Author: Rozenes, M. and J. McCarthy Date: 18/04/1993 Venue: Joint NCA / Victorian Council of Civil Liberties Conference, Melbourne
One of the more significant developments in law enforcement that has taken place over the last decade is the rise of the specialist investigative agency with coercive powers not available to conventional police forces. Starting with the establishment of the National Crime Authority in 1984, we now have the NSW Independent Commission Against Corruption, the NSW Crime Commission and the Queensland Criminal Justice Commission, and one suspects that a number of the remaining jurisdictions which at present do not have such an agency will be tempted to follow suit.1 To this list can be added the Australian Securities Commission which, while it has important regulatory responsibilities, also has a role in the investigation of breaches of the Corporations Law. In the discharge of its investigative responsibilities the ASC shares some of the characteristics of these specialist agencies, particularly the ability to rely on certain coercive powers. This paper firstly examines the reasons for the creation of just one of these specialist agencies - the NCA. In particular, we examine the proposition that a successful attack on organised crime requires resort to the coercive powers of a Royal Commission. This aspect will be examined from a more utilitarian perspective than we suspect will be the case in the session later in the conference which is specifically devoted to the right to silence. Finally, in considering the future direction and role of the NCA it will be suggested that the time has come for consideration to be given to substantial upgrading the role of the police component of the NCA to the extent that the Authority might become more police driven rather than being lawyer driven. This session of the Conference is, of course, concerned with specialist investigative agencies generally, and not just the NCA. However, we have concentrated on the NCA for the simple reason that, apart from the ASC, it is the only specialist agency in relation to which we are in a position to speak with any authority.
The Commonwealth DPP - our credentials
In one respect we are ideally placed to make a legitimate and at times a comparative assessment of the role of various investigative agencies. After all, the DPP is the funnel through which the product gets to court. The Commonwealth DPP has no investigative function of its own although over the years it has led the way in seeking an advisory involvement at an early stage in the investigative process. Other DPPs have in recent times recognised the utility of such a course. We are not to be taken as saying that the prosecution authority should usurp or even share the investigative function. On the contrary, we believe that it is critical that in order to be able to bring an independent assessment of the prospects in any given case the prosecutor must maintain a sufficient distance from the investigation. The Commonwealth DPP's practice is somewhat unique in that its "clients" are usually institutions rather than citizens. To name but a few, there is the Australian Taxation Office, the Australian Customs Service, the Australian Securities Commission, the Department of Social Securities, the Trade Practices Commission, the Health Insurance Commission, the Australian Federal Police and the National Crime Authority. In addition, some of the matters we prosecute are investigated by State Police. While all of these agencies have an investigative capacity, only the police and the NCA are traditional law enforcement authorities, with the remainder being principally concerned with regulation or revenue collection. The NCA - History The genesis of the NCA lies in the revelations of the reports of various Royal Commissions that took place in the 1970s and early 1980s as to the nature and extent of organised criminal activity in Australia. A theme common to the reports of Costigan, Stewart and Williams was that police forces had largely been ineffective against organised crime, and indeed that traditional methods of detecting and investigating offences were ill-suited to the task of controlling organised crime. In its "Initial Evaluation" report, the Parliamentary Joint Committee on the NCA conveniently summarised the reasons advanced by Stewart, Costigan and Williams for their view that conventional law enforcement agencies lacked the capacity to adequately deal with organised crime: Firstly, "policing is traditionally reactive rather than proactive: that is, police respond to complaints that offences have been committed and regard their task as having been completed when the person alleged to have committed the offence is apprehended rather than assembling intelligence which would enable individual offences to be seen as part of a pattern of illegal activity;" Secondly, "whereas the activities of criminal groups or syndicates transcended administrative, jurisdictional and even national boundaries, Australian law enforcement efforts had been fragmented, and there had been a failure to exchange information between agencies or even to disseminate information within single agencies;" Thirdly, "police forces lacked the resources which were necessary for a full-scale attack on even a single criminal group or syndicate and they lacked the support of specialist expertise - accountants and lawyers and the computer systems necessary to analyse vast amounts of documentary material;" Fourthly, "police lacked the power given to Royal Commissions to require persons to answers questions and to produce documents and they lacked the access to taxation records which was given to the Stewart and Costigan Royal Commissions." 2 An initial response by the Commonwealth to the recommendations of Stewart and Costigan in particular was the enactment in late 1982 by the then Coalition Government of a National Crimes Commission Act. This legislation was widely criticised, and after the election of the Labor Government in the following year it was decided to conduct a review of the concept of a Crimes Commission which had been recommended by both Stewart and Costigan. To that end a green paper was tabled in the Parliament, following which the Government convened a Conference in the middle of 1983 to discuss various issues associated with the establishment of a Crimes Commission. The main issue for debate at that Conference was whether the problems that had been encountered by law enforcement bodies in detecting and investigating organised crime could be addressed by up- grading the existing law enforcement machinery, or whether a new specialist law enforcement body was necessary. Of the reasons advanced by the various Royal Commissioners for the view that existing methods of policing were unequal to the task of controlling organised crime, it was the last of those mentioned - the lack of coercive powers - that seems to have provided the main impetus for the decision to establish the NCA, and indeed the other specialist investigative agencies that were to follow it. Many of the reasons identified by Stewart and others for the failure of conventional law enforcement agencies to adequately respond to organised criminal activity could be addressed without creating a specialist agency, and indeed a number of these had already been addressed to some extent by the time of the 1983 Conference. For example, the lack of co-operation between police forces in the collection and dissemination of information and intelligence had been addressed to some extent by the establishment in early 1981 of the Australian Bureau of Crime Intelligence. The late 1970s and early 1980s had also seen greater co-operation between police forces to deal with the problem of cross-jurisdictional criminal activity with the establishment of various joint police task forces. However, the police were still required to operate within the constraints imposed by the right to silence - while it had been the coercive powers of the Royal Commissions that had proved so invaluable in getting at the truth and revealing the nature and extent of organised criminal activity in Australia. If the significant criminals involved in organised crime were to be put behind bars, it was thought to be essential that the agency responsible for carrying out investigations have "Royal Commission" type powers, particularly the power to override the right to silence. Yet there could be no question of investing conventional police forces with such coercive powers. A standing "Royal Commission" type body, on the other hand, would enable a system of checks and balances to be incorporated in the enabling legislation. The perceived need for resort to coercive powers in the investigation of organised criminal activity was not, of course, the only reason it was ultimately decided to proceed with the establishment of the NCA. The police forces were barely coping with more conventional crime, and it was thought doubtful whether even better equipped and generally upgraded police forces would be able to adequately respond to organised crime, at least in the short term. It was thought that a standing Royal Commission type body would also facilitate the adoption of the multi-disciplinary approach to criminal investigation which had proved to be so successful with the earlier Royal Commissions. However, the multi-disciplinary approach is "in stark contrast to the ideologies and practices of most Western police forces which have traditionally regarded themselves as hermetically-sealed experts in criminal investigation and who are openly opposed to lateral entry".3 Further, there was the pragmatic consideration that the cost involved in establishing and maintaining a separate agency would be considerably less than that which would be involved in upgrading the existing police forces to the necessary standard. Coercive Powers Nevertheless, the view that coercive powers were essential if organised crime was to be successfully attacked requires examination. The coercive powers of the NCA that are relevant for present purposes are those in Division 1 of Part II of the NCA Act, particularly s25 and 30. s25 enables the Authority to hold hearings for the purposes of a special investigation it is conducting pursuant to a reference, and s30 relates to the conduct of such hearings. In particular, of s30(2) provides, amongst other things, that a person appearing as a witness at a hearing before the Authority shall not, without reasonable excuse, refuse or fail to answer a question that he or she is required to answer by the presiding member or refusal or fail to produce a document or other thing that the witness was required to produce by summons under the Act. Nevertheless, sub-section (4) preserves a witness's privilege against self incrimination by providing that it is a reasonable excuse for the purposes of sub-section (2) if the answer to the question put to the witness or the production of the document or other thing, as the case may be, might tend to incriminate the witness. However, what sub-section (4) giveth, sub-sections (5) and (7) taketh away. The effect of these latter sub-sections is to override the witness's privilege against self incrimination if an undertaking in writing in the terms of those sub-sections has been given to the witness by the Commonwealth DPP4 and/or a State DPP5 The undertaking that may be given to the witness pursuant to those two sub-sections, in general terms, is that neither the witness's testimony nor any evidence derived either directly or indirectly from the witness's testimony will be used in evidence against the witness for an offence other than proceedings in respect of the falsity of the evidence given by the witness. These are two issues here:
- the use of the coercive power where no issue of self incrimination arises
- the use of the coercive power where the issue of self incrimination does arise.
From a law enforcement perspective we have no difficulty with the power to require a witness at a hearing before the Authority to answer questions or to produce documents in circumstances where no issue of self incrimination arises. The power to require a person to answer questions is obviously a most useful investigative tool if the witness would be unwilling to co-operate if simply questioned by the police. Such a power may also have the advantage in some cases of allowing witnesses such as lawyers and bankers to freely provide information where they would otherwise be inhibited from doing so out of obligations of confidentiality.6 Nevertheless, from a law enforcement perspective we question the value of the power to override a witness's privilege against self incrimination where the protection that is afforded the witness as a consequence covers not only the witness's actual testimony but anything derived either directly or indirectly from that testimony. The practical effect of granting a witness an undertaking under either sub-section (5) or (7) will be to preclude the prosecution of the witness for any offence disclosed in the course of giving evidence unless there is sufficient independent evidence available to support a prosecution in the hands of the prosecuting agency prior to the witness testifying. A witness testifying before the Authority under a s30 undertaking, by disclosing perhaps for the first time his or her involvement in some offence, and which disclosure may be quite unrelated to the particular criminal activity under investigation, could effectively obtain an immunity from prosecution for the disclosed offence. It may well have been envisaged by those responsible for the preparation of the NCA Act that s30 would be employed by the Authority to secure information from unco-operative criminals who could only be forced to tell what they knew by overriding their privilege against self incrimination. However, be that as it may, because of the consequences of obtaining evidence under a s30 undertaking it is our experience that such undertakings have only been sought by the Authority to obtain the testimony of a person who has already (hopefully) told all he or she knows to the Authority's officers, often in the form of a statement which has been obtained in such circumstances that any admissions made are clearly inadmissible against the person.7 The timing of a recommendation by the Authority that an accomplice be given an undertaking under the NCA Act may also present problems for the DPPs. In this regard, the undertaking that is given to a prospective witness before the Authority is in very similar terms to the undertaking the Commonwealth DPP may give to secure the evidence of a witness for the prosecution.8 Yet the two undertakings are usually given at quite different stages. The undertaking under the DPP Act is almost invariably given at the conclusion of the investigation when the accomplice's account of the role he or she played in the offence can be tested against the available corroborative evidence. An undertaking under the NCA Act, on the other hand, may be sought at a much earlier stage in the investigation, and when there may be little independent material available against which one can test the prospective witness's assertion that he or she is but a mere minnow. For these reasons there may be little benefit to be gained in practice in making provision for the privilege against self incrimination to be dispensed with in the case of specialist investigative agencies such as the NCA, by which we mean those agencies whose primary function is to assemble sufficient admissible evidence to support a prosecution.9 On the other hand, this power may be a far more useful weapon in the hands of specialist agencies such as ICAC whose primary function appears to be to get at the truth, with securing convictions being a secondary aim. In their pursuit of the truth such agencies may be prepared to pay the price of being effectively estopped from prosecuting certain individuals.10 Given the limited value of a s30 undertaking as an investigative tool, some may argue that the protection afforded by such an undertaking should be modified by removing the restriction on the use of derived evidence, as was recently done in the case of the similar provisions in the Corporations Law and the ASC Law. 11 We would not, however, support such a change. The changes to the immunity provisions of the Corporations legislation were essential if Australia was to have an effective corporate regulatory system in Australia. In their original form these immunity provisions could have operated to effectively preclude a prosecution because of the answers given by a witness under compulsion in the course of an ASC examination which was being conducted at a time when the ASC was only contemplating seeking civil remedies. As a consequence, the ASC had been loath to use its examination powers where there was some possibility that a criminal prosecution might ultimately be warranted. There are, however, important differences between an ASC examination and a hearing under the NCA Act. In the latter case there is no issue of a law enforcement authority being forced to abandon a criminal prosecution because of disclosures made under compulsion for some other purpose. The immunity in respect of derivative use must be taken as forming part of the privilege against self incrimination in Australia.12 The removal of the present restriction on the use of derived material could only be justified if there was an overwhelming case for doing so. We do not believe such a case can be made out.13 However, there should be far less difficulty with an amendment which would override the right to claim the privilege in relation to documents and other things that a witness is required to produce under summons. After all, this material is already amenable to a search warrant in any event. The future of specialist investigative agencies such as the NCA. As a general observation there are far too many investigative agencies of one form or another in this country. In the Commonwealth arena alone, apart from the two main law enforcement bodies - the AFP and the NCA - there are a host of investigative units within various departments and agencies, and indeed these departmental investigative units account for the majority of prosecutions conducted by the Commonwealth DPP.14 The reasons for this are largely historical, but centre on the fact that the Commonwealth did not have its own statutory police force until the 1960s. Some may argue that the result of this plethora of Commonwealth investigative bodies is duplication of effort and inefficiency. An additional complicating factor is that, while the AFP and the NCA are essentially single purpose bodies in that their primary function is the detection and investigation of crime, some of these departmental investigators may have a competing agenda in that they are able to rely on other enforcement options such as the imposition of an administrative penalty. When the prosecution process is seen to be cumbersome, time consuming and expensive there is perhaps an understandable temptation to prefer these alternatives to a prosecution. In addition, some departmental investigators are also required to adopt a schizophrenic role - investigating suspected breaches as well as performing duties of an administrative nature unrelated to the investigation of suspected offences. The social security field officer may be required to deal with the one individual as both a "client" as well as a "suspect". It has been argued by the AFP that Commonwealth law enforcement would be far more effective and efficient if much of the work at present undertaken by departmental investigators was taken over by the AFP - particularly in the area of fraud on the Commonwealth. Nevertheless, notwithstanding the fragmented nature of law enforcement in Australia, and in the Commonwealth arena in particular, we have little doubt that the NCA will prove to be a permanent feature of the law enforcement landscape in Australia.15 Irrespective of the importance that one places on the NCA's coercive powers as a weapon in the attack on organised crime, with its multi- disciplinary approach to the investigation of crime and the fact that it is largely unaffected by jurisdictional boundaries, the NCA remains uniquely placed to provide a co-ordinated response to organised crime in this country. Of course, as there are changes in the environment in which the NCA operates, so the Authority will need to adapt. In this regard, the Authority is now a rather different organisation to what it was in 1984. While the Commonwealth's intention in setting up the NCA was that it would be a partner rather than a competitor to the existing law enforcement agencies, there can be no denying that in its early years the Authority's relationship with the various police forces was at best tense and at times acrimonious. That there would be some tension was perhaps inevitable. The police were bound to be jealous of the resources and powers given to the Authority. However, its heavy emphasis in the early years on drug trafficking and related criminal activities did little to improve relations. These early NCA operations relied heavily on conventional police methods, and the police forces could claim with increasing justification that these were not the sort of matters that the NCA had been set up to deal with. While the Authority achieved some significant results in its drug trafficking investigations, generally speaking they were no better than those achieved by the conventional police forces over the same period, particularly by the AFP.16 However, in its Corporate Plan for the period July 1991-June 1994 the Authority has adopted what, in contrast to what it had previously seen as its role, is a quite radical change of direction. Three of the principal elements in the new direction now being taken by the Authority are:-
- "a shift in the subject matter of its activities away from drug-related matters to serious white collar/corporate crime;
- a more balanced emphasis on the various functions given to the Authority by the NCA Act, rather than the emphasis given by the Authority to the investigative function in the past;
- a change in working methods, with co-ordination, co-operation and joint efforts replacing the more individual and isolated approach adopted by the Authority in the past." 17
Although this change in direction was prompted in part by criticisms that had been levelled at the Authority in the past,18 no doubt it was also an acknowledgment of the increased capacity of the AFP and State police forces to deal adequately with certain aspects of organised criminal activity, particularly in the drug trafficking area. The Authority's new direction has been further refined by its current chairperson, Tom Sherman. The Authority will concentrate on serious organised crime , money laundering and appropriate serious white collar crime. In addition, the Authority is uniquely placed to provide support for interstate policing. The shift in emphasis towards white collar and corporate crime is in particular to be welcomed. As mentioned at the outset of this paper, one change we would like to see, and then rather sooner than later, is a substantial upgrading of the police component of the NCA so that it becomes essentially a police rather than lawyer dominated organisation. In its "Initial Evaluation" Report the Joint Parliamentary Committee on the NCA recommended that "in the management of investigative teams the Authority (should) give greater recognition to the expertise of experienced police officers."19 However, what we have in mind goes beyond the modest change contemplated by the Joint Parliamentary Committee. Not only should it be the norm for an investigative team to be headed by a police officer, with lawyers and other specialists performing the role of advisers to the police component of the team, but indeed the police should be significantly involved in making the key policy decisions for the Authority. This may eventually involve the appointment of senior police officers as members of the Authority. In this context, it is pleasing to note the recent appointment of a senior police officer to head the Authority's regional office in Queensland. While in its 1991 Report the Parliamentary Joint Committee was to state that its earlier recommendation "was not based upon a conclusion that lawyers were either unable to manage or contribute effectively to investigations"20 there is no need to be so circumspect. As a general proposition lawyers do not make good investigators. We are quite good at assessing what evidence is needed to support a successful prosecution, but we are not so good at deciding how to go about getting that evidence and actually getting it. Such work requires the skills of a trained investigator, not a lawyer. Lawyers have little experience of investigative methods, and as a consequence they will tend to make operational decisions from their limited, and largely irrelevant, perspective as lawyers. Indeed, while the existing structure of the NCA reflects its philosophy that lawyers rather than police are the most appropriate people to run the NCA, there is some evidence that the dominance of lawyers within the Authority has in fact had an adverse effect on its performance.21 A number of other benefits would flow from such a change in the Authority's structure. Conventional police forces would be more disposed to treat the Authority as a colleague rather than something of an amateur in law enforcement. It would also present an opportunity to demonstrate to police forces the advantages of the multi-disciplinary approach to the investigation of sophisticated crime - but this time with police providing the direction and control of the investigation and with the role of the lawyers and other specialists being essentially that of advisers. Conclusion The NCA is now a rather different body to what it was in its early years, but it at last seems to have found a worthwhile niche for itself in the structure of law enforcement in Australia which is consistent with the reasons for establishing it in the first place. It was never feasible for the Authority to operate as Australia's "ninth police force", and the Authority is likely to prove to be a more long term proposition in performing a co-ordinating role in conjunction with the conventional police forces, with less emphasis being placed on conducting its own discrete investigations. While the need for coercive powers in the attack on organised crime seems to have provided one of the main reasons for establishing the NCA, its adoption of the multi-disciplinary approach to the investigation of sophisticated crime and its ability to conduct investigations largely unaffected by cross-jurisdictional problems are likely to prove to be of more long term value to the Authority. However, the Authority is unlikely to realise its full potential until the structure of the Authority generally, and that of its investigation teams in particular, reflect the fact that it is an investigative agency, albeit a specialist one, and not some sort of standing Royal Commission. Footnotes 1 There have been intermittent calls for the establishment of an ICAC-type body for the ACT. 2 The National Crime Authority - an initial evaluation, Report by the Parliamentary Joint Committee on the National Crime Authority, Canberra 1988, pages 21-22. 3 Corns, The National Crime Authority: an evaluation, 13 Criminal Law Journal 233 at 238 4 s30(5), National Crime Authority Act 1984 5 s30(7), National Crime Authority Act 1984 6 s30(3) does, however, preserve legal professional privilege. 7 Nevertheless, the NCA does see some advantage in using the formal hearing process to obtain the evidence of a "co-operative" witness. The position of the Commonwealth DPP is that an undertaking under s30(5) will only be given to such a witness if there is a reasonable basis for believing that the witness has not in fact been wholly co-operative and that the hearing process could elicit further material which has not previously been forthcoming. 8 s9(6), Director of Public Prosecutions Act 1983 (Commonwealth) 9 An indication of the limited utility of the s30 undertaking is that less than 30 witnesses appearing before the Authority were granted such undertakings in the first nine years of the NCA's operations. Source: Parliamentary Joint Committee on the NCA: Third Report (Appendix 2) Canberra, 1989; National Crime Authority Annual Reports for 1989/90, 1990/91 and 1991/92. 10 Paradoxically, the equivalent provision in the Independent Commission Against corruption Act 1988 (NSW), s26, places no restriction on the use of derived material. 11 s597, Corporations Law and s68, ASC Law. For the background to these changes see Use immunity provisions in the Corporations Law and the ASC Law, Report of the Joint Parliamentary Committee on Corporations and Securities, Canberra, Nov 1991. The charges were effected by the Corporations Legislation (Evidence) Amendment Act 1992 12 See generally Sorby v Commonwealth (1983) 152 CLR 281 13 In 1989 a former Chairman of the authority, Mr Peter Faris QC, proposed that the NCA Act be amended to remove the privilege against self incrimination (The Role of the National Crime Authority in Australian Law Enforcement, text of a speech delivered at Queen's Inn, University of Melbourne, 8 August 1989, page 9, referred to in Who is to guard the guards?: an evaluation of the National Crime Authority, Report by the Parliamentary Joint Committee on the NCA, Canberra 1991, page 205). In evidence to that Committee in July 1991, however, the then Chairman, Mr Justice Phillips, stated hat his personal view was that the privilege should not be removed (op. cit., page 205). On the other hand, the attitude of the NSW Commission on this issue is not so equivocal. On a number of occasions it has recommended that the equivalent provisions in its Act be amended to remove the right of privilege against self incrimination (see, for example, State Drug Crime Commission of NSW, Annual Report 1989-90, page 8). 14 In 1991/92 63 percent of matters prosecuted summarily by the Commonwealth DPP were referred by non-AFP agencies. Over the same period 33 percent of matters dealt with on indictment were referred by non-AFP agencies. Source: DPP Annual Report 1991/92, Prosecution Tables 9(a) and (b). 15 On the other hand, specialist investigative agencies such as ICAC which are more akin to a standing Royal Commission may prove to have only a limited life span. The more successful ICAC is in its primary functions of educating the public as to corrupt practices and promoting confidence in public administration in NSW, the less justification there will be for it to continue, at least in its present form. 16 However, the impact of the sunset clause on the NCA should not be unestimated. This had the unfortunate, and no doubt unintended, effect of forcing the Authority to get some early "runs" on the board before its very existence cam up for review, even if a fair proportion of them were "extras". 17 Who is to guard the guards: an evaluation of the NCA, Report by the Parliamentary Joint Committee on the National Crime Authority, Canberra, Nov 1991, page 72. 18 Ibid, page 69. 19 The NCA: an initial evaluation, op.cit., page 61. See also Who is to guard the guards? - an evaluation of the NCA, op.cit., page 227. 20 Who is to guard the guards - an evaluation of the NCA, op.cit. page 227. 21 See generally Corns, Lawyers and police: an uneasy marriage in the NCA's fight against organised crime, (1992) 25 ANZJ Crim. 231.