Solicitors:
Australian Federal Police (Plaintiff)
File Number(s): 2019/20642
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Judgment: EX TEMPORE
The Commissioner of the Australian Federal Police (the plaintiff) seeks orders pursuant to the Proceeds of Crime Act 2002 (Cth) (the Act), including restraining orders and custody and control orders, in respect of Alaedine Rifai and Amal Hilmi. The plaintiff also seeks an order pursuant to r 6.15 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) that the summons filed in court today be made returnable immediately. I am satisfied that, in light of the nature of the application and the contents of the affidavit of Scott Michael Mathews affirmed on 11 July 2019 (referred to in more detail below), it is appropriate that the summons be made returnable immediately.
The plaintiff also seeks an order pursuant to s 26(4) of the Act and r 18.2 of the UCPR that the application made by the plaintiff for the relief sought set out in paragraphs 1 to 18 of the summons be heard and determined without notice. I am satisfied that it is appropriate to make this order since one of the purposes of the orders being made is to prevent the defendants dealing with the property in any way which might have the tendency to compromise the Commissioner's interests under the Act.
The restraining orders are sought pursuant to s 18 of the Act in respect of property set out in schedules 1 to 4 of the summons. The property in schedule 1 is a vacant block of land at Goulburn which is in the name of Ms Hilmi. The property in schedule 2 is a residential property in Heckenberg, a suburb of Sydney, which is in the name of Mr Rifai. The property in schedule 3 is a residential property in Broadmeadows, a suburb of Melbourne, which is in the name of Ms Hilmi. Schedule 4 comprises three motor vehicles: a Mercedes, a Porsche and an Audi. The Mercedes and the Audi are registered in Mr Rifai's name and the Porsche is registered in Ms Hilmi's name.
Section 18 of the Act makes provision for this Court to make restraining orders in certain circumstances and relevantly provides:
"18 Restraining orders--people suspected of committing serious offences
When a restraining order must be made
(1) A court with * proceeds jurisdiction must order that:
(a) property must not be disposed of or otherwise dealt with by any person; or
(b) property must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified in the order;
if:
(c) a * proceeds of crime authority applies for the order; and
(d) there are reasonable grounds to suspect that a person has committed a * serious offence; and
(e) any affidavit requirements in subsection (3) for the application have been met; and
(f) the court is satisfied that the * authorised officer who made the affidavit holds the suspicion or suspicions stated in the affidavit on reasonable grounds.
. . .
Property that a restraining order may cover
(2) The order must specify, as property that must not be disposed of or otherwise dealt with, the property specified in the application for the order, to the extent that the court is satisfied that there are reasonable grounds to suspect that that property is any one or more of the following:
(a) all or specified property of the * suspect;
. . .
Affidavit requirements
(3) The application for the order must be supported by an affidavit of an *authorised officer stating:
(a) that the authorised officer suspects that the * suspect committed the offence; and
. . .
The affidavit must include the grounds on which the * authorised officer holds those suspicions.
Restraining order need not be based on commission of a particular offence
(4) The reasonable grounds referred to in paragraph (1)(d) need not be based on a finding as to the commission of a particular * serious offence.
Risk of property being disposed of etc.
(5) The court must make a * restraining order even if there is no risk of the property being disposed of or otherwise dealt with.
. . ."
I am satisfied that this Court is a court with proceeds jurisdiction within the meaning of ss 18(1), 335 and 338 of the Act as it has jurisdiction over indictable offences. As is apparent from its terms, s 18 imposes an obligation on a court with proceeds of jurisdiction, such as this Court, to make a restraining order under s 18 if certain conditions are met, including that the Court is satisfied that the authorised officer who made the affidavit in support of the application holds relevant suspicions stated in the affidavit on reasonable grounds: s 18(1)(f).
The conditions also include that a proceeds of crime authority applies for the order: s 18(1)(c). Under s 25 of the Act a proceeds of crime authority may apply for a restraining order. The plaintiff is identified as a proceeds of crime authority within s 338, the definitional section of the Act.
Section 18 also requires that there be reasonable grounds to suspect that a person has committed a serious offence. "Serious offence" is defined by s 338 of the Act, as meaning an indictable offence which is punishable by imprisonment of three or more years.
In his affidavit of 11 July 2019 Federal Agent Mathews deposes as to each of the matters required by s 18. He sets out his suspicions that the defendants and a related company, Universal Group Australia Pty Ltd (Universal), have committed one or more serious indictable offences: first, dishonestly obtaining a gain from the Commonwealth contrary to s 135(1) of the Criminal Code Act 1995 (Cth) (the Code); and, secondly, dealing with money with a value in excess of $100,000 which is reasonably suspected of being the proceeds of crime contrary to s 400.9(1) of the Code. An offence contrary to s 135(1) of the Code is punishable by imprisonment for 5 years and an offence contrary to s 400.9(1) of the Code is punishable by imprisonment of 3 years. Accordingly each of these offences constitutes a serious offence within the meaning of the Act: s 338.
In paragraph 13 of his affidavit Federal Agent Mathews sets out his suspicion that the property specified in each of the four schedules is property of one or more of the suspects, being the two defendants or Universal within the meaning of s 18(2)(a) of the Act or that it is a property of another person that is subject to the effective control of one or more of the suspects within the meaning of s 18(2)(c) of the Act.
Federal Agent Mathews also sets out his suspicion that the property specified in schedules 1 and 4, being the vacant land in Goulburn and the three motor vehicles, is either property that is wholly or partly the proceeds of an indictable and serious offence within the meaning of s 19(1)(d)(i) and/or property that is the instrument of an indictable and serious offence within the meaning of s 19(1)(d)(ii). Section 19 of the Act relevantly provides for the making of restraining orders with respect to property which is either suspected of being proceeds of crime or an instrument of crime.
It is alleged that the two defendants and Universal were providers authorised by the National Disability Insurance Agency (NDIA) to provide services to participants in the National Disability Insurance Scheme (NDIS). Such participants comprise persons within the community who are disabled and who qualify for assistance pursuant to the NDIS. The persons who provide services including building work to participants in the scheme are entitled to be reimbursed under NDIS with public money.
It is alleged that the two defendants have, by dishonestly submitting claims purportedly on behalf of the participants in respect of services alleged to have been provided to them under the NDIS, obtained money from the Commonwealth by fraud. I note that Federal Agent Mathews has analysed the NDIS payments which were made into the Universal bank account which totalled some $2.1 million. These payments include payments totalling $300,000 between 8 December 2017 and 30 April 2018 and $1.8 million between 1 May 2018 and 7 September 2018. It is alleged that at least $1 million of this total amount was obtained fraudulently. The investigation is continuing.
The plaintiff submits that there are reasonable grounds to suspect that at least a substantial portion of the payments made to Universal under the NDIS were obtained by the defendants fraudulently. Sections 18 and 19 require only that there be reasonable grounds to suspect the commission of the offence and also that the authorised officer, being in this case Federal Agent Mathews, holds the suspicion stated in the affidavit on reasonable grounds.
The threshold suspicion on reasonable grounds is not particularly high and falls much short of satisfaction beyond reasonable doubt, satisfaction on the balance of probabilities or what would be sufficient to constitute grounds to believe. The High Court considered this threshold and what was required before a suspicion ought be regarded as reasonable in George v Rockett (1990) 170 CLR 104; [1990] HCA 26. The Court (Mason CJ, Brennan, Deane, Dawson, Toohey and Gaudron JJ) said at 115-116:
"Suspicion, as Lord Devlin said in Hussien v Chong Fook Kam (1970) AC 942, at p 948, 'in its ordinary meaning is a state of conjecture or surmise where proof is lacking: "I suspect but I cannot prove.''' The facts which can reasonably ground a suspicion may be quite insufficient reasonably to ground a belief, yet some factual basis for the suspicion must be shown. In Queensland Bacon Pty Ltd v Rees [1966] HCA 21; (1966) 115 CLR 266, a question was raised as to whether a payee had reason to suspect that the payer, a debtor, 'was unable to pay (its) debts as they became due' as that phrase was used in s.95(4) of the Bankruptcy Act 1924 (Cth). Kitto J. said (at p 303):
'A suspicion that something exists is more than a mere idle wondering whether it exists or not; it is a positive feeling of actual apprehension or mistrust, amounting to "a slight opinion, but without sufficient evidence", as Chambers's Dictionary expresses it. Consequently, a reason to suspect that a fact exists is more than a reason to consider or look into the possibility of its existence. The notion which "reason to suspect" expresses in sub-s.(4) is, I think, of something which in all the circumstances would create in the mind of a reasonable person in the position of the payee an actual apprehension or fear that the situation of the payer is in actual fact that which the sub-section describes - a mistrust of the payer's ability to pay his debts as they become due and of the effect which acceptance of the payment would have as between the payee and the other creditors.'"
Having regard to the detailed affidavit of Federal Agent Mathews I am satisfied that there are reasonable grounds for his suspicions as set out in the affidavit and also that there are reasonable grounds to suspect that the defendants have committed the offences against the Code referred to.
Ms Kougellis who appears on behalf of the plaintiff has informed me that she has instructions to give an undertaking to the Court on behalf of the Commonwealth with respect to the payment of damages or costs for the making and operation of the order. The short minutes of order which she has handed up record that undertaking. I note that s 21 of the Act contemplates that such an undertaking be given.
Having regard to the material within the affidavit of Federal Agent Mathews I am satisfied that the requirements for the affidavit in s 18 have been met. Federal Agent Mathews also deposes as to the acquisition of the Goulburn property (referred to in schedule 1) and the three motor vehicles (referred to schedule 4). His analysis of the bank statements of Universal and the timing of the acquisition of those assets forms the basis for his suspicion on reasonable grounds that that property was acquired with the proceeds of crime or was an instrument of those offences. In these circumstances the Commissioner has established not only the basis for restraining orders to be made under s 18 in respect of the property described in schedules 1 to 4 of the summons, but also for restraining orders to be made under s 19 in respect of the property described in schedules 1 and 4.
I note that, in respect of the residential properties (the Heckenberg property in schedule 2 and the Broadmeadows property in schedule 3), the plaintiff has made provision to protect the rights of the registered mortgagees of those respective properties: paragraphs 13 and 14 of the draft short minutes of order.
The plaintiff also seeks custody and control orders pursuant to s 38 of the Act which relevantly provides that the Court may order the Official Trustee to take custody and control of property covered by a restraining order if the Court is satisfied that this is required. I am satisfied on the basis of the material in Federal Agent Mathews' affidavit that it is necessary to make an order under s 38 of the Act in respect of property which will be the subject of restraining orders under ss 18 and 19. It is important that property which is the subject of a restraining order be within the custody and control of an authorised authority such as the Official Trustee in order that the Commonwealth's putative rights to the property are protected during the pendency of a restraining order. It is foreseeable that ultimately forfeiture order will be made in respect of that property.
The plaintiff has also sought a direction that the matter be adjourned for directions before the common law registrar on 20 August 2019. This would appear to me to be an appropriate length of time having regard to the nature of the orders I propose to make and the need to give the defendants adequate notice in order that they can, if they so wish, obtain legal representation before the matter is before the Court on the next occasion.
For these reasons I am satisfied that it is appropriate, on the basis of the undertaking referred to above, to make the orders sought in the short minutes of order handed up by Ms Kougellis which I will initial and date. Accordingly I make orders in terms of paragraphs 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17 and 18. I also order in accordance with paragraph 19 that the proceedings are adjourned for directions before the common law registrar at 9am on 20 August 2019. I order in accordance with paragraph 20 that there be liberty to restore on three days' written notice and I make an order in terms of paragraph 21 that these orders be entered forthwith.
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Orders
The orders made are as follows.
Upon the plaintiff giving the usual undertaking as to costs and damages, on behalf of the Commonwealth, the Court orders that:
Preliminary Orders
1. Pursuant to rule 6.15 of the Uniform Civil Procedure Rules 2005 (NSW), the Summons be made returnable immediately.
2. Pursuant to section 26(4) of the Proceeds of Crime Act 2002 (Cth) (the Act) and rule 18.2 of the Uniform Civil Procedure Rules 2005 (NSW), the application of the Plaintiff for the relief sought in paragraphs 1 to 18 of the Summons be heard and determined without notice.
Section 18 Restraining Orders
1. Pursuant to section 18 of the Proceeds of Crime Act 2002 (Cth), the property specified in Schedule One, being property of Amal Hilmi, must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified.
2. Pursuant to section 18 of the Proceeds of Crime Act 2002 (Cth), the property specified in Schedule One, being property of Amal Hilmi that is subject to the effective control of Alaedine Rifai, must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified.
3. Pursuant to section 18 of the Proceeds of Crime Act 2002 (Cth), the property specified in Schedule Two, being property of Alaedine Rifai, must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified.
4. Pursuant to section 18 of the Proceeds of Crime Act 2002 (Cth), the property specified in Schedule Three, being property of Amal Hilmi, must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified.
5. Pursuant to section 18 of the Proceeds of Crime Act 2002 (Cth), the property specified in Item 1 of Schedule Four, being the property of Alaedine Rifai, must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified.
6. Pursuant to section 18 of the Proceeds of Crime Act 2002 (Cth), the property specified in Item 2 of Schedule Four, being the property of Amal Hilmi, must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified.
7. Pursuant to section 18 of the Proceeds of Crime Act 2002 (Cth), the property specified in Item 2 of Schedule Four, being the property of Amal Hilmi, that is subject to the effective control of Alaedine Rifai, must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified.
8. Pursuant to section 18 of the Proceeds of Crime Act 2002 (Cth), the property specified in Item 3 of Schedule Four, being the property of Alaedine Rifai, must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified.
Section 19 Restraining Orders
1. Pursuant to section 19 of the Proceeds of Crime Act 2002 (Cth), the property specified in Schedule One must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified.
2. Pursuant to section 19 of the Proceeds of Crime Act 2002 (Cth), the property specified in Schedule Four must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified.
Third Parties' Registered Interests in Restrained Property
1. Notwithstanding paragraph 5, Westpac Banking Corporation, as registered mortgagee (pursuant to mortgage number XXXX) in relation to the property specified in Schedule Two, may deal with that property in accordance with the terms of the registered mortgage.
2. Notwithstanding paragraph 6, Permanent Custodians Ltd, as registered mortgagee (pursuant to mortgage number XXXX) in relation to the property specified in Schedule Three, may deal with that property in accordance with the terms of the registered mortgage.
Custody and control orders
1. Pursuant to section 38 of the Proceeds of Crime Act 2002 (Cth), the Official Trustee in Bankruptcy is to take custody and control of the property specified in Schedule One.
2. Pursuant to section 38 of the Proceeds of Crime Act 2002 (Cth), the Official Trustee in Bankruptcy is to take custody and control of the property specified in Schedule Two.
3. Pursuant to section 38 of the Proceeds of Crime Act 2002 (Cth), the Official Trustee in Bankruptcy is to take custody and control of the property specified in Schedule Three.
4. Pursuant to section 38 of the Proceeds of Crime Act 2002 (Cth), the Official Trustee in Bankruptcy is to take custody and control of the property specified in Schedule Four.
Other orders
1. The proceedings are adjourned for directions before the Common Law Registrar at 9am on 20 August 2019.
2. Liberty to restore on three days' written notice.
3. These orders be entered forthwith.
SCHEDULE ONE
1. Real property located at XXXX, Goulburn NSW, being Lot XX in Deposited Plan XXXX in the name of Amal Hilmi.
SCHEDULE TWO
1. Real property located at XXXX, Heckenberg NSW, being Lot XX in Deposited Plan XXXX in the name of Alaedine Rifai.
SCHEDULE THREE
1. Real property located at XXXX, Broadmeadows VIC, being Lot XX on Plan of Subdivision XXXX, Parent Title Volume XXXX Folio XX in the name of Amal Hilmi.
SCHEDULE FOUR
1. Mercedes E63 bearing Victorian registration number XXXX with VIN number XXXX currently registered in the name of Alaedine Rifai.
2. Grey 2012 Porsche cayenne bearing Victorian registration number XXXX with VIN number XXXX currently registered in the name of Amal Hilmi.
3. Audi S3 bearing New South Wales registration number XXXX with VIN number XXXX currently registered in the name of Alaedine Rifai.
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Decision last updated: 19 July 2019