GET 24/7 LEGAL ADVICE

020 7387 2032

A confiscation order allows the courts to recover alleged proceeds of crime following a conviction. Tainted gifts are an important part of the confiscation proceedings, and can have serious consequences for more than just the defendant. In this article, we will look at what they are and what problems a third party could face. For more information, contact us today.

What is a tainted gift?

In confiscation proceedings, a gift is an asset which has been transferred by the defendant to another person. In order to qualify as a gift, the asset must be transferred for no consideration or significantly less than the asset is worth. For example, if you ‘sell’ someone a car worth £10,000 for £1,000 - this will be considered a gift. Gifts are not just assets but can be money too. 

Tainted gifts and criminal lifestyle

The rules around what constitutes a tainted gift depends on whether the defendant is deemed to have a criminal lifestyle or not. If the defendant does not have a criminal lifestyle, a gift will only be tainted when it is made on or after the date of the offence (also known as the ‘relevant day’). In cases where the offence was committed over a period of time, the earliest date is the relevant day. 

If the defendant does have a criminal lifestyle, then a gift will be considered tainted in one of two circumstances. Firstly, if the gift was made on or after the relevant day and resulted in a conviction for an offence that has triggered confiscation proceedings. Secondly, a gift will be a tainted gift if it was made by a defendant with a criminal lifestyle at any time, and was an asset obtained as a result of the defendant's criminal conduct or in connection with their criminal conduct.

The value of a tainted gift

Tainted gifts must be valued for the purposes of Proceeds of Crime Act (POCA) proceedings. A tainted gift will either be valued at the time the gift was made, or when the court assesses the value of the gift - whichever is higher. 

Can a gift to a spouse be considered as ‘tainted’?

Gifts between spouses can be tainted, but the categorisation of tainted gifts in this context is complex. For example, spouses share money and other assets on a daily basis, and so every sum of money given cannot be deemed to be a gift or tainted gift. However, substantial transfers may be deemed to be tainted gifts. For example, in the case of R v Thompson, the Court of Appeal determined that a joint ownership in a property that was not the matrimonial home was a tainted gift under POCA 2002. 

What happens to the recipient of a tainted gift during confiscation proceedings?

A third party who has been gifted an asset by a defendant now facing confiscation proceedings will encounter several difficulties. The gifted asset will be deemed to belong to the defendant, even if they paid for the item (at less than market value). The asset is likely to be restrained under a Restraint Order without notice. The Court may also grant an application by the prosecution to appoint an Enforcement Receiver who can take control of the asset and sell it to pay towards the defendant’s Confiscation Order. 

Third party rights 

The law recognises the rights of third parties in proceedings under POCA 2002. 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 three areas in which third party rights are protected are:

  1. Enforcement of Confiscation Orders
  2. Restraint Orders
  3. Cash Seizure

At Lewis Nedas Law, our leading specialist POCA defence teams can advise those facing POCA proceedings as well as those immediately affected by such orders e.g. third parties, business partners and co-directors.

Contact our Professional Asset Restraint & Confiscation Solicitors in Central London

Our team is highly experienced when dealing with these proceedings, including AML, taxation, bribery and corruption, market offences and more. We have in-depth knowledge of prosecution agencies policies and behaviour. 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 call us on 020 7387 2032 or complete our online enquiry form and we will get back to you without delay.

We are happy to help

Get 24/7 Legal Advice, call

020 7387 2032

“I was put in touch with Lewis Nedas Law through a mutual friend and I was not disappointed. The team were nothing but straight forward, honest and realistic about the nature of my case and the expected outcome from the minute I got in contact and were willing to take over from the previous company at very short notice. With their unrivalled experience and expertise in their profession the outcome was even better than expected and I couldn’t recommend them enough.”


contact

Please let us know your name.
Please let us know your email address.
Please enter a valid phone number
Invalid Input
Please let us know your message.
GDPR Agreement - I consent to the information supplied above to be stored on this website so that Lewis Nedas Law can respond to my enquiry.
Invalid Input

Accreditations and Awards

  • Legal 500 uk leading firm 2024
  • The Times Best Law Firms 2024
  • Legal 500 uk leading firm 2022 50x73
  • The Times Best Law Firms 2022
  • Google 5 stars