon.