1. Poca & money laundering
2019 Certificate in Forensic Investigation Techniques,
Saturday 30 March 2019

2. Statutory Crimes generally associated with Forensic Investigation
Prevention and Combating of Corrupt Activities Act 12 of (PACOCA)
General crime of corruption / Specific forms of corruption within the public & private sectors.
Prevention of Organised Crime Act 121 of 1998 (POCA)
Crimes relating to racketeering / money laundering / criminal gang activity;
Asset forfeiture provisions.

3. Statutory Crimes generally associated with Forensic Investigation
Public Finance Management Act 1 of 1999 (PFMA)
Maladministration: Disciplinary Action / Offences
Municipal Finance Management Act, 56 of 2003 (MFMA)
Companies Act 71 of 2008
Duties of Directors / Breach of confidence / Reporting Duties / Offences

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5. Part 1: Prevention of Organised Crime Act 121 of 1998 (POCA)

6. Introduction to PoCa
To introduce measures to combat organised crime, money laundering and criminal gang activities;
To prohibit certain activities relating to racketeering activities;
To provide for the prohibition of money laundering and for an obligation to report certain information;
To criminalise certain activities associated with gangs;

7. Introduction to PoCa
To provide for the recovery of the proceeds of unlawful activity;
For the civil forfeiture of criminal assets that have been used to commit an offence or assets that are the proceeds of unlawful activity;
To provide for the establishment of a Criminal Assets Recovery Account;

8. Introduction to PoCA
POCA sets out reasons why organised crime, money laundering and gang activities must be addressed:
There is a rapid growth of these activities both nationally and internationally + organised crime has internationally been identified as an international security threat;
These activities infringe on the rights of the people as enshrined in the Bill of Rights especially the right of every person to be protected from fear; intimidation; physical harm caused by the criminal activities of violent gangs and individuals;

9. Introduction to POCA
In broad terms the POCA makes provision for 3 types of offences:
Offences relating to Racketeering Activities – Chapter 2
Offences relating to Money-Laundering Activities – Chapter 3
Offences relating to Criminal Gang Activities – Chapter 4
In addition, POCA deals with the PROCEEDS OF UNLAWFUL ACTIVITIES – confiscation, restraint & realization of assets and eventual forfeiture thereof.

10. Introduction to POCA - racketeering
Read chapter 2, section 2 - Offences relating to Racketeering Activities:
What is Racketeering?
Racketeering is when organized groups run illegal businesses, known as “rackets,” or when an organized crime ring uses legitimate organizations to embezzle funds.
When Is a Person Guilty of Racketeering?
If they have any property which they know is linked to any illegal business activity. If a court finds that the person ought reasonably to have known that their property was being used in illegal activities, then that person is also considered guilty of a crime. This means that ignorance is no defence!

11. Introduction to POCA - racketeering
Read chapter 2, section 2 - Offences relating to Racketeering Activities:
What Is the Punishment for Racketeering?
The punishment for racketeering-related crimes can be high. Any person convicted of racketeering can get fined for up to R1 000 million or be imprisoned for life.
If a regional court thinks that a criminal ought to be fined for more that R100 million, or be imprisoned for more than 30 years, then the court will stop proceedings and hand the case over to the High Court.

12. Introduction to POCA – money laundering
Read chapter 3, section 4 - Offences relating to Money-laundering:
What is money-laundering?
is the process by which criminals disguise the original ownership and control of the proceeds of criminal conduct by making such proceeds appear to have derived from a legitimate source.
Before: it is problematic for criminals to use the illicit money because they cannot explain where it came from and it is easier to trace it back to the crime. After: it becomes difficult to distinguish money from legitimate financial resources, and the funds can be used by criminals without detection.

13. Introduction to POCA – money laundering
Read chapter 3, section 4 - Offences relating to Money-laundering:
Money-laundering can be broken down into three stages:
Stage 1 = Placement – the initial entry of illicit money into the financial system
Stage 2 = Layering – the process of separating the funds from their source, often using anonymous shell companies
Stage 3 = Integration – the money is returned to the criminal from legitimate-looking source

14. Introduction to POCA – money laundering
Read chapter 3, section 4 - Offences relating to Money-laundering:
When Is a Person Guilty of Money-laundering?
A person is guilty of a money-laundering offence if they know or ought to have known that they have acquired any property or proceeds derived from unlawful activity. This means that anyone who owns or is linked to ill-gotten gains can be found guilty of money-laundering.

15. Introduction to POCA – money laundering
Read chapter 3, section 4 - Offences relating to Money-laundering:
They can also be found guilty in the following situations:
If they enter into an agreement with another person who is linked to ill-gotten gains, or if they do anything that is linked with illegally derived property.
If they try to hide or disguise the nature, source or location of such property; or
If they help another person who is guilty of a money-laundering crime.
Any person convicted of an offence contemplated in section 4, 5 or 6 shall be liable to a fine not exceeding R 100 million, or to imprisonment for a period not exceeding 30 years

16. Introduction to POCA – money laundering
Read chapter 3, section 7 - Failure to report suspicion regarding proceeds of unlawful activities:
Any person who carries on a business or is in charge of a business undertaking who suspects or ought reasonably to have suspected that any property which comes into his or her possession or the possession of the said business undertaking is. or forms part of. the proceeds of unlawful activities; etc must report his or her suspicion.

17. Introduction to POCA – money laundering
Read chapter 3, section 7 - Failure to report suspicion regarding proceeds of unlawful activities:
This means that anybody who buys or rents or is involved in any deal linked to property which they suspect has been illegally acquired (or contributes to unlawful activities) must report their suspicion within a reasonable time.
Any person convicted of an offence contemplated in this section, shall be liable to a fine, or to imprisonment for a period not exceeding 15 years.

18. Introduction to POCA – Criminal gang
Read chapter 4, section 9 - Offences relating to Criminal Gang Activities:
Any person who actively participates in or is a member of a criminal gang and who wilfully aids and abets any criminal activity committed for the benefit of, at the direction of, or in association with any criminal gang; OR threatens any act of violence or any criminal activity by a criminal gang or with the assistance of a criminal gang; OR threatens any specific person or persons in general, with retaliation in any manner or by any means whatsoever, in response to any act or alleged act of violence, shall be guilty of an offence.

19. Introduction to POCA – criminal gang
Read chapter 4, section 9 - Offences relating to Criminal Gang Activities:
Who Is a Member of a Criminal Gang?
When deciding if a person is a member of a criminal gang, a court must take the following into account:
whether the person admits to being a member of the gang;
if the person is identified as a gang member by a parent or guardian;
whether the person lives in the gang’s territory and adopts their style of dress and other mannerisms;

20. Introduction to POCA – criminal gang
Read chapter 4, section 9 - Offences relating to Criminal Gang Activities:
Who Is a Member of a Criminal Gang?
When deciding if a person is a member of a criminal gang, a court must take the following into account:
if the person has been arrested more than once with other gang members for crimes typically committed by the gang; and
whether the person is identified as a member of the gang by physical evidence such as photographs and other documentation.

21. Introduction to POCA – criminal gang
Read chapter 4, section 9 - Offences relating to Criminal Gang Activities:
What Is the Punishment for Gang-Related Crimes?
Inciting or encouraging another person to take part in gang activities or to join a gang warrants a fine or imprisonment for a period of up to 3 years.
All the other gang-related crimes are punishable by fine or imprisonment of up to 6 years
See the added terms of imprisonment, if schools are nearby.

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23. Introduction to POCa
NB Read chapter 5 – Proceeds of unlawful activities:
Section ( 1 ) Whenever a defendant is convicted of an offence the court convicting the defendant may, on the application of the public prosecutor, enquire into any benefit which the defendant may have derived from—
(a) that offence; (b) any other offence of which the defendant has been convicted at the same trial; and (c) any criminal activity which the court finds to be sufficiently related to those offences,

24. Introduction to POCA Read chapter 5 – Proceeds of unlawful activities:
What Happens to the Profits of Crime?
Confiscation orders give the court the right to confiscate any ill-gotten gains, whereas restraint orders stop suspects from getting rid of any property or profits while they are being investigated.

25. Introduction to POCA Read chapter 5 – Proceeds of unlawful activities:
(a) Confiscation Orders
Whenever a convicted person is found to have benefited from a crime, the court may issue a confiscation order, instructing them to repay the State an appropriate amount, in addition to any punishment imposed for the offence.
If it is found that a defendant did not have legitimate sources of income to explain their ownership of property, then that property will be considered as an ill-gotten gain. Also, if the defendant provides false information, or no information, then any property connected will be considered to be a benefit derived from unlawful activity.

26. Introduction to POCA Read chapter 5 – Proceeds of unlawful activities:
(b) Restraint Orders
If the court puts a restraint order on a person’s property, that person cannot deal with the property in any way.
This means they cannot sell the property, give it way or transfer ownership.
The court can also issue provisional restraint orders, which have immediate effect and which call upon the person to present a case for why the order should not be made final.

27. Introduction to POCA Read chapter 5 – Proceeds of unlawful activities:
(b) Restraint Orders
In certain circumstances, a police official may seize the realisable property to prevent it being disposed of or removed.
When a High Court has issued a restraint order, it may also appoint a curator bonis to take charge of the property.
Such order may also be imposed on immovable property, preventing it from being mortgaged or sold without the consent of the High Court.

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29. Introduction to POCA Read chapter 6 – Civil Recovery of Property:
Preservation of Property
S 38. (1) The National Director may by ex parte application apply to a High Court for an order prohibiting any person, subject to such conditions and exceptions as may be specified in the order, from dealing in any manner with any property.
S 38 (2) The High Court shall make an order referred to in subsection (1) if there are reasonable grounds to believe that the property concerned—
(a) is an instrumentality of an offence referred to in Schedule 1; or
(b) is the proceeds of unlawful activities.

30. Introduction to POCA Read chapter 6 – Civil Recovery of Property:
Preservation of Property
If there are sufficient grounds for believing that property is an ill-gotten gain or is linked to a crime, an application can be made to the High Court to stop a person from having dealings with that property. If the application is approved, a preservation of property order is issued.

31. Introduction to POCA Read chapter 6 – Civil Recovery of Property:
Forfeiture of Property
If a preservation of property order has been issued, an application may be made to a High Court to have all property subject to such an order forfeited to the State.
Any person who has an interest in the property may appear in court to oppose the forfeiture order or to ask for the order to be changed.

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33. Introduction to POCA
Read chapter 7 – Criminal Assets Recovery Account:
Establishment of Criminal Assets Recovery Account
S 63. There is hereby established in the National Revenue Fund a separate account to be known as the Criminal Assets Recovery Account.
S 64. The Account shall consist of—
(a) all moneys derived from the execution of confiscation and forfeiture orders contemplated in Chapters 5 and 6…

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35. The end