Combating corporate crime

The Crimes Legislation Amendment (Combatting Corporate Crime) Bill 2019 (which would amend the Criminal Code Act 1995) is a key reform aimed at combatting corporate crime. The bill would amend the offence for bribery of foreign public officials in the Commonwealth Criminal Code to remove impediments to the successful investigation and prosecution of foreign bribery (including, for example, by replacing the existing requirement that the benefit or business advantage be “not legitimately due” with the broader concept of “improperly influencing” a foreign public official) and introduce a new corporate offence of failing to prevent foreign bribery by an associate.¹ The bill also introduces a Commonwealth Deferred Prosecution Agreement scheme for serious corporate crime and amends the definition of dishonesty in the criminal code to reflect current high court jurisprudence and ensure persons who intentionally engage in dishonest criminal conduct can be better held to account.² Aspects of the bill have been modelled on measures in the UK and US, which have successfully incentivised anti-bribery corporate compliance, self-reporting and cooperation by companies with law enforcement agencies where an offence has been committed. The bill also requires the attorney general to publish guidance on the steps a corporation can take to prevent an associate from bribing foreign public officials (the so-called adequate procedures guidance). A consultation draft was published in November 2019,³ and final guidance will be published when the bill becomes law. Civil society stakeholders have commended the efforts of the Attorney-General’s Department staff to further this and their willingness to engage with the private sector and civil society to develop the draft guidance. The bill would further implement Australia’s obligations under the OECD Anti-Bribery Convention. The OECD Working Group on Bribery has welcomed the introduction to parliament of the Crimes Legislation Amendment (Combatting Corporate Crime) Bill.⁴ However, parliament has not yet passed the bill.¹

Strengthening the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act) is another key element of the commitment. In December 2020, the Anti-Money Laundering and Counter-Terrorism Financing and Other Legislation Amendment Bill 2019 passed the parliament.⁵ The bill implemented some welcome but modest measures to strengthen Australia’s capabilities to address money laundering and terrorism financing. However, the AML/CTF Act does not currently extend to designated non-financial business or professions (DNFBPs), which can be a high-risk enabler for money laundering. DNFBPs include casinos, real estate agents, lawyers and accountants. The real estate sector, for example, has continually been identified as a weak spot in Australia’s AML/CTF regime (including by the Financial Action Task Force) because large sums of illicit funds can be concealed and integrated into the legitimate economy through real estate.⁶ The Financial Action Task Force has expressed concern that no legislative or regulatory measures have been promulgated in Australia to mitigate the high risks identified with some types of DNFBPs, and that some types of DNFBPs are not monitored by competent authorities and are not subject to suspicious transaction reporting obligations.⁷ More generally, Australia has low compliance with the Financial Action Task Force recommendations.⁸

Australia also invests in preventing corporate crime through other initiatives. One such initiative is the Bribery Prevention Network (BPN).⁹ The BPN is a partnership between government (namely the Attorney-General’s Department and the Australian Federal Police), the private sector and civil society (Transparency International Australia is a founding member and has a seat on the initiative’s steering and editorial committees) aimed at supporting Australian businesses to prevent, detect and address bribery and corruption risks. It provides resources and guidance, through the BPN portal, webinars and case studies,¹⁰ and is directed at smaller businesses that have fewer internal resources to manage bribery risks. The initiative is the first of its kind and has been recognised by the OECD Working Group on Bribery as making an important contribution to bribery prevention. The Australian Federal Police also undertakes foreign bribery enforcement action¹¹¹² and other programmes including, for example, to incentivise self-reporting and cooperation from companies who believe they may have breached Australia’s foreign bribery laws.¹³

While there has been important legislative development work, development of guidance for the corporate sector and anti-corruption enforcement in the period between 2018 and 2021, the commitment is focussed on achieving legislative change which has not occurred. The commitment is therefore assessed as being not fulfilled.