Sections 10A and 18A of the Proceeds of Crime Act 2002 (‘PoCA’) provide the framework for Crown Court Judges to determine property interests at the time a confiscation order is made.
Section 10A provides that a Court may determine the extent of a Defendant’s interest in the property at the time a confiscation order is made. In so doing, the Court will, at the same time, determine the extent of any third-party interests.
Section 18A provides that a Court may at any time order a third party to give specified information by a specified date to assist the Court in making a determination under section 10A.
The use of the word ‘may’ is significant. Crown Court Judges are not obligated to determine third-party interests at the time a confiscation order is made. Instead, Crown Court judges can leave the issue to be determined at the enforcement stage, when the prosecution seeks to enforce the terms of a confiscation order against a Defendant.
There are important tactical considerations which are case and fact specific which will dictate whether third parties should assert their interests at the time a confiscation order is made or at the enforcement stage. These considerations are beyond the scope of the present article.
In practice, if it appears to a Crown Court that there is property available to a Defendant that is likely to be used to satisfy the confiscation order and that a person other than the Defendant has an interest in that property, the Crown Court will often seek to grapple with and determine third party interests and, in order to do so, must give third parties a reasonable opportunity to make representations.
In a recent example involving property in the UK, IKP Solicitors secured return of substantial loaned funds to a third party despite those funds not being registered as a charge against the property and not being regarded as a preferential debt.
Determination of third-party interests often requires analysis and application of intricate property and trust law principles, and consideration of both financial and non-financial contributions. These issues are not the routine diet of a general criminal practitioner. It is imperative that third parties are represented by genuine PoCA subject matter experts.
The PoCA and Financial Crime department at IKP Solicitors, led by James O’Hara and Paul O’Donnell, possess the subject matter expertise to assist third parties to assert their interests, whether during the confiscation enquiry or at the enforcement stage. James and Paul are members of an elite group of Solicitors in the UK who are ranked by Chambers and Partners in the area of ‘PoCA Work & Asset Forfeiture’.