The Serious Crime Act 2015 (the act) was introduced to ensure that the National Crime Agency, the police and other law enforcement agencies have the powers they need to pursue, disrupt and bring to justice those engaged in serious and organised crime.
The new act comes into force on 1st June 2015 and also amends the Proceeds of Crime Act 2002 in relation to confiscation proceedings in some key areas:
Extensions of time to pay
Currently, when a Confiscation Order (the order) is made, a Crown Court may allow a defendant up to six months in which to satisfy their order. This can be extended by a further six months by way of application to the Crown Court thereby giving a defendant up to 12 months in which to pay. This gives a defendant up to a year before enforcement action is instigated by the Confiscation Unit and interest is applied to an outstanding amount under the order.
Under the new law, a defendant will be given just three months to pay and may only apply for a further three months. This gives a defendant a maximum of just six months in which to pay. This means that any interest in default of the order and the imposition of a default sentence for non-payment will be activated more swiftly once an order is made.
Prison sentences in default
Under the present POCA regime, the court imposes a period of imprisonment in default of the order. This is essentially done on a ‘sliding scale’. There are currently twelve incremental bands dependent on the amount outstanding under the order, with set maximum periods of imprisonment in default. By way of example, if a defendant owes an amount not exceeding £200 a default sentence of up to 7 days imprisonment may be imposed. At the other end of the scale, if a defendant owes an amount exceeding £1,000,000 a sentence of up to 10 years imprisonment may be imposed.
The range of maximum sentences will change under the new laws. The incremental bands will be reduced to just four. If a defendant owes an amount not exceeding £10,000 up to 6 months imprisonment may be imposed. If an amount exceeding £10,000 but not exceeding £500,000 is owed, up to 5 years may be imposed. If an amount exceeding £500,000 but not exceeding £1,000,000 is owed, 7 years may be imposed and an amount exceeding £1 million will in attract up to 14 years imprisonment.
Third party interests in assets
Presently, third parties who claim an interest in property in which the defendant also has an interest are unable to play an active part in the confiscation proceedings until the enforcement stage. This is once the order had been made and has not been satisfied in full. Third party claims on assets are often considered by the courts for the first time at this late stage in the proceedings. In many cases this potentially has the effect of frustrating enforcement of the order.
When the new act comes into force Crown Courts are granted powers to make a ruling determining the defendant’s interest in property, in which a third party has an interest at the time the order is made. Before making a determination, the Crown Court will allow third parties to make representations to the court regarding their interests in the property or asset in question. Therefore, third party interests will be taken into consideration at a much earlier stage in the proceedings.
The court’s determination will be conclusive in most circumstances. For example, the court’s determination in confiscation proceedings would override a greater claim made subsequently in family courts by a defendant’s partner. This may have the effect of making confiscation proceedings even more complex.
If you are facing confiscation proceedings it is vital that you seek specialist advice. Our team at Stephensons has expertise in all areas pertaining to proceeds of crime and financial asset recovery call us on 01616 966 229 or complete our online enquiry form.