Sunday, January 05, 2014

Cash Converters

This report in the Telegraph is an example of the increasing number of cases that come before the courts under the Proceeds of Crime Act (PoCA). This is a draconian piece of legislation that was enacted to prevent criminals from enjoying the benefits of their activities, even if there is insufficient evidence to bring a criminal charge. The Americans never laid a glove on Al Capone for racketeering, but jailed him for tax evasion.
The important thing to remember is that these are civil proceedings, so the burden of proof on those seeking seizure and forfeiture is only on the balance of probabilities, rather than the much stricter beyond reasonable doubt test for a criminal charge. Another consequence of the proceedings being civil is that legal aid is not available, leaving an individual who faces the full resources of the state alone in court.

It is clearly just that a professional criminal who can can lounge in his Essex or Spanish hacienda courtesy of the loot from his misdeeds, should face a rigorous examination of the source of the money, but inevitably many of those who fall foul of PoCA are small fry. If a police raid on a drug dealer turns up a large amount of cash in addition to a stash of drugs and the usual paraphernalia such as scales and plastic bags then it makes sense for him to lose it. I cannot feel easy though, when, to quote a real example from a couple of years back, a man who had worked on construction sites for two years to  earn money to take back to his family, and paid tax and National Insurance on it, had £15,000 seized as he left the UK, on the grounds that since his work permit had expired the cash was the proceeds of unlawful conduct and therefore subject to forfeiture. We applied the law in accordance with our Clerk's advice, but I was left with an uneasy feeling that while we had done our judicial duty, the result was not really fair.

Another concern is that the agency that seizes the cash, be it police, UKBA, or whoever gets to keep some of the proceeds. That doesn't feel right to me.


  1. It feels absolutely 3rd World! Whatever next, a negotiation with the policeman on the spot whether there's "another way to resolve this"? (handing over a few 50 quid notes to the officer as one does). Whatever shiny-eyed accountant thought that this is self-financing and therefore must be a Good Thing needs to reflect that every warlord of East Africa is also self-financing.

    Perhaps the next stage should be having suspects pay for their interrogation, as in the Terry Gilliam movie "Brazil"? Then the courtroom could enjoy dialogue like:

    Guard: Don't fight it son. Confess quickly! If you hold out too long you could jeopardize your credit rating.

    since obviously the best metric for measuring the "efficiency" of a justice system is convictions per hour.

  2. I chaired courts in the past which dealt with dozens of POC Applications and all felt right to me! Many were uncontested because even if legal aid were to be available, they generally weren't too keen to be anywhere near a court or anywhere they could be found!

  3. By that argument, if you get a job by speeding to the interview your entire income is the proceeds of a crime.

  4. I may not be entirely up to speed on this, but I was under the impression that a confiscation order in respect of the proceeds of crime could only be made by a Crown Court following a sentence by that court (although the conviction itself could have been before for the magistrates), where the offence had continued for at least 6 months. The order could, however, be made for the entire receipts of the criminal conduct, not just the 'net profit' after deducting expenses (!)

    However, perhaps POCA has been amended (?) or the cases Bystander and other correspondents have in mind may perhaps come under a different section of POCA - I was only aware of the orignal provision mentioned above.

  5. I am not a lawyer, but I can say that magistrates routinely see PoCA seizures for as little as a thousand or two. The first stage is to ask for an order detaining the cash for 3-6 months while enquiries are carried out. Stage two is an application for forfeiture (although there is a short-cut, if the respondent declines to resist the application, when we can forfeit there and then) .As I said, it is draconian.

  6. I too have dealt with a number of these and as you point out the defendant often doesn't show. However, one sticks in the mind from about 2 years ago. HMRC came to Court to apply for a further 6 month extension to hold a large amount of cash - £20000 something. To them it was a rubber stamping exercise whilst " they continued their inquires" When I asked how long this had been going on, the answer was " about 14 months". We decided that this was more than enough time for them to have concluded the matter and refused the application. The defendant, who was in Court, and whom had co operated throughout left Court a happy and relieved man. Can't say the same for the man from HMRC.

  7. I guess this relates to the infamous "Operation Rize" in 2009 when the Met police opened 6700 safety deposit boxes on the strength of a warrant covering just three boxes (they had to shop around for the "W" - no inner London judge would sign it, eventually a Judge in Croydon did.)

    Half the boxes were empty; they've had about 20 convictions based on the contents of the others and are facing 3500 legal actions for the return of the contents of the others - and some of the valuables seems to have gone missing between the deposit centre and the the nick.

    The police are spinning it as a fantastic success but the taxpayer could be paying out £50m compensation before it's all over.

  8. I sit at a court that hears many PoCA applications and I remember being amazed at my first one. That was because my job then took me on both long haul and short haul flights at least a half a dozen times a year, always from Heathrow. In all my years of travelling I could not recall one single instance of ever having seen any notice, going out or on arrival, about cash of more than £1,000 being liable to seizure if no suitable explanation could be provided for why it was being carried.

    Unlike Bystander I have no major issues with the legislation but at the very least there should be prominent notices for all travellers at all points of departure and entry prominently displayed. I wonder if they are now so displayed?

    I have never sat on a contested hearing that has not gone the way of the agency that seized the money, because on each case it has been clear that something dodgy was going on but I have sat on a case when we concluded that some of the money was legitimately being carried. That portion of the total was duly returned.

  9. "We applied the law in accordance with our Clerk's advice, but I was left with an uneasy feeling that while we had done our judicial duty, the result was not really fair."

    I have to say that if I were in your shoes (as presented above), and especially since I don't see where in the 2002 Act it entitles you to do so - as what you describe does not seem to be a "Criminal Lifestyle offence, (as per Schedule 2)", I would have been inclined to reject the L.A. advice and see if the Crown were prepared to Appeal. It is possible for a magistrate to *occasionally* take a stand which disagrees with the Legal Advisor (as it is possible for LA's to be wrong). Errors in Law can be remedied, or it could have provided the nice test case which the Appeal court would use to clarify the expectations of the law.

  10. We applied the law in accordance with our Clerk's advice, but I was left with an uneasy feeling that while we had done our judicial duty, the result was not really fair.
    Shame on you! You should have told the clerk to shove it and acquitted under the rules of jury nullification. I know know that you cannot be trusted to behave honestly when in court. You are the one who belongs in prison, Bystander!

  11. What? That's a pretty outrageous attack.

    It's the job of our judicial system to apply the law as it's written - sometimes bad law leads to potentially 'unfair' results, although it may be the correct legal outcome.

    In case it has escaped your notice, highlighting this was one of the points of Bystander's article.

    1. So why bother having magistrates ? Just let the Court Clerk decide in the Crown's favour, as that is what appears to happen in every case we see here.


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