Kangs Solicitors regularly successfully represents clients, both businesses and private individuals, in the recovery of cash which has been seized by law enforcement agencies

In this article, Sukhdip Randhawa of Kangs Solicitors comments upon the outcome of a case which firstly came before the Westminster Magistrates’ Court.

Kangs Solicitors has vast experience dealing with all of the law enforcement agencies including the Police, HMRC, NCA, FCA and the SFO and we are highly commended by the leading law directories, The Legal 500 and Chambers & Partners for our work involving financial fraud and cash seizure investigations.

For an initial no obligation discussion, please call our team at any of our offices detailed below:

The Legislation | Kangs Cash Seizure Solicitors

The Proceeds of Crime Act provides that investigators have the power to seize cash, where the amount involved is in excess of one thousand pounds and:

  • they believe that such cash represents the proceeds or crime; or
  • that it is intended for use by any person in the pursuit of unlawful conduct.

Cash may be retained initially for forty eight hours whereafter an application has to be made to the Magistrates’ Court for an extension where:                  

  • a Court Order may be made for the cash to be retained for a further six months; and
  • thereafter, further extensions of the Order may be sought for leave to hold the cash for up to two years from the date when the first Court Order was obtained.

Commissioner for HMRC v Mann | Kangs Cash Forfeiture Solicitors

  • The Commissioner appealed a decision by the District Judge sitting at Westminster Magistrates’ Courts not to extend the detention of cash beyond the expiration of the first period of six months.
  • The District Judge’s decision was based on the fact that the case was heard after the expiration of the six month’s detention as the Hearing could not be heard within the stipulated time as the result of delays caused by the COVID pandemic. 
  • The Appeal Court upheld the District Judge’s ruling saying:
    • ‘In section 298(2), parliament provided that where an application for forfeiture had been made to a Magistrates Court, the cash is to be detained until Court Proceedings are concluded.  When the forfeiture by notice procedure was introduced by the 2009 Act, a similar provision was made in section 297D(5).  But neither in 2002 nor in 2009, did Parliament make any amendment to section 295 to ensure that when an application is made for an Order under section 295(2), extending the period for which cash may be detained, the same kind of holding provision should apply.  Parliament must, in my view therefore, be taken to have been content with the strict approach which this Court has taken in the case of Henry & Walsh to statutory powers which, though not identically worded, are not materially different’.
  • The result effectively means that HMRC, or other prosecution authorities, must not only lodge their applications for continued detention and seizure of cash within the six months time period, but such applications must also be heard within that time period.  If not so heard, the Courts have no power to extend the detention any further.
  • The District Judge held previous cases were binding upon her decision including the case of R v Uxbridge Magistrates Courts ex parte Henry.  This case related to the initial seizure of cash for 48 hours.  s25(2) provides:
    • Cash seized by virtue of this section shall not be detained for more than 48 hours unless its continued detention is authorised by an Order made by a Justice of the Peace.
    • In this case an application was made for a further extension after the 48 hours period had expired.  It was cited:
    • Parliament in my judgement, has prescribed a specifically limited period, a period to be measures in hours.  This is, as the learned editors of Archibald have pointed out, draconian legislation.  In these circumstances it is particularly important that its provision should be strictly complied with.  48 hours is the period given to Customs & Excise to make their further enquiries, and if they require more time then they have to go to Magistrates to seek an appropriate Order.  It does not seem to me that that places any undue burden upon them’.
  • The same point was discussed in the case of Walsh & Etherington v HMRC where the judgment  stated as follows:
    • I have no doubt that the wording of subsection (2) is such as to preclude any Justices from making any Order authorising the continued detention of any cash under that section after the end of the 48 hours from seizure.  The statutory provision is one which, in my judgement, has to be construed strictly… for the moment that 48 hours has elapsed, if there has been no extension, then there is no authority for the continued detention of the money’.
  • The ruling the Commissioners for HMRC v Mann concluded as follows:
    • ‘I have a great deal of sympathy with HMRC on the facts of the present case.  Their application was lodged with the Court, as I have pointed out, just as the first national lockdown was beginning.  They had no reason to believe that a Hearing would be so difficult to arrange.  If an extension were a matter of discretion, it might well have been exercised in their favour but, like District Judge Green, I conclude that this is not a matter for discretion at all.  I would therefore dismiss the appeal’

How Can We Help? | Kangs National Criminal Defence Solicitors

We appreciate the significant stress and strain that any financial seizure investigation can have on a client and their business and family.  We aim to work proactively with our clients and engage in early dialogue and negotiations with the law enforcement agencies in an effort to achieve a favourable resolution to all matters.

Hamraj Kang leads an award-winning team nationally reputed for its excellence in fraud and assets recovery related work.

We welcome new enquiries by telephone or email.  We provide an initial no obligation consultation from our offices in London, Birmingham and Manchester.

Alternatively, we provide an initial consultation by telephone or video conferencing. 

Contact:

Hamraj Kang
hkang@kangssolicitors.co.uk
07976 258171 | 020 7936 6396 | 0121 449 9888

Suki Randhawa
srandhawa@kangssolicitors.co.uk
0121 449 9888 | 020 7936 6396

Tim Thompson
tthompson@kangssolicitors.co.uk
020 7936 6396 0161 817 5020