Though not contained in a single instrument, the main features of the asset management system approved by the international community encompass transparency, accountability and efficiency.
2.9.1 Transparency
Transparency is the key feature of a reliable system for managing proceeds of crime. It includes elements such as data storage and access to information.86 The system needs to have an updated database in which records of all assets, whether recovered or in the process of being recovered will be stored.
The database should include details of the properties, such as the date of their preservation, their value at the time preservation, the costs of their management until
confiscation date, their value at confiscation stage, the actual value realised and the manner of
85 See the provisions of Section 69A (3) of POCA (SA).
86 See Para 27(k) of the FATF Best Practices Paper (2012).
their disposition.87 Regular record-keeping will assist the system to work in a transparent manner and ensure accurate retribution. Where the system has no proper record-keeping mechanisms, it will be impossible to establish the proportionality of retribution.
The second basic element of transparency in asset management is access to
information. The citizenry should have access to information contained in the database. 88 Victims of the offence in question must know how much was recovered in order to assess proportionality in relation to what they have received as compensation. An opaque system will not secure the citizenry a right to access the information and may create favourable conditions for corruption.
Retribution is about proportionality. Without access to information as to how the recovered properties were dealt with, there will be no assurance of such proportionality. This element introduces another feature of a dependable system of managing proceeds of crime and that is accountability.
2.9.2 Accountability
Accountability forms the backbone of a reliable system of asset management. The AMI holds assets subject to confiscation as a trustee and not as a beneficiary. The beneficiaries of the proceeds of crime are the victims of the offence. After the final order has been made, the beneficiaries must be aware of what transpired with the assets. This may be attained by establishing a reporting mechanism through which the citizenry become informed of the manner in which the proceeds were handled and distributed.
Moreover, the international community requires that there should be put in place an auditing system for the reports and the contents of the database.89 Auditing will assist in verifying the contents of the reports and the information available in the database. It will assist also in establishing whether the system is efficient enough to continue with the business of managing assets subject to confiscation. Most importantly, auditing will assist in identifying problems facing the system and suggest solutions. In other words, auditing aims at improving
87 See Para 27(k) of the FATF Best Practices Paper (2012).
88 See G8 Best Practices (2005).
89 See G8 Best Practices (2005).
the performance and efficiency of an asset management system. It acts as a mechanism for monitoring and evaluation in an effort to warrant retribution.
2.9.3 Efficiency
The efficiency of an asset management system may be measured by evaluating its role in achieving the goals of asset recovery. In order to have a successful recovery, the assets should be available to satisfy the requirement of retribution. A court order to confiscate proceeds of crime may not be valuable where the proceeds themselves are no longer in existence. Hence, to determine whether the system is efficient, the capacity of the system to handle assets must be checked.
There are three major elements that determine the capacity of an asset management system: a reliable source of funding,90 skilled staff 91 and a sound system of checks and balances.92 The sources of funds should be well-established to avoid the need to rely on the preserved assets, which will affect retribution. Government budgetary allocations may be useful in this regard. Where the laws allow, investments from the preserved assets also may be a dependable source of funding the operations of the system.
The system needs also to be staffed by personnel skilled in legal and asset management matters. The staff will assist in making cost-effective decisions during all stages of the asset recovery process. For example, decisions have to be made about which mode of preservation will be suitable for a particular property and which legal procedure ought to be followed.
Decisions of this nature need expert opinion in those two fields, as well as a system of monitoring and evaluation in order to establish checks and balances.
In addition, a reliable asset management system is characterised by a reliable
enforcement mechanism. To ensure the implementation of these features, an effective legal framework should be in place.93 Law is the most reliable means for enforcing accountability and
90 See Para 27(b) of the FATF Best Practices Paper (2012).
91 Para 27(e) and (f) of the FATF Best Practices Paper (2012).
92 See G8 Best Practices (2005).
93 Seidman et al (2007: 21).
other matters pertaining to asset recovery. In the absence of legal measures, enforcement of other features is not guaranteed.94
The features suggested by the international community correspond to the principles of public asset management. This may be gleaned from the key elements of public asset
management which include transparency, accountability, sustainability, efficiency and effectiveness.95 Unlike management of assets subject to forfeiture, the aim public asset management is to ensure observance of the core values of good governance.96
Good governance in public management is advocated frequently in the public sector modernisation process, popularly referred to as “New Public Management” (NPM). This is a global reform movement consisting of common aspects of public governance that generally supports the view that the public sector can be managed and evaluated in the same manner as private sector.97 The basic demands of the NPM include transparency, efficiency and
responsiveness which appear also as key factors in the constitution of retribution. This suggests that there might be no effective retribution in the absence of a system to manage assets
characterised by the basic requirements of NPM.