Chapter 2


Australian Crime Commission Annual Report 2014-15

Background

2.1        The Australian Crime Commission (ACC) is established under the Australian Crime Commission Act 2002 (the ACC Act) as a statutory authority to combat serious and organised crime.[1]

2.2        It is the only agency 'solely dedicated to combating serious and organised crime of national significance'.[2]

2.3        The ACC works with partners across law enforcement, national security, government and industry and provides Australia with 'the ability to discover, understand and respond to federally relevant serious and organised crime'.[3]

Annual report compliance

2.4        The ACC annual report must comply with requirements specified in section 61 of the ACC Act. Subsection 61(2) requires that the report must include the following:

(a)  a description of any investigation into matters relating to federally relevant criminal activity that the ACC conducted during the year and that the Board determined to be a special investigation;
(b)  a description, which may include statistics, of any patterns or trends, and the nature and scope, of any criminal activity that have come to the attention of the ACC during that year in the performance of its functions;
(c)  any recommendations for changes in the laws of the Commonwealth, of a participating State or of a Territory, or for administrative action, that, as a result of the performance of the ACC’s functions, the Board considers should be made;
(d)  the general nature and the extent of any information furnished by the ([Chief Executive Officer (CEO]) during that year to a law enforcement agency;
(da)  the general nature and the extent of any information disclosed by the CEO during that year to a body corporate under section 59AB;
(e)  the extent to which investigations by the ACC have resulted in the prosecution in that year of persons for offences;
(ea)  the extent to which investigations by the ACC have resulted in confiscation proceedings;
(g)  particulars of the number and results of:
  (ii)  applications made to the Federal Court or the Federal Circuit Court under the Administrative Decisions (Judicial Review) Act 1977 for orders of review in respect of matters arising under this Act; and
  (iii)  other court proceedings involving the ACC;

being applications and proceedings that were determined, or otherwise disposed of, during that year.[4]

2.5        As a Commonwealth entity, the ACC must comply with the Public Governance, Performance and Accountability Act 2013 (PGPA Act), which requires Commonwealth entities to provide an annual report to the entity's responsible minister, for presentation to the Parliament, on the entity's activity during the reporting period,[5] and with the Public Governance, Performance and Accountability Rule 2014.[6] 

2.6        Under the PGPA Act, Commonwealth entities are also required to prepare annual performance statements and include a copy of these statements in the entity’s annual report that is tabled in the Parliament.[7] The ACC's annual performance statement appears at chapter 3 of the annual report.

2.7        Based on the committee's assessment, the annual report meets the above requirements.

ACC achievements in 2014–15

2.8        The annual report notes that there were numerous priorities for the ACC in 2014–15.

Investigations

2.9        The annual report notes that the ACC's investigations are 'designed to disrupt and deter criminal groups by collecting evidence and intelligence about criminal activity'.[8] The ACC Board approved the following investigations during the reporting period:

  • Targeting Criminal Wealth;
  • Highest Risk Criminal Targets;
  • Highest Risk Criminal Targets—Victoria; and
  • Highest Risk Criminal Targets—South Australia.[9]

Intelligence operations

2.10      The annual report states that the ACC's 'intelligence operations focus on gathering intelligence around particular criminal activity so decisions are informed by the extent, impact and threat of that activity'.[10] The ACC Board approved the following intelligence operations during the reporting period:

  • High Risk and Emerging Drugs;
  • Outlaw Motor Cycle Gangs;
  • National Security Impacts from Serious and Organised Crime;
  • Making Australia Hostile to Serious and Organised Crime; and
  • Child Sex Offences.[11]

Contribution to law reform and parliamentary inquiries

2.11      The ACC has continued its engagement with various parliamentary inquiries, and noted its participation in the following parliamentary inquiries during the reporting period:

  • the Senate References Committee on Legal and Constitutional Affairs, Comprehensive Revision of the Telecommunications (Interception and Access) Act 1979;
  • the Parliamentary Joint Committee on Intelligence and Security, Inquiry into the Telecommunications (Interception and Access) Amendment (Data Retention) Bill 2014;
  • the Parliamentary Joint Committee on the Australian Commission for Law Enforcement Integrity, Inquiry into the jurisdiction of the Australian Commission for Law Enforcement Integrity;
  • the Parliamentary Joint Committee on Law Enforcement, Inquiry into financial related crime;
  • the Parliamentary Joint Committee on Intelligence and Security, Inquiry into the Counter-Terrorism Legislation Amendment (Foreign Fighters) Bill 2014;
  • the Parliamentary Joint Enquiry on Law Enforcement, Inquiry into the ability of Australian law enforcement authorities to eliminate gun-related violence in the community;
  • the House of Representatives Standing Committee on Infrastructure and Communications, Inquiry into the use of subsection 313(3) of the Telecommunications (Interception and Access) Act 1979 (TIA Act);
  • the Senate Legislation  Committee on Legal and Constitutional Affairs, Inquiry into the Crimes Legislation Amendment (Powers, Offences and Other Measures) Bill 2015;
  • the Senate Economics References Committee, Inquiry into digital currency;
  • the Parliamentary Joint Committee on Law Enforcement, Inquiry into crystal methamphetamine (ice);
  • the Northern Territory Legislative Assembly Select Committee inquiry into ‘ice’; and
  • the Parliamentary Joint Committee on the Australian Commission for Law Enforcement Integrity, Integrity of Australia’s border arrangements.[12]

2.12      The ACC also engaged closely with the Attorney-General's Department in respect of its reviews of the anti-money laundering/counter-terrorism financing regime.[13] The ACC contributed to a mutual evaluation undertaken by the international Financial Action Task Force, which concluded in April 2015; and a statutory review of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006.[14]

Staffing and financial management

2.13      On 30 June 2015, the ACC comprised 581 staff across eight offices around Australia.[15] This is a slight increase from the previous reporting period, of 562 staff (across nine offices).[16]

2.14      The Australian National Audit Office determined that, with respect to the ACC's financial statements, the ACC had complied with the Australian Accounting Standards and the Public Governance, Performance and Accountability (Financial Reporting) Rule 2015, and presented fairly its financial position as at 30 June 2015, its financial performance and cash flows for 2014–15.[17]

2.15      The ACC reported a deficit of $6.295 million in 2014–15,[18] compared to $6.317 million in 2013–14.[19]  The annual report notes that, with the exclusion of unfunded depreciation and capital funding, the ACC would have realised a surplus of $0.184 million for the 2014–15 financial year.[20] The annual report also provides:

The ACC’s total appropriation for 2014–15 was $98.370 million, which included $93.358 million operating budget, $4.812 million Departmental Capital Budget and a net equity injection of $0.200 million.[21]

Ombudsman's report—controlled operations

2.16      The Ombudsman's inspection and reporting functions in respect of controlled operations are found in subsection 15HS(1) of the Crimes Act 1914 (Crimes Act) that provides:

The Ombudsman must, from time to time and at least once every 12 months, inspect the records of each authorising agency to determine the extent of compliance with this Part [Part IAB—Controlled operations] by the agency and by law enforcement officers.

2.17      The ACC is one such authorising agency.[22]

2.18      On 24 February 2016, the committee received two detailed reports from the Ombudsman regarding the ACC's involvement in controlled operations under Part 1AB of the Crimes Act: the first relating to the inspection of the controlled operation records of the ACC for the period 1 January 2014 to 30 June 2014 (published June 2015), and the second relating to the inspection of the controlled operation records of the ACC for the period 1 July 2014 to 31 December 2014 (published August 2015). Although some of the reported activities occurred outside of the 2014–15 period, for the purpose of this report, the committee has considered these reports as part of the 2014–15 reporting period.

2.19      The reports were provided in accordance with section 10 of the Parliamentary Joint Committee on Law Enforcement Act 2010. The committee has noted the reports and has received them as confidential correspondence.[23]

2.20      A general summary of the information produced in these reports is available in the Ombudsman's public report in respect of the controlled operation activities of the Australian Commission for Law Enforcement Integrity, the Australian Federal Police and the ACC for the period 1 July 2014 to 30 June 2015.[24]

Committee view

2.21      After reviewing the confidential and public reports, the committee is generally satisfied as to how the ACC has discharged its obligations with respect to controlled operations. Nevertheless, the committee notes the reoccurrence of one issue that was also raised in the previous Ombudsman's report, where a written record for an urgent application for authority did not address the legislative requirements under section 15GH of the Crimes Act. The Ombudsman's report sets out the ACC's remedial action in response to this issue—that the ACC would address this issue through its internal training program and resources.[25]

2.22      The committee also notes two findings by the Ombudsman during the reporting period. In relation to the first finding, concerning variations made on the authorising officer's own initiative to the same authority, the Ombudsman set out the ACC's advised remedial action and commended the ACC for its responsiveness, noting it would test the effectiveness of these measures at future inspections.[26] In relation to the second finding concerning variation of an existing authority, the Ombudsman noted that the ACC advised that it is considering the Ombudsman's suggestion in relation to this issue.  The committee commends the ACC on its constructive dealings with the Ombudsman.

2.23      The committee will continue to monitor the ACC's use of its controlled operations powers and in particular, instances where a written record for an urgent application for authority did not address the legislative requirements under section 15GH of the Crimes Act.

Ombudsman's report—surveillance devices

2.24      Pursuant to the Surveillance Devices Act 2004 (Surveillance Act):

The Ombudsman must inspect the records of a law enforcement agency to determine the extent of compliance with this Act by the agency and law enforcement officers of the agency.[27]

2.25      The ACC is one such law enforcement agency.[28]

2.26      The Surveillance Act restricts the use, communication and publication of information obtained through the use of surveillance devices. The Surveillance Act also establishes procedures for law enforcement agencies to obtain permission to use such devices in relation to 'criminal investigations and the recovery of children, and imposes requirements for the secure storage and destruction of records in connection with the use of surveillance devices'.[29]

2.27      The Ombudsman's public report concerning the ACC's compliance with the Surveillance Act from 1 January 2014 to 30 June 2014 (the September 2015 report),[30] being the most recent report provided to the Attorney‑General in accordance with the Surveillance Act, was provided to the committee by the Ombudsman on 24 February 2016 and is the subject of the committee's consideration in this report.

2.28      The September 2015 report into inspections under the Surveillance Act notes that while no recommendations were made as a result of the Ombudsman's inspections of the ACC from 7 to 9 October in Brisbane, it was unable to determine compliance in two instances, and the ACC self-disclosed one issue of non‑compliance.[31]

Committee view

2.29      After reviewing the September 2015 report, the committee is generally satisfied with how the ACC has discharged its obligations with respect to the Surveillance Act. The committee notes that the Ombudsman has expressed its satisfaction that the ACC has taken self-initiated measures to address the issues identified.[32]

Ombudsman's report—telecommunications interception records and stored communication records

2.30      On 24 February 2016, the committee received two detailed reports on the inspection of the ACC's telecommunications interception records under the TIA Act, the first in relation to the period 1 January to 30 June 2014 (published May 2015), and the second in relation to the period 1 July to 31 December 2014 (published August 2015). The committee also received a detailed report on the inspection of stored communications records of the ACC for the period 1 July 2013 to 30 June 2014 (published 16 September 2015). Although some of the reported activities occurred outside of the 2014–15 period, for the purpose of this report, the committee has considered these reports as part of the 2014–15 reporting period. The committee has noted the reports and has received them as confidential correspondence.

Committee view

2.31      The committee notes the Ombudsman's findings in respect of the ACC's compliance with the TIA Act, including in respect of one reoccurring issue. The committee notes the ACC's advised remedial action taken in respect of this issue.

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