FCA Application Defeated | Success Opposing an Enforcement Receiver Under POCA

Where a confiscation order has been made and has not been satisfied or subject to an appeal, an application may be made to appoint an Enforcement Receiver. The Enforcement Receiver is tasked with enforcing the confiscation order in respect of the defendant’s realisable property.

KANGS has successfully assisted a client defeat an application by the Financial Conduct Authority (FCA), pursuant to section 50 of the Proceeds of Crime Act 2002 (POCA) to appoint an Enforcement Receiver to seize a property belonging to him.

The FCA alleged that our client had received money from a convicted criminal which derived from the proceeds of crime, by way of a ‘tainted gift.’

Nazaqat Maqsoom of KANGS explains how this highly successful result was achieved.

Background

The FCA’s Case and Confiscation Strategy

Following the successful prosecution by the FCA of a defendant charged with multiple counts of fraud, subsequent Confiscation Proceedings determined that the defendant had benefitted from the criminal conduct by an amount exceeding three million pounds.

The FCA alleged that a proportion of that financial benefit, amounting to a sum in the region of two hundred thousand pounds, had been transferred by the defendant to our client by way of a ‘tainted gift.’ The FCA sought to recover this amount by seizing property belonging to our client, exercising section 50 of POCA.

Our Client Challenges to the ‘Tainted Gift’ Allegations

Our client vehemently disputed these allegations stating that the payments which had been made to him represented repayments of loans previously made to the defendant, and that he was in fact, a victim of the defendant having incurred a loss himself.

As our client was not a party to the Confiscation Proceedings against the defendant, the Prosecutor was required to make a separate Application to the Court seeking the appointment of an Enforcement Receiver. In order to succeed, it had to be shown that, on the balance of probabilities, the funds paid to our client arose from the proceeds of crime and represented a ‘tainted gift’ in the hands of our client.

Our client wished to oppose this Application as no allegations of any criminal wrongdoing had been made against him. The monies paid to him were totally unrelated to the property which was the subject of the recovery proceedings.

Accordingly, our client instructed the highly experienced lawyers at KANGS to assist him and oppose the FCA Application.

The Relevant Law

Appointment

Section 50 of POCA states that, on the application of the Prosecutor, the Crown Court may by Order appoint a Receiver in respect of realisable property in circumstances where:

• a Confiscation Order is made which
• is not satisfied, and
• it is not subject to appeal.

Tainted gifts

Section 77 of POCA states that a gift is tainted if it was made by the defendant at any time and was of property which:

• he obtained a result of or in connection with his general criminal conduct, or

• represented in his hands property obtained by him as a result of or in connection with his general criminal conduct.

How We Assisted Our Client

Following instruction, the team at KANGS immediately commenced preparation of our client’s opposition to the FCA Application and, amongst other steps:

• examined and considered in detail all relevant documentation including the FCA Application and supportive evidence,

• attended upon our client discussing the history of his transactions with the defendant, the reasons for and the nature of the loans which he had made to the defendant, the manner in which repayments had been made and all associated activity,

• advised our client upon his position and the appropriate manner in which to proceed in order to defeat the Application,

• liaised with all parties throughout,

• prepared and served all relevant procedural documents including detailed Witness Statements,

• identified and instructed specialist Counsel with appropriate experience,

• conducted appropriate negotiations with the Prosecution.

The Successful Outcome

Once the FCA had considered all of the detailed representations carefully prepared and presented by the team at KANGS, together with the negotiations that had been conducted, it withdrew the enforcement proceedings in their entirety.

Accordingly, our client was able to keep possession of his property. Our client was understandably absolutely delighted with this highly satisfactory outcome.

How Can We Assist You?

Facing any form of proceedings seeking confiscation of your property is extremely worrying and stressful. It is therefore essential that you obtain experienced legal representation to help you navigate and resolve whatever issues confront you.

Our team of solicitors regularly advise and represent individuals and businesses who are subject to various types of proceedings pursuant to Proceeds of Crime Act 2002 including:

• Account Freezing and Forfeiture Orders
• Cash Seizures and Detention
• Enforcement proceedings
• Restraint Orders
• Confiscation Orders
• Criminal fraud prosecutions

If we may be of assistance, please contact our team using the details below who would be pleased to hear from you.

Tel:       0333 370 4333

Email: info@kangssolicitors.co.uk

We provide initial no obligation discussion at our three offices in London, Birmingham, and Manchester. Alternatively, discussions can be held through video conferencing or telephone.

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