Seizure of Proceeds of Crime

• < Procedure and Practice
• < Search and Seizure
• < Seizure of Property
• < Proceeds of Crime

General Principles

Part XII.2 was enacted in Bill C61 to meet Canada's international obligations under the United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances.

Pursuant to section 462.33, on application by the Attorney General, the court may order that certain property be restrained.

Application for restraint order

462.33 (1) The Attorney General may make an application in accordance with subsection (2) [application for restraint order – procedure] for a restraint order under subsection (3) [application for restraint order – requirements for granting order] in respect of any property.

Procedure

(2) An application made under subsection (1) [application for restraint order] for a restraint order under subsection (3) [application for restraint order – requirements for granting order] in respect of any property may be made ex parte and shall be made in writing to a judge and be accompanied by an affidavit sworn on the information and belief of the Attorney General or any other person deposing to the following matters, namely,

(a) the offence or matter under investigation;

(b) the person who is believed to be in possession of the property;

(c) the grounds for the belief that an order of forfeiture may be made under subsection 462.37(1) [order of forfeiture of proceeds of crime] or (2.01) [order of forfeiture of proceeds of crime – particular circumstances] or 462.38(2) [requirements to order forfeiture] in respect of the property;

(d) a description of the property; and

(e) whether any previous applications have been made under this section with respect to the property.

Restraint order

(3) A judge who hears an application for a restraint order made under subsection (1) [application for restraint order] may — if the judge is satisfied that there are reasonable grounds to believe that there exists, within the province in which the judge has jurisdiction or any other province, any property in respect of which an order of forfeiture may be made under subsection 462.37(1) [order of forfeiture of proceeds of crime] or (2.01) [order of forfeiture of proceeds of crime – particular circumstances] or 462.38(2) [requirements to order forfeiture], in respect of a designated offence alleged to have been committed within the province in which the judge has jurisdiction — make an order prohibiting any person from disposing of, or otherwise dealing with any interest in, the property specified in the order otherwise than in the manner that may be specified in the order.

Effect of order

(3.01) A restraint order issued under subsection (1) [application for restraint order] has effect throughout Canada.

Property outside Canada

(3.1) A restraint order may be issued under this section in respect of property situated outside Canada, with any modifications that the circumstances require.

Idem

(4) An order made by a judge under subsection (3) [application for restraint order – requirements for granting order] may be subject to such reasonable conditions as the judge thinks fit.

Notice

(5) Before making an order under subsection (3) [application for restraint order – requirements for granting order] in relation to any property, a judge may require notice to be given to and may hear any person who, in the opinion of the judge, appears to have a valid interest in the property unless the judge is of the opinion that giving such notice before making the order would result in the disappearance, dissipation or reduction in value of the property or otherwise affect the property so that all or a part thereof could not be subject to an order of forfeiture under subsection 462.37(1) [order of forfeiture of proceeds of crime] or (2.01) [order of forfeiture of proceeds of crime – particular circumstances] or 462.38(2) [requirements to order forfeiture].

Order in writing

(6) An order made under subsection (3) [application for restraint order – requirements for granting order] shall be made in writing.

Undertakings by Attorney General

(7) Before making an order under subsection (3) [application for restraint order – requirements for granting order], a judge shall require the Attorney General to give such undertakings as the judge considers appropriate with respect to the payment of damages or costs, or both, in relation to

(a) the making of an order in respect of property situated within or outside Canada; and

(b) the execution of an order in respect of property situated within Canada.

Service of order

(8) A copy of an order made by a judge under subsection (3) [application for restraint order – requirements for granting order] shall be served on the person to whom the order is addressed in such manner as the judge directs or as may be prescribed by rules of court.

Registration of order

(9) A copy of an order made under subsection (3) [application for restraint order – requirements for granting order] shall be registered against any property in accordance with the laws of the province in which the property is situated.

Continues in force

(10) An order made under subsection (3) [application for restraint order – requirements for granting order] remains in effect until

(a) it is revoked or varied under subsection 462.34(4) [order for restoration of property or revocation or variation of order] or revoked under paragraph 462.43(a) ;

(b) it ceases to be in force under section 462.35 [expiration of special warrants and restraint orders]; or

(c) an order of forfeiture or restoration of the property is made under subsection 462.37(1) [order of forfeiture of proceeds of crime] or (2.01) [order of forfeiture of proceeds of crime – particular circumstances], 462.38(2) [requirements to order forfeiture] or 462.41(3) [notice requirements for forfeiture of proceeds of crime – order to restore property] or any other provision of this or any other Act of Parliament.

Offence

(11) ...

R.S., 1985, c. 42 (4th Supp.), s. 2; 1993, c. 37, s. 21; 1996, c. 16, s. 60; 1997, c. 18, s. 30; 2001, c. 32, s. 15; 2005, c. 44, s. 4; 2019, c. 25, s. 181.
[annotation(s) added]

– CCC

The application can be made on an ex parte basis.

The court may make the order where it is satisfied that "there are reasonable grounds to believe that there exists" there is property for which an order of forfeiture may be made "in respect of a designated offence alleged to have been committed within the province in which the judge has jurisdiction".

The order will have the effect of "prohibiting any person from disposing of, or otherwise dealing with any interest in, the property specified in the order otherwise than in the manner that may be specified in the order."

Purpose of Legislation

The purpose of Part XII.2, which relates to proceeds of crime is to ensure that "crimes does not pay". It recognizes that in certain situations "crime is big business" and that "massive profits" can be made from criminal activity.

In order to "remove" profits from crime, there must be "severe" consequences for possessing proceeds of crime.

Procedure

The application must consist of:

1. a written application
2. affidavit outlining:
   1. the offender or matter under investigation
   2. person believed to be in possession
   3. grounds for this belief
   4. grounds for belief that the order may be made under s.462.37(1), (2.01) or 462.38(2)
   5. a description of the property, and
   6. whether any previous application has been made

Management Order

Management order

462.331 (1) With respect to property seized under section 462.32 [search and seizure of proceeds of crime] or restrained under section 462.33, other than a controlled substance, within the meaning of the Controlled Drugs and Substances Act, or cannabis, as defined in subsection 2(1) of the Cannabis Act, on application of the Attorney General or of any other person with the written consent of the Attorney General, if a judge is of the opinion that the circumstances so require, the judge may

(a) appoint a person to take control of and to manage or otherwise deal with all or part of the property in accordance with the directions of the judge; and

(b) require any person having possession of that property to give possession of the property to the person appointed under paragraph (a).

Appointment of Minister of Public Works and Government Services

(2) When the Attorney General of Canada so requests, a judge appointing a person under subsection (1) [authorizing a management order] shall appoint the Minister of Public Works and Government Services.

Power to manage

(3) The power to manage or otherwise deal with property under subsection (1) [authorizing a management order] includes

(a) the power to make an interlocutory sale of perishable or rapidly depreciating property;

(b) the power to destroy, in accordance with subsections (4) to (7) [management order – destruction of property], property that has little or no value; and

(c) the power to have property, other than real property or a conveyance, forfeited to Her Majesty in accordance with subsection (7.1) [management order – forfeiture order].

Application for destruction order

(4) Before a person who is appointed to manage property destroys property that has little or no value, they shall apply to a court for a destruction order.

Notice

(5) Before making a destruction order, a court shall require notice in accordance with subsection (6) [manner of giving notice] to be given to and may hear any person who, in the court’s opinion, appears to have a valid interest in the property.

Manner of giving notice

(6) A notice shall

(a) be given in the manner that the court directs or that may be specified in the rules of the court; and

(b) specify the effective period of the notice that the court considers reasonable or that may be set out in the rules of the court.

Destruction order

(7) A court shall order that the property be destroyed if it is satisfied that the property has little or no financial or other value.

Forfeiture order

(7.1) On application by a person who is appointed to manage the property, a court shall order that the property, other than real property or a conveyance, be forfeited to Her Majesty to be disposed of or otherwise dealt with in accordance with the law if

(a) a notice is given or published in the manner that the court directs or that may be specified in the rules of the court;

(b) the notice specifies a period of 60 days during which a person may make an application to the court asserting their interest in the property; and

(c) during that period, no one makes such an application.

When management order ceases to have effect

(8) A management order ceases to have effect when the property that is the subject of the management order is returned in accordance with the law, destroyed or forfeited to Her Majesty.

For greater certainty

(8.1) For greater certainty, if property that is the subject of a management order is sold, the management order applies to the net proceeds of the sale.

Application to vary conditions

(9) The Attorney General may at any time apply to the judge to cancel or vary any condition to which a management order is subject but may not apply to vary an appointment made under subsection (2) [appointment of Minister of Public Works and Govt Serv.].

2001, c. 32, s. 16; 2017, c. 7, s. 58; 2018, c. 16, s. 212.
[annotation(s) added]

– CCC

Search Warrant

• Proceeds of Crime Search Warrant

Order to Access Property

Application for review of special warrants and restraint orders

462.34 (1) Any person who has an interest in property that was seized under a warrant issued pursuant to section 462.32 [search and seizure of proceeds of crime] or in respect of which a restraint order was made under subsection 462.33(3) [application for restraint order – requirements for granting order] may, at any time, apply to a judge

(a) for an order under subsection (4) [order for restoration of property or revocation or variation of order]; or

(b) for permission to examine the property.

...

Terms of examination order

(3) A judge may, on an application made to the judge under paragraph (1)(b) [restraint orders – order to examine], order that the applicant be permitted to examine property subject to such terms as appear to the judge to be necessary or desirable to ensure that the property is safeguarded and preserved for any purpose for which it may subsequently be required.
...
R.S., 1985, c. 42 (4th Supp.), s. 2; 1996, c. 19, ss. 69, 70; 1997, c. 18, ss. 31, 140; 2001, c. 32, s. 17; 2010, c. 14, s. 8.

– CCC

Revocation or Variation of a Proceeds Restraint Order

• Revocation or Variation of a Proceeds Restraint Order

Disclosure Order

• Proceeds of Crime Disclosure Order

Disposal of Seized Property

Residual disposal of property seized or dealt with pursuant to special warrants or restraint orders

462.43 (1) Where property has been seized under a warrant issued pursuant to section 462.32 [search and seizure of proceeds of crime], a restraint order has been made under section 462.33 [restraint orders against property] in relation to any property or a recognizance has been entered into pursuant to paragraph 462.34(4)(a) [order for restoration of property or revocation or variation of order – types of recogs] in relation to any property and a judge, on application made to the judge by the Attorney General or any person having an interest in the property or on the judge’s own motion, after notice given to the Attorney General and any other person having an interest in the property, is satisfied that the property will no longer be required for the purpose of section 462.37 [order of forfeiture for proceeds of crime], 462.38 [order of forfeiture for proceeds of crime] or any other provision of this or any other Act of Parliament respecting forfeiture or for the purpose of any investigation or as evidence in any proceeding, the judge

(a) in the case of a restraint order, shall revoke the order;

(b) in the case of a recognizance, shall cancel the recognizance; and

(c) in the case of property seized under a warrant issued pursuant to section 462.32 or property under the control of a person appointed pursuant to paragraph 462.331(1)(a) [authorizing a management order – designate custodian],

(i) if possession of it by the person from whom it was taken is lawful, shall order that it be returned to that person,

(ii) if possession of it by the person from whom it was taken is unlawful and the lawful owner or person who is lawfully entitled to its possession is known, shall order that it be returned to the lawful owner or the person who is lawfully entitled to its possession, or

(iii) if possession of it by the person from whom it was taken is unlawful and the lawful owner or person who is lawfully entitled to its possession is not known, may order that it be forfeited to Her Majesty, to be disposed of as the Attorney General directs, or otherwise dealt with in accordance with the law.

Property outside Canada

(2) An order may be issued under this section in respect of property situated outside Canada, with any modifications that the circumstances require.
R.S., 1985, c. 42 (4th Supp.), s. 2; 2001, c. 32, s. 24; 2004, c. 12, s. 7.
[annotation(s) added]

– CCC

Copies of documents returned or forfeited

462.46 (1) If any document is returned or ordered to be returned, forfeited or otherwise dealt with under subsection 462.34(3) [terms of examination order] or (4) [order for restoration of property or revocation or variation of order], 462.37(1) [order of forfeiture of proceeds of crime] or (2.01) , 462.38(2) [requirements to order forfeiture] or 462.41(3) [notice requirements for forfeiture of proceeds of crime – order to restore property] or section 462.43 [residual disposal of property seized or dealt with pursuant to special warrants or restraint orders], the Attorney General may, before returning the document or complying with the order, cause a copy of the document to be made and retained.

Probative force

(2) Every copy made under subsection (1) [copies of documents returned or forfeited] shall, if certified as a true copy by the Attorney General, be admissible in evidence and, in the absence of evidence to the contrary, shall have the same probative force as the original document would have had if it had been proved in the ordinary way.
R.S., 1985, c. 42 (4th Supp.), s. 2; 2005, c. 44, s. 11.
[annotation(s) added]

– CCC

Definitions Relating to Proceeds of Crime

PART XII.2 Proceeds of Crime

Interpretation

Definitions

462.3 (1) In this Part [Pt. XII.2 – Proceeds of Crime (ss. 462.3 to 462.5)],
designated drug offence [Repealed, 1996, c. 19, s. 68]

designated offence means

(a) any offence that may be prosecuted as an indictable offence under this or any other Act of Parliament, other than an indictable offence prescribed by regulation, or

(b) a conspiracy or an attempt to commit, being an accessory after the fact in relation to, or any counselling in relation to, an offence referred to in paragraph (a); (infraction désignée)

designated substance offence [Repealed, 2001, c. 32, s. 12]

enterprise crime offence [Repealed, 2001, c. 32, s. 12]

judge means a judge as defined in section 552 or a judge of a superior court of criminal jurisdiction; (juge)

...
R.S., 1985, c. 42 (4th Supp.), s. 2; 1993, c. 25, s. 95, c. 37, s. 32, c. 46, s. 5; 1994, c. 44, s. 29; 1995, c. 39, s. 151; 1996, c. 19, ss. 68, 70; 1997, c. 18, s. 27, c. 23, s. 9; 1998, c. 34, ss. 9, 11; 1999, c. 5, ss. 13, 52; 2001, c. 32, s. 12, c. 41, ss. 14, 33; 2005, c. 44, s. 1; 2010, c. 14, s. 7.

– CCC

Procedure

Making of Regulations

462.3...

Regulations

(2) The Governor in Council may make regulations prescribing indictable offences that are excluded from the definition “designated offence” in subsection (1).
...
R.S., 1985, c. 42 (4th Supp.), s. 2; 1993, c. 25, s. 95, c. 37, s. 32, c. 46, s. 5; 1994, c. 44, s. 29; 1995, c. 39, s. 151; 1996, c. 19, ss. 68, 70; 1997, c. 18, s. 27, c. 23, s. 9; 1998, c. 34, ss. 9, 11; 1999, c. 5, ss. 13, 52; 2001, c. 32, s. 12, c. 41, ss. 14, 33; 2005, c. 44, s. 1; 2010, c. 14, s. 7.
[annotation(s) added]

– CCC

Section 462.3(3) and (4) were repealed by 2019, c. 25, s. 179.

See Also

• Forfeiture of Proceeds of Crime