NCA relentless in demand for answers to unexplained wealth
Three UWOs, and related interim freezing orders, were obtained by the NCA in May 2019 over three different London properties – reportedly worth £80 million in total. The NCA argued that these were acquired by the late Mr Rakhat Aliyev, a former senior official of the government of Kazakhstan, as a means of laundering the proceeds of unlawful conduct.
In August 2019 the respondents - Andrew J Baker, Villa Magna Foundation, Manrick Private Foundation, Alderton Investments Limited, Tropicana Assets Foundation, along with Rakhat Aliyev’s ex-wife, Dariga Nazarbayeva, and her son, Nurali Aliyev, provided information about the purchase and transfer of the properties, their registered owners and the ultimate beneficial owners.
Confirming that Dariga Nazarbayeva was the ultimate beneficial owner of two of the properties and her son the other, they asserted that the purchases were unconnected to Rakhat Aliyev and his alleged criminal activities, and that he was never the ultimate beneficiary of the properties. The NCA nevertheless declined to withdraw the UWOs, which led ultimately to the respondents’ application to discharge them.
On 8 April – case reported as NCA v Baker & Ors handed down remotely - all three UWOs and related interim freezing orders were discharged. Mrs Justice Lang ruled that requirements for making UWOs under the Criminal Finances Act were not met, and that the NCA's underlying assumption that Rakhat Aliyev was the source of the funds “was unreliable”. In addition she found “cogent evidence” that Dr Nazarbayeva and Nurali Aliyev had established the companies which owned the properties and provided the funds to purchase them.
In reporting that the High Court had ruled against it, the NCA stated that:
We disagree with this decision to discharge the UWOs and will be filing an appeal. These hearings will establish the case law on which future judgments will be based, so it is vital that we get this right. The NCA is tenacious. We have been very clear that we will use all the legislation at our disposal to pursue suspected illicit finance and we will continue to do so.”
This important judgment will be considered carefully by law enforcement agencies and practitioners alike – as will the significant costs implications. The appeal that will follow may well determine not only this case but the extent to which UWOs are used in the future.
If you are affected by a UWO or an AFO - and we anticipate that ever increasing numbers of individuals will be so affected in the coming months and years - it is critical to obtain specialist legal advice at the earliest possible opportunity. Deciding on the appropriate strategy at the outset will maximise the chances of a positive outcome. Our team of asset forfeiture and proceeds of crime lawyers have extensive experience of challenging these orders and of engaging effectively with law enforcement and the courts.
Ed Smyth is a Senior Associate in the Criminal Litigation Department 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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