The Fundamentals of Proceeds of Crime, Confiscation Orders and Restraint Orders: When, why and what to do?

Proceeds of crime is a term given to money or assets which are said to have been gained during the course of criminal activity. Authorities, including the Crown Prosecution Service (CPS), Driver and Vehicle Standards Agency (DVSA), Financial Conduct Authority (FCA) and Serious Fraud Office (SFO), have the power to confiscate these assets under the Proceeds of Crime Act 2002.

Restraint Orders

When:   During the initial stages of an investigation, a Restraint Order can be obtained from the Crown Court which restrains a suspect’s assets. It can follow quickly once a suspect has been notified of an investigation, particularly in cases involving financial crime and fraudulent behaviour.

Why:      The purpose of a Restraint Order is to protect the maximum possible assets so that they remain available should a Confiscation Order be made following the outcome of the substantive proceedings, particularly as some investigations can take several years.

What to do:        It is important for an individual to seek specialist legal advice as soon as they are notified of an investigation but if they haven’t done so beforehand, most certainly where a Restraint Order has been applied for by the prosecuting body. It is possible for an application to be made to the Court requesting that the Restraint Order be discharged or varied. There will be circumstances however where this would not be appropriate and instead, a request for an increase in the allocated living expenses allowance can be negotiated.

A fundamental cornerstone of the Criminal Justice System is that an individual is innocent until proven guilty; nonetheless a Restraint Order can see an otherwise innocent person denied access to their assets, having not only a significant impact on them, but also family and friends.

Confiscation Orders

A Confiscation Order can be made when the Defendant has been:

  • Convicted of an offence in the Crown Court
  • Committed for sentence to the Crown Court
  • Committed for confiscation to be considered to the Crown Court

It can be ordered when a Defendant is sentenced or the Court can also choose to postpone the confiscation proceedings for a period of up to 2 years from the date of conviction whereby a timetable will be set for the exchange of information between the prosecution and defence.

The Court must consider:

  • Whether the Defendant has a ‘criminal lifestyle’?
  • Has the Defendant benefitted from their criminal conduct?
  • What is the amount that can be recovered from the Defendant, i.e. the available amount?

The Defendant will be ordered to pay the benefit from their criminal conduct unless they can show that part or all of it is no longer available. Once a Confiscation Order has been made, a Defendant must pay the specified sum of money either immediately or within a fixed period of time.

If payment is not made, enforcement of the Confiscation Order can follow and may include a ‘default sentence’, where the Crown Court fixes a period of imprisonment to be served if the Defendant fails to pay.

Are Confiscation Proceedings Criminal or Civil?

The process referred to above is in relation to criminal confiscation proceedings, but there are alternative provisions of civil recovery in the High Court.

Civil proceedings can be used when it is not possible to obtain a criminal conviction, where a criminal conviction is obtained but a Confiscation Order is not made, or where the public interest is better served using civil recovery (such as where suspects have moved abroad or the offences were committed overseas where the matter cannot be prosecuted in the UK Courts).

Woodfines Solicitors has a specialist team of solicitors who regularly deal with financial crime and confiscation proceedings. If you require advice or information, please contact Charlotte Hunt, Mike Hayward or any member of the Crime and Regulatory department on 01908 202150.

Charlotte Hunt