Federal Parliament has enacted amendments to Crimes Legislation Amendment (Proceeds of Crime and Other Measures) Bill 2016 with implications for Australian business. The Act amends the Criminal Code and prohibits the making, altering, destroying or concealing of an accounting document:
- with the intention to facilitate, conceal or disguise the giving or receipt of a payment not legitimately due to a person; or
- reckless to the fact that doing so facilitates, conceals or disguises the giving or receipt of such a payment.
This has been a response to international criticism of Australia's failure to enforce anti-corruption laws. It is anticipated that these amendments will have serious ramifications for Australian business with a clear message from government that it is committed to ensuring Australia has tough laws against white-collar crime.
As a result of these laws, any investigations into potential criminal conduct by an Australian Corporation going forward is likely to focus upon the treatment of that conduct in the books and records of the corporation. Jones Day Lawyers indicate that measures which Australian corporations should consider undertaking in order to protect themselves from prosecution under the new offences include:
- Training those responsible for maintaining the books and records of the company as to the new offences;
- Reviewing the adequacy of the control and supervision of those responsible for maintaining the books and records of the company;
- Obtaining certificates of compliance from all employees who are responsible for providing the raw data inputs that feed into the accounting records of the company;
- Reviewing the adequacy of training and policy implementation designed to prevent illegitimate conduct within the corporation; and
- Undertaking random in-country audits in high-risk jurisdictions or industries.
Significant penalties follow from conviction — imprisonment for individuals, and fines that mirror the penalties for the offence of bribing foreign government officials, which can be as high as 10 percent of the annual turnover of the corporation in the 12-month period prior to the relevant conduct.
During an annual Audit process , increased checks and balances should be applied to ensure current accounting protocols, policies and procedures are robust enough to minimise the opportunities for breaches of this Act to occur. Please contact our Audit and Assurance director Michael Georghiou to discuss this change in further detail.
Please note that this publication is intended to provide a general summary and should not be relied upon as a substitute for personal advice.
Thanks to Jones Day for contribution to content.