Jared Savage

Jared Savage is the New Zealand Herald's investigations editor.

Seized millions fail to help

Despite promises, no money from crims' assets has gone to alcohol and drug treatment.

Most of the assets seized in New Zealand stem from methamphetamine offending and the Government promised to re-invest the seized revenue into tackling the country's P problem. Photo / File
Most of the assets seized in New Zealand stem from methamphetamine offending and the Government promised to re-invest the seized revenue into tackling the country's P problem. Photo / File

Not one cent of the millions of dollars worth of assets seized from criminals has been funnelled into drug treatment or resources to fight organised crime as promised when the enabling law came into force.

Nearly $150 million worth of homes, cars, boats, cash, jewellery and other valuables has been restrained since the Criminal Proceeds (Recovery) Act was passed in December 2009, of which $27 million has been forfeited to the Crown.

Of that, just $10.2 million has actually been placed in the Government coffers, according to figures released under the Official Information Act.

The law targets those who lead a lucrative lifestyle from illegal enterprise and essentially forces someone to prove how an asset was paid for legitimately - even if they were acquitted on criminal charges.

Most of the assets seized in New Zealand stem from methamphetamine offending and the Government promised to re-invest the seized revenue into tackling the country's P problem.

"The Government is planning to put the money to good use," former Police Minister Judith Collins told Parliament in November 2010.

"Police are working with other agencies on plans to expand alcohol and drug treatment and extra law enforcement initiatives to fight organised crime groups."

She also said in a TV interview: "I'm very keen on it to go towards rehabilitation for addicts who have been the victims of these people."

But inquiries by the Herald have found that none of the money raised by the sale of assets or confiscated cash has been distributed more than three years after the law came into force.

A progress report titled "Tackling Methamphetamine" tabled with the Department of Prime Minister and Cabinet shows that the Government still plans to fund the expansion of alcohol and other drug treatment, continuing care services and law enforcement initiatives to fight organised crime groups dealing in methamphetamine and drugs.

The allocation is "ongoing but transfer of monies is behind schedule", according to the document, published in October.

"Net funds are being held by the Official Assignee. No monies have been allocated to agencies to fund anti-drug activities yet.

"Officials are working through options to address this action next year [2013]."

Guy Sayers, manager of the Official Assignee group, which handles the forfeiture, said all the funds from forfeited assets are paid to the consolidated account, which is controlled by the Budget cycle.

The total revenue from forfeited assets is $10.3 million - nearly $2.2 million less than the original estimated value.

The same "Tackling Methamphetamine" report said the Ministry of Health had funded an extra 60 residential treatment beds and another 20 "social detox" for methamphetamine addicts since 2009.

However, Roger Brooking, a drug counsellor who works closely with prisoners or those before the courts, said much more could be done.

His book Flying Blind examines the lack of treatment facilities for drug and alcohol addicts and says thousands of New Zealanders are missing out on treatment, or spending long times on waiting lists - time in which they relapse and possible offend again to pay for their habit.

Mr Brooking said the best facility for complex cases involving mental health, addiction and criminal offending was Moana House in Dunedin - which has only 13 beds.

"There has been no increase in the availability of community-based treatment where it is really needed.

"Compared with the size of the problem, the lack of funding put into addiction treatment in New Zealand inevitably perpetuates alcohol and drug abuse and associated crime."

A spokeswoman for Prime Minister John Key said the Official Assignee estimated that individual cases might take three to four years from the time of the initial restraining order to payment being made to the Crown.

"Given this, it is expected decisions on funding options will be worked through this year."

Coffers way off overflowing

While $150 million worth of assets have been restrained - and of that, $27 million already forfeited - the actual amount of money put in the Government coffers so far is $10.3 million.

Figures obtained under the Official Information Act show the amount gained is nearly $2.2 million less than originally estimated.

Money held in frozen bank accounts was $58,531 more than estimated, but the total of confiscated cash was $817,198 less than expected.

Guy Sayers, of the Official Assignee, said this was because some of the cash might have been returned, or used to paying living expenses as ordered by courts in certain cases.

The realised value of seized properties was $637,207 - about half of the original estimate.

Mr Sayers said this reflected the balance of equity after a sale, including deduction of mortgage debt, third-party claims from spouses and the costs of sale.

Revenue raised from motor vehicles and valuables, such as jewellery, was also lower than the valuation. Sometimes the sale did not meet valuation, said Mr Sayers, and there were also securities and costs of sale to be paid.

- NZ Herald

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