When is Enough, Enough? Section 22 POCA Orders

Section 22 of the Proceeds of Crime Act 2022 is a mechanism for the prosecution to seek a ‘reconsideration of the available amount’, i.e. to demand more money be paid by an offender who may have already discharged his/her Confiscation Order, perhaps years earlier.

Some Concepts

Those familiar with confiscation proceeds will be well aware of the concepts of ‘benefit’, ‘recoverable amount’ and ‘available amount’. In summary, where the prosecution asks the court to engage confiscation proceedings against X, because X is said to have benefited from his criminal conduct, either from X’s particular criminal conduct or his ‘criminal lifestyle’ (section 6(4) the the court must (note, ‘must’) “decide the recoverable amount” and make a confiscation order in that sum (s6(5)).

By section 7, the recoverable amount “is an amount equal to the defendant’s benefit”. That may be a substantial sum if it is a criminal lifestyle case. But, if the defendant shows that the available is “less than that benefit”, then the court may make an order that matches what is actually available to X, or to some other amount that the court believes is “just” (s7 (2) (3)).

It is a cardinal principle of confiscation law that no order can be made which exceeds that which the Defendant can afford to pay (R v May [2008] 1 AC 1028).

The available amount is:

• The aggregate of the total value of all of the defendant’s free property (at the time the confiscation order is made); less
• The total value of an obligations that have priority (s9(2)) and
• The total value (at the time the order is made) of any tainted gifts.

What if the Benefit Figure is more than the Available Amount

The benefit figure is the sum that the courts find the defendant has actually benefited from, i.e. his/her illicit gains. How that figure is calculated, profit and losses, increases in value etc. are not for this article. What is of significance for the purposes of this article, is that while a defendant may walk away from court thinking ‘the benefit figure was £1 million, but I only had to pay £100’, the reality is that the benefit is still there. The prosecution can come back for the balance if X, for example, won the lottery or was struck by some other good financial fortune. It matters not that the new money is not the proceeds of crime. The Crown may still apply under S22 for a new ‘available amount’ figure. There is no time limit.

Challenging an S22 Order

Where a court receives such an order, it must re-assess the existing Order to determine if a defendant’s newly acquired good fortune causes him/her to be in possession of funds exceeding the ‘available amount’. Once this assessment is completed, the court has the discretion to increase the order or to refuse to vary the order (s22 (4)).

Defendants ought to be aware that:

1. Relevant principles to the question as to if the Order will be allowed include, the additional funds now available, the effect of a further payment on the defendant, and the time elapsed since the original confiscation order was made (R v Padda [2014] 1 WLR 1920).

2. The burden of proof remains with the defendant, as the subject of the confiscation order, to show on the balance of probabilities why the property should not be considered recoverable under the order / why it is unjust to make an upward variation in the circumstances (R v O’Flaherty [2018] EWCA Crim 2828).

3. A defendant lawfully or legitimately coming into newly acquired funds will not stop a court in ordering an increase to their order (R v Mundy [2018] 4 WLR 130 (CA)).

4. An underlying principle courts will take into consideration is that criminals should be deprived of the proceeds of their crime’ (R v S [2019] EWCA Crim 569). The purpose of the POCA act is to ensure the entirety of the funds a defendant has received from their criminal conduct.

A court may refuse to vary the order or make the requested uplift where to do so would not be considered ‘just’ in the circumstances. Defendants hoping to challenge the Order may be able to rely on the court’s discretion finding that any variation/ uplift would be unjust. The following points may be of some value to such an argument:

1. The passage of time. Article 6 ECHR makes clear that proceedings against a defendant must be brought within a reasonable time. Should the Order have been passed some years prior, it could be argued the passage of time would render any uplift unjust.

2. The context in which the defendant came into his/ her newly acquired money. E.g. if the money represents compensation following a road traffic accident, a S22 Order may be unjust (R v John [2014] 2 Cr App R (S) 73 (CA)).

To conclude, defendants made subject to confiscation proceedings ought to be aware that the available amount ordered can be varied/ uplifted at a later point. These kinds of Orders are only increasing. Section 22 Orders can be challenged through arguments that the court should exercise its discretion not to impose such an order because it would be unjust to do so.