Proceeds of Crime Act 2022
The Proceeds of Crime Act 2022, or POCA as it is commonly known, was introduced to prevent criminals from profiting from their illegal activities. It came into force on 24th March 2003 and applies to all relevant offences committed from that date onwards.
Our industry-leading crime and fraud team have vast experience in assisting clients with matters involving POCA issues. We regularly work with both defendants and prosecutors to uncover the true extent of criminal gains and prepare comprehensive yet easily accessible reports for our clients to rely on in support of their position.
What Is The Proceeds Of Crime Act 2022?
The Proceeds of Crime Act 2022 encompasses a broad range of offences. Prior to it coming into force, parties involved in money laundering cases had to navigate two separate regimes under the Drug Trafficking Act 1994 and the Criminal Justice Act 1988. Now, the law has been simplified into one statute, which allows law enforcement agencies to seize and confiscate any gains deemed to have been acquired through criminal activities. POCA was introduced in response to growing concern that existing laws were ineffective in denying criminals the benefit of their ill-gotten gains.
The Act applies to a wide range of criminal activities, including drug trafficking, money laundering, and fraud. It also covers crimes that are not traditionally associated with financial gain, such as terrorism and human trafficking.
How Does The Proceeds Of Crime Act 2002 Work?
The Proceeds of Crime Act 2002 lays down the legislative framework for the recovery by law enforcement agencies of criminal gains. The Act provides for several methods of collecting such sums, of which ‘confiscation’ is the most widely used. A Confiscation Order can be made only after a defendant has been convicted of a criminal offence and compels the defendant to pay a sum of money equivalent to that deemed to be the benefit they gleaned from their criminal activities.
Some forms of recovery under POCA do not rely on an individual having been convicted of an offence. For example, Part 5 of POCA allows law enforcement officials to instigate civil proceedings to recover any property or other assets they believe to have originated from criminal conduct. To succeed in such proceedings, the prosecuting body needs only satisfy the civil burden of proof, namely that the relevant assets were gained through criminal activity on the ‘balance of probabilities’, as opposed to the higher criminal burden of ‘beyond all reasonable doubt’. Crucially, the proceedings can be pursued even against individuals found not guilty of committing a criminal offence.
Where Does Money Forfeited Under The Proceeds Of Crime Act 2022 Go?
The money forfeited under POCA is used in various ways. Some may be allocated to the victim as compensation. Some sums go to the Home Office, and some are invested into the community to fund community projects and aid in the purchase of vital resources.
Has the Proceeds of Crime Act 2022 been successful in tackling criminal activity in the UK?
The Proceeds of Crime Act has been described as ‘ground-breaking’, and there can be no doubt that, since its implementation, the Act has significantly assisted authorities in their efforts to stem the activities of organised crime groups, recover ill-gotten gains, and deter financial crimes. Government figures show that, in the financial year 2022 to 2023, £339.1 million worth of assets were recovered under POCA.
Having said that, the Proceeds of Proceeds of Crime Act is not without its critics who complain that the system is ineffective in recovering the proceeds of crime. They point, amongst other factors, to the perceived high level of unpaid Confiscation Orders and the slow progress of confiscation proceedings. In response, plans are afoot to reform the system and bolster its efficiency by improving the enforcement of orders made under POCA, and speeding up confiscation proceedings.
What Are The Drawbacks Of The Proceeds Of Crime Act 2022?
POCA’s primary aim was to curtail the activities of career criminals and deny them the often-significant benefit of their criminal conduct. However, the Act has led to several, arguably unforeseen consequences.
For example, some Local Authorities have taken to using the Act to claim substantial sums from landlords found to be in breach of planning legislation. Our crime and fraud team recently worked on one such case, in which they successfully reduced the sums payable by our client from £8.9 million to £180,000. They did so by carefully scrutinising the sums claimed by the Local Authority as constituting criminal benefit, and showing that they had, in fact, originated from legitimate sources.
How Can We Assist In Cases Involving The Proceeds Of Crime Act 2022?
Since the focus on cases brought under the Proceeds of Crime Act 2002 is to recover the sums obtained through criminal conduct, an essential aspect of such proceedings is establishing the true extent of any criminality. Accordingly, the involvement of a forensic accountant with expertise in POCA matters is crucial. As the case mentioned above highlights, the figures forwarded by the prosecuting authority can sometimes be inflated or simply inaccurate. Taking them at face value is, at the very least unwise; at worst, it can be disastrous for a defendant.
Our expert crime and fraud team use their forensic accounting expertise and experience alongside cutting-edge techniques and technology to scrupulously analyse the prosecuting authority’s figures and compare them against the defendant’s own financial records and any other relevant documentation. Their resultant report often proves to be a key document in the case, allowing the defendant’s legal team to confidently argue their client’s case at trial, during settlement discussions or when using alternative dispute resolution methods.
“Your report was a herculean task and put us in an incredibly strong position. Thank you ever so much for the work and advice you have provided . The report was clear and accessible and will not hesitate to recommend you all.”
“I am indebted to you for your contribution, and for explaining things in plain English such that even lawyers can understand the issues”
“It was a pleasure working with you on what was a rather difficult case”