We were instructed to prepare an expert accounting report on behalf of a Defendant (previously convicted for being involved in the supply of cannabis) in relation to a confiscation of assets hearing under Section 6(4) of the Proceeds of Crime Act 2002. The Prosecution had calculated the amount of benefit at £3.2 million. They had estimated that the Defendant’s total available amount of realisable assets were £2.1 million, consisting of properties and cash.
We undertook our usual task of attempting to reduce the figure of alleged benefits. This included identifying several instances of double counting, arithmetic errors, legitimate income of the Defendant and items outside of the 6 year period, which had all been included by the Prosecution. In particular we were able to demonstrate that the majority of the benefits included by the Prosecution related to the Defendant’s business which we proved consisted of legitimate receipts. We were even able to show that the cash found on him on the date of his arrest related to the cash takings from the retail shop which had been legitimately earned.
In our report we concluded that the only benefit was the value of the drugs seized for which he was convicted, amounting to £100,000. We also reduced the value of realisable assets down to £860,000, having identified assets that were either not owned at all or were in fact in joint ownership and not therefore available to the Defendant.
An interesting feature of this case was the response to our report by the Prosecution. They agreed with much of our report but still maintained that benefits should in fact be reduced to £1.8 million (previously £3.2 million) and they adopted our figure for net realisable assets. However in a supplemental report we were able to show that £1.7 million of the revised benefit figure had been based on a misinterpretation of the Defendant’s financial accounts and issues relating to VAT.
It was apparent that the Prosecution had not properly considered our supplemental report before the matter came to trial. Once they finally read it properly, just before trial was about to commence, they requested an adjournment which was agreed by the Judge. During the adjournment a negotiated settlement was agreed based solely on the value of the drugs seized.
The result was very much appreciated by the Defendant and his legal team. It goes to show that the Prosecution’s figures are very often significantly overstated and a skilled and persistent forensic accountant can achieve much to show the shortcomings of the figures presented.