Proceeds of Crime Act Proceedings (POCA)

if you are convicted of certain offences (or offences committed over a period of time), following the Conviction, the Prosecution will make an application to the Court for a confiscation order to 'confiscate,' your assets.

 

Whilst the aim of the legislation is to confiscate the assets of offenders - such that they do not profit from the proceeds of their crimes - in reality the system does not involve 'actual,' confiscation.  This is explained in full below.

 

The Procedure to be followed by the Court is as follows:

(1) The Court will first ascertain the benefit figure. 

The benefit figure will depend on whether the case is a

 

(A) Particular Benefit Case or

 

(B) Lifestyle Case.

 

This is discussed further below. 

 

(2) Once the benefit figure is ascertained, the Court will consider what 'realisable assets,' the defendant owns. 

 

(3) The Court might consider that the defendant has assets in excess of those which have been disclosed or found by the Prosecution.  Those are called 'Hidden Assets.' Any hidden assets are immediately realisable (i.e. payable upon the confiscation order being made). 

 

(4) The Court might also consider that the defendant has given assets away.  These are known as 'tainted gifts,' and are also immediately realisable.  Once the Court is satisfied as to the value of the 'realisable assets,' this figure will become the 'recoverable amount,' and a confiscation order will be made in that amount.

 

So first, the Court will state the benefit figure (important because if the defendant later accumulates money or property, inherits or wins the lottery - the Prosecution can ask the Court to re-visit the issue of confiscation if the benefit figure has not been fulfilled).

 

Second, the Court will state the recoverable amount figure (i.e. the amount that falls to be recovered from the Defendant) and make a confiscation order in that amount.  It is often the case in for example, drugs cases, that the benefit figure is several million pounds.  However, if the Defendant has no assets and there is no evidence of hidden assets or tainted gifts, the confiscation amount is often agreed at £1.00.  

 

PARTICULAR BENEFIT CASES

 

If the case is a particular benefit case, the Prosecution will seek to confiscate 'the particular benefit,' you have received.  As is often the case with criminal law matters, 'particular benefit,' is a misnomer.  It refers to the whole of the benefit you have received, irrespective of whether you 'actually benefitted,' from it and irrespective of what you did with it.

 

For example, in the case of a person convicted of housing benefit, the benefit figure would be the amount of the housing benefit received (irrespective of the fact this might have been paid directly to a Landlord).  Of course in that case, that person would have received the 'benefit,' of the property in which to live - rather than the actual money paid - but the money paid would be the starting point for calculating the benefit.

 

If a case involves a fraudulent loan or mortgage, then the benefit is likely to be calculated as the actual amount fraudulently loaned, plus any increase in the equity of the property on which it was loaned.

 

CRIMINAL LIFESTYLE CASES

 

If the case is a lifestyle case, the position is even worse.  There are a number of rebuttable statutory assumptions which apply.  The assumptions are draconian and if they are not 'rebutted,' they will apply to your case.  For example, there is an assumption that any property owned by you during the six preceding the relevant date (usually the date of charge) is the proceeds of crime.  Any monies passing through your hands is also assumed to be the proceeds of crime.  If you do not dispute the assumptions, then the Prosecution can rely upon the statutory assumptions to win their case.

 

Mercifully, there is a process to ensure that this does not lead to unfairness (beyond the unfairness that was obviously envisaged by Parliament when this legislation was passed).

 

(1) In the first instance, the defendant is required to disclose any assets to the Prosecution.

(2) The Prosecution then later serve a statement confirming what they say the benefit, hidden assets, tainted goods and recoverable amount is.

(3) The Defendant responds with his/her own statement confirming what (if any) areas of the Prosecution statement is agreed and what are disputed.  This statement should attach any empirical evidence as exhibits so as to try to prove the points raised in documentary form.  It is a woeful fact that a convicted defendant may have very little credibility before the Trial Judge (who will almost certainly retain the case) so the more that can be evidenced in documentary form, the better.  Mere assertions from the Defendant are not sufficient.

(4) The Prosecution and Defence should then negotiate to see whether agreement can be reached.

(5) If agreement can be reached, and the Judge agrees (which is usually but not definitely a formality if the Prosecution are in agreement), a confiscation order will be made according to the agreed amounts.

(6) If agreement cannot be reached, the matter will be listed for a contested hearing before the Judge.

(7) Once a confiscation order is made, the Judge will fix a period in custody in default of payment.  The current periods are as follows:


POCA 2002, s 35(2A) is as follows:

Amount of confiscation order Maximum term
£10,000 or less 6 months
£10,001-£500,000 5 years
£500,001-£1m 7 years
More than £1m 14 years

 

As you can undoubtedly see, the potential consequences of non-payment of the amount of the confiscation order are extreme.

 

Moreover, even if a period is served in default - this does not 'wipe out,' the recoverable amount, which remains recoverable - irrespective of the period served in default. Half the amount imposed in default will be served in custody.

 

(8) The Defendant will be given up to three months to pay (which can be extended to six months as long as an application is made the court before the expiry of the three month period).

 

(9) The Prosecution can seek to enforce the sum included in a confiscation order against third parties. Joint property - or even property in which the Prosecution allege the defendant has an equitable interest (even where there is no legal interest) could be at risk.

 

If what is written above has confused and bewildered you, you can join the ranks of most of the population as well as a large amount of lawyers! The reality is, if you face Proceeds of Crime Act Proceedings, you need a Solicitor by your side who understands the legislation, the endless array of case-law and how best to approach the case. This will differ enormously from case to case and only experience in this area can assist.

 

Coral Fitzgerald has conducted many Proceeds of Crime Act cases - with considerable success.

 

A few are listed below - just to give an idea of Coral's extensive experience in this area of the law. If you need assistance, give Coral a call on 07790 356069 to discuss your case further.

 

(1) Conterfeit Good Matter leads to a Prosecution statement alleging that this is a 'criminal lifestyle,' case and seeking to confiscation in excess of £1,000,000, despite the original offence being worth no more than a total of circa £20,000. Following the instruction of a Forensic Accountant and considerable negotation with the Prosecution, the recoverable amount is agreed in the sum of £25,000 (plus £13,000 costs). Coral Fitzgerald as litigator throughout the POCA proceedings.

 

(2) Running a brothel case. Prosecution seek in excess of £250,000. Following the instruction of a forensic accountant a sum of £90,000 is acceptable to the Prosecution. Coral Fitzgerald as litigator throughout the POCA proceedings.

 

(3) Theft from Employer case. Client had pleaded guilty on a limited basis. The client had previous convictions so the Judge took the view that the lesser amount posited by the client would not make a difference to the sentence and proceeded to sentence without a newton hearing. The Prosecution then sought to revert to the original sum for the purposes of the POCA proceedings. Client had no assets whatsoever, so Prosecution expected agreement to be reached as a formality. Client would not agree to the benefit figure and the matter was listed for a contested hearing. On the day of the contested hearing, the Prosecution conceded and the benefit figure was agreed at the lower amount. Confiscation in the sum of £1. (Coral Fitzgerald as litigator and advocate throughout the POCA proceedings).

 

(4) Benefit Fraud case. Prosecution assert 'lifestyle offence,' and seek to recover value of two expensive properties. Contested hearing follows and Judge orders £178,000 as the benefit figure and recoverable amount. Whilst this is a large sum of money - it was a fraction of the amount sought by the Prosecution.

 

(5) Third Party Joining. Recent legislation means that in certain circumstances, third parties can be joined to POCA proceedings if their property is at risk. The substantive case here was a supply of drugs case, in which the Prosecution had assessed the benefit figure in excess of £1,000,000. The realisable assets included my client's property. The client was the partner of the defendant, and as such, despite the fact the client's property was registered in their sole name, the property was listed as one of the realisable assets of the defendant. Several lengthy statements and 1000 pages of exhibits later, the Prosecution entirely conceded that the property belonged only to my client and that the defendant had no interest in it. It was therefore removed from the list of realisable assets. Moreoever, a further £27,000 was deducted from the defendant's list of realisable assets, given the very detailed and evidenced information we had been able to provide in this case.

 

(6) Fraud By Misrepresentation Case. Unusual Facts but the Prosecution ultimately withdraw their POCA application in entirety. Astounding result for a convicted client. Litigator Coral Fitzgerald. Advocate Mitch Cohen.

 

 

 

 

 

 

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