South African Police Service
INPUT FOR THE JUSTICE PORTFOLIO COMMITTEE ON THE ORGANIZED CRIME BILL, 1998

The South African Police Service has responded to the invitation of the Department of Justice, on behalf of this Committee, to submit representations on the above-mentioned Bill.

A written submission, containing a number of remarks on the drafting and substance of the Bill, was forwarded to the Department of Justice before the end of August 1998. It is trusted that those comments will be taken into account, in finalizing the Bill.

The purpose of today’s briefing is to express support for the Bill and the fundamental principles embodied in it, with reference to developments in the international arena, in the field of combating organized crime.

The United Nations Commission on Crime Prevention and Criminal Justice initiated the drafting of a comprehensive Convention against transnational organized crime, as well as other international instruments (protocols addressing trafficking in women and children, combating the illicit manufacturing of and trafficking in firearms, and transporting immigrants, including by sea).

The Convention and accompanying protocols will become the centrepiece of a new global strategy to attack the structural underpinnings of organized crime worldwide. Organized crime has benefitted from globalization of the world’s economy, imitating legitimate business as it expands in the global economy. At the last drafting session of the draft Convention in Argentina (31 August 1998 - 4 September 1998) it was stressed that in spite of its growth and universalization, organized crime was a historical phenomenon that had a life cycle with a beginning, a development and an end. The single most important accomplishment in the last 15 years of combating organized crime, was to challenge and destroy the myth of invincibility of criminal organizations.

This new Convention should open doors for much better co-operation among countries. It will allow for practical tools that practitioners could use. The Convention should bring about harmonization of laws on issues such as participation in a criminal organization or conspiracy and criminalization of money-laundering.

The abovementioned meeting concluded the first reading of the draft Convention and discussed the following issues: mutual legal assistance, investigation of offences, transfer of proceedings, recognition of foreign judgements, protection of victims and witnesses, law-enforcement co-operation, collection and sharing of information on organized crime, training and technical assistance, prevention, the role of the United Nations and other relevant organizations, relation with other Conventions, etc. Some of the key provisions of the draft Convention, which also relates to this Bill, are:

Article 3
"Each State Party shall undertake, in accordance with the fundamental principles of its domestic legal system, to make punishable, one or both of the following types of conduct:

(a) Conduct by any person consisting in an agreement with one or more persons that an activity should be pursued which, if carried out, would amount to the commission of crimes or offences which are punishable .....

(b) Conduct by any person who participates in a criminal organization, where such participation is intentional and either be with the aim of furthering the general crime activity or criminal purpose of the group or be made in the knowledge of the intention of the group to commit offences.

Article 4
Each State Party shall adopt such legislative and other measures as may be necessary to establish as offences under its domestic law, when committed intentionally -

(a) the conversion or transfer of property, knowing that such property is the proceeds of crime, for the purpose of concealing or disguising the illicit origin of the property .....;

(b) the concealment or disguise of the true nature, source, location, disposition, movement, rights with respect to, or ownership of property, knowing that such property is the proceeds of crime.

Article 4 bis
Each State Party shall institute a domestic regulatory regime for financial institutions doing business within its jurisdiction to deter and detect money-laundering such regimes shall include the following minimum requirements:

(a) .....

(b) The elimination of bank secrecy laws that may impede the operation of State Parties’ anti-money-laundering programs.

(c) .....

(d) Ensuring the availability to law enforcement, regulatory and administrative authorities of information held by such institutions on the identity of clients and beneficial owners of accounts, towards this end, State Parties shall prohibit financial institutions from offering accounts identified only by number, anonymous accounts, or accounts in false names.

Article 7
States Parties shall adopt such measures as may be necessary to enable confiscation of -
(a) proceeds derived from an offence established in articles ..... or property the value of which corresponds to that of such proceeds.

(b) property, equipment or other instrumentalities used in or intended for use in an offence .....

If one studies the contents of the draft of the Convention, it is clear that the Bill before this Committee is the type of legislation which will be required by the Convention, once adopted, in order for member states to comply with the Convention. The draft Convention reflects the thinking of law enforcement and Governments, internationally, on the type of legislation needed to combat organized crime effectively on a global scale. At the moment the South African Police Service is busy to negotiate police co-operation agreements with ± 17 countries. Such agreements have been concluded with 11 Southern African countries (multilateral), as well as Brazil, Argentine, France and the Russian Federation (bilateral). The draft Convention reflects some of the principles usually embodied in police co-operation agreements as well as agreements on mutual assistance in criminal matters. As such it will improve police co-operation and mutual assistance in criminal matters on a global scale.

A copy of the report on the last meeting of the Ad Hoc Committee responsible for drafting the Convention, as well as the latest draft of the Convention, are attached for the information of the Portfolio Committee. I may refer especially to pages 5 up to 14 of the draft Convention. [Ed note: appendix not included]

The Bill in my opinion, already gives effect to many of the requirements of the Convention which will become the guiding light in future, regarding the combating of organized crime.

SOUTH AFRICAN POLICE SERVICE

PREVENTION OF ORGANISED CRIME BILL, 1998 : COMMENTS OF THE LEGAL COMPONENT, DETECTIVE SERVICE

1. In principle, the measures introduced by the Prevention of Organised Crime Bill, 1998, are supported.

2. Although the Bill embodies extra-ordinary and drastic measures to combat organised crime and criminal gang activities, we are, generally speaking, of the opinion that the Bill should be drafted in a clear and plain format. It is an arduous task to read and understand the contents of the Bill. This will also assist in the training of police officials and prosecutors who, ultimately, will determine the success of the legislation, once enacted. (In the USA, RICO legislation was enacted in 1970 but has only been understood and fully utilised by law enforcement agencies since approximately 1982.)

3. The following specific comments are made:
3.1 Ad clause 1, page 3 : Definition of "authorised police officer"

- Neither the Criminal Procedure Act, 1977 (Act No 51 of 1977), nor the South African Police Service Act, 1995 (Act No 68 of 1995), contains a reference to "police officer". In the former Act, the term "police official" is used, whilst in the latter Act the term "member" is used.

- It is proposed that the term "police officer" be substituted for "police official".

3.2 Ad clause 1, page 3 : Definition of "criminal gang"

The definition of "criminal gang" needs to be refined. According to the current wording of the definition, persons who belong to a criminal gang must have two or more members who engage in crime. Persons, in this sense of the word, cannot consist of members. The following amendments are proposed:

- Delete the words "who have" in the second line of the definition and substitute these for the words "of whom".

- Delete the words "members who" in the third line of the definition and substitute these for the word "are".

- Add the letter "d" after the first "engage" in line 3 of the definition.

- As a result of these proposals, the definition should read as follows:
" ’criminal gang’ means a formal or informal ongoing organisation, association, or group that has as one of its primary activities, the commission of criminal acts and that consists of three or more persons of whom two or more are individually or collectively engaged in or have engaged in a pattern of criminal gang activity".

3.3 Ad clause 1, page 3 : Definition of "criminal gang member"

- The factors that may be taken into account in considering whether a person is a member of a gang need clarification. Factor (b), for instance, is limited to identification as a criminal gang member by a parent or guardian. What is the position if the criminal gang member is identified as such by another relative or friends, an acquaintance or a member of the public? Will these persons be covered by factor (e)?

- Factor (c) refers to a "documented reliable informant". It is suggested that we should only refer to "a reliable informant". Problems may be experienced with disclosure of documentation which may compromise the identity of the informer or unrelated investigations.

3.4 Ad clause 2(1)(e), page 4 : Offences

- Conspiracy is already dealt with in section 18(2)(a) of the Riotous Assemblies Act, 1956 (Act No 17 of 1956).
- This argument is also applicable to the conspiracy offences in clause 41(1)(c) of the Bill. The offence of incitement, referred to in clause 41(1)(d) of the Bill, is, likewise, dealt with in section 18(2)(b) of the Riotous Assemblies Act, 1956.

3.5 Ad clause 2(2), page 4 : Offences
The wording of this clause throws suspicion on the constitutionality thereof. What about illegally obtained evidence that violates another person’s (other than the accused’s) fundamental rights? (Vide : S v BG Nkabinde (unreported judgement, Natal Provincial Division, High Court of South Africa, case no CC124/97 and S v Naidoo and another [1998]1 All SA 189(D)).

3.6 Ad clause 2(3)(b)(ii) page 4 : Offences

- "Organised crime" is not defined in the Bill. The following definition, which is used within the Detective Service for purposes of crime threat analyses and crime intelligence statistics, could be of assistance in defining the concept:

- "Organised crime is the systematic commissioning of crimes motivated by a craving for profit or power". Within the parameter of this definition, a criminal group involved in organised crime needs to meet the following criteria:

1. The criminal group has to involve the collaboration of more than two people;
2. It has to be suspected of involvement in serious criminal offences;
3. It has to have been involved in such serious criminal activity for a prolonged or indefinite period;
4. It has to be motivated by the pursuit of profit and/or power;
5. It should simulate and/or employ commercial or businesslike structures;
6. By way of division of labour, group members should have their own appointed tasks;
7. It should employ some form of discipline and control (disciplinary sanctions);
8. It should be engaged in money-laundering;
9. It should use violence and other means suitable for the purposes of intimidation;
10. It should attempt to exert influence on politics, the media, public administration, judicial authorities or the economy (corruption).
11. Abuse of state/provincial, national and international borders.
Before a criminal group can be identified as an organised criminal organisation, at least 6 of the criteria need to be fulfilled, including the first four on the list. This definition caters for both criminal groups with exclusive identities and loosely-knit criminal coalitions.

- The distinction between "crime" (clause 2(3)(b)(I)) and "organised crime" (clause 2(3)(b)(ii)) is not clear. The National Director is, in this instance, concerned with organised crime, not ordinary crime.

- It is suggested that this clause be redrafted along the following lines:
"3(b) The National Director shall only authorise prosecution if he or she is of the opinion that an offence contemplated in subsection (1) has been committed."

3.7 Ad clause 4, page 4 : Criminal forfeiture
The reasons for inclusion of criminal forfeiture provisions in the Bill are not clear since criminal forfeiture provisions are already included in the Proceeds of Crime Act, 1996 (Act No. 76 of 1996). Separate criminal forfeiture provisions will promote legal uncertainty and will hamper training. The Proceeds of Crime Act, 1996 could regulate criminal forfeiture and the Organised Crime Bill, 1998, civil forfeiture.

3.8 Ad clause 4(3), page 4 : "gross profits"
"Gross profits" of an offence will almost be impossible to determine with accuracy. What does one use as a criterion to determine the "gross profits" of an offence? It is perhaps advisable to delete this subclause as it is too prescriptive.

3.9 Ad clause 4(4)(b), page 5 : "bona fide purchaser"
"Bona fide purchaser" is not defined. The term should also make provision for persons other than purchasers, for instance, persons who inherited property.

3.10 Ad clause 5, page 5 : Notice of suspicion concerning property:
- The purpose of this section is not clear. Notification of persons having an interest in or control over property might provide criminals with the ideal opportunity to hide or otherwise dissipate the property. To avoid this, the first step should rather be to approach the court for a restraining order in order to "freeze" the property.

- In both processes; i.e. clauses 5 and 6, a reasonable suspicion has to be proved.

3.11 Ad clause 5(3), page 5 : Notice of suspicion:
Words are missing in the second line of subclause section 3, after "Magistrate’s Court".

3.12 Ad clause 7(2)(a), page 6: Ancillary orders:
Clause 7(2)(a)(ii) is unnecessary. This is already covered by the offence of perjury.

3.13 Ad clause 13(2)(b), page 7 : Provision for expenses:
- Clause 13(2)(b) is not clear. Does "property’ in this sense refer to restrained or unrestrained property? If it is referring to restrained property the property would not have been acquired legally.

- Why should criminals involved in organised crime, be in a better situation than ordinary criminals or any other person as far as legal representation or expenses are concerned? The former is also at liberty to approach the Legal Aid Board if he/she cannot meet his/her legal expenses, from unrestrained property.

3.14 Ad clause 13(2)(b), page 7 : Provision for expenses
How does one bring your interests in immovable property within the jurisdiction of a High Court that has granted a restriction order?

3.15 Ad clause 15(1), page 8 : Taxation of legal expenses:
Save for the heading of clause 15, the nature of the order referred to in clause 15(1) is not explained.

3.16 Ad clause 25, page 11 : Privilege
On face value the constitutionality of this clause, especially subclauses(1) and (2) might pose a problem.

3.17 Ad clause 28(1), page 12 : Application of Chapter to deceased persons:
- Not all persons have a legal representative. The words "legal representative" should rather be substituted for "Master of the High Court or executor of the estate".

- This clause as well as the ensuing clauses should be renumbered : there are two clauses 28.

3.18 Ad clause 31(1)(b)(ii), page 13 : Hearings of court to be given in public:
The words "any category" in the second last line of clause 13(1)(b)(ii) might be discriminatory.

3.19 Ad clause 36, page 15 : Objects of board
- There are no mechanisms in the Bill which provide for money to be deposited into the Criminal Assets Recovery Fund. Clause 36 merely provides that the board, to be appointed by the Minister of Justice, will manage the moneys paid into the Fund. At present, all such moneys are paid into the central Treasury, in accordance with existing legislation.

- The sole purpose of the Criminal Assets Recovery Fund should be to benefit the law enforcement agencies and the victims of organised crime. Law enforcement agencies and victims should become the "owners" of the moneys/property paid into the Fund. Although the board is obliged to render financial assistance to the law enforcement agencies and victims, the current wording of clause 36 does not clearly state that they are the sole contenders for the moneys paid into the Fund or that such moneys will not be paid into the central Treasury.

- The moneys paid into the fund will be subject to the scrutiny of the Auditor-General. The Bill should provide for this in clear terms.

3.20 Ad clause 41, page 16 : Gang related offences
It is noted that clause 41(1)(a) and 41(1)(e) distinguish between "willfully" and "intentionally", as the form of dolus. We are of the opinion that this distinction will lead to unnecessary confusion in the interpretation of the Act and that the term "intentionally" should be used throughout the Act where dolus is required.

3.21 Ad clause 45(1)(b), page 17 : Regulations
It is proposed that clause 45(1)(b) be amended to read as follows:
"The Minister may make regulations as to any matter which is necessary or expedient to be prescribed in order that the purpose of this Act may be achieved."

3.22 Ad Schedule I, page 18:
- Offences relating to the dealing in or smuggling of ammunition, firearms, explosives or armament should be expanded to include the trafficking (illicit trade) and possession of such goods.
The reference of the Intimidation Act is incorrect. It should read Act No 72 of 1982.
Shouldn’t specific offences in the Intimidation Act, 1982, be identified? The drafting of the sentence leaves one with the impression that the intention of the legislature is to limit the contraventions to specific offences, not all the offences contemplated in the said Act.

3.23 Ad Schedule 3, page 20:
- Paragraph 1(a) should read "convert", not "couvert".

- Paragraph 5 should also delete subsections (3) and (4) of section 10 of the Drugs and Drug Trafficking Act, 1992 (Act No 140 of 1992). Stock-brokers and financial instrument traders are already covered by the obligation imposed by section 31 of the Proceeds of Crime Act, 1997, (Act No 76 of 1996). Subsection (4) is also covered by section 31 of the latter Act.

4. The Draft International Convention against Organised Transnational Crime which was analysed by international experts at a meeting earlier this year in Warsaw, Poland, could provide valuable guidelines pertaining to the drafting and contents of the Bill. According to a report by Dr MS Ramaite, Deputy Attorney-General, Pretoria, "there was consensus that the convention should create an obligation on States to take such legislative measures as may be necessary to ensure that certain forms of criminal conduct associated with organised transactional crime would become criminal offences." The draft convention also contains a definition of "organised crime" which could be of assistance in defining the concept. This definition reads as follow:

- " ‘organised crime’ means group activities of three or more persons, with hierarchical links or personal relationships, which permit their leaders to earn profits or control territories or markets, internal or foreign, by means of violence, intimidation or corruption, both in furtherance of criminal activity and to infiltrate the legitimate economy.

5. Thank you for the opportunity to comment on the Bill. It would be appreciated if the South African Police Service could be kept abreast of developments in the Portfolio Committee, to determine whether further inputs are necessary.

NATIONAL COMMISSIONER : SOUTH AFRICAN POLICE SERVICE