Supreme Court New South Wales Medium Neutral Citation: R v Bail Applicant M [2020] NSWSC 1685 Hearing dates: 24 November 2020 Date of orders: 24 November 2020 Decision date: 24 November 2020 Jurisdiction: Common Law - Criminal Before: Fagan J Decision: Bail refused Catchwords: BAIL REVIEW - release application Legislation Cited: Criminal Code 1995 (Cth) Proceeds of Crime Act 2002 (Cth) Category: Principal judgment Parties: M (applicant) Regina (respondent) Representation: Counsel: H Brady SC (applicant) Solicitors: Juris Cor Legal (applicant) Commonwealth Crown Solicitor (respondent) File Number(s): 2020/303027 Publication restriction: No Judgment 1. Bail applicant M applies for bail in relation to two charges brought against him on 10 August 2020, the most serious of which is that between 19 December 2019 and 4 March 2020 he dealt in proceeds of crime to the value of $28.4 million, contrary to s 400.3(1) of the Criminal Code 1995 (Cth). He was arrested on that charge on 10 August 2020 and has been in custody since. Persons referred to herein have been arraigned in view of the pending charges. 2. Orders for the service of the brief have been extended to 27 November 2020, when the charge is to be before Parramatta Local Court for reply. I am informed by the Crown that most of the brief has been served, to the point where the Crown would be in a position to proceed to a committal hearing on the 27th, or any date thereafter appointed, to establish a case fit to be committed to the District Court for trial. 3. However, the Crown acknowledges that the investigation of the materials is ongoing. This is an extensive process because much of the evidence in the Crown's possession consists of electronic stored communications between encrypted devices and much of it is in Mandarin and requires translation. 4. There is also, in the nature of such a charge concerning an extended course of illicit dealings in cash, a good deal of collation that is required to coordinate the evidence of surveillance of participants, monetary transactions and electronic communications. Hence, the Crown acknowledges that even after 27 November 2020, assuming a committal hearing in the first half of 2021, it is likely that during that interval the materials to be tendered against the applicant will be expanded. It is expected that the Crown's particulars of the charge period will be extended so that it alleges a course of conduct for the whole duration from 19 December 2019 to 10 August 2020. 5. The Crown alleges that the applicant was the Australian based coordinator of a money laundering syndicate. He is a Chinese citizen who is in Australia on a resident return visa, which is apparently a form of permanent residency. He has been here since May 2009. He arrived here on a skilled working visa. Apparently the work he has done in Australia since his arrival some 11 years ago has involved establishing and operating small retail businesses and some measure of property development, the details of which I do not have. 6. The applicant remains a Chinese national. He is able, on his current visa, to leave Australia and to return during the period of its currency, which is apparently at least out until 2023. The applicant resided at Dundas Valley in New South Wales throughout the period of alleged offending up until his arrest. 7. The Crown alleges that in the capacity of coordinator in the money laundering enterprise the applicant issued instructions to others to collect large sums of cash from customers seeking to have its value transferred to other jurisdictions without being traceable to the customers. It is alleged that the applicant, as coordinator, directed persons under him to collect cash and in some cases to count it, in some cases to return some of it to himself and in some cases to transfer or pass on the money to other persons. 8. The detail of exactly what was directed to be done with the money after it had been collected varies from instance to instance, over many instances within the charge period. The Crown alleges that the purpose for which the money was to be used as an instrument would be crimes of transferring moneys and dealing with moneys in contravention of various provisions that control such movements, including remittances by persons not authorised to make remittances and contravention of provisions relating to control of reportable cash transactions. 9. The Crown is in a position to tender intercepted electronic communications that would show frequent exchanges between the applicant and a co-offender C, consistent with the applicant arranging for C to collect very large sums of cash in the hundreds of thousands of dollars on many occasions. C's movements in relation to a large number of such collections were under surveillance as he travelled by air from Tasmania to Victoria and to New South Wales, and as he travelled within those states in hired motor vehicles. 10. C was arrested at Box Hill in Metropolitan Melbourne in March 2020 in possession of $400,000 in cash. He has been charged with dealing in proceeds of crime. He was granted conditional bail by the Melbourne Magistrates Court and is presently residing in Tasmania. 11. The Crown alleges that following C's arrest in March of this year, the applicant continued his activities using a co-offender D in place of C. D's movements were similarly kept under surveillance by Australian Federal Police agents, and communications between the applicant and D were monitored. 12. D collected cash and redistributed it primarily in New South Wales. He was arrested on 10 August 2020 shortly after carrying two bags containing a million dollars in cash into an Auburn address that is associated with the applicant. A note counting machine was found in that property. Another $140,000 in cash was found at D's residence. D has been charged with a money laundering offence and granted conditional bail by this Court (Button J) on 12 November 2020. 13. On the charge of money laundering that the Crown has brought against the applicant he would face a penalty of up to 25 years' imprisonment. It is a strong Crown case. I have reviewed the statement of facts concerning the applicant's activities in conjunction with C up to March 2020. I must proceed on the assumption that evidence that can be adduced by the Crown would be to the effect of the matters that are summarised in that statement. 14. In the face of this strong Crown case and other circumstances there is, in my view, a very high risk of flight. The applicant's Chinese passport has been seized. But Australian authorities have no control over the Chinese Embassy issuing him another one. A condition of bail is proposed that he would not go within 500 metres of the Chinese Consulate-General in Camperdown or the Chinese visa application service in Woolloomooloo. I do not regard those proposed conditions for observance by the applicant as a very significant protection against the risk of him obtaining a new travel document. If he should flee the jurisdiction and return to China there would be negligible prospect of his being returned and brought to justice. Australia has no treaty of extradition with China. 15. Because of the applicant's superior role in the alleged money laundering enterprise, he faces a significantly longer prison term than either C or D. If he should be convicted, his term of imprisonment without parole would well exceed the likely duration of his remand. The evidence that the Crown says, through its statement of facts, it is able to adduce supports the inference that the applicant derived considerable wealth for himself from this activity. One subject of specific evidence referred to in the Crown brief is that, for example, he expended $137,000 on a Porsche motor vehicle in quite recent times. The intercepted electronic communications include arrangements for sums in the tens of thousands of dollars to be delivered to him on multiple occasions, apparently for his own use beneficially. He does not appear to have had any successful, legitimate income generating business in recent years. 16. The cost of the applicant making an escape by some unconventional means would, in my view, likely be no object in view of the amounts of money that have been referred to in this bail application. Of course, it is not alleged by the Crown that the applicant kept for himself the whole of the very large sums that were collected by underlings at his direction. But it is apparent that he derived significant commission or cut. He has real property in New South Wales and a property in Tasmania. The latter purports to have been paid for substantially by $300,000 said to have come from his father. I am not in a position to assess the veracity of that source. 17. Although the applicant has real property assets in Australia, I do not consider that they would have a very significant hold on his remaining in this country. If he should be convicted of the matter with which he is charged, it is entirely possible that any real estate owned by him may be forfeited to the Crown under the Proceeds of Crime Act 2002 (Cth). 18. The applicant did not, at the time of his arrest, have any lawful business or employment in Australia that would keep him here. He had made application to establish and obtain registration of a money remittance service, but apparently it has never been activated and has never been the source of a legitimate business income within that financial sector. 19. The applicant is married with a very young child, and he has two children of eight and ten years from a former relationship. It is said on his behalf that he maintains a close relationship with the children by his first wife. His present wife is also a Chinese national. She arrived in Australia in 2013 as a student, and remains on a bridging visa. It appears from the affidavit evidence of the wife that there is a strong relationship between her and the applicant, and she also deposes to the strength of the applicant's connection with his children by his former marriage as well as a bond to their own child. The applicant's wife has poor health and is in receipt of quite a range of treatment. 20. I do not regard this relationship with the wife as giving rise to a tie to the Australian community. Accepting that it is a strong relationship, it would appear no hardship to her to return to her country of origin if the applicant should flee there. I do not regard this as a significant qualification to what I perceive as a very high risk of flight. 21. I similarly do not regard the offering of $50,000 and $80,000 respectively from two of the applicant's friends as surety as being any great hold upon him. The seriousness of the charge is so great that offers of security from independent persons of that order do not weigh very greatly. I am also concerned that in the context of criminal activity that has involved very substantial and frequent hidden transfers of cash, the Court cannot have great assurance that such sureties would place upon the applicant the usual and traditionally expected moral pressure to comply with his bail conditions. I perceive a significant risk that with the amount of untraceable money that is involved in the activities of the applicant, there may be means of him reimbursing such sureties should their bail deposits be forfeited in the event of his departure. Obviously there is no evidence about that, but the very nature of the criminal allegations against the applicant is such that the Court perceives enormous sums of money moving around in a completely hidden way and cannot take at face value the financial circumstances of the individuals who are proposing to stand surety. 22. The applicant's offer of security over his own real property is similarly of limited weight in circumstances where, as earlier indicated, he is at risk of forfeiture of such property in any event. 23. The applicant has proposed conditions of bail that would amount to a form of house arrest, and has offered to provide at his own expense 24-hour a day monitoring by a company named Attenti Australia Pty Limited. That company provides human movement monitoring services and has done so for several years in this country. Its services are provided to Corrective Services New South Wales, for example, in relation to the monitoring of persons who are under extended supervision orders under the Crimes (High Risk Offenders) Act 2006 (NSW). 24. The circumstances of monitoring, if it were adopted, would be that the Australian Federal Police would have to nominate a designated officer who could be contacted by the monitoring company should the applicant move outside defined bounds, referred to in the jargon of this industry as geo-fences. It would also notify the designated AFP officer of any other movements that constituted infringement of his bail conditions. This would necessitate that there be a Federal Agent who could be available to respond to such notifications on a 24-hour a day basis. 25. The Commonwealth Crown has extensive objections to a grant of bail upon the basis that the risk of flight should be ameliorated by adopting this monitoring system by a privately operated company such as Attenti. First, Assistant Commissioner Gough has provided a statement that refers to instances in the experience of the Australian Federal Police where the system has not proved entirely satisfactory. One was a case where a person was charged with very serious offences of importing a massive quantity of methyl amphetamine into this country, did not answer bail and, although he was under electronic monitoring, the system was, for one reason or another, not effective to alert police in a manner that would enable them to prevent his escape. I make no criticism of the company or of its capabilities but the incident illustrates that electronic monitoring is not a guarantee. 26. A second incident referred to by Assistant Commissioner Gough concerned a number of alarms that were reported with respect to a particular person on bail regarding geo-fence violations. It transpired that these reports resulted from malfunction of the equipment. Commissioner Gough points out that, had the AFP responded to these reports and moved to arrest the particular person for a bail violation, it would have faced significant legal repercussions for what might be held to be wrongful arrest. It is noted that the transmitting systems of these electronic monitors can suffer a drop-out of signal, for example when the person wearing it enters certain buildings, goes into underground train stations or the like. Such triggering of responses would require the AFP to act upon receiving information from Attenti, and this again could result in unnecessary diversion of resources by the AFP to this quite labour intensive monitoring function. The Commissioner's concerns about operation of the system and the potential for it not being fool proof are substantial and warrant careful consideration by this Court. 27. A further difficulty the AFP has with respect to the arrangement is that it would be reliant upon Attenti to report the operation of the monitoring device, including attempts to tamper with it. The AFP would have no power to alter the frequency at which the device reports to Attenti, and no independent ability to assess the accuracy of information that Attenti is providing. It would have no command control over personnel of Attenti who are utilising the system. 28. Commissioner Gough points out that the AFP does not have an existing contractual working relationship with Attenti. That company has not engaged with the AFP in any tender process and its electronic services have not been vetted or endorsed by the Australian Federal Police. 29. In those circumstances it would be a very significant step for this Court to determine that the applicant be released on bail on condition of his movements being monitored by Attenti, thereby imposing upon the AFP a working relationship with a private entity of this nature. On that ground alone I do not consider this would be an acceptable bail condition. 30. Commissioner Gough also points to the imposition upon the Australian Federal Police resources of adopting such a monitoring condition. As the Assistant Commissioner states, the Australian Federal Police force does not have a community policing function in New South Wales. It does not have geographically dispersed police stations in a network with police officers stationed and on duty, ready to respond to notifications. 31. It would be necessary to have a dedicated officer ready to respond around the clock to any notifications from Attenti. If the AFP accepted the veracity of information provided by Attenti, on any particular occasion it would deploy agents with respect to a reported bail violation on the faith of information provided by this private operator whose systems are not under the control or responsibility of the police force for the reasons previously referred to. 32. The Assistant Commissioner says that if an officer were designated to be the contact point for Attenti under monitoring conditions such as this, the officer could not continue in that duty if he had to be diverted to different duties and reassigned according to the operational priorities of the police force. The situation for the Australian Federal Police is very different from that of the New South Wales police, in terms of numbers of personnel in stations on the ground geographically dispersed and able to deal with a system such as this. 33. The AFP has its own capability to monitor the movements of persons in connection with its anti-terrorism policing function. But it cannot divert resources from that function to the management of a person on conditional bail such as this applicant under the proposed conditions. 34. For all of these reasons, the proposed condition that the applicant would submit to electronic monitoring is, in my view, unacceptable and not practically workable for an applicant such as this bail applicant, who is facing a Commonwealth charge. 35. I have considered all of the other proposed bail conditions, which have been prepared with a great thoroughness by this bail applicant's representatives. They are undoubtedly a comprehensive endeavour to address the relevant risk which, in my mind in the present case, is a risk of flight. I am not satisfied that those proposed conditions can reduce that risk to an acceptable level, and for these reasons bail is refused. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 26 November 2020