THE FORGOTTEN ORDER OF SECTION 44(1) OF THE ANTI-MONEY LAUNDERING, ANTI-TERRORISM FINANCING, AND PROCEEDS OF UNLAWFUL ACTIVITIES ACT 2001 [AMLATFA 2001]
This Article intends to provide an understanding on the implication(s) of an Order under Section 44(1) of AMLATFA 2001. We first begin with a brief understanding of Section 56(1) of AMLATFA 2001.
- Section 56(1) AMLATFA 2001 imposes several conditions before it can be invoked:-
a) There must not be a prosecution or conviction for an offence under subsection 4(1) or a terrorism financing offence; and
b) the application must be done before the expiration of 12 months from the date of the seizure, or where there is a freezing order, 12 months from the date of the freezing.
Section 44(1) AMLATFA 2001 states:-
I) Subject to Section 50, an enforcement agency may issue an order to freeze any property of any person or any terrorist property, as the case may be, wherever the property may be and whether the property is in his possession, under his control or due from any source to him ...
- When one reads both Sections 44(1) and 56(1) together, some form of confusion arises; i.e. is the "order to freeze" under Section 44(1), a "freezing order"; as referred to in Section 56(1)? I am of the view that, this "order to freeze" must be construed and taken to mean, the "freezing order" specified under the conditions of Section 56(1).
- The phrase "freezing order" and the "freezing periods" stated under Section 56(1) has not been limited to the cover and/or be applicable to only one particular section and/or Act. It is stated as a requirement of fact. Hence, it ought to follow that, as long as there is a valid and legal "freezing order" issued against the property concerned, the 12 months' period under Section 56(1) starts to run and the same cannot be enlarged by any means. Such an unwarranted enlargement will clearly defeat the purpose of the conditions imposed.
- So, how is one affected? Practically, enforcement agencies will issue an "order to freeze" under Section 44(1) to commence investigations. The proprietor of the property will not be able to attend to his property upon the issuance of the order. How long does this order stand? Is it perpetual in nature? We shall discuss this below. After the issuance of this "order to freeze", the Prosecution Department will then issue a "seizure order" pursuant to Section 50(1) of AMLATFA 2001.
- Based on the above, I take the stand that, any computation of time ought to start from the first conduct of depriving one of their property; i.e. by any means of seizure or by means of issuance of an "order to freeze" or a "freezing order". This is the only practical approach in giving effect to the 12 months period; imposed by Parliament.
- The other school of thought opines that; the computation of the 12 months period must start upon issuance of the "seizure order" as the qualification of 12 months is spelled in connection to the "seizure order" and "freezing order" under Section 56(1).
- There is a separate argument in favor of the contention that, both the "seizure order" and "freezing order" are separate in nature; rendering their respective time periods, distinctive. If this argument is to be adhered to, a property can be "frozen" for a maximum period of 24 months; as opposed to the express provision of 12 months.
- It must be noted that, the intention of Parliament is clear; it is either the "seizure order" OR the "freezing order" – under Section 56(1) AMLATFA 2001. The 12 months' time period cannot be enlarged by issuing one order after the other. The 12 months’ time period provided for under Section 56(1) serves as a protection; i.e. to prevent a property from being "frozen" for too long a time.
Therefore, it should follow that:-
a) once enforcement agencies issue an "order to freeze" under Section 44(1) ALMFTA 2001 and/or a "seizure order", the 12 months' time period to file a motion under Section 56(1) AMLAFTA 2001 becomes applicable; OR
b) once authorities issue a "freezing order" under Section 56(1) AMLFTA 2001, the 12 months' time period to file a motion under Section 56(1) AMLAFTA 2001 becomes applicable.
It is one or the other and not one after the other. In the event such a motion is not filed within the 12 months' time period, the effected party shall have a cause of action to claim, amongst others, damages for illegal detention.
- I do hope that, upon reading this Article; and if the facts of any particular case demands, practitioners will take to task the existence of an "order to freeze" under Section 44(1) to challenge the validity of any motion filed under Section 56(1) – which is outside the 12 months' time period stipulated.
Note:- Once the conditions of Section 56(1) AMLATFA 2001 are satisfied, the Prosecution can file a motion to the High Court; seeking an Order for forfeiture of the property that has either been seize or frozen. In practice, this is mainly deals with monies in bank accounts that is motioned to be forfeited by the Government. This article will not examine the ingredients needed to "cook up" a successful motion; but on the provision, that, 12 months cannot pass before the filling of the said motion.