Citation: Arora v Commonwealth Director of Public Prosecutions [2011] NSWSC 552
Court: Supreme Court of New South Wales
Date: 10 June 2011
Judge(s): Simpson J
Background
Two plaintiffs, a father and son, faced separate charges of money laundering under the Commonwealth Criminal Code. The elder plaintiff was charged under s 400.4 (dealing with money of $100,000 or more) and the younger under s 400.3(1) (dealing with money of $1,000,000 or more), both on the basis that they intended the money to become an "instrument of crime."
The Commonwealth Director of Public Prosecutions (CDPP) alleged that each plaintiff had purchased large numbers of bank drafts in individual amounts under $10,000 over several years, with the total sums across all transactions well exceeding the relevant thresholds. When particulars were sought, the CDPP identified the underlying crime as "structuring," an offence under the Financial Transaction Reports Act 1988, which is committed when a person conducts two or more cash transactions below the mandatory reporting threshold for the dominant purpose of avoiding that reporting obligation.
Each plaintiff applied to the Supreme Court for a permanent stay of his prosecution, on two separate grounds: that the charges were legally defective as particularised, and that the CDPP's decision to prosecute money laundering rather than structuring constituted an abuse of process.
Legal Issues
- Whether the money laundering charges, as particularised, were legally tautologous or otherwise defective, because the same activity was alleged to constitute both the "dealing" and the intended "instrument of crime"
- Whether the CDPP's exercise of prosecutorial discretion, specifically the decision to charge money laundering (carrying a maximum of 25 years' imprisonment) instead of structuring (maximum of 5 years), amounted to an abuse of process warranting a permanent stay
Decision
On the first ground, Simpson J rejected the argument that the charges were necessarily circular or defective. The plaintiffs contended that the conduct said to constitute the "dealing" (purchasing bank drafts in sub-$10,000 amounts) was identical to the conduct that would constitute the structuring offence intended to be facilitated. However, the court observed that structuring requires at least two non-reportable cash transactions to be complete. Any single bank draft purchase, considered in isolation, could not itself constitute structuring. The "dealing" and the completed crime were therefore not the same act.
The court also noted that "dealing" under s 400.2 of the Code includes not only the conduct of banking transactions but also possession of money. This meant the particulars were not inevitably self-defeating, and in any event remained open to revision before trial. The charges were not so fundamentally flawed as to warrant a permanent stay.
On the second ground, the court acknowledged that it retains a limited supervisory role to prevent abuse of prosecutorial discretion, but found no such abuse on the facts. The CDPP was not confined to a binary choice between a single money laundering charge and a single structuring charge. Given the volume of transactions, particularly in the younger plaintiff's case involving 198 transactions totalling over $1.5 million, a prosecution confined to a single structuring count with its five-year maximum would have been inadequate to reflect the alleged criminality. The court was satisfied that no abuse of process had been demonstrated.
Orders Made
- The summons of each plaintiff was dismissed.
Key Takeaways
- A money laundering charge under s 400.3 or s 400.4 of the Criminal Code (Cth), framed as "dealing with money intending it to become an instrument of crime," is not rendered tautologous merely because the underlying crime intended is structuring of the very same transactions, provided the elements of each offence remain conceptually distinct.
- Structuring under s 31(1) of the Financial Transaction Reports Act 1988 requires at least two non-reportable cash transactions to be complete; a single transaction below the reporting threshold cannot itself constitute the offence.
- Courts retain a limited power to intervene where prosecutorial discretion has been exercised abusively, but that power is narrow. No decided case cited to the court had deployed it to dictate the nature of the charges to be preferred against an accused.
- Where the volume and aggregate value of alleged transactions far exceed what a single structuring charge would adequately reflect, the CDPP's election to prosecute money laundering rather than structuring does not, without more, constitute an abuse of process.
- Particulars provided in support of a money laundering charge may be revised before trial, so deficiencies in particularisation as initially provided do not necessarily render the charge permanently flawed.
Legislation and Cases Referenced
Legislation:
- Criminal Code (Cth), ss 400.1, 400.2, 400.3, 400.4
- Financial Transaction Reports Act 1988 (Cth), ss 7, 31(1)
Cases:
- Nahlous v R [2010] NSWCCA 58; 201 A Crim R 150
- R v Huang; R v Siu [2007] NSWCCA 259; 174 A Crim R 370
- Thorn v R [2009] NSWCCA 294; 198 A Crim R 135