FSMC, TITLE 11.  CRIMES

CHAPTER 9
Money Laundering and Proceeds of Crime

Editor's note: Former chapter 9 of this title on Major Crimes (§§ 901-951) was repealed in its entirety by PL 11-72 § 1. This new chapter 9 was enacted by PL 11-72 § 84 and is part of the Revised Criminal Code Act.

SUBCHAPTER III
Confiscation

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PART 2: Confiscation Orders

SECTIONS

§ 933. Procedure for in rem confiscation order where a person dies or absconds.
§ 934. Confiscation where a person dies or absconds.
§ 935. Confiscation order on conviction.
§ 936. Effect of confiscation order.
§ 937. Voidable transfers.
§ 938. Protection of third parties.
§ 939. Discharge of confiscation order on quashing or reversal of conviction.
§ 940. Payment instead of a confiscation order.
§ 941. Application of procedure for enforcing fines.

§ 933. Procedure for in rem confiscation order where a person dies or absconds.

(1) Where an information or a complaint has been filed alleging the commission of a serious offense by a person and a warrant for the arrest of the person has been issued in relation to that information or complaint, the Secretary may apply to the Supreme Court for a confiscation order in respect of any tainted property if the defendant has died or absconded.

(2) For the purposes of subsection (1) of this section and section 934 of this chapter, the person is deemed to have absconded if reasonable attempts to arrest the person pursuant to the warrant have been unsuccessful during a period of six months commencing on the day the warrant was issued, and the person shall be deemed to have so absconded on the last day of that period.

(3) Where the Secretary applies under this section for a confiscation order against any tainted property, the Supreme Court shall, before hearing the application:

(a) require notice of the application to be given to any person who, in the opinion of the Supreme Court, appears to have an interest in the property; and

(b) direct that notice of the application be announced on public radio, posted at the main Post Office and all branch offices, and at the National Government headquarters in Palikir, and published in a newspaper published and circulating in the Federated States of Micronesia, containing such particulars and for so long as the Supreme Court may require.

Source: PL 11-72 § 122.

Cross-reference: The statutory provisions on the Executive and the President are found in title 2 (Executive) of this code. The statutory provisions on the Judiciary and the FSM Supreme Court are found in title 4 (Judicial) of this code.

§ 934. Confiscation where a person dies or absconds.

(1) Subject to section 933(3) of this chapter, where an application is made to the Supreme Court under section 933(1) of this title, for a confiscation order against any tainted property by reason of a person having died, or absconded in connection with a serious offense, and the Court is satisfied that:

(a) any property is tainted property in respect of the offense;

(b) proceedings in respect of a serious offense committed in relation to that property were commenced; and

(c) the accused charged with the offense referred to in subsection (1)(b) of this section has died or absconded; the Supreme Court may order that the property or such property as is specified by the Supreme Court in the order be confiscated.

(2) The provisions of section 933(2), 935, 936, 937 and 938 of this chapter shall apply with such modifications as are necessary to give effect to this section.

Source: PL 11-72 § 123.

Cross-reference: The statutory provisions on the President and the Executive are found in title 2 of this code. The statutory provisions on the FSM Supreme Court and the Judiciary are found in title 4 of this code.

§ 935. Confiscation order on conviction.

(1) Where, upon application by the Secretary, the Supreme Court is satisfied that property is tainted property in respect of a serious offense of which a person has been convicted, the Supreme Court may order that specified property be confiscated.

(2) In determining whether property is tainted property, the Supreme Court may presume, in the absence of evidence to the contrary:

(a) that the property was used in or in connection with, the commission of the offense if it was in the person's possession at the time of, or immediately after, the commission of the offense for which the person was convicted; and/or

(b) that the property was derived, obtained or realized as a result of the commission of the offense if it was acquired by the person before, during or within a reasonable time after the period of the commission of the offense of which the person was convicted, and the Supreme Court is satisfied that the income of that person, from sources unrelated to criminal activity of that person, cannot reasonably account for the acquisition of that property.

(3) Where the Supreme Court orders that property, other than money, be confiscated, the Supreme Court shall specify in the order the amount that it considers to be the value of the property at the time when the order is made, taking account of how such value is to be determined under section 907 of this act.

(4) In considering whether a confiscation order should be made under subsection (1) of this section the Supreme Court shall have regard to:

(a) the rights and interests, if any, of innocent third parties in the property;

(b) the gravity of the offense concerned;

(c) any hardship that may reasonably be expected to be caused to any innocent person by the operation of the order; and

(d) the use that is ordinarily made of the property, or the use to which the property was intended to be put.

(5) Where the Supreme Court makes a confiscation order, the Supreme Court may give such directions as are necessary or convenient for giving effect to the order.

Source: PL 11-72 § 124.

Cross-reference: The statutory provisions on the President and the Executive are found in title 2 of this code. The statutory provisions on the FSM Supreme Court and the Judiciary are found in title 4 of this code.

§ 936. Effect of confiscation order.

(1) Subject to subsection (2) of this section, where a Court makes a confiscation order against any property, the property vests absolutely in the Federated States of Micronesia by virtue of the order, except with respect to real property, where any legislation then in force in any State of the Federated States of Micronesia prohibits the Federated States of Micronesia from taking title to such real property, in which case a lien shall be immediately attached to the property in favor of the Federated States of Micronesia, in the amount of the value of the property less any prior recorded encumbrances. In the case of such real property, the Secretary shall be authorized to make application to the Supreme Court, and the Supreme Court may grant an order forcing the sale of such property (unless the sale of such property is prohibited by legislation then in force in the State), with proceeds to be paid to the Federated States of Micronesia after sale, less prior recorded encumbrances.

(2) Where property ordered to be confiscated is recordable property, and where not prohibited under the laws of a State of the Federated States of Micronesia:

(a) the property vests in the Federated States of Micronesia in equity but does not vest in the Federated States of Micronesia at law until the applicable recordation requirements have been complied with;

(b) the Federated States of Micronesia is entitled to be recorded as owner of the property; and

(c) the Secretary has power, on behalf of the Federated States of Micronesia, to do or authorize the doing of anything necessary or convenient to obtain the recordation of the Federated States of Micronesia as owner, including the execution of any instrument to be executed by a person transferring an interest in property of that kind.

(3) Where the Supreme Court makes a confiscation order against property:

(a) the property shall not, except with the leave of the Supreme Court, and in accordance with any directions of the Supreme Court, be disposed of, or otherwise dealt with, by or on behalf of the Federated States of Micronesia before the relevant appeal date; and

(b) if, after the relevant appeal date, the order has not been discharged, the property may be disposed of and the proceeds applied or otherwise dealt with in accordance with the direction of the Secretary.

(4) In this section:

(a) "Recordable property" means real property, the title to which is passed by recordation in accordance with the provisions of the applicable state law;

(b) "Relevant appeal date" used in relation to a confiscation order made in consequence of a person's conviction of a serious offense means:

(i) the date on which the period allowed by rules of court for the lodging of an appeal against a person's conviction, or for the lodging of an appeal against the making of a confiscation order expires without an appeal having been lodged, whichever is the later; or

(ii) where an appeal against a person's conviction or against the making of a confiscation order is lodged, the date on which the appeal is finally determined.

Source: PL 11-72 § 125.

Cross-reference: The statutory provisions on the President and the Executive are found in title 2 of this code. The statutory provisions on the Congress of the Federated States of Micronesia are found in title 3 of this code. The statutory provisions on the FSM Supreme Court and the Judiciary are found in title 4 of this code.

The website of the FSM National Government contains announcements, press releases, news, forms, and other information on the National Government at http://fsmgov.org.

The FSM Supreme Court website contains court decisions, rules, calendar, and other information of the court, the Constitution, the code of the Federated States of Micronesia, and other legal resource information at http://www.fsmsupremecourt.org/.

The official website of the Congress of the Federated States of Micronesia contains the public laws enacted by the Congress, sessions, committee hearings, rules, and other Congressional information at http://www.fsmcongress.fm/.

§ 937. Voidable transfers.

The Supreme Court may, before making a confiscation order and in the case of property in respect of which a restraining order was made, where the order was served in accordance with section 960 of this title, set aside any conveyance or transfer of the property that occurred after the seizure of the property, or the service of the restraining order, unless the conveyance or transfer was made for valuable consideration to a person acting in good faith and without notice.

Source: PL 11-72 § 126.

§ 938. Protection of third parties.

(1) Where an application is made for a confiscation order against property, a person who claims an interest in the property may apply to the Supreme Court, before the confiscation order is made, for an order under subsection (2) of this section.

(2) If a person applies to the Supreme Court for an order under this section in respect of property and the Supreme Court is satisfied:

(a) that the person was not in any way involved in the commission of the offense; and

(b) where the person acquired the interest during or after the commission of the offense, that he or she acquired the interest:

(i) for sufficient consideration; and

(ii) without knowing, and in circumstances such as not to arouse a reasonable suspicion, that the property was, at the time he or she acquired it, tainted property; the Supreme Court shall make an order declaring the nature, extent and value (at the time the order is made) of the person's interest.

(3) Subject to subsection (4) of the this section, where a confiscation order has already been made directing the confiscation of property, a person who claims an interest in the property may, before the end of the period of 12 months, commencing on the day on which the confiscation order is made, apply to the Supreme Court for an order under subsection (2) of this section.

(4) A person who:

(a) had knowledge of the application for the confiscation order before the order was made; or

(b) appeared at the hearing of that application; shall not be permitted to make an application under subsection (3) of this section, except with leave of the Supreme Court.

(5) A person who makes an application under subsections (1) or (3) of this section must give no less than 14 days written notice of the making of the application to the Secretary, who shall be a party to any proceedings in the application.

(6) An applicant or the Secretary may, in accordance with the rules of court, appeal the Court's order made under subsection (2) of this section.

(7) Any person appointed by the Supreme Court under section 968 of this chapter shall, on application by any person who has obtained an order under subsection (2) of this section, and where the period allowed by the rules of court with respect to the making of a claim has expired and any appeal from that order has been determined:

(a) direct that the property or part thereof to which the interest of the applicant relates, be returned to the applicant; or

(b) direct that an amount equal to the value of the interest of the applicant, as declared in the order, be paid to the applicant.

Source: PL 11-72 § 127.

Cross-reference: The statutory provisions on the Executive and the President are found in title 2 (Executive) of this code. The statutory provisions on the Judiciary and the FSM Supreme Court are found in title 4 (Judicial) of this code.

§ 939. Discharge of confiscation order on quashing or reversal of conviction.

(1) Where the Supreme Court makes a confiscation order against property in reliance on a person's conviction of a serious offense and the conviction is subsequently reversed by a court of final jurisdiction, the reversal of the conviction discharges the order. However, upon notice of intent by the Department of Justice to recharge the matter, the court may order continued detention of the property pursuant to section 935 of this chapter.

(2) Where a confiscation order against property is discharged as provided for in subsection (1) of this section or by the Supreme Court, hearing an appeal against the making of the confiscation order, any person who claims to have an interest in the property immediately before the making of the confiscation order may apply to the court in writing for the transfer of the interest to the person.

(3) On receipt of an application under subsection (2) of this section, the court shall conduct a hearing to determine, by a preponderance of the evidence, ownership of the property, and if satisfied that the applicant is lawfully entitled, and has no complicity with respect to the offense, shall:

(a) if the interest is vested in the Federated States of Micronesia, give directions that the property or part thereof to which the interest of the applicant relates, be transferred to the person; or

(b) in any other case, direct that there be payable to the person an amount equal to the value of the interest as at the time the order is made.

Source: PL 11-72 § 128.

§ 940. Payment instead of a confiscation order.

Where the Supreme Court is satisfied that a confiscation order should be made in respect of the property of a person convicted of a serious offense, but that the property or any part thereof or interest therein cannot be made subject to such an order and, in particular:

(1) cannot, on the exercise of due diligence be located;

(2) has been transferred to a third party in circumstances which do not give rise to a reasonable inference that the title or interest was transferred for the purpose of avoiding the confiscation of the property;

(3) is located outside the Federated States of Micronesia;

(4) has been substantially diminished in value or rendered worthless; or

(5) has been commingled with other property that cannot be divided without difficulty; the Supreme Court may, instead of ordering the property or part thereof or interest therein to be confiscated, order the person to pay to the Federated States of Micronesia an amount equal to the value of the property, part or interest, taking into account section 907 of this chapter.

Source: PL 11-72 § 129; PL 11-76 § 8.

Cross-reference: The statutory provisions on the Executive and the President are found in title 2 (Executive) of this code. The statutory provisions on the Judiciary and the FSM Supreme Court are found in title 4 (Judicial) of this code.

§ 941. Application of procedure for enforcing fines.

Where the Supreme Court orders a person to pay an amount under section 940 of this chapter, that amount shall be treated as if it were a fine imposed upon him or her in respect of a conviction for a serious offense, and the Supreme Court shall:

(1) notwithstanding anything contained in any other Act, or law, including the Code of the Federated States of Micronesia, impose, for contumacious default of the payment of that amount, a term of imprisonment:

(a) of not more than 30 days, where the amount does not exceed $1,000;

(b) of not more than one year, where the amount does not exceed $5,000;

(c) of not more than five years, where the amount does not exceed $50,000 dollars; or

(d) of not more than ten years, where the amount exceeds $50,000;

(2) direct that the term of imprisonment imposed, pursuant to subsection (1) of this section, be served consecutively to any other form of imprisonment imposed on that person, or that the person is then serving; or

(3) direct that other provisions of this code regarding the disposition of offenders serving a term of imprisonment, shall not apply in relation to a term of imprisonment, imposed on a person pursuant to subsection (1) of this section.

Source: PL 11-72 § 130.

Cross-reference: The statutory provisions on the President and the Executive are found in title 2 of this code. The statutory provisions on the FSM Supreme Court and the Judiciary are found in title 4 of this code.