Confiscation Proceedings
A confiscation order is made after a person has been convicted of an offence which has resulted in a financial gain. The purpose of a confiscation order is to prevent a Defendant from benefiting from the proceeds of their crime. The court determines the amount of benefit received from the relevant criminal conduct and the defendant's available assets, then makes an order accordingly.
Confiscation proceedings begin with the prosecutor serving a Statement of Information which contains matters relevant to prosecution including whether the accused has a criminal lifestyle and the amount of his benefit from either his particular criminal conduct or general criminal conduct. It will also contain information about the accused’s available assets to assist in ascertaining the exact amount of the confiscation order to be made. It should be noted, however, under the Proceeds of Crime Act 2002 it is the accused’s responsibility to satisfy the court of the available amount of assets.
Confiscation law is complex and Prosecutor’s often draft their allegations in a way which is will seem very unfair to a defendant. Confiscation proceedings therefore require a clearly devised defence strategy and careful and detailed analysis by a team of dedicated lawyers who are committed to getting you a fair result.
Benefit Figure
"Benefit" is defined as the proceeds of the offence. When assessing the benefit figure, the Prosecution will look at the particular criminal conduct, which is the amount of turnover generated by the offence. They will also add to this figure, where they can, an allegation that the defendant has lead a general criminal lifestyle and therefore has received a benefit from general criminal conduct.
If the prosecution alleges that a defendant has lead a general criminal lifestyle, they will invite the Court to make a number of assumptions about the defendant's financial circumstances. For example, that any unexplained cash deposits in a bank account has come from general criminal conduct.
In some situations, the Prosecution will allege that the defendant has what is referred to as "hidden assets". This allegation is particularly complex and involves the defence having to prove that they have not got assets which are unaccounted for. If a Court determines that a defendant has hidden assets, the consequences can be devastating for a defendant. The defendant must show that these hidden assets (the nature of which the prosecution is unlikely to be able to specify because they are hidden) do not exist. The outcome of this is often that the defendant's 'available amount' cannot be calculated leaving the Court in the position of having to make a confiscation order against the defendant in the full amount of his alleged 'benefit'.
The defence lawyers have to serve a Defence Response, setting out the facts that are not accepted. The burden is therefore on the defence to show the legitimacy of the defendant's assets.
Realisable Asset Figure
Once the Court has decided what the benefit figure should be, the Court will then consider what the defendant can actually afford to pay, which is referred to as the ‘available amount’ or the ‘realisable asset figure’.
The prosecution, in their statement, will have set out what they believe the Defendant can afford to pay. However this figure is usually very inaccurate, particularly where they allege that the defendant has access to hidden assets.
The defence, therefore, needs to obtain valuations of any assets that exist and will make representations regarding third party interests in the property, such as the spouse’s financial interest in the family home.
Often when preparing the Defence Response, the defence lawyers will need to prepare detailed financial analysis of the client’s financial circumstances and explain the legitimacy of deposits into an account or the legitimacy of a business. This will sometimes require input from expert forensic accountants, depending on the circumstances of the case.
The Court will then make a decision about what the Defendant can actually afford to pay and will then make a confiscation order for either the Benefit figure, or the Available Amount, whichever is the lower of the two.
Practically it is sometimes possible to negotiate with the Prosecution the Benefit figure and the Available Amount figure, which removes the uncertainty of what the Judge will otherwise order. However this is not always possible.
Time served in default
When a Confiscation Order is made, the Judge will order the Defendant to pay the confiscation order. Usually the Defendant will require time to sell assets to be able to pay the confiscation order, in which case the Judge will usually allow a period of 6 months for this. It is sometimes possible to obtain a further extension of time beyond this period.
When making the confiscation order, the Judge will also order that if the Defendant does not pay the order by the deadline set, they will serve time in prison in default of the payment. The time to be served is in addition to time served for the offence itself and is proportional to the value of the Confiscation Order. The maximum time that the Judge can order to be served in default of paying the confiscation order is 10 years.
Certificate of Inadequacy
If when a Defendant’s assets are sold, they are less than was anticipated by the Court, leaving insufficient funds to satisfy the Confiscation Order, the defence lawyers can apply to the Court to vary the Confiscation Order - a process which used to be referred to as a Certificate of Inadequacy. If this application is successful, it will reduce the value of the Confiscation Order to match the value of the Defendant’s realised assets.
Certificate of Increase
If when a Defendant’s assets are realised, they are more than was anticipated by the Court, resulting in excess funds, the Prosecution may apply to the Court to increase the Confiscation Order- a process which used to be referred to as a Certificate of Increase.
Contact us
Richard Nelson LLP has a number of experienced Solicitors nationwide who have a strong reputation and a proven track record for their skills and expertise in defending Confiscation Orders.
For more information, or to take through with us the consequences of Confiscation Proceedings, please contact us on 0115 986 3636.