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Hidden Assets

The term ‘Hidden Assets’ is familiar to all who have experience of confiscation proceedings in the Crown Courts in England and Wales. Curiously, however, the term does not appear and is not defined anywhere in the Proceeds of Crime Act 2002.

The starting point is the benefit figure. S.7(1) PoCA 2002 provides that “The recoverable amount for the purposes of section 6 is an amount equal to the defendant’s benefit from the conduct concerned.” S.7(2) PoCA 2002 provides “… if the defendant shows that the available amount is less than that benefit the recoverable amount is (a) the available amount, or (b) a nominal amount, if the available amount is nil.” In summary, the recoverable amount is the same as the criminal benefit figure unless and until a Defendant demonstrates that it is less.

The difficulty is immediately apparent. Financial Investigators, armed with the assumptions in s.10 PoCA 2002, routinely overvalue criminal benefit. Thereafter, the burden of proof shifts to Defendant’s to challenge the calculation of criminal benefit and/or to show, on the balance of probabilities, that they do not have available an amount equal to the asserted criminal benefit figure. This will often involve the instruction of a Forensic Accountant to analyse and opine on volumes of financial data, including for example in relation to dissipation of alleged Hidden Assets.

In a recent case involving conspiracy to conceal, disguise, convert and transfer criminal property, IKP Solicitors were instructed to challenge an allegation of more than £200,000 worth of Hidden Assets. Unsurprisingly, the prosecution had significantly overvalued the criminal benefit at £1.5 million. In the end, the prosecution accepted the criminal benefit was 93% less than alleged and that the total assets, including hidden assets, were 93% less than alleged. After several weeks of careful negotiation, a final order was agreed, upon without the need for a contested hearing.

The difficulties and complexities are dealing properly with allegations of Hidden Assets cannot be overstated. It is imperative that Defendants are represented by genuine PoCA experts.

The PoCA and Financial Crime department at IKP Solicitors, led by James O’Hara and Paul O’Donnell, regularly accept instructions to act on allegations of Hidden Assets on both a private or legal aid basis. Both James and Paul possess the necessary subject matter expertise to assist Defendant’s in challenging allegations of Hidden Assets and compliments his expertise with a bank of trusted expert Counsel and consultants. James and Paul are members of an elite group of Solicitors in the UK ranked by Chambers and Partners in the area of ‘PoCA Work & Asset Forfeiture’.


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