Organised crime costing Australia $36 billion a year

Richard Grant, Executive Director of Intelligence at the Australian Criminal Intelligence Commission, talks about a report they’ve released into serious and organised crime in Australia

Introduction: Organised crime costing Australia 36 billion a year

Ross Greenwood:  Welcome back to Money News right around Australia. Everybody understands, right now, that cyber crime is growing, but so too is organized crime. Cybercrime and organized crime are basically perfect bedfellows. But it’s not just cyber crime where organized crime operates in Australia, it goes to so many different areas. It goes to corruption within our public servants, it goes to violence and intimidation, it goes to a range of different areas. The thing is, it’s one hell of a lot more costly than what you or I imagine and it’s going on the whole time. The Australian Criminal Intelligence Commission watches this on an annual basis.

It’s put out its 2017 report and has identified six key enablers of organized crime in Australia; money laundering, technology and digital infrastructure, professional facilitators, identity crime, corruption within the public sector, violence and intimidation. There’s a range of different areas but the cost, I’ve got to tell you, is eye watering. Let’s go now to the executive director of intelligence at the Australian Criminal Intelligence Commission, Richard Grant is online. Many thanks for your time Richard. There’s a range of different areas but the cost, I’ve got to tell you, is eye watering. Let’s go now to the executive director of intelligence at the Australian Criminal Intelligence Commission, Richard Grant is online. Many thanks for your time Richard.

Interview with Richard Grant, Executive Director of Intelligence, Australian Criminal Intelligence Commission

Richard Grant:  Thanks for your time, Ross.

Ross Greenwood:  Go first to the cost. Surprise people, this has really knocked me about.

Richard Grant:  Well, it’s actually quite depressing, as you said. We’ve estimated a cost, conservatively, at about $36 billion, that’s 36 billion. When you take that through– spread it across the population, that’s about $1,561 for every man, woman, and child in the country.

Ross Greenwood:  36 billion is eye watering, it really is. I’m sitting here and thinking that that is probably larger than the annual education budget in Australia, I’m absolutely certain it would be. It just gives you some sense of the scale as to how big $36 billion is. The thing that really is alarming to me is this notion of professional facilitators. What you’re saying is there’s a real problem coming because professional lawyers, accountants, even computer experts are being used to commit crimes and hide assets. The question is whether many of those so-called professionals understand, truly, what they’re undertaking?

Richard Grant:  You’re correct, Ross. When we talk about the facilitators, we’re talking about, as you said, lawyers, accountants, financial and tax advisors, registered migration agents, stockbrokers, real estate agents, customs brokers, people working in the ICT world. It really is a smorgasbord of professional facilitators. In some cases, some of them might be unwilling or just negligent, but in some cases, in the more egregious areas, their behavior is really quite criminal. They’re the ones facilitating a lot of the crime.

Ross Greenwood:  The other point, also, is that there’s a whole range of different areas that you can go to, and you’ve mentioned these areas. Sports betting is one. Cybercrime, we understand and we speak about that a lot here on the program, but also Phoenix activity as well. Let’s start with sports betting. I presume this is about money laundering more than anything else, is it?

Richard Grant:  Well, we’ve been doing some really quite interesting work in that space. We’ve got the ability to collect unique intelligence that gives us insights into the size of the market, but also the threat and risks to the market. Of course, with all of that, then that potentially starts to undermine the integrity in sport. So, look, it’s hard to put a figure on that but certainly, that’s one of our focuses, is on the sports betting market, particularly the unregulated sports betting market. Coming out on this report is the fact that we’ve really got to reach overseas now and be joined up with a number of our overseas partners because none of these problems are just unique to Australia.

Ross Greenwood:  The other point, also, is you talk about the global links there. What you’ve said, here in the report, as visibility of criminal activities becomes increasingly obscured through the new technologies and sophisticated methods, it’s clear that a connected, informed and collaborative response to the threat is required. Now, that’s the keys, isn’t it? Unless you can actually have all the different agencies and intelligence from overseas feeding in, unless there’s a concerted attempt, people are just going to basically go between the gaps and find the ways in which there are weaknesses in the system so they can go about their nefarious ways.

Richard Grant:  Ross, you are completely and utterly correct. Though a lot of the emphasis of Australian law enforcement, certainly the ACIC, has really been about engagement with international partners. We’ve recently, in the last couple of years, put some people offshore, not for liaison work, but to actually gather unique and discreet intelligence, which helps us understand the level of threat and harm in the community, but more importantly, starts to join up our operational work to take the fight offshore. We’ve said that 70% of targets or the associates who are adversely impacting the country are actually offshore, so it doesn’t make sense to have the fight just domestically. We’ve got to work more and more with our international partners to take them out overseas.

Ross Greenwood:  The reason is; and let’s go to something that’s very basic, everybody understands, that is a Nigerian scam, for example. It’s very difficult for a person who was a victim of a scam here to be able to try and take action in Nigeria because our policing organizations, Federal police and whatever it might be, do not have the jurisdiction in Nigeria, so you need cooperation in the areas where the scams are being perpetrated.

Richard Grant:  Look, you’re perfectly correct. The other thing is, years ago, we saw this with the Italian mafia, where the goods or the drugs were produced in one country, sold in another with the profits going to another country, with the organizers being in a fourth or fifth country. So, that diversification of your operations makes it very hard to share information and for law enforcement to work effectively to target these criminals. We’re now seeing this being industrialized from various ethnic groups and various organized crime groups. We’re attractive because we have got a relatively unsophisticated investment market or investors and we’re pretty well cashed-up. We weren’t particularly affected by the GFC in comparison to a lot of other countries, so we’re a target.

Ross Greenwood:  Also, we have very large superannuation pots that are largely digitally able to be accessed, that would also be a big issue.

Richard Grant:  You’re correct. We saw that a few years ago, for those who remember. Every household in Australia got a letter from the relevant police commissioner in their state, that was about the cold-calling investment scams that we’re seeing coming out of a lot of countries, particularly in southeast Asia, targeting us, because of– that we were cashed-up, and as I said, the relatively unsophisticated investor. We talk about that in our report and talk about the cycle of how people are targeted. The reason for that is, as I said, we’re cashed-up but, also, if you were working offshore, you’re working digitally, and particularly with some of the other things around encryption, then it makes it exceptionally difficult for law enforcement.

Ross Greenwood:  I’ll give you another good example. I know, maybe, you can’t comment about this, but I’ll just put it out there to people. Say, for example, there’s a current example of a bank that is being pursued through the Federal court on civil action for 53,000 breaches of reporting transactions or failing to report transactions to AUSTRAC. Now, my question to the chief executive was; it still is and it hasn’t been properly answered, I don’t think, why was it that the bank did not know about the loophole or the breach inside its own security system that meant those reports weren’t going off, but somehow, during that period of time, lots of crooks did understand that there was a weakness in its security system and poured, literally, billions of dollars through its banking accounts during that time? It’s just a hypothetical question sitting out there, but I’ve got to say, Richard, you may not be able to comment about that one at this time.

It’s just a hypothetical question sitting out there, but I’ve got to say, Richard, you may not be able to comment about that one at this time.

Richard Grant:  Look Ross, I think I’ll let that one go through the keeper mate.

Ross Greenwood:  But it’s not a bad question, I would suggest. Nonetheless, I’ll tell you what, great to have you on the program. Richard Grant is the executive director of intelligence at the Australian Criminal Intelligence Commission. It is serious stuff people, it really is. You’ve just got to make certain you keep your security close and keep your money even closer. Again, Richard, many thanks for your time.

Richard Grant:  Thanks for your time, Ross.

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