Account Freezing Orders were introduced under the Criminal Finances Act 2017 (‘the 2017 Act’) and came into force on 31 January 2018.
The availability of these Orders, incorporated into the Proceeds of Crime Act 2002 (‘POCA 2002’), has substantially increased the ability of law enforcement agencies, such as HMRC, the SFO and the NCA, to freeze funds held in bank accounts and subsequently to apply for their forfeiture.
For further details in relation to Account Freezing Orders and Account Forfeiture Orders please follow this link.
Kangs Solicitors has been representing individuals and businesses in relation to Account Freezing Orders and Account Forfeiture Orders since their inception and we have considerable experience in dealing with all law enforcement agencies including the police, HMRC, NCA and the SFO.
We have a long history of being highly recognised by the leading law directories, the Legal 500 and Chambers & Partners, for our work in relation to financial fraud. The current edition of the Legal 500 (2021 edition) recognises that we are:
‘One of, if not the best, criminal specialist firms in the country’.
Our team is led by Hamraj Kang an award-winning solicitor who has been ranked as a ‘star individual’ for five consecutive years by Chambers & Partners for his work in defending fraud investigations and prosecutions.
For an initial no obligation discussion, please call our Team at any of our offices detailed below:
Hamraj Kang outlines below some of the recent issues and trends that we have noticed in relation to the use of Account Freezing Orders.
Increase in Account Freezing Order Applications | Kangs Solicitors
We have noticed a substantial increase in the use of Account Freezing Orders by law enforcement agencies, particularly HMRC.
We are currently acting for a wide range of corporate and individual clients in industries as diverse as construction, precious metals, currency exchanges and coin traders who have been served with an Account Freezing Order.
Legal Expenses Funding | Account Freezing Order Solicitors
Often, when a business or individual has a bank account frozen, that account is the only or primary bank account available from which to draw immediate funds. As such, all living, business and legal expenses which would usually be paid from such bank account are prohibited by the imposition of the Account Freezing Order which has been served.
Such a restriction places the account holder in an invidious position.
How does the account holder pay for legal representation in such circumstances?
It is notable that the 2017 Act does make provision for reasonable legal expenses to be paid from the frozen funds. This provision is similar to the process for Civil Recovery Orders/Property Freezing Oders but can be contrasted with other provisions contained in POCA 2002 which relate to Cash Seizures and Restraint Orders.
Following service of Cash Seizure and Restraint Orders there is no entitlement to access seized cash or restrained assets to fund legal expenses.
Whilst the 2017 Act contains the relevant provisions enabling the account holder to seek access to the frozen account to fund reasonable legal expenses, in reality, the situation is rarely straightforward and often involves protracted negotiations with the law enforcement agency which has frozen the bank account in order to secure the release of funds.
In our recent experience, investigating agencies such as HMRC will not readily agree to the release of funds. Invariably the suggestion is made that the account holder has access to other means to enable legal expenses to be paid.
Generally, the investigating agency will require a Statement of Assets from the account holder confirming the value of current available assets and liabilities.
When a release of funds is allowed towards legal fees, the amount agreed will generally be limited to recognised prescribed standard rates which, invariably, fall short of the level required to meet the full costs of conducting a detailed defence.
If the investigating agency is not willing to agree to the amount of legal expenses being sought, an application can be referred to the Magistrates’ Court for a final decision.
When considering whether the application is reasonable the Court will take into account, inter alia:
- whether the amount being claimed is reasonable,
- the anticipated total amount of legal expenses likely to be incurred,
- whether or not it is fair (to the account holder and any other interested party) to allow the frozen funds to be utilised to fund the reasonable legal expenses,
- the fairness of a refusal to allow legal expenses to be drawn from the frozen account if that will mean the account holder is unable to contest the proceedings.
In many instances, we have been able to agree reasonable legal expenses funding with the investigating agency without the need for a court hearing. However, we appreciate that all of the above can be an anxious and stressful time for the account holder while negotiations are being conducted.
We have substantial experience in navigating through this complex area of law and supporting clients through the process of ensuring that their claim for legal expenses funding is presented in a robust manner supported by appropriate evidence.
Our Experience | Why Choose Kangs Solicitors?
The team at Kangs Solicitors has:
- represented clients in financial investigations in courts throughout England and Wales for over twenty years,
- considerable knowledge of working in every conceivable sector including construction, metals, Money Service Businesses, foreign currency exchange, alcohol and tobacco, manufacturing, import and export agents,
- massive financial fraud expertise assisting clients with all aspects of financial fraud including ancillary charges such as money laundering.
- access to the finest barristers and QCs in the country to guarantee the best possible representation for our clients.
- we are the winners of the Legal 500 ‘Criminal Law Firm of the Year’ and
- our senior partner, Hamraj Kang, is the current winner of the Legal 500 ‘Criminal and Fraud Solicitor of the Year 2020’.
How to Contact Us | Kangs Solicitors
We appreciate the significant stress and strain that a financial investigation can have on a client and family. We aim to work proactively with our clients in an effort to secure an early favourable resolution to the problems with which they are confronted.
Hamraj Kang leads an award-winning team of solicitors nationally reputed for its excellence in fraud related work.
We welcome new enquiries by telephone or email.
Our team of lawyers is available to meet at our offices in London, Birmingham or Manchester or, alternatively, we are happy to arrange an initial no obligation meeting via telephone or video conferencing.
For initial enquires please contact: