Money Laundering and Proceeds of Crime (Amendment) Act 2010

Subscribe to a Global-Regulation Premium Membership Today!

Key Benefits:

Subscribe Now for only USD$20 per month, or Get a Day Pass for only USD$4.99.
MoneyLaunderingandProceedsofCrime_Amendment_Act2010Gazetting


Act No. 32 of 2010




C
T

MONEY LAUNDERING AND PROCEEDS
OF CRIME (AMENDMENT) ACT 2010





Money Laundering and Proceeds of Crime
(Amendment) Act 2010 Arrangement of Sections





to
Act No. 32 of 2010 Page 3




C
T

MONEY LAUNDERING AND PROCEEDS OF CRIME
(AMENDMENT) ACT 2010

Arrangement of Sections
Section

1 Short Title .................................................................................................... 5
2 Amendment to Tongan version only ..................................................................... 5
3 Section 2 amended ..................................................................................... 6
4 Section 11(2) repealed ............................................................................. 10
5 New section 11A – Functions and Powers of Transaction Reporting

Authority ......................................................................................................... 10
6 Section 13 amended ................................................................................. 14
7 Section 14 amended ................................................................................. 14
8 New sections 14A and 14B ............................................................................. 14
9 Section 15 amended ................................................................................. 15
10 Section 16 amended ................................................................................. 15
11 New section 16A ............................................................................................. 15
12 Section 17 amended ................................................................................. 16
13 Section 18 amended ................................................................................. 17
14 Section 19 amended ................................................................................. 17
15 New section 24A - penalty for disclosure ...................................................... 22
16 Section 26 amended ................................................................................. 23
17 Section 34 amended ................................................................................. 23
18 Section 28(1) amended ............................................................................ 23
19 New section 35A and 35B ........................................................................ 23
20 New section 48A ............................................................................................. 24
21 Section 51 amended ................................................................................. 25
22 Section 57 amended ................................................................................. 25
23 New section 57A and 57B – Restraining orders for terrorist property ................ 27
24 Section 58 amended ................................................................................. 28
25 Section 59 repealed .................................................................................. 28

Arrangement of Sections
Money Laundering and Proceeds of Crime

(Amendment) Act 2010





Page 4 Act No. 32 of 2010
to



26 Section 72 amended ................................................................................. 28


Money Laundering and Proceeds of Crime (Amendment)
Act 2010 Section 1





to
Act No. 32 of 2010 Page 5




C
T

MONEY LAUNDERING AND PROCEEDS OF CRIME
(AMENDMENT) ACT 2010

Act No. 32 of 2010

AN ACT TO AMEND THE MONEY LAUNDERING AND PROCEEDS OF
CRIME ACT

I assent,
GEORGE TUPOU V,
20th September 2010.


BE IT ENACTED by the King and the Legislative Assembly of Tonga in the Legislature
of the Kingdom as follows:
________________________________________________________________

1 Short Title

(1) This Act may be cited as the Money Laundering ad Proceeds of Crime
(Amendment) Act 2010.

(2) The Money Laundering and Proceeds of Crime Act 2000, as amended, is in
this Act referred to as the Principal Act.

2 Amendment to Tongan version only

The Principal Act is amended, in the Tongan version only, by deleting the words
“pa’anga hiamatea” wherever it appears and replacing them with “ngaahi koloa ‘oku
ma’u mei ha hia”.



Section 3
Money Laundering and Proceeds of Crime (Amendment)

Act 2010





Page 6 Act No. 32 of 2010
to



3 Section 2 amended

Section 2 of the Principal Act is amended by-

(a) deleting the definition of “authorised officer” and replacing it with the
following-



““ authorised officer” means a police officer or a customs officer;”;


(b) deleting the definition of “cash” and replacing it with the following-



““ cash” means-

(a) the coin and paper money of the Kingdom or of a foreign country that
is designated as legal tender and which is customarily used and
accepted as a medium of exchange in the country of issue;

(b) monetary instruments that may be exchanged for money (such as
cheques, travellers cheques, money orders, negotiable instruments in a
form in which title thereto passes on delivery);

(c) jewellery, precious metals and precious stones, or pea ls; or

(d) where the context permits, cash includes cash in electronic form;”;


(c) in the definition of “cash dealer”, adding the following new paragraphs after
paragraph (d)-



“(e) casinos, including internet casinos, gambling houses or lotteries;

(f) real estate agents or real estate brokers;

(g) dealers in precious metals and dealers in precious stones, and other
dealers in high value goods;

(h) law practitioners, notaries, and other independent legal professionals
when they prepare for, engage in or carry out transactions for their
client concerning the following activities-

(i) buying and selling of real estate;

(ii) managing of client money, securities or other assets;

(iii) management of bank, savings or securities accounts;

(iv) organisation of contributions for the creation, operation or
management of companies; or

(v) creation, operation or management of legal persons or
arrangements, and buying and selling of business entities;

(i) accountants, auditors and tax advisors; or

Money Laundering and Proceeds of Crime (Amendment)
Act 2010 Section 3





to
Act No. 32 of 2010 Page 7




(j) trust and company service providers not otherwise covered by
this law, which as a business, provide any of the following
services to third parties-

(i) acting as a formation agent of legal persons;

(ii) acting as (or arranging for another person to act as) a
director or secretary of a company, a partner of a
partnership, or similar position in relation to other legal
persons;

(iii) providing a registered office, business address,
accommodation, correspondence or administrative address
for a company, a partnership, any other legal person or
arrangement;

(iv) acting as (or arranging for another person to act as) a
trustee of an express trust; or

(v) acting as (or arranging for another person to act as) a
nominee shareholder for another person.”



(d) inserting a new definition for the term “Court” immediately after the
definition of “cash” as follows–



““ Court” means the Supreme Court;”



(e) the definition of “defendant” is deleted and replaced with the following-



““ defendant" means a person that is under investigation for a serious offence
or has been charged with a serious offence, whether or not he has been
convicted of the offence, and includes in the case of proceedings for a
restraining order under section 58, a person who is be ng investigated for a
serious offence or is about to be charged with a serious offence;”



(f) inserting a definition of “premises” after the definition of “person” as
follows-



“premises” includes any place within the Kingdom and in particular
includes -

(a) any vehicle, vessel, craft, aircraft or any structure in the coastal waters
of the Kingdom; or

(b) any tent, caravan or other moveable structure;”



Section 3
Money Laundering and Proceeds of Crime (Amendment)

Act 2010





Page 8 Act No. 32 of 2010
to



(g) deleting the definition of “proceeds of crime” and replacing with-


““ proceeds of crime” means –

(a) any property derived or realised directly or indirectly from a serious
offence and includes, on a proportional basis, property into which any
property derived or realised directly from the offenc was later
successively converted, transformed or intermingled, as well as income,
capital or other economic gains derived or realised from such property
at any time since the offence; and

(b) includes any property used or intended to be used in the commission of
any serious offence;”;



(h) deleting the definition of “property” and replacing it with-


““ property” means cash and all other real or personal property of every
description, whether situated in Tonga or elsewhere and whether tangible or
intangible, and includes an interest in any such prope ty including any legal
document or instrument, including electronic or digital, evidencing title to, or
interest in, such assets;”;



(i) deleting the definition of “serious offence” and replacing it with -



““ serious offence’ means an offence against a provision of –

(a) any law of Tonga for which the maximum penalty is imprisonment or
other deprivation of liberty for a period of not less than 12 months or
more severe penalty;

(b) a law of a foreign state, in relation to acts or omissions which, had they
occurred in Tonga, would have constituted an offence for which the
maximum penalty is imprisonment or other deprivation of liberty for a
period of not less than 12 months, or more severe pnalty, including an
offence of a purely fiscal character;”;



(j) inserting a definition of “tainted property” after the definition of “serious
offence” as follows–



““ tainted property” in relation to a serious offence, means-

(a) property used in or in connection with or intend d for use or in
connection with the commission of the offence, if it was in the person's
possession at the time of, or immediately after, the commission of the
offence;

Money Laundering and Proceeds of Crime (Amendment)
Act 2010 Section 4





to
Act No. 32 of 2010 Page 9




(b) property derived, obtained or realised as a result of or in connection
with the commission of an offence if it was acquired by the person
before, during or within a reasonable time after the period of the
commission of the offence of which the person is about to be charged,
charged or convicted; or

(c) that the income of that person from sources unrelated to criminal
activity of that person cannot reasonably account for he acquisition of
that property; and

(d) tainted property includes property of a corresponding value to property
defined in (a), (b) and (c) above;”;



(k) inserting the following new definitions where appropriate:



““ entity” means a person, group, trust , partnership, fund, association or
organization, whether incorporated or unincorporated;

“specified entity” means a person or entity:

(a) that is a United Nations listed entity as described in section 4 of the
Transnational Crimes Act 2005; or

(b) for which a declaration has been made under section 5 of the said Act;

“ terrorist act” has the same meaning as the Transnational Crimes Act 2005;

“ terrorist financing” means any act related to the provision or collection, by
any means, directly or indirectly of any funds or property used, or intended to
be used in the commission of a terrorist act or for the benefit of a terrorist
group;

“ terrorist group” means:

(a) an entity that has as one of its activities or pu poses committing, or
facilitating the commission of, a terrorist act; or

(b) a specified entity.

“ terrorist property” means:

(a) property that has been, is being, or is likely to be used to commit a
terrorist act; or

(b) property that has been, is being, or is likely to be used by a terrorist
group; or

(c) property owned or controlled, or derived or generated from property
owned or controlled, by or on behalf of a specified entity.”.

Section 4
Money Laundering and Proceeds of Crime (Amendment)

Act 2010





Page 10 Act No. 32 of 2010
to



4 Section 11(2) repealed

Section 11(2) of the Principal Act is repealed.

5 New section 11A – Functions and Powers of Transac tion Reporting
Authority

The Principal Act is amended by inserting the following new section immediately
after section 11 –



“11A Functions and Powers of Transaction Reporting Authority

The Transaction Reporting Authority shall have the following functions and
powers–

(a) receive information and reports provided under section 14(1) and
information –

(i) provided to it by any agency of another country;

(ii) provided to it by any law enforcement agency in the
Kingdom or otherwise or any government agency or
institution in the Kingdom or otherwise; and

(iii) voluntarily provided to it about a serious offence, a money
laundering offence, the offence of the financing of
terrorism, or a violation of this Act;

(b) analyze and assess all reports and information;

(c) request information or reports from financial institutions and
cash dealers under section 14;

(d) for transactions or transfers that occurred prior to the coming into
force of the Money Laundering and Proceeds of Crime
(Amendment) Act 2010, require a financial institution to disclose
records in the financial institution’s possession, custody or
control that pertain to transactions or transfers for a particular
account or person, and for a particular time period;

(e) enter the premises of any financial institution and cash dealers
during ordinary business hours to inspect any records, ask any
questions of any employee of the financial institution and cash
dealers relating to such records, and make notes and take copies
of the records;

(f) collect any information that the Transaction Reporting Authority
considers relevant to serious offences, money launderi g
activities, the financing of terrorism or violations of this Act
whether or not publicly available, including commercially
available databases, or information that is collected or

Money Laundering and Proceeds of Crime (Amendment)
Act 2010 Section 5





to
Act No. 32 of 2010 Page 11




maintained, including information that is stored in databases
maintained by government agencies and institutions;

(g) obtain from any government department any records of a person
under investigation for committing, or attempting to commit, a
serious offence, a money laundering offence, an offence of the
financing of terrorism or a violation of this Act;

(h) obtain from any telecommunications corporation established in
the Kingdom telephone call records of a person under
investigation for committing, or attempting to commit, a serious
offence, a money laundering offence, an offence of the financing
of terrorism or a violation of this Act;

(i) seek information from any foreign government agency, foreign
law enforcement agency, foreign supervisory authoriy and
foreign auditing authority for purposes of this Act;

(j) refer any report, and information pertaining to that report, to the
appropriate law enforcement agency in the Kingdom if, on the
basis of its analysis and assessment, the Transaction Reporting
Authority has reasonable grounds to suspect that a tr nsaction or
any other activity would be relevant to the investiga ion or
prosecution of a serious offence, money laundering offence, or
terrorist financing offence, and in connection therewith, the
Transaction Reporting Authority may send a copy of such
referral or information to the relevant supervisory authority;

(k) destroy a suspicious transaction report received or collected on
the expiry of seven years after the date of receipt of the report if
there has been no further activity or information relating to the
report or the person named in the report, or seven years from the
date of the last activity relating to the person or report;

(l) instruct any financial institution and cash dealers to take such
steps as may be appropriate in relation to any information or
report received by the Transaction Reporting Authori y, to
enforce compliance with this Act or to facilitate any investigation
anticipated by the Transaction Reporting Authority or a law
enforcement agency;

(m) on reasonable grounds to suspect that a transaction or attempted
transaction may involve a serious offence, money laundering
offence, or terrorist financing offence, direct in writing that the
reporting institution concerned either proceed or refrain from
proceeding with the transaction or attempted transaction, for a
period to be determined by the Transaction Reporting Authority,
provided that –

(i) any direction must not exceed five working days if the
direction is in writing;

Section 5
Money Laundering and Proceeds of Crime (Amendment)

Act 2010





Page 12 Act No. 32 of 2010
to



(ii) any direction given orally must not exceed 24 hours and
must be confirmed in writing within 24 hours of the oral
direction; or

(iii) before the expiration of five days direction the Transaction
Reporting Authority may apply to the Court for an
extension of the period of the direction;

(n) compile statistics and records, and may disseminate i formation
within the Kingdom or elsewhere and make recommendations
arising out of any information received;

(o) in consultation with the relevant supervisory authori y, shall
issue guidelines to financial institutions and cash dealers in
relation to customer identification, record keeping and reporting
obligations, and the identification of suspicious transactions;

(p) where appropriate, periodically provide feedback to financial
institutions, cash dealers and relevant government d partments,
offices, agencies and institutions regarding outcomes relating to
the reports or information provided pursuant to this Act;

(q) obtain further information on persons or transactions referred to
in a report made to it pursuant to this Act;

(r) provide training programs for financial institutions and cash
dealers in relation to customer identification, record keeping and
reporting obligations, and the identification of suspicious
transactions;

(s) conduct research into trends and developments in the area of
money laundering and the financing of terrorism andimproved
ways of detecting, preventing and deterring money laundering
and the financing of terrorist activities;

(t) educate the public and create awareness on matters relating to
money laundering and the financing of terrorism;

(u) disclose any report, or information derived from such report, to
any government department, office or agency subject to he
confidentiality requirements of this Act;

(v) disclose any report, or information derived from such report, to a
foreign or government institution or agency, or any international
organization, in accordance with this Act;

(w) liaise with, and enter into any agreement or arrangement with,
any foreign government institution or agency, or any
international organization, regarding the exchange of information
pursuant to this Act; and

(x) report in writing to the Attorney General prior to the end of each
fiscal year on the activities of the previous year and the expected
activities of the Transaction Reporting Authority during the

Money Laundering and Proceeds of Crime (Amendment)
Act 2010 Section 5





to
Act No. 32 of 2010 Page 13




subsequent year, without disclosing confidential information or
information that may jeapordize an ongoing investigation or
prosecution.



11B Information sharing arrangements with foreign State governments

(1) The Transaction Reporting Authority may disclose any report or
information to a foreign State government agency or institution, or an
international organization, that has powers and duties similar to those of
the Transaction Reporting Authority –

(a) on such terms and conditions as are set out in an agreement
between the Transaction Reporting Authority and the foreign
government institution or agency, or international organization,
regarding the exchange of such information under subsection (2)
of this section; or

(b) where such an agreement has not been entered into, o such
terms and conditions as may be agreed upon by the Transaction
Reporting Authority and the institution, agency or organization at
the time of disclosure.

(2) The Transaction Reporting Authority, with the approval of the Attorney
General, may enter into an agreement, in writing, with a foreign
government institution or agency, or international organization, with
powers and duties similar to the Transaction Reporting Authority
regarding the exchange of information between the Transaction
Reporting Authority and that institution, agency or organization.

(3) The information exchanged under subsection (1) or (2) of this section
shall be limited to information that the Transaction Reporting
Authority, the foreign government institution or agency, or the
international organization has reasonable grounds to suspect would be
relevant to the investigation or prosecution of a serious offence, a
money laundering offence or a financing of terrorism offence, or an
offence that is substantially similar to these offenc s.

(4) Agreements entered into under subsection (1) or (2) of this section shall
include the following terms -

(a) a restriction on the use of the report or information to purposes
relevant to investigating or prosecuting a serious ffence, a
money laundering offence, financing of terrorism offence, or an
offence that is substantially similar to these offenc s; and

(b) a stipulation that the report or information be trea ed in a
confidential manner and not be further disclosed without the
express consent of the Transaction Reporting Authority.





Section 6
Money Laundering and Proceeds of Crime (Amendment)

Act 2010





Page 14 Act No. 32 of 2010
to



11C Protection against liability

Any employee of the Transaction Reporting Authority, or any officer,
agent or person authorized to act on behalf of the Transaction Reporting
Authority, shall not be liable for damages for any acts or omissions
made in the discharge of his duties under this Act unless it is shown
beyond reasonable doubt that the act or omission was m de in bad
faith.”.

6 Section 13 amended

Section 13(1)(a) of the Principal Act is amended by deleting the existing paragraph
and inserting the following -



“(a) records of all transactions carried out by it, in accordance with the
requirements of subsection (3);”

7 Section 14 amended

Section 14(1) of the Principal Act is amended by –

(a) inserting after the first appearance of the word “transaction” the words “or an
attempted transaction”; and

(b) inserting after the word “serious offence” the words “or terrorist financing”.

8 New sections 14A and 14B

The Principal Act is amended by inserting the following new section 14A
immediately after section 14-



“14A Offence of failing to report suspicious transactions

Any person who fails to comply with the requirements of section 14 commits
an offence and upon conviction shall be liable to a fine not exceeding
$150,000.



14B Privileged communication

(1) The provisions of section 14 shall not apply to disclosure of any
privileged communication between a law practitioner and his client.

(2) For the purposes of this Act a communication is a privileged
communication only if -

Money Laundering and Proceeds of Crime (Amendment)
Act 2010 Section 9





to
Act No. 32 of 2010 Page 15




(a) it is a confidential communication, whether oral or in writing,
between-

(i) a law practitioner in his professional capacity and another
law practitioner in such capacity; or

(ii) a law practitioner in his professional capacity and his
client, whether made directly or indirectly through an
agent of either;

(b) it is made or brought into existence for the purpose of obtaining
or giving legal advice or assistance, in ascertaining the client’s
legal position, or in performing the task of defending or
representing the client in, or concerning judicial, administrative,
arbitration or mediation proceedings;

(c) the communication is not made or brought into exist nce for the
purpose of committing or furthering the commission f a
criminal offence.

(3) If the information consists wholly or partly of, or relates wholly or
partly to, receipts, payments, income, expenditure or financial
transactions of a specified person whether a law practitioner, his client,
or any other person, it is not a privileged communication if it is
contained in, or comprises the whole or part of anybook, account,
statement or other record prepared or kept by the law practitioner in
connection with any account held by the law practitioner.”.

9 Section 15 amended

Section 15(a) of the Principal Act is amended by inserting after the words “money
laundering” the following words “or terrorist financi g”.

10 Section 16 amended

Section 16(a) of the Principal Act is amended by inserting after the words “money
laundering” the following words “and terrorist finacing”.

11 New section 16A

The Principal Act is amended by inserting the following new section 16A
immediately after section 16 -




“16A Measures and Sanctions

Any supervisory or regulatory authority or competent disciplinary authority
that discovers a breach of the obligations established under this Act by a cash

Section 12
Money Laundering and Proceeds of Crime (Amendment)

Act 2010





Page 16 Act No. 32 of 2010
to



dealer, over the counter cash dealer, financial institution or other regulated
business it supervises may impose one or more of the following measures and
sanctions-

(a) written warnings;

(b) order to comply with specific instructions;

(c) order reports on a regular basis from the cash dealer, over the counter
cash dealer, financial institution or other regulated business on the
measures it is taking;

(d) barring individuals from employment within the sector;

(e) replacing or restricting the powers of managers, directors, principals,
partners or controlling owners, including the appointing of ad hoc
administrator;

(f) a temporary administration of the cash dealer or financial institution; or

(g) suspending, restricting or withdrawing the licens of the cash dealer or
financial institution.”.

12 Section 17 amended

Section 17 of the Principal Act is amended-

(a) by numbering the first paragraph as (1);

(b) in sub-section (1)(a) by deleting the words “reason to believe” and replacing
them with the words “reasonable grounds to believe or suspect”;

(c) in sub-section (1)(b) by deleting the words “rend rs assistance to another for”
and replacing them with the word “by”; and

(d) by deleting -

(i) “12 months” and replacing it with “10 years”;

(ii) “$10,000” and replacing it with “$500,000”; and

(iii) “$50,000” and replacing it with “$1,000,000”; and

(e) inserting the following after sub-section (1)(b)(ii) -



“(2) For the purposes of proving a money laundering offence under sub-
paragraph (1), it is not necessary to prove which serious crime has been
committed.

(3) Knowledge, intent or purpose required as an element of an offence in
sub-section (1) may be inferred from objective factu l circumstances.

(4) Nothing in this Act prevents a person that committed an offence that
generated proceeds of crime from being convicted of a money
laundering offence in respect of those proceeds of crime under sub-
section (1).”.

Money Laundering and Proceeds of Crime (Amendment)
Act 2010 Section 13





to
Act No. 32 of 2010 Page 17




13 Section 18 amended

Section 18 of the Principal Act is amended by inserting “or an anonymous account”
after the words “in a false name”.

14 Section 19 amended

Section 19 of the Principal Act is deleted and replaced with the following new
sections –



“19 Cash Declarations

(1) Any person who enters or leaves the Kingdom with cash amounting to
more than the prescribed sum or its equivalent in any other cash shall
make a declaration to an authorised officer in the prescribed form in the
Foreign Exchange Control Regulations.

(2) Any person sending out of or receiving in to the Kingdom currency
amounting to more than the prescribed sum by any means, including
but not limited to postal services, courier services or trans-shipment by
any craft must make a declaration to Customs in the prescribed Form
under the Foreign Exchange Control Regulations.

(3) Any person failing to declare cash in the prescibed sum to an
authorised officer commits an offence under this Act and shall be liable
on conviction to a fine not exceeding $50,000.



19A Questioning

(1) Any authorised officer may question any person arriving in or departing
from the Kingdom about the source, ownership, acquisition, use, or
intended destination of any cash in that person’s possession.

(2) Any person who, without reasonable excuse, on so being questioned by
an authorised officer fails or refuses to answer any question put to that
person commits an offence and shall be liable on convi tion to a fine
not exceeding $20,000.



19B Searches

(1) Any authorised officer may search any premises, place, or craft, if he
has reasonable grounds for suspecting that there is on the premises,
place, or craft, cash-

(a) which is recoverable cash or is intended by any person for use in
unlawful conduct, and

(b) the amount of which is not less than the minimum amount.

Section 14
Money Laundering and Proceeds of Crime (Amendment)

Act 2010





Page 18 Act No. 32 of 2010
to



(2) An authorised officer may search any person if he has reasonable
grounds for suspecting that a person is carrying cash-

(a) which is recoverable cash or is intended by any person for use in
unlawful conduct, and the amount of which is not less than the
minimum amount; or

(b) has failed to declare cash, the amount of which is not less than
the minimum amount in the prescribed form.

(3) An authorised officer may, so far as he thinks it necessary or expedient,
require a person searched under this section –

(a) to submit to a search of any goods he has with him, and, where
the authorised officer requires; and

(b) to submit to a search of his person.

(4) An authorized officer exercising powers by virtue of subsection (3)(b)
may detain the person for so long as is necessary for their exercise of
the powers of search.

(5) The powers conferred by this section are exercisable only so far as
reasonably required for the purpose of finding cash.

(6) Any personal search of a person shall be carried out only by an
authorised officer of the same gender of the person to be searched.



19C Seizure of Cash

(1) An authorised officer may seize any cash, if he has reasonable grounds
for suspecting that -

(a) it is recoverable cash;

(b) intended by any person for use in unlawful conduct; or

(c) it is undeclared cash intended for use in unlawful conduct.

(2) Any authorised officer may also seize cash part of which he has
reasonable grounds for suspecting that it is -

(a) recoverable cash;

(b) intended by any person for use in unlawful conduct; or

(c) it is undeclared cash intended for use in unlawful conduct.


19D Detention of seized cash

(1) While the authorised officer continues to have reason ble grounds for
his suspicion, or for the purposes of investigation, cash seized under
section 19C may be detained for a period of 72 hours.

(2) The period for which the cash or any part of it may be detained may be
extended by an order made by the Court, but the order may not
authorise the detention of any of the cash-

Money Laundering and Proceeds of Crime (Amendment)
Act 2010 Section 14





to
Act No. 32 of 2010 Page 19




(a) beyond the end of the period of three months beginning with the
date of the order; or

(b) in the case of any further order under this section, beyond the end
of the period of two years beginning with the date of the first
order.

(3) An application for an order under subsection (2) may be made by the
authorised officer, and the Court may make the order if satisfied, in
relation to any cash to be further detained, that either of the following
conditions is met-

(a) there are reasonable grounds for suspecting that the cash is
recoverable cash and that either-

(i) its continued detention is justified while its source,
ownership, use or destination is further investigated or
consideration is given to bringing proceedings against any
person for an offence with which the cash is connected; or

(ii) proceedings against any person for an offence with which
the cash is connected have been started and have not b en
concluded;

(b) there are reasonable grounds for suspecting that the cash is
intended to be used in unlawful conduct and that either—

(i) its continued detention is justified while its ntended use is
further investigated or consideration is given to bringing
proceedings against any person for an offence with hich
the cash is connected, or

(ii) proceedings against any person for an offence with which
the cash is connected have been started and have not b en
concluded.

(4) An application for an order under subsection (2) may also be made in
respect of any cash seized under section 19(D), and the Court may
make the order if satisfied that—

(a) the condition under subsection (3) is met in respect of part of the
cash; and

(b) it is not reasonably practicable to detain only that part.

(5) An order under subsection (2) shall provide for n tice to be given to
any persons affected by it.



19E Interest

If cash is seized under section 19D for more than 48 hours, it shall be as
soon as practicable, be paid into an interest-bearing account, and the
interest accruing on it is to be added to it on its forfeiture or release.



Section 14
Money Laundering and Proceeds of Crime (Amendment)

Act 2010





Page 20 Act No. 32 of 2010
to



19F Release of seized cash

(1) This section shall apply while any cash is seized un er section
19D.

(2) The Court may direct the release of the whole or any part of the
cash if the following condition is met -

(a) the Court is satisfied, on an application by the person from
whom the cash was seized, that the conditions in section
19D for the detention of the cash are no longer metin
relation to the cash to be released;

(b) after notifying the Court under whose order cash is being
seized, an authorized officer may, release the whole or any
part of it if satisfied that the seizure of the cash to be
released is no longer justified.



19G Forfeiture

(1) While cash is detained under section 19D, an application for the
forfeiture of the whole or any part of it may be made to the Court
by an authorised Customs or Police officer.

(2) The Court may order the forfeiture of the cash or any part of it if
satisfied that the cash or part is –

(a) recoverable cash; or

(b) intended by any person for use in unlawful conduct.

(3) In the case of recoverable cash which belongs to joint tenants,
one of whom is an exempted joint owner, the order may not
apply to so much of it as the court thinks is attributable to the
exempted joint owner's share.

(4) Where an application for the forfeiture of any cash is made under
this section, the cash is to be seized (and may not be released
under any power conferred by this Act) until any proceedings in
pursuance of the application (including any proceedings on
appeal) are concluded.

(5) Where cash has been seized under sections 19C and 19D and no
notice of appeal has been received by either the seizing authority
or the Court within the period of 30 days from the time of
seizure, then the cash will be automatically forfeited to the
Crown.



19H Application of forfeited cash

(1) Cash forfeited under this Act, and any accrued interest on it shall
be paid into the Seized Assets Fund.

Money Laundering and Proceeds of Crime (Amendment)
Act 2010 Section 14





to
Act No. 32 of 2010 Page 21




(2) Any forfeited cash under sub-section (1) shall not be paid in -

(a) before the end of the period within which an appeal is
made; or

(b) before the appeal is determined or otherwise disposed f.


19I Victims and other owners

(1) A person who claims that any cash or any part of it, seized under
this Act belongs to him may apply to a Court for the cash or part
to be released to him.

(2) The application may be made in the course of detention or
forfeiture proceedings or at any other time.

(3) If it appears to the court concerned that-

(a) the applicant was deprived of the cash to which the
application relates, or of cash which it represents, by
unlawful conduct;

(b) the cash he was deprived of was not, immediately before
he was deprived of it, recoverable cash; and

(c) that cash belongs to him,

the Court may order the cash to which the application relates to
be released to the applicant.

(4) The Court may order the cash to which the application relates to
be released to the applicant or to the person from whom it was
seized, if -

(a) the applicant is not the person from whom the cash to
which the application relates was seized;

(b) it appears to the court that that cash belongs to the
applicant;

(c) the Court is satisfied that the conditions in section 19D for
the seizure of that cash are no longer met or, if an
application has been made under section 19G, the court
decides not to make an order under that section in relation
to that cash; and

(d) no objection to the making of an order under this
subsection has been made by the person from whom that
cash was seized.



19J Compensation

(1) If no forfeiture order is made in respect of any cash seized under
this Act, the person to whom the cash belongs or from whom it

Section 15
Money Laundering and Proceeds of Crime (Amendment)

Act 2010





Page 22 Act No. 32 of 2010
to



was seized may make an application to the Court for
compensation.

(2) If, for any period beginning with the first opportunity to place the
cash in an interest-bearing account after the initial seizure of the
cash for 48 hours, the cash was not held in an interest-bearing
account while seized, the Court may order an amount of
compensation to be paid to the applicant.

(3) The amount of compensation to be paid under subsection (2)
shall be the amount the Court thinks would have been earned in
interest in the period in question if the cash had been held in an
interest-bearing account.

(4) If the Court is satisfied that, taking account of any interest to be
paid under section 19E or any amount to be paid under
subsection (2), the applicant has suffered loss as a result of the
seizure of the cash and that the circumstances are exc ptional,
the Court may order compensation or additional compensation to
be paid to him.

(5) The amount of compensation to be paid under subsection (4)
shall be the amount the court thinks reasonable, having regard to
the loss suffered and any other relevant circumstances.

(6) Compensation shall be paid in the first instance from the general
fund held by the Court.

(7) A forfeiture order shall be made in respect only of a part of any
cash seized under this Act and this section has effect in relation
to the other part.”.

15 New section 24A - penalty for disclosure

Section 24 of the Principal Act is amended by inserting the following new section
immediately after section 24-



“24A Penalty for disclosure

(1) Any person who knows or suspects that a report under this section is
being prepared or has been sent to the Transaction Reporting Authority
or any additional information requested by the Transaction Reporting
Authority has been prepared or sent, shall not disclose to another
person, other than a Court, the National Reserve Bank of Tonga or
other person authorized by law, any information or other matter in
relation the report.

(2) A person who contravenes this section commits an offence and shall on
conviction be liable to a fine up to $250,000 and or imprisonment for a

Money Laundering and Proceeds of Crime (Amendment)
Act 2010 Section 16





to
Act No. 32 of 2010 Page 23




period not exceeding 15 years, and in the case of a body corporate a
fine of up to than a fine of $500,000.”

16 Section 26 amended

Section 26(a) of the Principal Act is amended, in the English version only, by
deleting the word “no” and replacing with “not”.

17 Section 34 amended

Section 34 of the Principal Act is amended by-

(a) repealing section (2); and

(b) in subsection (4)(c), inserting before the word “hardship” the word “undue”.

18 Section 28(1) amended

Section 28(1) of the Principal Act is amended by deleting the words “six months”
and inserting the words “two years”.

19 New section 35A and 35B

The Principal Act is amended by inserting the following new sections immediately
after section 35:



“35A Application for Forfeiture Order for terrorist property

The Attorney General may apply to the Court for an order forfeiting to the
Crown all or any property that is terrorist property.



35B Notice of Application

(1) Where the Attorney General applies under section 35C for a forfeiture
order the Attorney General must give no less than 30 days written
notice of the application to any person who is know to have an interest
in the terrorist property in respect of which the application is being
made;

(2) Any person who claims an interest in the property may appear and
produce evidence at the hearing of the application; and

(3) The Court may, at any time before the final determination of the
application, direct the Attorney General to –

(a) give notice of the application to any person who, in the opinion
of the Court, appears to have an interest in the property; and

Section 20
Money Laundering and Proceeds of Crime (Amendment)

Act 2010





Page 24 Act No. 32 of 2010
to



(b) publish in the Gazette or a newspaper published and circulating
in Tonga, a notice of the application.



35C Forfeiture Order for terrorist property

(1) Subject to subsection (2), where, upon application by the
Attorney General, the Court is satisfied, on the balance of
probabilities, that property to which the application relates is
terrorist property, the Court shall order that the property or such
of the property as is specified by the Court in theorder, be
forfeited.

(2) Where a person claiming an interest in property to which an
application relates satisfies the Court that the person –

(a) has an interest in the property;

(b) has, in the circumstances, exercised reasonable car to
ensure that the property is not terrorist property; and

(c) is not a member of a terrorist group,

the Court shall order that the interest shall not be affected by the
forfeiture order, and the Court shall declare the nature and extent
of the interest in question.

(3) If a person obtains an interest in property after it becomes
terrorist property, no order shall be made under subsection (2) in
respect of that interest unless the person is a bonfide purchaser
for value, without reason to suspect that the property is terrorist
property.

(4) The provisions of this Act shall apply, with the appropriate
modifications as are necessary, to an application for a forfeiture
order under this section.”.

20 New section 48A

The Principal Act is amended by inserting a new section immediately after section
48 –



“48A Confiscated and forfeited funds

(1) There is hereby established in the public accounts of the Kingdom the
Tonga Confiscated and Forfeited Assets Fund.

(2) There shall be credited to the Tonga Confiscated nd Forfeited Assets
Fund -

(a) all moneys derived from the fulfilment of confiscation and
forfeiture orders contemplated in this Act;

Money Laundering and Proceeds of Crime (Amendment)
Act 2010 Section 21





to
Act No. 32 of 2010 Page 25




(b) any sums of money allocated to the Tonga Confiscated and
Forfeited Assets Fund from time to time;

(c) any voluntary payment, grant or gift made by anperson for the
purposes of the Tonga Confiscated and Forfeited Assets Fund;
and

(d) any income derived from the investment of any amount standing
to the credit of the Tonga Confiscated and Forfeited Assets
Fund.

(3) The Minister for Finance may authorise payments out of the Tonga
Confiscated and Forfeited Assets Fund to -

(a) compensate victims who suffered losses as a result of serious
offences, terrorism or unlawful activity;

(b) satisfy a compensation order under this Act;

(c) enable the appropriate law enforcement agencies to continue
their fight against serious offences, terrorism and unlawful
activities;

(d) share confiscated property with foreign States;

(e) rehabilitation of drug user;

(f) public education on the dangers of drug abuse; or

(g) any other matter the Minister of Finance deems appropriate to
utilise the Fund for.

(4) The Minister for Finance shall table a report in Parliament, not later
than the first sitting day after the expiry of 90 days from the end of the
fiscal year detailing -

(a) the amounts credited to the Tonga Confiscated and Forfeited
Assets Fund;

(b) the investments made with the amounts credited to the Tonga
Confiscated and Forfeited Assets Fund; and

(c) the payments made from the Tonga Confiscated and Forfeited
Assets Fund, including the specific purpose for which each
payment was made and to whom it was made.”.

21 Section 51 amended

Section 51 of the Principal Act is amended by repealing section 51(4).

22 Section 57 amended

Section 57 of the Principal Act is amended by:

Section 22
Money Laundering and Proceeds of Crime (Amendment)

Act 2010





Page 26 Act No. 32 of 2010
to



(a) deleting the words “realizable property” where th y appear and inserting the
words “tainted property”.

(b) repealing subsection (2) and substituting the following subsection –

“(2) An application for a restraining order may be made ex parte and shall
be in writing and be accompanied by a sworn statement stating –

(a) where the defendant has been convicted of a seriou offence –

(i) the serious offence for which he was convicted;

(ii) the date of the conviction;

(iii) the court before which the conviction was obtained an
whether an appeal has been lodged against the convicti ;

(iv) a description of the property in respect of which the
restraining order is sought;

(v) the name and address of the person who is believed to be
in possession of the property;

(vi) the grounds for the suspicion that the property is ta nted
property, is the proceeds of crime or property thatm y be
used to satisfy a confiscation order or pecuniary penalty
order in relation to the offence;

(vii) the grounds for the suspicion that the defendant derived a
benefit directly or indirectly from the commission f the
offence; and

(viii) where the application seeks a restraining order against
property of a person other than the defendant, the grounds
for the suspicion that the property is the proceeds of crime,
tainted property in relation to the offence or a gift caught
by this Act, or is subject to the effective control of the
defendant; or

(b) where the defendant is charged or is about to be charged with a
serious offence –

(i) the serious offence for which he is charged or about to be
charged;

(ii) the grounds for suspecting that the defendant committed
the offence;

(iii) a description of the property in respect of which the
restraining order is sought;

(iv) the name and address of the person who is believed to be
in possession of the property;

(v) the grounds for the suspicion that the property is the
proceeds of crime, tainted property in relation to the
offence or property derived from a serious offence, or

Money Laundering and Proceeds of Crime (Amendment)
Act 2010 Section 23





to
Act No. 32 of 2010 Page 27




property that may be used to satisfy a confiscation order or
pecuniary penalty order; and

(vi) the grounds for the suspicion that the defendant derived a
benefit directly or indirectly from the commission f the
offence; or

(c) where the application seeks a restraining order against property
of a person other than the defendant, the grounds for the
suspicion that the property is proceeds of crime, tainted property
in relation to the offence and is subject to the eff ctive control of
the defendant or a gift caught by this Act; or

(d) the grounds for the suspicion that a confiscation order or a
pecuniary penalty order may be or is likely to be made under this
Part in respect of the property.”.

23 New section 57A and 57B – Restraining orders for terrorist property

The Principal Act is amended by inserting the following new sections immediately
after section 57:



“57A Application for Restraining Order in respect of terrorist property

(1) Where there are reasonable grounds to suspect that any property is
property in respect of which a forfeiture order may be made under
section 35C, the Attorney General may apply to the Court for a
restraining order under subsection (2) against that property.

(2) An application for a restraining order may be made ex parte and shall
be in writing and accompanied by an affidavit stating-

(a) A description of the property in respect of which the restraining
order is sought;

(b) The location of the property; and

(c) The grounds for the belief that the property is terrorist property
for which an order may be made under section 35C.



57B Restraining Orders in respect of terrorist property

(1) Subject to this section, where the Attorney General applies to the court
for a restraining order against property and the Court is satisfied that
there are reasonable grounds for suspecting that the property is terrorist
property for which a forfeiture order may be made under section 35A,
the Court may make an order –

Section
Money Laundering and Proceeds of Crime (Amendment)

Act 2010





Page 28 Act No. 32 of 2010
to



(a) prohibiting any person from disposing of, or dealing with, the
property or such part thereof or interest except in he manner
specified in the order; and

(b) at the request of the Attorney General, where th Court is
satisfied that the circumstances so require, that te Attorney
General take custody of the property or such part thereof and
manage or otherwise deal with all or any part of the property in
accordance with the directions of the Court.

(2) For the avoidance of doubt, the Court may make n order under
subsection (1) in respect of money or other property located in Tonga
or elsewhere.

(3) Where the Attorney General is given a direction under subsection (1)
(b), the Attorney General may do anything that is reasonably necessary
for preserving the property and for this purpose may exercise any
power that the owner of the property could exercise and do so to the
exclusion of the owner.

(4) Where the Attorney General applies to the Court for an order under
subsection (1), a witness shall not be required to answer any question or
to produce any document if the Court is satisfied that answering the
question or producing the document may prejudice the investigation of,
or prosecution of a person for, an offence.”.

24 Section 58 amended

Section 58(1)(d) of the Principal Act is amended by deleting the words “and that the
property is subject to the effective control of thedefendant”.

25 Section 59 repealed

The Principal Act is amended by repealing section 59.

26 Section 72 amended

Section 72(1) of the Principal Act is amended by inserting after the first appearance
of the word “person” the words “is being investigated for or”.





Passed by the Legislative Assembly this 2nd day of September 2010.

Related Laws