Confiscation Orders

Our team includes some of the UK’s leading confiscation law solicitors, who have been instructed in many high profile cases. We have a particular niche in representing third parties, such as spouses or business, claiming an interest in property or assets included in a confiscation order.

Specialist advice is essential in confiscation cases. Confiscation law is a self-contained branch of criminal law and procedure involving a high degree of complexity and knowledge of civil law principles governing the status of trust funds, pensions, overseas assets, tainted gifts, hidden assets and third party interests as well as receivership and bankruptcy law and procedure.

The purpose of a Confiscation Order is to deprive a defendant of the benefit he or she has obtained from criminal conduct. The Court has wide ranging powers to make “assumptions” as to whether any assets represent a benefit from criminal conduct that is potentially liable for confiscation. When calculating the sum of the Confiscation Order the court can also make assumptions about any hidden property or tainted gifts connected to the accused. Individuals who fail to take proper advice and prepare their cases properly stand to forfeit all of their assets including, for instance, their interest in a jointly owned property such as a matrimonial home.

Following a conviction for fraud or many other types of criminal offences, the Crown or the Court can consider confiscating the defendant’s assets as part of the sentencing process. Prosecuting agencies have a strong incentive to pursue confiscation because fifty per cent of the monies raised used to fund the investigators, prosecutors and the court service. With growing pressure on government agencies to secure income from external sources applications for confiscation are now routine in fraud cases.

Confiscation Orders Under the DTOA and CJA

Confiscation Orders for all offences charged or indicted after 23 March 2003 are governed by the Proceeds of Crime Act 2002. Earlier legislation such as the Criminal Justice Acts of 1988 and 1994 and the Drug Trafficking Offenders Act may apply to offences committed before this date.

There are significant differences in the confiscation law and procedure that applies to POCA offences and the older legislation. For example, confiscation orders made under the old legislation that are still outstanding are enforced in the High Court, rather than the Crown Court which presides over POCA applications. Under the old legislation provision could be made for the payment of legal expenses incurred during the proceedings and this does not apply under POCA.

Furthermore, in some cases Defendants may not have the right to apply to vary an order made under the CJA or DTOA legislation but other avenues of challenge may arise.

Anybody affected by a restraining order or confiscation order (e.g. a spouse, friend or relative of a defendant) should act quickly to protect their interests. Third parties could be affected by an order if for instance they have a joint share in the ownership of a property with he accused or if it is alleged that they have been the beneficiary of a “tainted gift” that has been transferred or sold at a significant undervalue.

Family members or friends who are affected by restraint orders have the right to be represented and can apply for the orders to be removed or varied to the Crown Court and for payment of their living expenses and in some cases, legal expenses incurred that are unconnected with the pending criminal case. In certain circumstances a third party may be able to apply to the High Court for a declaration of their interests in a contested joint property.

In confiscation proceedings the Crown’s case is normally prepared by financial investigators lacking any accountancy background. Discrepancies can therefore arise in the claims made by the Crown which may include grossly inflated calculations of benefit and the amount available for confiscation due, for instance, to the double counting of receipts and expenditure.

We work alongside and regularly instruct expert forensic accountants to identify, challenge and rebut the evidence relied on by the Crown.

Client A was a businessman convicted of fraud. Following his conviction, A was made subject to one of the U.K.’s largest ever confiscation orders – a figure in excess of £40 million. Having served his prison sentence for the original criminal matter, the Serious Fraud Office are now seeking activation of a default sentence against A as most of the confiscation order remains unpaid.

Proceedings against A have been ongoing for several years. BSQ are currently engaged in resisting the enforcement proceedings in the Magistrates Court. BSQ also represent A in related proceedings before the Commercial Court to determine A’s realisable interest in a pool of property valued at approximately £80 million from which the SFO seek payment of the outstanding confiscation order. The BSQ partner’s instructed are Daniel Godden and Roger Sahota.

The case remains one of the most complex confiscation matters litigated in this jurisdiction. See the Evening Standard’s coverage of the case.

Client B was charged with being part of a conspiracy to defraud various banks of over £1million over a period of 2.5 years by the use of sophisticated “phishing’ and other malware that enabled him to gather a library of stolen credit card and bank payment details.

The Defendant’s role as alleged by the CPS was successfully challenged during a Newton hearing whereupon his culpability was severely curtailed and confiscation proceedings under Part 2 of POCA 2002 were avoided. BSQ partner Daniel Godden was instructed.

Click to read the BBC News’ Report.