Account Freezing Orders (AFrOs) are a measure introduced by the Criminal Finances Act 2017 and have been available to a wide range of law enforcement agencies since February 2018. We have previously blogged on how popular such orders - and the consequent forfeiture orders which may follow - have proved with the authorities, and a recent Freedom of Information Act request we made to the Metropolitan Police Service (MPS) provides a valuable illustration of how use of the orders is increasing.
In the calendar year 2018 (though bear in mind that AFrO data is only available from the April) the MPS obtained 207 orders, freezing in excess of £42 million. 2019 saw a decrease in the number of orders, and the value of frozen balances, to 183 and £17.1 million respectively. However 2020 figures, which one might have expected to be impacted by the coronavirus pandemic, show a significant rise in AFrOs, to 341. The value of frozen balances was £30.7 million.
The MPS is just one police force and we know from other published figures that 812 accounts were frozen nationwide during the financial year 2019/20, more than 15 every week. The appeal of the orders to law enforcement is obvious: not only can AFrOs be obtained with relative ease, but should matters proceed to forfeiture, under the Asset Recovery Incentivisation Scheme (ARIS) the applicant agency will retain a proportion of the forfeited funds.
While the legislation does not require any criminal investigation to run in parallel with an AFrO application – indeed, it was recently reported that HMRC has not brought a single criminal prosecution arising from the 381 AFrOs that it has obtained - that should in no way detract from the grave consequences that can follow from the subject of an AFrO being denied the use of their account(s). Even if proceedings do not end with forfeiture, the effect on business and personal lives of up to two years of financial paralysis to can be catastrophic.
For more information on any issues raised in this blog post, please contact a member of our Account Freezing and Forfeiture Orders, and Cash Seizure team.
About the author
Ed Smyth is a Partner in the Criminal Litigation team and represents individuals and corporates involved across the full spectrum of criminal and quasi-criminal matters. He has considerable experience of confiscation and asset forfeiture proceedings and of challenging the exercise of search and seizure powers. He has acted in cases involving the SFO, the NCA, HMRC, the Information Commissioner, the Electoral Commission and various professional disciplinary bodies.
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