The calculation of a defendant’s benefit figure will vary significantly depending on whether or not they are found to have a “criminal lifestyle” under POCA 2002.
When the Crown pursue a confiscation order, a defendant’s benefit will be calculated by reference to the value of property or pecuniary advantage they have obtained from the offence they have been convicted of.
Where the defendant has been convicted of an offence listed under Schedule 2 of the Proceeds of Crime Act 2002, or (broadly) has benefitted from £5,000 or above, over the course of 6 months or more.
What does “criminal lifestyle” mean?
In terms of POCA, once a defendant satisfies the test in the legislation they are said to have a “criminal lifestyle”. This allows the Crown to significantly increase the benefit figure.
In broad terms once the test is met the Crown will examine a defendant’s financial history over a six year period prior to the date of charge. Any property obtained, property held, or expenditure evident within that period can be totted up and added to the benefit figure.
In order to reduce that benefit figure the defendant then has to evidence the source of the funds. The burden of proof rests on the defendant to do so – the Crown don’t have to prove any criminal offence took place.
Example
A defendant faces confiscation following conviction for possession with intent to supply class A drugs (a Schedule 2 offence). The Crown allege benefit based on the value of the drugs recovered, but can also apply the “criminal lifestyle” provision and when the financial investigator obtains bank statements for the previous six years, they find regular cash deposits amounting to £15,000 over the period.
The defendant will have this £15,000 added to his benefit figure unless he can prove to the civil standard (on the balance of probabilities) that the source of these funds are legitimate and not the proceeds of criminal conduct.
Criminal lifestyle allegations often require extensive preparation, enquiries with financial institutions, third parties, and obtaining evidence from witnesses. Consideration should also be given to whether “double counting” has taken place in the figures alleged by the Crown.
Olliers always ensure that every possible avenue is explored in defence of criminal lifestyle allegations. This involves obtaining documentation from banks, accountants, and third parties, expert analysis of and presentation of this material to support submissions to reduce the benefit alleged.
Case Study
Ms. M faced confiscation proceedings arising from her conviction for money laundering. The Crown sought a benefit figure based on her conviction and the application of lifestyle provisions totalling almost £1million. In her defence Olliers argued a significant part of this calculation was based on “double counting” of money laundered; effectively the benefit from her conviction had been counted three times over to artificially inflate the figure.
In combination with other defence submissions the final benefit figure was reduced to £97,440. This was said to be lower than the defendant’s available amount, meaning that she would retain assets after paying her confiscation order in full.
Need help? Olliers are specialist Asset Recovery & Confiscation Lawyers (London & Manchester)
Contact Richard Holliday or Matthew Corn on 0161 834 1515.