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Unexplained Wealth Orders

Unexplained Wealth Orders. Olga Tocewicz Senior Associate, Corporate Crime. Background. New powers under Part 8 of the Proceeds of Crime Act 2002 (‘POCA’) Came into force on 31 January 2018 Can be sought by an “enforcement authority”, in England and Wales: the National Crime Agency,

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Unexplained Wealth Orders

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  1. Unexplained Wealth Orders Olga Tocewicz Senior Associate, Corporate Crime

  2. Background • New powers under Part 8 of the Proceeds of Crime Act 2002 (‘POCA’) • Came into force on 31 January 2018 • Can be sought by an “enforcement authority”, in England and Wales: • the National Crime Agency, • Her Majesty’s Revenue and Customs, • The Financial Conduct Authority, • the Serious Fraud Office, or • the Crown Prosecution Service

  3. Conditions • The High Court may grant a UWO if: • The respondent “holds” the property and • the property is worth over £50,000 • The High Court must be satisfied that there are reasonable grounds for suspecting that the legitimate income of the respondent is insufficient to enable them to acquire the property

  4. Conditions • The High Court must be satisfied that: • the respondent is a politically exposed person OR • there are reasonable grounds for suspecting that: • the respondent is, or has been, involved in serious crime, or • a person connected with the respondent is, or has been, so involved.

  5. The Order • The UWO requires the respondent to provide a statement explaining: • nature and extent of the interest • how the respondent obtained the property • details of any trust, and • any other information as specified by the UWO

  6. Politically exposed person (‘PEP’) • an individual who is, or has been, entrusted with prominent public functions by an international organisation or by a State • a member of their family • someone known to be a close associate of such a person • someone otherwise connected with such a person

  7. Far reaching powers • It does not matter: • whether or not there are other persons who also hold the property; or • whether the property was obtained by the respondent before or after the date the new legislation came into force.

  8. What if I don’t comply? • If the respondent fails, without reasonable excuse, to comply the property is to be presumed to be recoverable property using POCA’s civil recovery powers. • It is a criminal offence to knowingly or recklessly make a false declaration in response to a UBO.

  9. The case of “Mrs A” • Wife of a "fat cat banker" • The NCA believes two homes worth £22 million were bought with cash stolen by the woman's husband while he was working for a state bank in their home country • The couple have an estimated wealth of more than £55 million • The court heard that Mrs A led an extravagant lifestyle, spending £16 million in Harrods over 10 years

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