Mr Deputy Speaker, I move that the bill be now read a second time.
The purpose of this bill is to insert new offences into the Criminal Code Act specifically addressing identity theft. The creation of new specific identity theft offences will fill the legislative gap regarding preparatory identity theft offences such as the act of obtaining identifying data belonging to another person through the use of credit card skimming devices.
Identity crime is a major concern for this government. It is also a significant national and international issue with the Australian Crime Commission reporting that identity theft is a key enabler for serious and organised crime.
The Australian Bureau of Statistics Personal Fraud Survey for 2010-11 found that Australians lost $1.4bn due to personal fraud which included credit card fraud, identity theft and scams. Based on the results of the survey, the Australian Bureau of Statistics estimated that 1.2 million Australians, forming 6.7% of the population, were victims of at least one incident of personal fraud in the preceding 12 months. As a result of advancements in technology, globalisation and the anonymity of the Internet, identity crime is becoming easier to commit.
Identity theft can be perpetrated in various ways and includes the use of a skimming device to obtain credit card data from an ATM or EFTPOS card using identification information to open a false bank account, to obtain a loan or the use of credit card information to purchase items on the Internet.
The impacts of identity crime are considerable and are not limited to direct personal financial deficit. As the owner of a skimmed credit card or debit card is rarely liable for the fraudulent transactions the relevant financial institution has to bear the loss and, ultimately, the community will suffer adverse effects through high banking costs.
Other indirect consequences of credit card skimming include adverse credit card ratings, a loss of reputation or security for legitimate businesses, higher prices for retail to cover losses; increased business costs of managing and preventing identity crime; and psychological stress for victims. A person’s identity is central to who they are and, in a technological society in which we live, it is vital to one’s ability to carry out transactions and everyday tasks. The theft of a person’s identity can suspend their ability to engage in everyday and carryout transactions, which can lead to emotional upheaval.
Northern Territory residents are victims of identity theft and fraud just like any other jurisdiction and, typically, offenders are located outside the Northern Territory. In March 2008, the model criminal law officers committee released its final report on identity crime. This report found, at the time, the criminal law across the states and territories did not fully address the range of conduct which can be attributed to the misappropriation and wrongful use of identity information. Although the Criminal Code contains a number of general stealing, forgery and criminal deception offences, which might apply to identity theft and card skimming, these offences do not cover preparatory offending such as the act of obtaining or identifying data belonging to another person.
Under these general offences, a person who obtains identification information cannot be prosecuted until, and unless, a further offence is committed, for example, where financial information is used to purchase items over the internet. Because much of the data obtained through credit card skimming is sent overseas, those further offences may not occur for a significant period of time and are much harder to detect and prosecute.
A national response to combat serious and organised crime, of which closing legislative gaps with respect to identity crime is part, was agreed at the April 2009 meeting of the former Standing Committee of Attorneys-General - now the Standing Council on Law and Justice - with the unfortunate acronym of SCLAJ. It is also agreed the identity crime offences, including credit card skimming, should be a short- to medium-term goal. Most Australian jurisdictions have now implemented this goal.
The provisions of the Criminal Code Amendment (Identity Crime) Bill are largely based on the Model Criminal Code provisions proposed by the Model Criminal Law Officers’ Committee in their 2008 Final Report on Identity Crime; to comprehensively cover all forms of identity fraud and theft.
The Criminal Code Amendment (Identity Crime) Bill inserts Part 2A into Part VII of the Criminal Code creating 3 new offences:
(a) section 228C – dealing in identification information;
(b) section 228D – possessing identification information; and
(c) section 228E – possessing equipment used to deal in identification information or identification documentation.
Section 228A provides the definitions for the Division. The definition of ‘identification information’ has been specifically drafted in accordance with the recommendations of the Model Criminal Law Officers’ Committee to ensure the broadest possible application so that all forms of identity crime, including credit card skimming, are captured. For example, the definition of identification information includes a credit or debit card, its number, or data stored or encrypted on it.
The term ‘deal in’ is also defined to include make, copy, store, supply, transmit or use and has been drafted to ensure that all forms of dealing with identification information or identification documentation are covered. This is particularly relevant to section 228E, which provides for the offence of possessing equipment used to deal in identification information or identification documentation.
If the definition of deal-in only included the term ‘make’, this would be insufficient to cover the credit card skimming devices, or equipment, which merely retain or copy identification information, as these devices do not manufacture or make identification information. Each of the offences requires the offender to intend to commit or facilitate the commission of a crime by dealing in, or possessing, identification information or equipment. It is not the intention of the legislation to criminalise legitimate possession or use of identification information or equipment, for example, the possession or use of identification information equipment by bank or financial institutions, or possession of a smart phone, computer, photo copier or printer by any person.
In order to be found guilty of an offence under the new identity theft offences (sections 228C, 228D and 228E) a person must intend to use the information or equipment to commit or facilitate a crime. The requirement for the intention to commit, or facilitate the commission of a crime also excludes relatively minor offending, for example, a juvenile using or possessing fake identification with the intention of purchasing alcohol, as these offences carry a penalty of less than two years imprisonment and therefore do not fit the definition of a crime, as classified in section 38E of the Interpretations Act. In addition, section 228C and 228D make it clear it is not an offence for a person to possess or deal in their own identification information.
Under the proposed Sections 228C, 228D and 228E of the Criminal Code it will not matter if the crime for which the information or equipment is possessed or dealt in is impossible to commit, nor is it necessary for the prosecution to prove that the crime intended to be committed was actually committed. It is only necessary to prove that the person intended to commit or facilitate the commission of a crime. It is also not a defence under sections 228C and 228D for the victim to have consented to their identification information being possessed or dealt with.
All provisions have been drafted to ensure they remain technologically neutral and are not out-dated by future technological advancements.
The proposed penalty for dealing in identification information is seven years imprisonment. Although the penalty for dealing in identification information under the model Criminal Code is only five years imprisonment, in order to keep the penalties for the proposed offences consistent with the offences of theft, criminal deception and forgery, the term of seven years has been prescribed.
This term also reflects the serious impact identity crime has on victims and the community. The proposed penalties for possessing identification information (under section 228D) and possessing equipment used to deal with identification information or identification documentation (under section 228E) are consistent with the model Criminal Code at three years imprisonment.
Section 228B provides that section 4BF of the Criminal Code, which relates to an attempt to commit a crime, does not apply to other offences.
Given the offences target preparatory offending, an ‘attempt offence’ is unnecessary. This position is consistent with that of the model Criminal Law Officers Committee in the final report on identity crime.
Section 228F provides for an alternative verdict in a trial or summary hearing. If the trier of fact (jury or magistrate) is not satisfied beyond reasonable doubt that the defendant is guilty of dealing in identification information (under section 228C), they can still find the defendant guilty of the offence of possessing identification information under section 228D as an alternative verdict.
In addition to creating identity offences, the bill provides for a court to issue a certificate to a victim of identity theft confirming that certain transactions were, in fact, carried out by another person. The certificate may be issued to the victim either by a local court or the sentencing court.
Section 28C of the Local Court Act will allow for a victim to apply to the local court for a certificate at any time irrespective of a prosecution for an identity crime offence or the identification of the perpetrator. If a certificate has not been issued prior to sentencing, Part 5 Division 1AA of the Sentencing Act will provide for the sentencing court to issue a certificate to the victim, whether on their own initiative or the application by prosecution when sentencing an offender for one of the new identity theft offences.
The rationale behind the certificate is to assist a victim in remedying the effects of identity crime. The certificate will not restore the victim’s credit rating, but it may be used by the victim to prove that certain transactions were fraudulent.
The process for obtaining a victim’s certificate in the local court and sentencing court is slightly different. In assessing an application for a victim’s certificate, the local court must be satisfied on the balance of probabilities that:
(a) an offence against Sections 228C and 228D or 228E of the Criminal Code has been committed;
(b) the victim’s identification information was the subject of the offence, and
(c) the certificate may assist the victim to deal with any problems the commission of the offence has caused in relation to the victim’s personal or business affairs.
The ordinary standard of proof in the civil jurisdiction is the ‘balance of probabilities’, while the standard of proof in the criminal jurisdiction is ‘beyond reasonable doubt’. ‘Beyond reasonable doubt’ is a much higher standard of proof than that of the ‘balance of probabilities’.
The local court hears matters in the civil jurisdiction, and section 28C(1) specifically provides that the standard of proof that is to be used with assessing an application is on the balance of probabilities. Although the local court will be determining whether or not an offence has been committed, it is not a prosecution and, therefore, the finding will not result in any detriment to the offender and so the court will not need to be satisfied of this fact beyond reasonable doubt. The finding of the local court is, therefore, a finding of fact and not a finding of guilt.
Providing for the local court to assess an application on the balance of probabilities is extremely important in assisting the victim, as the provision does not require them to prove beyond reasonable doubt that an offence has been committed, rather that, on the balance of probabilities an offence was committed.
The same test is to be applied by the sentencing court when determining whether the certificate may assist the victim in section 97AB(1)(c). However, unlike the local court, as a certificate may only be issued by a sentencing court when they are sentencing an offender for one of their new identity theft offences, there is no need for the court to be satisfied that an offence has occurred.
The grant of a certificate by the local court prior to a finding of guilt will not impact on the sentencing process and will not prevent a sentencing court from ordering an offender to pay full restitution or compensation to the victim. Further, if the offender pleads not guilty and proceeds to trial, the issue of a certificate by the local court cannot be used as evidence against the defendant in a criminal trial to prove the offence did, in fact, occur.
Although a number of other Australian jurisdictions require a conviction prior to a certificate being issued to a victim, and will only do so upon sentencing an offender for an identity theft offence, we as a government have decided to allow for a victim to apply for a certificate at any time, irrespective of a prosecution whether or not (a) the person who committed the offence is identifiable, or (b) criminal proceedings have, or can be taken, against a person or are pending. This position is consistent with that taken by the Commonwealth government. It is also the most supportive of victims because prosecutions may take some time to finalise, may also result in an acquittal on technical basis, or the offender may be overseas or unable to be located.
This government is very concerned about the impact of offending on both the victim and the community. It is important that the victim be able to remedy the serious effects of identity crime as soon as possible so they can resume their lives. If a victim is forced to wait until a conviction to obtain proof of theft or their identity, then their psychological stress and financial detriment would be significantly exacerbated. The Final Report Identity Crime, referencing and article by Mike Hatch in the William Mitchell Law Review, noted that victims of identity crime spend an average of two or more years attempting to fix their credit report and restore their credit rating. By providing victims with the opportunity to obtain a certificate confirming the theft of their identity as early as possible, we are aiming to reduce the detriment of the crime and allow the victim to move on sooner.
By targeting preparatory offending, banks, financial institutions and businesses will also be able to be protected. As offenders will be targeted prior to using identification information, financial detriment will be mitigated as business will not have to remedy the fraud by reversing transactions or reimbursing the victim.
The introduction of specific identity crime provisions will fill the legislative gap regarding preparatory offending and will allow the prosecution of all acts relating to identity theft, including credit card skimming and possessing a device or information used to commit a further offence. This is an important step towards ensuring the safety of Territorians and assisting the national response targeting serious organised crime. By addressing gaps in our legislation consistent with the model Criminal Code we will ensure the Territory is not a safe haven for criminals seeking to escape other jurisdictions.
Finally, the bill also amends the private security regulations regarding crowd controllers, security firms, and security officers’ licences. The bill adds each of the new identity theft offences (sections 228C, 228D and 228E of the Criminal Code Act) to the list of disqualifying offences for obtaining a security provider licence. As a result, persons who have been convicted of identity theft offences will not be appropriate persons for the purposes of section 15(7) of the Private Security Act and will be precluded from obtaining a security provider licence. Given the business conducted by those who hold security licences, it is important to ensure proper screening of applicants and that those persons who have been convicted of identity theft offences are precluded from obtaining a licence.
Madam Speaker, I commend the bill to honourable members and table a copy of the explanatory statement.
Debate adjourned. |
Northern Territory Second Reading Speeches