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The year in review

The role of ACLEI is to support the Integrity Commissioner in providing independent assurance to government about the integrity of prescribed law enforcement agencies and their staff members.

ACLEI's performance framework

ACLEI's 2016–17 Portfolio Budget Statements (at pages 64 and 65) set out five performance criteria which track how ACLEI is progressing towards meeting its purpose.

1

The corruption notification and referral system is effective

2

ACLEI's investigations are conducted professionally and efficiently, and add value to the law enforcement integrity system

3

ACLEI monitors corruption investigations conducted by law enforcement agencies

4

ACLEI insights contribute to accountability and anti-corruption policy development

5

ACLEI's governance and risk management controls are effective and take account of its operational role

Delivery against strategic priorities

To focus ACLEI's efforts towards meeting its performance criteria, the 2016–17 Corporate Plan (page 3) sets out ten strategic priorities. These strategic priorities indicate key activities that ACLEI will undertake or work towards during the reporting period to meet its key performance criteria, whilst supporting the Integrity Commissioner to build and maintain an agency which makes the best use of resources to deliver maximum value to the public. The Annual Performance Statement on pages 20–26 reflects the actual results achieved against the performance criteria set out in the Portfolio Budget Statements for the reporting period.

Explanation of terms

  • Complete: one-off projects or activities that are considered finalised.
  • Business as usual: ongoing projects or activities that have reached a desired level of performance, now to be maintained.
  • On track: projects or activities that are progressing satisfactorily and for which completion in the following year (or moving to "business as usual" for ongoing activities) could reasonably be anticipated.
  • Progress made: projects or activities that are in the early stages of completion and for which further significant work could be anticipated in the following reporting year.

Engage with relevant agencies to strengthen joint understanding of corruption methods and motivations at the border—including in administration of biosecurity, anti-money laundering and visa arrangements—and the role of corruption as an enabler of serious crime types.

  • The AFP and DIBP seconded a number of staff to ACLEI
  • Sixty corruption issues were investigated jointly with other law enforcement agencies
  • The Community of Practice for Corruption Prevention met three times
  • ACLEI officers delivered 18 presentations to support awareness-raising activities amongst LEIC Act agencies and the broader public service
  • Vulnerability assessments were undertaken and shared with relevant agencies operating in border environments

Status: Business as usual

Reinforce a professional, adaptive culture across ACLEI's Canberra and Sydney locations, building on the reviews of organisational culture and structure conducted in 2015–16.

  • As recommended by a review, the Assistant Director Professional Standards regularly attended the Sydney Office to oversee security and integrity measures
  • The Executive Director Operations met regularly with Sydney-based Directors to assist in ensuring that staff were complying with ACLEI governance requirements and adopting the integrity culture established in Canberra
  • ACLEI staff attended a number of internal skills workshops and external conferences and training programs on topics such as fraud, protective and cyber security, integrity, leadership and mental health awareness
  • Increased use of, and access to, teleconferencing and other communications technology has increased integration of Sydney and Canberra staff

Status: Business as usual

Contribute to the implementation review of the Integrity Commissioner's DIBP jurisdiction, to be conducted in the second half of 2016, including by exploring options for longer-term operational facilities for the ACLEI-AFP Sydney Joint Taskforce.

  • ACLEI provided an extensive submission to the review
  • In line with the recommendations made by the review, ACLEI continues to seek funding to secure ongoing accommodation in Sydney.

Status: Complete

Consolidate the effectiveness of the Operations Governance Board in directing detection, disruption and deterrence efforts towards high-impact risks, where there would be the greatest strategic benefit in ACLEI's direct involvement.

  • During the reporting period, the Internal Governance Board subsumed the Operations Governance Board, to represent a whole-of-agency approach to addressing ACLEI's strategic direction, governance, performance and allocation of resources, having regard to risk. The Internal Governance Board's attendance was amended to integrate the members and advisors of the former Operations Governance Board
  • The Internal Governance Board met on 10 occasions

Status: Complete

Review and refine ACLEI's access to key operational capabilities—such as in forensic financial analysis and law enforcement data—to enhance operational efficiency.

  • A forensic financial analysis capability was funded and a position created for a forensic accountant.
  • A position was advertised to develop agreements with law enforcement agencies and private enterprise to facilitate access to information holdings

Status: On track

Reinforce ACLEI's ability to detect serious and systemic corruption through the enhancement of ACLEI's intelligence collection capability—including through human intelligence collection—and targeted detection projects with partner agencies.

  • ACLEI's human intelligence collection capability generated a significant number of information reports to assist internal investigations. Some of these reports were shared with relevant state and federal law enforcement agencies
  • ACLEI's corruption prevention practitioners worked alongside investigators to inform the compilation of vulnerability assessments

Status: On track

Proactively disseminate information about corruption risks and vulnerabilities to allow LEIC Act and other relevant agencies to disrupt insider threat.

  • A number of vulnerability assessments were undertaken and shared with LEIC Act agencies
  • The Integrity Commissioner engaged regularly with LEIC Act agency heads to outline corruption vulnerabilities observed in operations
  • ACLEI officers delivered 18 presentations to support awareness-raising activities amongst LEIC Act agencies and the broader public service

Status: Business as usual

Explore new or strengthened relationships with counterpart agencies to build joint capability, to combat corruption-enabled crime.

  • ACLEI contributed to the development of an ACLEI-led Visa Integrity Taskforce with DIBP to investigate allegations and collect intelligence and evidence of visa fraud
  • Major investigations partners included state-based agencies
  • A number of human intelligence information reports were disseminated to state law enforcement agencies
  • ACLEI participated in and facilitated a number of taskforces with international, federal and state agencies

Status: Business as usual

Work with LEIC Act agencies to map and fine tune their integrity systems in a dynamic risk environment.

  • ACLEI commenced working with AUSTRAC to map and measure its integrity maturity
  • ACLEI continued to support DIBP's Operation Arête—an initiative to proactively strengthen integrity within DIBP.
  • ACLEI supported DAWR to assess its vulnerabilities

Status: Business as usual

Continue to engage with LEIC Act agency audit committees and management forums to focus and align anti-corruption efforts across shared operating environments.

  • ACLEI officers delivered presentations to LEIC Act agencies regarding integrity matters, early intervention, ACLEI's corruption prevention functions and an overview of ACLEI
  • ACLEI officers attended the biannual Commonwealth Fraud Liaison Forum to discuss technical, legislative and best practice issues in investigations

Status: Business as usual

Operations overview

This year marked another period of heightened operational activity for ACLEI, evidenced by a significant number of corruption issue notifications received and a significant increase in investigation figures (see Part 4, Appendix 4). Additionally, 2016–17 saw a notable increase in complexity of investigations, as illustrated by a sharp rise in the use of ACLEI's investigation powers. For example, compared with 2015–16, in 2016–17 ACLEI conducted over four times as many hearings, sought over three times as many telecommunications interception warrants, and sought over five times as many surveillance device warrants.

As the complexity of investigations has increased, so too has the time required to conduct these investigations to an appropriately high standard. ACLEI sought to be proactive and innovative by making improvements to efficiency and effectiveness. An example of this in 2016–17 was the 'operationalisation' of the corruption prevention function, which integrated the corruption prevention and intelligence assessments teams into one unit within the Operations Branch. This unit conducts strategic intelligence reporting and vulnerabilities reporting to assist jurisdictional agencies in building their integrity culture and programs, as well as providing timely strategic insight into current and emerging integrity risks in LEIC Act agencies. These actions and activities by ACLEI have been well-received by the LEIC Act agencies.

ACLEI's operational staff continue to demonstrate flexibility and adaptability, operating from ACLEI's Canberra and Sydney locations, while travelling inter-state and internationally as required to investigate corruption issues.

This section summarises:

  • how corruption issues were managed during the reporting period
  • ACLEI's use of investigation powers
  • outcomes of investigations and legal proceedings during 2016–17, and
  • trends and patterns.

How corruption issues were dealt with in 2016–17

a diagram showing how corruption issues were dealt with

This flowchart shows the number of corruption issues that comprised ACLEI's workload in 2016--17, and how each was dealt with during the year. The flowchart is divided into three streams, assessments, ACLEI investigations and other agency investigations and starts with 310 corruption issues being brought forward from 2015--16.

  1. The Assessments stream progresses as follows: 52 issues requiring assessment and four assessments awaiting decision brought forward from 2015--16, plus 135 new notifications, plus 19 new referrals equals 206 issues requiring assessment. The flowchart then adds four assessments awaiting decision, minus 66 decisions for other agency investigations, minus 97 decisions for ACLEI investigation (which includes four own-initiative investigations), minus 29 issues concluded for no further action, minus one concluded as it did not relate to a staff member, minus four concluded for non-corrupt conduct equals 13 assessments underway at the end of the reporting period.
  2. The ACLEI investigation stream progresses as follows: 137 ACLEI investigations brought forward from 2015--16 + zero issues reopened for investigation, plus 107 ACLEI investigations commenced in the reporting period (which includes 60 joint investigations), equals 244 ACLEI investigations active during the year (which includes 153 joint investigations). The flowchart then subtracts four investigations concluded via reports to the Minister and then subtracts 10 concluded investigations due to being discontinued which equals 230 ACLEI investigations for the reporting period (which includes 145 joint investigations).
  3. The other agency investigations stream progresses as follows: 117 other agency investigations brought forward from 2015--16. The 66 assessments which resulted in other agency investigations were distributed as follows: 54 issues which were referred to the relevant agency for internal investigation under paragraph 26(1)(b) of the LEIC Act , 12 issues where an agency continued a non-significant investigation under subsection 22(1) of the LEIC Act, and zero issues which were referred to the AFP for external investigation under paragraph 26(1)(c) of the LEIC Act). This results in 183 other agency investigations during the year. The flowchart then subtracts 62 other agency investigations concluded by reports reviewed by ACLEI, one concluded due to being discontinued and 10 reconsidered. This leaves a total of 110 other agency investigations which were active at the end of the reporting period.
  4. Adding the 13 assessments under way, 230 ACLEI investigations and 110 other agency investigations, ACLEI will carry forward 353 corruption issues to 2017--18.

Use of powers

Investigations into hard-to-detect corruption issues involved the deployment of covert capabilities (such as telecommunications interception, surveillance devices, assumed identities and physical surveillance assets) as well as the use of the Integrity Commissioner's statutory coercive powers.

The decision to use a particular power or method is based on operational and legal considerations, relating to which method may best fit an investigation plan, having regard to privacy, risk, legislation and other factors. The following table indicates the trend in use of these powers.

Trends in the use of ACLEI's investigation powers1

Capability

2012–13

2013–14

2014–15

2015–16

2016–17

Notice to provide information or produce documents or things [s 75, LEIC Act]

28

31

32

84

77

Summons to attend a hearing to give evidence and/or produce documents or things [s 83, LEIC Act]2

21

17

6

11

283

Hearings conducted [s 82, LEIC Act]

20

17

7

6

26

Power of entry without warrant [s 105, LEIC Act]

0

1

0

0

0

Search warrant [Part 9, Division 4, LEIC Act]4

0

4

3

9

34

Telecommunications (Interception and Access) warrant5

10

25

3

6

27

Surveillance devices warrant(may include multiple devices)6

6

14

2

4

26

Controlled operation authorisation(Part IAB, Crimes Act 1914)

0

3

1

0

2

Assumed identity authorisation(Part IAC, Crimes Act 1914)7

0

0

0

9

14

  1. Powers exercised under warrants obtained by other agencies in the context of joint investigations with ACLEI are not reported in this table.
  2. In some instances, multiple hearings may be conducted for a summons, or hearings may not proceed for operational reasons.
  3. Includes one summons which was revoked during the reporting period.
  4. Search warrants obtained are occasionally not executed, due to operational developments.
  5. Warrant numbers do not include renewals.
  6. Warrant numbers include extensions, but not renewals.
  7. Authorisation numbers do not include cancellations.

Investigation reports

Two Investigation Reports were provided to the Minister during 2016–17. Summaries of these reports are in Appendix 2: Investigation Reports to the Minister.

Prosecutions

Corruption in law enforcement agencies often involves collusion between corrupt or compromised law enforcement officials and other people, including those with connections to organised crime. Over time, ACLEI's investigations have demonstrated the importance of such corrupt networks to the success of the business models of criminal enterprises.

Accordingly, while ACLEI's investigations may give rise to prosecutions of staff members of LEIC Act agencies, they may also—particularly in the case of joint investigations—result in prosecutions of civilians or employees of other government agencies.

Summary of prosecutions arising from ACLEI activity in 2016–17

Prosecutions concluded

Five prosecutions arising from ACLEI investigations resulted in convictions during the year.

  • A civilian received a sentence of nine years imprisonment with a non-parole period of six-and-a-half years, arising from the joint ACLEI and AFP Operation Murray.
  • A (now former) staff member of the former Australian Crime Commission (now the Australian Criminal Intelligence Commission (ACIC)) received a good behaviour bond of 12 months and a fine of $500 arising from the joint ACLEI and ACIC Operation Hadron.
  • A (now former) staff member of the Department of Agriculture and Water Resources (DAWR) received a community correction order for 24 months, community service of 350 hours to be completed in 24 months, a fine of $10,000, mandatory drug and alcohol rehabilitation and a forfeiture order over property as a result of charges arising from the joint ACLEI and DAWR Operation Swan.
  • A civilian received a fine of $5000 and a sum of $50,100 was forfeited as the proceeds of crime, arising from the joint ACLEI and DAWR Operation Swan.
  • A civilian received a good behaviour bond of three years arising from the joint ACLEI and AFP Operation Jarvis.

Prosecutions pending

Six prosecutions were before the courts at the end of the reporting period.

Outcomes of other legal proceedings

Confiscation proceedings

No proceeds of crime applications were commenced directly by ACLEI during the reporting period.

Enforcement orders

No applications were made to the Federal Court of Australia for delivery of a witness passport or for an arrest (see sections 97–101 of the LEIC Act).

Other court proceedings

No applications for orders of review in respect of matters arising under the LEIC Act were determined or otherwise disposed of in 2016–17.

Patterns and trends in corruption

Many of the trends and patterns observed by ACLEI in the reporting period are in accordance with, or extensions of, previously identified trends. In adherence to ACLEI's prioritisation of operational security of current investigations, and in an effort to avoid prejudicing current or potential court matters, ACLEI's commentary on trends and patterns are of a general nature and may not make identifying references to specific investigations or operations.

Border crime

As with previous reporting periods—particularly since the incorporation of DIBP into ACLEI's jurisdiction—a significant proportion of ACLEI's investigative activity related to potential corruption-enabled border crime. The nature of the activities performed by law enforcement officers at Australia's borders means that some LEIC Act agencies operating at the border will always be working in an environment which poses significant corruption risk. Notable risks in relation to corruption-enabled boarder crime are associated with the importation of illicit drugs, the importation of illicit tobacco, visa fraud, and attempts to gain commercial advantage through the circumvention of Australia's biosecurity processes.

Importation of Illicit drugs

The importation of illicit drugs continues to correlate with the use of corrupt methods or insider compromise, particularly as the activity is considered a primary source of wealth of organised crime groups. With law enforcement agencies making record seizures of illicit drugs, corruption-enabled importation of these prohibited substances continues to be an area of focus of ACLEI's investigations. As with previous reporting periods, ACLEI is aware that officers may be exploiting their knowledge of, and privileged access to, the secure border environment and to law enforcement databases to facilitate drug importations.

Illicit tobacco

Illicit tobacco—that is, tobacco which does not comply with Australia's production, importation or sale legislation— is an area of increasing focus in ACLEI's operational activities. In 2016-17, LEIC Act agencies were involved in the seizure of record quantities of illicit tobacco. Working with relevant agencies, ACLEI played an important role in detecting some of the methods used by organised crime to import the illicit tobacco which, in addition to depriving the Australian taxpayer of the required duties for the product, can be used to fund further criminal activities.

Visa fraud

Residency and travel visas issued by public officials are viewed as a highly attractive commodity for people overseas, making the visa process vulnerable to attempts by organised crime, terrorists or individuals attempting to commit fraud (including for commercial purposes) as a means of gaining illicit entry to Australia.

A proposed increase in targeted investigation in this area will improve enforcement of Australia's immigration laws, as well as detecting and pursuing those who would seek to exploit the integrity of the visa process for criminal gain.

Biosecurity

Biosecurity is a critical part of the government's efforts to prevent and respond to pests and diseases that threaten the economy and environment. ACLEI's investigations indicate that unscrupulous individuals and businesses may try to circumvent Australia's strong border regulations through forming corrupt or inappropriate relationships with public officials.

This type of corruption may introduce significant biosecurity risk through lax procedures in the screening of agricultural imports. In addition to being a 'doorway' for the importation of illicit drugs, it can also provide an unfair commercial advantage and benefit for suppliers and importers.

Vulnerability of 'back office' staff

ACLEI's investigations are continuing to recognise that non-front line staff are attractive to organised crime and individuals who value the information to which they have access. While traditional law enforcement corruption detection efforts may have focused on front line, 'operational' law enforcement officers, in reality, back office staff—such as corporate support or 'unsworn' public service staff—are at times more vulnerable to compromise. Back office staff can have similar or higher levels of access to sensitive information and systems as their operational colleagues, while they may also be less prepared to recognise and appropriately respond to approaches from those intending to break the law.

'Social capital' as a non-financial motivation

While financial gain is certainly a significant motivating factor in the decision made by some law enforcement officials to behave corruptly, it is not always the case. ACLEI has observed corrupt behaviour where, rather than an immediate financial gain, the 'reward' takes other forms, such as social reward.

Social reward may entail corrupt activities where the reward may be good standing within the individual's extended family, ethnic group or community. In these instances the corrupt behaviour may relate to unauthorised disclosure of classified information or preferential treatment in decision making.

Corruption prevention myths

ACLEI drew on patterns and trends observed during the reporting period, such as social capital motivation and back-office risk, to publish 'ACLEI's Top 5 Corruption Prevention Myths'. Available on ACLEI's corruption prevention webpage (www.aclei.gov.au/corruption-prevention), the 'myths' identify common assumptions that can limit the ways we might approach managing corruption risk.