NCA obtains first UWO against a suspected organised criminal – a change in approach
In the Government Anti-Corruption Strategy 2017-22 Unexplained Wealth Orders were cited as one of the key tools to ensure a more robust response to tackling economic crime. “Goal 2” of the strategy is to achieve stronger law enforcement, prosecutorial and criminal justice action.
Unexplained Wealth Orders were introduced under the Criminal Finances Act (April 2017) and are now in force. (See previous blog by Áine Kervick). Transparency International have long campaigned for their introduction and the introduction of this new order was a key outcome of the Anti-Corruption Summit 2016 hosted in London. Stemming the flow of “illict finance” into the UK and ending the use of London as a “safe haven” for “dirty money” is a government and law enforcement priority.
Part 1, ss 1-9, of the Criminal Finances Act create “Unexplained Wealth Orders” (“UWO”). (A new provision is to be inserted into the Proceeds of Crime Act 2002 Chapter 2 Part 8). These will require a person who is suspected of involvement in or association with serious criminality to explain the origin of assets that appear to be disproportionate to their known income. A failure to provide a response would give rise to a presumption that the property was recoverable, in order to assist any subsequent civil recovery action. A person could also be convicted of a criminal offence, if they make false or misleading statements in response to a UWO.
A UWO will be granted where the court is satisfied that there are reasonable grounds for suspecting that an individual had insufficient time or available resources to acquire the asset in question. This is an order that requires a respondent to provide a statement setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made, and explaining how the respondent obtained the property. A respondent who is unable to provide an explanation could see the property seized. A UWO can be made against politically exposed individuals or individuals where there are reasonable grounds for suspecting that they are, or have been, involved in serious crime in the UK or elsewhere.
Championed as a key tool in the fight against corruption, the debate during the passing of the Act did also raise a number of issues of concern. Critics were concerned by the order’s practical impact of reversing the burden of proof on individuals. Commentators suggested that the orders are an example of undue interference by the state in the private property rights of individuals. Indeed, the seizure of assets by the state is a coercive measure which should not be used lightly.
Now these orders are in force, we will witness whether this is the reality. Given these concerns it is unsurprising that the SFO is not encouraging a race towards the first UWO. SFO Director David Green was reported in the media as saying that the SFO would not use them unless it had “the right case”. So the SFO clearly wants to make sure it is on firm ground before deploying its new, but slightly controversial, tool”.
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