We are often asked by clients whether or not law enforcement agencies are entitled to seize valuable assets such as cash, property, bank accounts and jewellery even though no criminal conviction has been obtained.
The simple answer is ‘Yes’. Investigating agencies such as the Police, HMRC, NCA, FCA and the SFO are entitled to seize such items at the outset of an investigation despite the absence of a criminal conviction.
However, Court Orders seeking asset seizures are regulated by statute and can be challenged by anyone served with such an Order.
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Kangs Solicitors has been representing individuals and businesses in relation to Seizure and Freezing Orders since their inception and we have considerable experience in dealing with all law enforcement agencies including the Police, HMRC, NCA, FCA and the SFO.
We have a long history of being highly commended by the leading law directories, the Legal 500 and Chambers & Partners for our work on behalf of clients facing financial investigations of every nature.
Our team’s strength is recognised by Chambers & Partners which says:
‘It has a very strong team of lawyers who can rise to the challenge of the most complex fraud case’.
Our team is led by Hamraj Kang an award-winning solicitor ranked as a ‘star individual’ for five consecutive years by Chambers & Partners for his work in financial investigations.
For an initial no obligation discussion, please call our Team at any of our offices detailed below:
Hamraj Kang discusses different avenues available to law enforcement agencies seeking to seize items of value considered to be ‘recoverable property’.
Civil Proceedings Not Criminal Proceedings | Kangs Freezing Order Solicitors
Cash Seizures, Property Freezing Orders, Account Freezing Orders and Restraint Orders are all governed by the Proceeds of Crime Act 2002 (‘POCA 2002’). Account Freezing Orders were introduced in 2018 by way of an amendment to POCA 2002.
It is important to note that the obtaining of a Cash Seizure Order, Property Freezing Order or an Account Freezing Order by an enforcement agency signals the commencement of civil proceedings, which, as they are not criminal proceedings, are not intended to prove an individual’s guilt with the potential of a resultant prison sentence.
The purpose of the civil proceedings is to seize any ‘recoverable property’ or any property that is ‘intended by any person for use in unlawful conduct’.
In simple terms, if it can be shown to the civil standard of proof that the asset/money derives from the proceeds of crime or is intended to be used for the purposes of unlawful conduct, the court will strip that asset/money away from the individual.
The Powers Of Seizure | HMRC Investigations Defence Solicitors
The powers of seizure of law enforcement agencies such as HMRC, SFO and NCA vary depending on the nature of the asset in question.
In general terms, cash, property and bank accounts can be seized for a period of up to two years after which they should be returned to the owner or the law enforcement agency must commence forfeiture proceedings.
Seizure of Watches & Jewellery | Listed Assets POCA 2002
Watches and jewellery can be seized and POCA 2002 was amended by the Criminal Finance Act 2017 to allow for this.
In order to seize such items, the law enforcement agency must ensure that:
- the item is specifically listed (see below),
- there is reasonable suspicion to conclude that the item represents ‘recoverable property’, and
- the value is £1,000 or more.
This minimum value of £1,000 represents the cumulative value of all such items in the event that more than one item is seized.
Section 303B of POCA 2002 specifically lists the assets which are covered (‘the Listed Assets’) and the Listed Assets are further defined in Section 303B(4)(a)-(c) as follows:
- precious metals – gold, silver or platinum (whether in an unmanufactured or a manufactured state),
- precious stones,
- artistic works – work falling within section 4(1)(a) of the Copyright, Designs and Patents Act 1988,
- face-value vouchers – a voucher in physical form that represents a right to receive goods or services to the value of an amount stated on it,
- postage stamps.
Although the initial time limits for seizure (6 hours and 42 hours) are much shorter than for Cash Seizures, the Magistrates’ Court has the same powers as it would for Cash Seizures and may grant a six months extension which can be further extended every six months for a maximum of two years.
The application process is the same as with Cash Seizure applications.
As with Cash Seizure applications, the Respondent may challenge the continued seizure of the Listed Assets and which can include technical arguments challenging the validity of service of the appropriate notices.
Either at or before the expiry of the two years period, the law enforcement agency must either return the Listed Assets to the owner or initiate forfeiture proceedings.
Forfeiture proceedings for Listed Assets follow the same procedure as those for Cash Seizure and will be decided on the same basis. However, third parties are entitled to claim a ‘legitimate share’ of a Listed Asset if it is accepted that the acquisition was only partly funded by ‘recoverable funds’.
Why Is The Civil POCA 2002 Regime Attractive To Law Enforcement Agencies?
Pursuing civil seizure and forfeiture applications is attractive to HMRC, NCA, SFO and the Police as they are more cost effective and quicker than the pursuit of criminal investigations.
Additionally, civil proceedings only need to be proved to the civil standard of proof (i.e. ‘on the balance of probabilities’) as opposed to the criminal standard of proof (i.e. ‘beyond reasonable doubt’).
The fact that a criminal conviction is not a pre-requisite to commencing civil proceedings is a huge incentive to the investigating agencies given that criminal investigations involving financial crime can take many years to formulate and bring to trial.
The civil POCA 2002 regime potentially offers a much quicker method of seizing and confiscating ‘recoverable property’ than the slower and more costly post-conviction confiscation regime.
What Steps Can A Respondent Take? | Solicitors Defending Freezing Orders
Whilst there appears to be significant advantages to HMRC, SFO and NCA pursuing Respondents via the civil POCA 2002 route, it is by no means the position that all applications which they pursue will be successful.
We regularly act for clients where we successfully oppose Freezing Orders, Cash Seizure Orders and Restraint Orders resulting in the return to them of all the funds/assets which the authorities were seeking to seize.
Such results can be achieved by engaging expert legal advice at the outset as there are numerous tactical considerations that require careful attention which we find can prove to be crucial for the ultimate success of a client’s case.
We have substantial experience in this complex and fast changing area of law and supporting clients through the process of ensuring that their money and assets are protected in such proceedings.
How to Contact Us | Kangs Solicitors
We appreciate the significant stress and strain that a 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 agency in an effort to secure a favourable resolution to the matter.
Hamraj Kang leads an award-winning team of solicitors nationally reputed for its excellence in fraud and asset recovery 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: