R v S concerned an appeal against a decision to vary a confiscation order upwards where the Crown Court had reduced the increase requested by the Crown by 40% to reflect assistance given by the appellant to law enforcement when he was a covert human intelligence source.
David McNeill from 5SAH represented the Crown in the appeal. James Fletcher from 5SAH discusses the case and why it is a useful reminder that the Court has a wide discretion on prosecution applications to increase confiscation orders.
Legislative Background
Under s.22 Proceeds of Crime Act 2002 (“POCA”) a prosecutor can apply to the Crown Court to increase a confiscation order. Such applications occur some time after an initial confiscation order when law enforcement discovers that a Defendant has other or new assets available to him to pay the outstanding benefit.
Section 22(4) indicates that Court has a discretion to increase the confiscation order and if it exercises that discretion can increase the order to an amount “that is just”.
In Peacock [2012] UKSC 5, the Supreme Court confirmed that an increase in available amount could be based on assets acquired after the original confiscation order. In Padda [2013] EWCA Crim 2330, the Court of Appeal held that in deciding whether to increase a confiscation order the Crown Court could take into account all relevant factors while noting that the legislative policy was in favour of maximising recovery of proceeds of crime, even from legitimately acquired assets.
Facts of this case
The original confiscation order was made on 11 January 2007 with benefit of £189,000. After a variation in November 2007, the available amount was £8,550. This was paid, leaving an unsatisfied benefit figure of £180,000.
Following release from his sentence the appellant began a business and acquired a property in June 2014.
The Police became aware of the acquisition of the property and the CPS made a s.22 application in June 2016.
At the Crown Court the judge considered (i) the outstanding sum, (ii) length of time since the original order, (iii) the additional amount now available and (iv) the need to balance the legislative policy identified in Peacock and Padda against the adverse impact on the offender.
As to (i) – (iii) the judge considered that nothing had been paid by the appellant in the intervening period, that there was no unreasonable delay in making the application and that the appellant had sufficient means to pay the increase. In relation to (iv) the judge considered the appellant’s business dealings since leaving prison “sailed very close to the wind” but he also considered assistance that the Appellant had provided to Police as a Covert Human Intelligence Source (“CHIS”) between 2007 and 2014 for which he had been paid £27,000 in 2011 and which had been used to establish the business.
The judge considered an increase that was “just” in the circumstances, taking into account the assistance provided to the Police, should be reflected in a reduction to the increase of 40%.
The Appeal
On Appeal the appellant argued that the reduction should have been in the region on 75-80%.
The appeal was refused, the Court of Appeal held that the Crown Court was entitled to reach the decision it had.
The Court of Appeal made 6 observations about cases where assistance has been offered:
- Under s.22 the Court has a broad discretion.
- Where the facts justify it, assistance to the authorities can be a factor to be considered, although a reduction will have the effect of allowing the offender to benefit to that extent.
- Assistance to prosecuting authorities can already be taken into account as part of sentence.
- The extent to which assistance is reflected in a reduction is fact sensitive and there are no certain rules.
- The quality and quantity of the assistance must be considered.
- The Court will consider the terms upon which the assistance is given, for example whether by payment and by how much.
The Court of Appeal indicated it would not interfere with a decision of the Crown Court unless there was an error of law akin to public law unreasonableness.
The case illustrates is an interesting, if unlikely to be repeated, scenario, where the value of assistance given to police by the offender, allowed him to retain 60% of his after-acquired property. Although there was no apparent mathematical basis for the 40% reduction, the Court of Appeal made it clear that it would not interfere in such decisions unless they were so unreasonable that they amounted to an error in law.
The practical effect of the decision is that the offender has been able to retain property that would otherwise have had to be used to pay back an unsatisfied benefit.
However, even in cases where assistance has been given, the Court of Appeal’s 6 points of guidance suggests that the quality, nature and value of that assistance will need to be carefully considered before any reduction can properly be ascribed to it.
The case is more generally a useful reminder that on s.22 application the legislative policy, while important, is not a trump card and that the Court retains a wide discretion to consider all the circumstances.
James Fletcher practises in both civil and criminal law. He is a specialist in Asset Recovery and Proceeds of Crime work. He is instructed on behalf of businesses, by individual members of the public and by Government departments. He has been featured in Chambers and Partners in the field of Proceeds of Crime and Asset Forfeiture work (all circuits) since 2014 and has been “Top Ranked” since 2016. James is ranked as a tier 2 leading individual in the Legal 500 for POCA and asset forfeiture (London Bar). He is also ranked in Who's Who at the UK Bar (2017 & 2018 Edition) in the field of criminal fraud work.
David McNeill is a barrister with a strong practice in fraud and serious and organised crime cases. David is ranked in Chambers and Partners as a Band 4 leader in the field of financial crime. David has built up a wide experience prosecuting and defending difficult, complex, multi-handed cases, both alone and as junior counsel. He has particular knowledge of tax, VAT and Excise, drugs, money-laundering and organised crime cases and has been instructed on a number of cases with a significant international dimension.
