16 June 2014

Bureaucratic Convenience

I've argued elsewhere that trust is a key aspect of calls by law enforcement and national security agencies for greater powers and the relaxation of administrative burdens. Regrettably members of the thin blue line on occasion mistake bureaucratic convenience for substantive need and are presumably perplexed by critics who are unimpressed by institutional overreaching.

The Australian reports that South Australian police "want sweeping changes to privacy laws to allow government departments to dob in criminals who use them to hide the proceeds of their illegal activities". Privacy laws supposedly "prevent state and federal government agencies from disclosing almost all private information to police, even when they suspect illegal activity".

SA Police Commissioner Gary Burns has reportedly told the Parliamentary Joint Committee on Law Enforcement inquiry into financial crime that Australia Post, the Department of Immigration & Border Protection, Centrelink and other government entities must be allowed to "volunteer" private information. Burns' submission calls on changes to legislation regulating the collection and subsequent disclosure of information, albeit apparently acknowledging that the law features "specific exemptions permitting disclosure".

In an ambitious call for an easier life Burns states that police want
  • simpler access to state and national databases which use facial identification such as passports and driver’s licences. 
  • national rollout of facial recognition technology across all government departments. 
  • real-time blocks on bank accounts without the account holder’s consent. 
  • using new technology to speed up information exchange between police and financial institutions. 
The Australian article quotes SA Commissioner for Victims’ Rights Michael O’Connell as commenting that the ability of financial criminals to hide large amounts of money from state police was one of the keys to their success.
The ease with which offenders can move the proceeds of their unlawful deeds across borders is a primary factor facilitating the success of cross-jurisdictional crime such as fraud. Conversely, those borders are often obstacles to police and law enforcement.  The economic costs and impact upon victims as well as others who fear being defrauded is enormous. There should be swift and collaborated responses that a respectful of victims’ rights and minimise the risk of secondary victimisation. 
Why stop there? Burns is reported as criticising international agreements which required requests for assistance to foreign authorities.
Mutual assistance requests are cumbersome and time-consuming. The delay in the provision of requested material can often frustrate investigations and the court process.
His advisers perhaps need to bring him up to speed about international law, i.e. the South Australian law does not extend to Thailand, China or the UK. The SA Police would presumably be underwhelmed if directed by an overseas counterpart to stand and deliver.

The submission by the Australian Bankers Association comments that
Whilst identity fraud relating to credit cards is an issue, a potentially more serious and worrying problem is emerging. With the increased utilisation by security teams of data analytics, Australian financial institutions are increasingly detecting potential identity fraud, particularly amongst non-Australian resident customers, specifically the use of what appears to be false passports in the customer on boarding (Know Your Customer) process. 
Unlike the Attorney-General’s Document Verification Service, there is no mechanism for Australian banks to verify that a passport which looks genuine is actually legitimate, or that it has actually been used to legally enter Australia (helping reinforce one identity per person). Numerous instances have been identified where accounts have been opened by foreign customers (e.g. tourists, students, working holiday visa holders) using a passport which appears genuine, but which returns an invalid result when checked with the issuing authority overseas. In these cases, it is not unusual for accounts to be used for money laundering purposes, or to be used to perpetrate fraud against the parent (or another) financial institution. The current reliance on attempting to manually verify individual identity documents with the issuer is sometimes feasible for one-off cases (depending on the issuing jurisdiction), but it becomes unworkable as volumes increase. 
Ideally, a mechanism would be developed to enable Australian banks to validate foreign customer identity documents as legitimate, either at the source through the host country, Interpol, or as a fall-back against Australian Customs and Immigration Passenger Movements. Early identification of false or suspicious identities, combined with an agreed reporting mechanism (e.g. AUSTRAC, AFP) would enable early intervention by law enforcement as well as potentially disrupt organised financial crime and money laundering activity.