2007/ACT/WKSP/007 International Cooperation in Combating Corruption Related to Money Laundering

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1 2007/ACT/WKSP/007 International Cooperation in Combating Corruption Related to Money Laundering Submitted by: Thailand Capacity Building Workshop on Combating Corruption Related to Money Laundering Bangkok, Thailand August 2007

2 International Cooperation in Combating Corruption Related to Money Laundering Wanchai Roujanavong Ministry of Justice Thailand United Nations Convention against Corruption 1

3 Money laundering related to Corruption Article 23: State Parties must establish the following offences as crimes. Conversion or transfer of proceeds of crime Concealment or disguise of the nature, source, location, disposition, movement or ownership of proceeds of crime Acquisition, possession or use of proceeds of crime Participation in association with or conspiracy to commit, attempts to commit and aiding, abetting, facilitating and counselling the commission of any of the above offences. The predicate offences shall include offences committed both within and outside the jurisdiction of the State Party. Concealment Article 24 : State Parties must establish as an offence. The concealment or continued retention of property when the person involved knows that such property is the result of any of the offences established in accordance with this convention 2

4 Statute of limitations Article 29 : Statute of limitations. State Party shall establish under its domestic law a long statute of limitations period or provide for the suspension of the statute of limitations where the alleged offender has evaded the administration of justice. Freezing, seizure, and confiscation Article 31: Each State Party shall take, to the greatest extent possible within its domestic legal system, such measures as may be necessary to enable confiscation of: Proceeds of crime or property derived from offences established in accordance with this convention Property, equipment or other instrumentalities used in or destined for use in offences established in accordance with this convention. (Even though the proceeds of crime have been transformed or converted into other property or have been mingled with property acquired from legitimate sources.) 3

5 Bank Secrecy Article 40: Each State Party shall ensure that, in the case of domestic criminal investigations of offences established in accordance with this Convention, there are appropriate mechanisms available within its domestic legal system to overcome obstacles that may arise out of the application of bank secrecy laws. Asset Recovery Asset recovery is one of fundamental Principles of this Convention (Article 51) Consists of 4 main measures Prevention and detection of transfers of proceeds of crime Measures for direct recovery of property Mechanisms for recovery of property through international cooperation in confiscation Return and disposal of assets 4

6 Prevention and detection of transfers of proceeds of crime Article 52: Each State Party shall require financial institutions to verify the identity of customers to take reasonable steps to determine the identity of beneficial owners of funds deposited into high-value accounts to conduct enhanced scrutiny of accounts sought or maintained by or on behalf of individuals who are, or have been, entrusted with prominent public functions and their family members and close associates. Measures for direct recovery of property Article 53: Each State Party shall Permit another State Party to initiate civil action in its courts to establish title to or ownership of the property taken by corruption Permit its courts to order the offender to pay compensation or damages to another State Party that has been harm by such offences Permit its courts to or competent authorities, in deciding on confiscation, to recognize another State Party s claim as a legitimate owner of the property taken by corruption 5

7 International cooperation for recovery of property Article 54: Each State Party shall Permit its competent authorities to give effect to an order of confiscation issued by a court of another State Party Permit its competent authorities to order the confiscation of such property of foreign origin in accordance with its domestic law Allow confiscation of the property without criminal conviction in cases in which the offender cannot be prosecuted by reason of death, flight or absence or in other appropriate cases. International cooperation for recovery of property Article 54: Each State Party shall Permit its competent authorities to freeze or seize property upon a freezing or seizure order issued by a court or competent authority (or even a request) of a requesting State Party that provides a reasonable grounds for taking such actions and that the property would eventually be subject to an order of confiscation Permit its competent authorities to preserve property for confiscation 6

8 International cooperation for purpose of confiscation Article 55: Having received a request from another State Party, a State Party shall take measures to identify, trace, and freeze or seize proceeds of crime, property, equipment or other instrumentalities for the purpose of eventually confiscation If a relevant treaty is needed, the State Party shall consider this Convention the necessary and sufficient treaty basis Return and disposal of assets Article 57: Property confiscated shall be disposed of, including by return to its prior legitimate owners. Each State Party shall enable its competent authorities to return confiscated property, when acting on the request made by another State Party in accordance with this Convention. In the case of embezzlement of public funds or of laundering of embezzled public funds In the case of proceeds of crime In all other cases 7

9 Money Laundering Control Act 1999 Predicate offense Section 3: In this Act, Predicate offense means (1) offences relating to narcotics (2) offences relating to sexuality in particular to sexual offences pertaining to procuring, seducing, or taking or enticing for indecent act on women or children in order to gratify the sexual desire of another person, and offences relating to the trafficking in children or minors, (3) offences relating to cheating and fraud to the public (4) offences relating to embezzlement or cheating and fraud involving assets Money Laundering Control Act 1999 Predicate offense (5) offences relating to malfeasance in office, or malfeasance in judicial office, or offences pertaining to malfeasance or dishonesty in carrying out official duties (6) offences relating to the commission of extortion or blackmail by a member of an unlawful secret society or organized criminal association (7) offences relating to customs evasion (8) offences relating to terrorism 8

10 Money Laundering Control Act 1999 Money laundering offence Section 5 : Whoever (1) transfers, receives the transfer, or changes the form of an asset involved in the commission of an offense, for the purpose of concealing or disguising the origin or source of that asset, or for the purpose of assisting another person either before, during, or after the commission of an offense to enable the offender to avoid the penalty or receive a lesser penalty for the predicate offense; or (2) acts by any manner which is designed to conceal or disguise the true nature, location, sale, transfer, or rights of ownership, of an asset involved in the commission of an offense shall be deemed to have committed a money laundering offense. Money Laundering Control Act 1999 Section 6 : Whoever commits a money laundering offense, even if the offense is committed outside the Kingdom, shall receive the penalty in the Kingdom, as provided in this Act, if: (1) either the offender or co-offender is a Thai national or resides the Kingdom; (2) the offender is an alien and has taken action to commit an offense in the Kingdom or is intended to have the consequence resulting therefrom in the Kingdom, or the Royal Thai Government is an injured party; or (3) the offender is an alien whose action is considered an offense in the State where the offense is committed under its jurisdiction, and if that individual appears in the Kingdom and is not extradited under the Extradition Act, Section 10 of the Penal Code shall apply mutatis mutandis. 9

11 Mutual Legal Assistance in Criminal Matters Act 1992 PART 9 Forfeiture or Seizure of Properties Section 32 Upon receipt the request for assistance from a foreign state to forfeit or seize properties located in Thailand, the Competent Authorities shall apply to the Court having jurisdiction over the location of the properties for passing the judgement forfeiting such properties or for the issuance of an order seizing them. Mutual Legal Assistance in Criminal Matters Act 1992 Section 33 The properties specified in the request for assistance from a foreign state may be forfeited by the judgement of the Court if such properties have been priory adjudicated to be forfeited by the final judgement of a foreign court and they are forfeitable under Thai laws. If the properties were adjudged to be seized by a foreign court before the Court passed its judgement or after the passing of the judgement to forfeit such properties but the judgement has not become final yet, the Court may deem it appropriate to order the properties to be seized provides that they are seizable under Thai laws. The forfeiture or seizure of properties by the judgement or order of the Court under this Section shall be effective even the offence which is the cause of such forfeiture or seizure may not have taken place in the territory of Thailand. 10

12 Mutual Legal Assistance in Criminal Matters Act 1992 Section 34 The provisions related to forfeiture of properties set forth in the Criminal Procedure Code and the Penal Code shall be applied to the inquiry, the application of motion, the trial, the adjudication, and the issuance of an order to forfeit or seize of properties in this regard, mutatis mutandis. Section 35 The properties forfeited by the judgement of the Court under this part shall become the properties of the State, but the Court may pass judgement for such properties to be rendered useless, or to be destroyed. Limitations The forfeited properties belong to the State or the requested state. Section 51 of the Money Laundering Control Act and Section 35 of the Mutual Assistance in Criminal Matters Act 11