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Enhancing Public Accountability: Key Elements of the Public Office (Accountability) Bill 2025
Kirsty Cook
In the last decade, the Government of India has pursued dedicated legislative action towards achieving the objectives of its primary Anti-Money Laundering (“AML”) statute i.e. Prevention of Money Laundering Act 2002 (“PMLA”). Not only has India enacted critical statutory amendments to widen the scope of the proceeds of crime under the PMLA to include foreign assets, but has also supplemented the PMLA with the Fugitive Economic Offenders Act, 2018 (“FEOA”), which is aimed at confiscation of properties without trial/conviction where the “fugitive economic offender” fails to submit to the Indian jurisdiction. The FEOA applies to matters concerning values of more than INR 1 Billion (≈GBP 10 Million). The investigation and enforcement authority under PMLA, i.e. the Directorate of Enforcement (“ED”) in India is making consistent and concentrated efforts to trace, attach/seize and confiscate foreign assets of persons alleged and/or suspected to have indulged in the money laundering.
Since the amendment of the definition of “proceeds of crime” under Section 2(1)(u) of the PMLA was effected to include properties situated outside India and value equivalent attachment of property within India for properties taken or held outside India, the ED has provisionally attached properties worth millions in foreign jurisdictions, including significant attachments in the United Kingdom (“UK”) by issuance of letters of request/letters rogatory.
In this regard, the reciprocal arrangement between India and the UK is governed by the Mutual Legal Assistance Treaty 1995 (“India-UK MLAT/MLAT”) which, inter alia, allows for the execution of a request for ‘restraining’ (attaching) a property in the UK on the request of Indian authorities and vice-versa.
The ED has on several occasions cited delays in execution of its Letters of requests to the UK and still faces major hurdles in achieving finality in terms of execution, running the risk of properties being disposed of or transferred to third parties pending execution.
Requests for mutual legal assistance in respect of restraint (that is, the UK terminology most commonly used to describe ‘attachment’) and confiscation are dealt with in Part 11 of the Proceeds of Crime Act 2002 and the Proceeds of Crime Act 2002 (External Requests and Orders) Order 2005 (“POCA External Requests Order”). This legislation enables a UK court to make restraint and confiscation orders at the request of overseas authorities and guidelines for such authorities are provided by the Home Office in its document “Request for Mutual Legal Assistance in criminal matters: guidelines for authorities outside of the United Kingdom”.
In brief summary, the mechanism for enforcement of such orders is by way of judicial cooperation, which requires the UK Central Authority (UKCA), a body of the Home Office, to refer the case to a domestic prosecuting agency, usually the CPS or, in cases of serious and complex fraud, the SFO, which will apply to the court in the UK to seek an order to enforce the request at the behest of the requesting authority. All requests for freezing of assets require dual criminality, i.e. the alleged conduct must amount to an offence in both the requesting state and the UK. Such requests are required to provide a significant amount of information, which will enable the CPS or SFO to apply to the court for the requested order. Per provisions in the UK, requests for mutual legal assistance must satisfy stringent criteria, such as dual criminality and stringent evidentiary requirements, which are not easily met.
In our piece, available here, we undertake a brief comparison between the Indian legal provisions and the mechanisms for enforcement in the UK which goes some way to explain the material difference in substantive and procedural thresholds in their respective domestic laws, resultant delays and, in some cases, failure to co-operate, in these matters.
Click here to download the article
Further information
If you have any questions, please contact Chirag Naik from MZM Legal LLP or Rebecca Niblock in our Kingsley Napley Criminal team.
About the authors
Chirag Naik is a Principal Associate with MZM Legal LLP’s globally recognised White Collar Crime, Investigations and Criminal Compliance Practice. With extensive cross-border litigation and crisis management experience he regularly acts and advises on high-profile and complex matters concerning fraud, money laundering, extradition, corruption, foreign assets, cyber-crime, corporate governance and more. He has been successively ranked by the Legal 500 as a “Rising Star” in White-Collar Crime (India) in 2021, 2022 AND 2023.
Rebecca Niblock is a leading criminal lawyer, with a specialism in dealing with complex matters that cross jurisdictions. She is ranked as a Star Individual by Chambers & Partners UK 2021 in the field of Crime: Extradition and is recommended in Who’s Who: Business Crime Defence Lawyers.
Mobile:
+91-9665445227
Email: chirag.naik@mzmlegal.com
Website: www.mzmlegal.com
LinkedIn: www.linkedin.com/in/thechiragnaik
Twitter: https://twitter.com/chr_nk?s=20
We welcome views and opinions about the issues raised in this blog. Should you require specific advice in relation to personal circumstances, please use the form on the contact page.
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