Cash /asset restraint / confiscation / POCA / Civil Recovery (including Third Party Rights)
This is a fast-moving area of law. Recent developments include the pursuit of Civil Recovery Orders by the authorities, rather than the pursuit of high profile criminal proceedings. In these difficult economic times, the Courts are taking increasingly novel approaches. Amongst other things, the Courts are now considering the apportionment of responsibility between defendants, the interests of third parties and creditors, and certificate of inadequacy.
The Proceeds of Crime Act 2002 (POCA) and the Serious Organised Crime and Police Act 2005 (SOCPA) (statutes originally intended to deal with terrorism and organised crime), have given the authorities the power to seize assets and cash etc regardless of whether they are prosecuting the individual of a criminal offence.
Criminal Solicitors London for Proceeds of Crime Act Prosecutions
An excellent example of our success in this area came in the wake of Operation Rize. In June 2008 SOCA and the Metropolitan Police raided several safety depositories in North and Central London and the contents of 7,000 safety deposit boxes and their owners were fully investigated. We represented dozens of individuals affected by this, guiding them through police interviews, directing the collation of all relevant material to prove the provenance of their monies until their property was restored. Over 98% of our clients have had their property fully restored.
We are also guiding those clients who are facing HMRC investigations. We have had notable success in this area, including representing the very few of our clients who have had their property detained pursuant to civil recovery forfeiture orders with great success. Please refer to our case list to see some of our successful results in the field of asset restraint & confiscation.
A restraint order is an order prohibiting any specified person from dealing with any realizable property held by him. Ordinarily the person named in the order will be the defendant but it may be an innocent third party such as a business partner or spouse.
Once a restraint order is obtained, copies of the order and witness statements must be served on the Defendant and any other person prohibited from dealing with property.
A third party may, on receipt of the order, apply for variation or discharge of the order in writing, supported by a witness statement. Any contested hearing will be dealt with by a judge sitting in chambers.
If you are an innocent party to a restraint order contact us today.
Cash Seizure provides the Authorities with the mechanism to recover the proceeds of criminal activity without the need for criminal proceedings being instigated.
Police or Revenue and Customs Officers may seize cash if they have reasonable grounds for suspecting that it is (a) recoverable property or (b) intended by any person for use in unlawful conduct.
If you believe that cash which belongs to you has been seized contact us now. Our criminal solicitors represent clients whose cash has been the subject of seizure and can help you get your money back.
Please refer to our case list to see some of our successful results in this field.
Protecting Third Party Rights in POCA Proceedings
The Proceeds of Crime Act 2002 protects third party rights. These 'Third parties' may be family members of the defendant, business partners, private tenants and anyone else who may have a beneficial interest in the relevant property.
The law recognises the rights of third parties in proceedings under the Proceeds of Crime Act 2002. The three areas in which third party rights are protected are:
- Enforcement of Confiscation Orders
- Restraint Orders
- Cash Seizure
Our solicitors are at the forefront of developments in this growing area of law.
Enforcement of Confiscation Orders
Confiscation Orders are the main thrust of the Proceeds of Crime Act 2002. They are orders made upon conviction which seeks to recover the proceeds of criminal activity from a Defendant.
Once the confiscation order reaches the 'Enforcement Stage', third parties can seek to enforce their rights. At this stage, third parties are permitted to make submissions to the court regarding their interest in the property. The objective, of course, is to allow their enjoyment of the property to continue. If you are a party to property which is the subject of a confiscation order under the proceeds of crime act, contact Lewis Nedas Law without delay.
I Have Been Served with a Criminal Asset Restraint Order – What Should I Do Now?
First of all seek specialist legal advice; we have a very experienced pro-active team.
Look closely at the terms of the order, which has been made by a Crown Court Judge, upon, usually, the application by the prosecutor.
Restraint orders are generally applied for in the very early stages of a criminal investigation. The purpose of the order is to meet any confiscation order which may arise upon conviction. The Crown Prosecutor applies ex parte to the court to freeze assets /accounts monies etc, S/he must persuade the court that on the balance of probabilities (a low standard of proof) that they are benefits obtained as a result of criminal conduct AND that there is a genuine risk that the assets will be: dissipated; sold/given away or removed from the jurisdiction. The Crown must provide the court with full and frank disclosure concerning their application.
These orders are very draconian and widely drawn, they will include a request that the subject of the order continue to disclose all assets/gifts received during the life of the order, and that a full list of all assets and interests in assets should be disclosed to the Crown within a given time period.
The statement is vitally important and needs careful consideration; it has to be accurate, full and frank. Though the statement cannot be relied upon during the course of criminal proceedings which MAY follow, it will certainly be used during any confiscation proceedings that will follow upon conviction.
The order will affect: the subject of the investigation, anyone with a joint interest in any or all of the restrained assets; innocent third parties e.g. life/business partners, friends, family, banks/mortgage companies or the recipient of a “tainted gift".
Usually, the order allows the subject to live on a maximum of £250.00 per week to meet living expenses.
Would it be Possible to Vary or Discharge the Order?
Certainly, it may be possible to vary the order either in correspondence with the Crown e.g. if a specific debt needs to be paid or go back to court for a major variation. However, the issue of legal fees needs to be addressed...it will not be possible to pay legal fees from restrained assets. IF legal aid is available, granted PERHAPS, after criminal proceedings have been instituted or if a friend /family member genuinely gifts the money, then legal fees can be met. It cannot be a loan but must be a genuine gift.
It is possible to discharge a restraint order - generally it is the banks /mortgage companies who apply to do this as third parties.
If a variation or discharge is sought then there has to be an inter partes hearing before a Crown Court Judge, and there is right of appeal from that hearing.
Supposing the Order Affects your Business?
It is possible for the Crown to “pierce the corporate veil” in order to ascertain whether a company is sheltering the proceeds /benefits of crime or is a legitimate business. And it will be treated as realisable property. However the Crown does have to take great care to ensure that the legitimate business is allowed to continue, especially if it is a working company with employees and there are salaries that have to be met. In those circumstances management receivers are appointed. The fees of these receivers are met from the restrained assets and are very expensive.
We have seen many cases, especially in serious fraud investigations, where the client is on bail for years and his /her assets are restrained for the same period. S42(7) Proceeds of Crime Act 2002 provides that a restraint order MUST be discharged if proceedings for an offence are not brought within a reasonable time, but this very much depends upon the specific facts of the case.
Have You Received Notification That You Are Subject To A Civil Recovery Order?
We are firmly of the view that the Crown will continue to extend its pursuit of civil asset recovery using all their draconian powers. See SOCA's application in Perry v SOCA (2012).
From the Crown's perspective, it is easier, quicker and more cost effective for them to do so. They do not require a prosecution or conviction and the onus is upon the respondent (you/your company!) to prove upon the balance of probabilities that the assets/monies/goods are NOT the proceeds of crime.
There already has been a huge increase in the volume and complexity of these proceedings (see the above-mentioned reference to Perry v SOCA). The NCA has already vowed to continue disrupting those that they suspect of criminal activity through this process.
The authorities have the following remedies at their disposal:
- Property freezing orders;
- Receivership orders;
- Recovery orders;
- Cash restraint;
- Disclosure orders;
- Condemnation of goods (usually by HMRC) relating to alcohol, tobacco or goods subject to sanctions or import/export controls.
These actions can affect innocent third parties who will require advice or representation in order to protect their interests.
Costs are an important issue to remember when dealing with these proceedings e.g. if and when the Crown make a part 36 offer and the costs sanctions that can flow from that. It is also likely that the respondent will have to fund his own defence privately; there is very little legal aid available for these proceedings. We have a long and successful record when dealing with Civil Asset Recovery; we use the best forensic accountants and specialist barristers from leading chambers.
We work nationally, fee levels permitting, all for flexible reasonable rates.
What is a SOCPA Agreement?
Why Choose Us?
We are different in many respects from other firms, primarily, because our specialist team, led by Ian Coupland, comprises of both top level civil/commercial litigators and a highly respected white collar crime team (see our reputation page) who pool their experience and work together to assist you to recover what is owed to you.
We have many years of successfully acting for: companies, insurers, business partnerships, high net worth individuals in these situations, successfully traced assets, obtained Mareva Injunctions, and have restrained and/or realised assets located in other jurisdictions.
More Planned Changes for POCA (Proceeds of Crime Act), Asset Restraint and Confiscation Proceedings
The Home Affairs Parliamentary Committee concluded in July 2017, that Government and prosecution authorities are simply not doing enough to secure the proceeds of crime, from those convicted of crimes, and those who have managed to evade prosecution.
Focusing upon those convicted of criminal offences, over £1.61 billion remains outstanding from Confiscation orders made by the Courts, albeit 1/3 of that sum represents penalties and interest for non payment of those orders. As a result, The Law Commission has turned his attention to the issue and will report in October 2017.
In truth, the SFO and FCA have a much better record as far as recouping the proceeds of crime are concerned, certainly better than police forces, CPS and the NCA, that is probably because they have relatively well resourced specialist teams of lawyers and financial investigators.
Another possible explanation is that those convicted of financial crime and fraud often have easily identifiable assets, when compared with those convicted of drugs or people trafficking offences.
There have been substantial changes to the POCA regime, as embodied within this years Criminal Finances Act 2017 re Sar reports and Unexplained Wealth Orders (please see our blog: Unexplained Wealth Orders : a new tool for seizing proceeds of crime 12/4 2017 – newsroom section on our website).
The CFA 2017 brings in new disclosure orders including the requirement of a third party to disclose information as required and amendments to SAR regime.
All POCA regulated firms can now share information with other such regulated firms where there is a suspicion of money laundering.
The NCA will now be able to extend the moratorium period to six months and the Magnitsky Clause within the CFA allows non–conviction recovery powers to include assets obtained by a gross abuse of human rights.
Additionally, The Home Office and The Attorney Generals Office have just closed a consultation on 25/09/2017 which will focus upon the following discreet areas:
- Powers to search, seize, and detain property
- Exercising investigation powers under POCA 2002
- Using search powers to recover criminal cash
- Powers to seize identifiable listed assets
- Prosecutors guidance on the operation of POCA investigation powers
- Exercise of various new seizure, detention and forfeiture powers under the CFA 2017 (Criminal Finances Act)
The FCA is also considering criminally prosecuting firms/individuals for anti money laundering failings – see their business plan for 2017/2018.
They are keen to also establish 0PBAS (Office for Professional Body AML Supervisors), which will oversee (and enforce) obligations under new AML Regulations.
How Can We Help You?
We have one of the leading specialist POCA defence teams in the Country; we advise those facing POCA proceedings and those immediately affected by such orders e.g. third parties, business partners and co Directors.
Our team includes specialist White Collar/Corporate Crime defence teams, highly ranked by the leading Legal ranking directories and are highly experienced when dealing with these proceedings, including AML, taxation, bribery and corruption, market offences, and have a genuinely in depth knowledge of Prosecution agencies policies and behaviour.
A number of other firms of lawyers have Dispute Resolution Departments comprising of corporate litigators and young barristers that deal with this field and are relative newcomers to this area of law. Not us, we have been dealing with these issues since the enactment of POCA 2002 and believe in early pro active defence, an approach which has proved to be very successful.
Contact our Specialist Asset Restraint & Confiscation Solicitors in London, UK
If you are the subject of a restraint order or a third party affected by such, speak to one of our top asset restraint and confiscation solicitors: please telephone us on 020 7387 2032, complete our online enquiry form, or contact Jeffrey Lewis,Siobhain Egan, Miles Herman or Keith Wood.