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Confiscation – Concerns about Poor Recovery are a Reminder of the Importance of making sure the Order is Fair and Proportionate in the First Place

For years, the issue of recovery of Confiscation Orders has concentrated the mind of the legal community. Confiscation Orders are made following a defendant’s conviction for certain offences. The Order aims to ensure offenders are deprived of financial benefit gained through their offending. But released figures show that only a fraction of that ordered to be confiscated is actually recovered.

In dealing with this, the Serious Crime Act 2015 amended the Proceeds of Crime Act 2002, reducing the time defendants have to satisfy their Orders. Interest payments and sentences in default were activated more quickly. Also, the incremental bands for calculating default sentences were reduced increasing the maximum punishment for failure to pay an Order from 10 years in custody to 14 years.

But the handwringing about poor recovery through confiscation continued. In July 2016 the Home Affairs Committee published the report of its enquiry into the effectiveness of the procedures for seizure of criminal assets. Amongst its recommendations was that failure to satisfy a confiscation order should be a criminal offence and that prisoners should not be released from custody until the orders were paid in full. The Government responded to this November 2016, rejecting many of the Committees’ suggestions.

So, there is agreement that the enforcement regime is ineffective and that recovering is inconsistent. But there is division as to the reasons for this and how it can be dealt with.

The Law Commission jumped into this void. It is a statutory, independent body whose stated aim is to ensure the law is as fair, modern, simple and cost effective as possible. No surprise then that the dysfunctional, underachieving confiscation regime came within its sights. In November 2018 it announced that it would review confiscation laws to ensure they are working effectively in “depriving convicted offenders of their ill-gotten gains”.

It will first need to identify the problem. Confiscation proceedings are hugely complex and difficult to navigate. They require detailed examination of finances, often over long historic periods. The law is hard to navigate, frequently changing and inconsistently applied. Whilst Orders to pay should reflect amounts “available” to satisfy the direction, the amount considered available may be calculated on the basis of “hidden” assets. Defendants who dispute the existence of these assets complain that the resulting Orders are unrealistic and they cannot pay them. Inconsistency in applications for bank freezing orders may contribute to the dissipation of assets before the Order is made. And for some defendants, the spectre of further custody is insufficient incentive to pay.

So, the Law Commission will look at how this can be tackled. They are at the ‘pre-consultation’ stage with the stated aim of publishing a consultation paper by September 2019. Through this project they aim to:

  • Improve the efficiency of the process by which confiscation orders are made
  • Ensure the fairness of the confiscation regime
  • Optimise the enforcement of confiscation orders to improve recovery rates

Professor Ormerod QC – Commissioner for Criminal Law- has been reported as saying that a key focus will be looking at new methods to encourage offenders to pay. So, where the focus of change previously has been incentivising payment through further prison time, the Commission will consider scrapping default sentences that start immediately on completion of the sentence. Instead, travel bans and curfews will be considered. So, offenders will be released in circumstances that are uncomfortable but will not prevent them working towards repayment. The threat of a return to prison would then hang over them if payment was still not made.

As we await possible reform of the enforcement landscape, those facing confiscation proceedings should ensure they instruct an expert, experienced solicitor to help navigate this complex area. It is vital that within this difficult landscape, all possible steps are taken to ensure any Order imposed is fair and – in accordance with direction of R v Waya – proportionate. A defendant charged with an offence that could lead to confiscation proceedings should choose their representative carefully so that on conviction, the best possible lawyer is in place to assist as the case moves forward.