Regulation 

Beware the powers of Unexplained Wealth Orders

  • Describe the importance of Unexplained Wealth Orders
  • Describe how UWOs work
  • Describe the powers that enforcement authorities have with UWOs
CPD
Approx.30min
Beware the powers of Unexplained Wealth Orders

The Criminal Finances Act 2017 was heralded as a new dawn in the British state's ability to crack down on criminality and tax evasion.

Aimed at countering the UK's reputation as a haven for illicit income, the Act gives law enforcement agencies "new capabilities and powers to recover the proceeds of crime and to tackle money laundering, corruption and terrorist funding."

Since receiving royal assent in April 2017, the Act's various provisions have, one by one, come into effect. January saw the first anniversary of its most high profile provision: the Unexplained Wealth Order.

Twelve months since UWOs were first made available to law enforcement, what initial assessment can be made of the Criminal Finance Act's efficacy?

Unexplained Wealth Orders

If the general public have heard about the Criminal Finances Act 2017 at all, it is likely to be in relation to Unexplained Wealth Orders.

Dubbed by the press as "McMafia orders" after the hit BBC drama about international crime, UWOs are an investigative tool obtained in respect of property, which, if granted by a court, can be used alongside other civil recovery powers to strip individuals of the proceeds of their alleged crimes.

They can be obtained by an enforcement authority such as the NCA, HMRC or SFO where there are reasonable grounds to suspect that someone has lawfully obtained income is insufficient to have acquired any property valued over £50,000.

In order for a UWO to be granted, the recipient needs to be one of two genres of person: either a so-called Politically Exposed Person, or someone involved in or connected to a person involved in serious crime.

Importantly, where a person is a PEP there is no need for there to be evidence of any criminality at all.

The exact terms of each UWO will vary, but they will all require the recipient to explain how they were able to obtain the property in question.

UWOs are potentially very powerful for law enforcement agencies.

They force the recipient to explain their innocence, rather than the applicant to prove guilt; they involve a burden of proof much lower than in any civil or criminal trial; and they can be enforced without the recipient being found guilty, or even accused, of any crime.

Privacy

According to the Government’s Anti-Corruption Strategy Year 1 Update, published in December 2018, just three Unexplained Wealth Orders have been granted since the legislation came into effect.

Of these, the identity of just one recipient is in the public domain: Zamira Hajiyeva, the wife of the former chairman of the International Bank of Azerbaijan, Jahangir Hajiyev.

Mrs Hajiyeva received two UWOs, one in respect of a house on Walton Street in West London, the other in respect of a land on which Mill Ride Gold Club, near Ascot, is located. The total purchase price of the two properties is said to have been £22m.

CPD
Approx.30min

Please answer the six multiple choice questions below in order to bank your CPD. Multiple attempts are available until all questions are correctly answered.

  1. What powers do Unexplained Wealth Orders give the investigative authorities

  2. UWOs involve a burden of proof which is lower than in any civil or criminal trial. True or false?

  3. What is a Politically Exposed Person?

  4. Why was the UWO against Mrs Hajiyeva made public?

  5. In order for a court to grant the initial freezing order the officer need only to convince it that they have "reasonable grounds to suspect" the money was either obtained through unlawful conduct or is intended for use in unlawful conduct. True or false?

  6. A freezing order can leave a subject destitute. True or false?

Nearly There…

You have successfully answered all the questions correctly, well done!

You should now know…

  • Describe the importance of Unexplained Wealth Orders
  • Describe how UWOs work
  • Describe the powers that enforcement authorities have with UWOs

I completed this CPD in

To bank your CPD please complete the form below.

Were the stated learning objectives met?

Why weren't they met?

What did you learn from undertaking this CPD exercise?

Why did you undertake this piece of learning?

Banked!

Congratulations, you have successfully completed and banked this piece of CPD

Already Banked!

You have already banked for this article.

To bank your CPD you must or

Register

One or more questions have been incorrectly answered,
 please review your answers and try again.

Please complete all the above text fields to bank your CPD.

More Regulation CPDSee my completed CPDSee all CPD