Victoria’s $434m crime proceeds haul cops a caning

By Julian Bajkowski

Victoria’s system of confiscating money and assets from the state’s organised criminals and drug dealers has been found sorely wanting by the state’s Auditor General after a new report highlighted a raft of operational and governance shortcomings.

An audit of the state’s Asset Confiscation Scheme by the Victorian Auditor General’s Office released on Wednesday 4th September found that it was impossible to tell how ell, or otherwise, the system of depriving criminals of their ill-gotten gains is performing “as it lacks an effective performance framework.”

Asset confiscation is far from small change. The audit report put the value of assets ‘retrained’ by the scheme between 2007-2008 to June 2013 at $434 million. It said that “on average” 79 per cent of that was houses and property known as “real assets.”

The issue the Auditor has is figuring out how well run, or otherwise, the management processes around such a large sum are.

The news is not good.

“Its ability to deprive people of the proceeds of crime, and to deter and disrupt further criminal activity, is hampered largely by weaknesses in Victoria Police's approach to identifying assets, and weaknesses in how the Asset Confiscation Scheme operates as a whole,” Auditor General John Doyle wrote in the report, which has also recommended improvements at other legal and law enforcement agencies that work with the scheme.

“The audit found that the Asset Confiscation Scheme is not operating as effectively or efficiently as it should, as it is hampered by weaknesses in the way that assets are identified for confiscation, and how the Scheme is governed,” the Audit report said.

A major problem identified with the scheme’s operation and performance is that its purpose and mandate are simply unclear and confused.

“Victoria Police plays a critical role in the Scheme as it is responsible for identifying assets for confiscation through its investigative processes. However, it is not maximising opportunities to identify such assets related to profit-motivated, serious and organised crime,” the report said.

“Its asset confiscation functions are undermined by a failure to make the most of its investigative tools, by a lack of effective planning, and by capacity and capability weaknesses. Its current focus on victims of crime work does not directly or demonstrably contribute to the Scheme's objectives and diverts it from focusing on profit-motivated crime.”

The focus on using seized assets to compensate victims of crime has long been privately questioned by law enforcement professionals because it puts in place processes and mechanisms that can detract from the wider purpose of making criminal enterprises unprofitable.

“Significant governance weaknesses within the Scheme limit the ability of the agencies to work together effectively to implement the government's policy objectives,” one of the Audit’s conclusions states.

The latest audit is not the first time the scheme has been roasted.

“While the Scheme has been operating for over 15 years, it has experienced, and continues to experience, governance problems that undermine its effectiveness and efficiency,” the audit said.

“These governance issues have been known since at least 2003, and were further identified in the 2008 and 2009 reviews, and the 2012 evaluation. While efforts have been made to address them, these have not been effective.”


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