The range of powers available to investigators under the Proceeds of Crime Act 2002 (POCA) is extensive. While there is some overlap with powers available for other investigations, the fact that a case involves one of the issues with which POCA is concerned makes a significant difference to what investigators can do.
What are my options?
For those on the receiving end of such an order, or an application for or a notice under one, the extent of the apparent duty of compliance can come as an unpleasant surprise. While of course any validly made order or notice should be complied with, in many cases there are options for objecting to an order, applying to vary or discharge it, or for negotiating how to comply.
The principal forms of order under POCA are the production order and the disclosure order. Broadly speaking, the former are appropriate for obtaining documents or other material, and the latter for information. In both cases the application must state that a person specified in it is subject to a confiscation, exploitation, or money laundering investigation, or that property specified in it is subject to a civil recovery, detained cash, or frozen funds investigation.
Why have I been targeted?
The precise grounds for the order will then vary according to the type of case. Importantly, in the case of a production order, a person specified (who may or may not be the person under investigation) must be shown to be in possession of the material sought, but in the case of a disclosure order, the question of what information is sought, from whom, and how (for instance by answering questions in interview, or by disclosing documents) is then left to the officer him- or herself, when he or she issues a disclosure notice.
Should I just give them everything?
An important issue for many is that neither a production order nor a disclosure notice can require someone to provide ‘to give information or material that is subject to legal professional privilege (LPP). Nor can they require the production of ‘excluded material’, as defined in the Police and Criminal Evidence Act 1984 (PACE) – which, broadly speaking, comprises medical and other personal data held subject to a duty of confidentiality.
Do I need advice?
What then should an individual or a business do when they are put on notice of an application for an order, or are served with a production order or a disclosure notice? Whether the order has yet been made or not, it will always be worth considering whether the grounds are properly made out, including for instance whether the order or notice is too broad, or requires material or information of the wrong type, and/or against the wrong people. In all cases, the recipient’s duties to others (including but not limited to their customers and clients) should also be considered, with excluded or LPP material protected from disclosure.
Importantly, it should not be taken for granted that the authorities who have applied for an order, or the court that has granted it, have acted properly and competently. The powers available in POCA are broad, but there are also important safeguards, with which some judges and investigators are more familiar than others.
What are my risks?
In addition to that, there will often be potential for an investigation to take unwelcome twists, such that someone treated initially as a witness or a source of information might ultimately become a suspect. While the likelihood of such twists may be considered as small, the consequences if they do transpire are serious enough to take the risk seriously.
With those potential complexities in mind, all but the most specialised legal experts are likely to benefit in these circumstances from some bespoke advice. In some cases, it may uncover a vital detail that could change the recipient’s approach entirely.
In others, it may serve to avoid what may be misdirected work and worry in puzzling out the proper response to the exercise of these little-known but significant powers.
If you’d like to discuss any of the issues raised in this article with one of our solicitors then please get in touch in the strictest confidence.
John Binns is a partner at BCL specialising in all aspects of business crime, with a particular interest in confiscation, civil recovery and money laundering under the Proceeds of Crime Act 2002 (“POCA”). His business crime experience includes representing suspects, defendants and witnesses in cases invoking allegations of bribery and corruption, fraud (including carbon credits, carousel/MTIC, land-banking, Ponzi and pyramid scheme frauds), insider trading, market abuse, price-fixing, sanctions-busting, and tax evasion. He has coordinated and undertaken corporate investigations and defended in cases brought by BEIS, the FCA, HMRC, NCA, OFT, SFO and others.