O'Donoghue, Re Criminal Justice Act 1988

On an application for a certificate of inadequacy, the defendant bears the burden of proving that the value of his realisable assets has fallen below the confiscation order. He must explain what has happened to assets identified in the original order, including any income or other fruits derived from them. The court cannot reopen the original finding that an asset was beneficially owned unless the confiscation order is reversed on appeal. No relevant distinction exists between identified and hidden assets. If non-disclosure prevents the defendant from discharging the burden, the court may refuse the certificate or make a reasonable-return presumption against him.

The applicant had been convicted of obtaining property by deception and theft and made subject to a confiscation order of £94,587. He sought a certificate of inadequacy reflecting losses on the later sale of a car and caravan. The prosecution contended that the court had to consider a further £35,500, previously found to be a realisable asset, and any interest or other fruits obtained from it.

The central issue was whether the applicant had discharged the burden of proving that his realisable assets as a whole were insufficient to satisfy the confiscation order, and whether an exception applied because the £35,500 was said to be a hidden asset.

1. Burden of proof. The defendant must establish that the value of his realisable property has decreased so that it no longer suffices to satisfy the confiscation order. It is insufficient merely to assert that the assets are inadequate. He must disclose what has happened since the order to property found by the trial judge to be realisable, including its income and fruits. The principle in Gokal v SFO [2001] EWCA Civ 368 was applied.
2. Effect of the original confiscation order. On a certificate application the court cannot go behind the original finding that the defendant beneficially owned the £35,500. Any challenge to that finding must be made by appeal against the confiscation order.
3. Hidden assets. Article 6 of the European Convention on Human Rights does not require a different approach for hidden assets. The position is the same whether an asset is identified or hidden. Unless proof shows that a later dealing or event changed beneficial ownership or realisability, the state of affairs at the date of the confiscation order is presumed to continue.
4. Non-disclosure. The applicant had failed to disclose what had happened to the £35,500 and therefore had not discharged the burden. He was not entitled to the certificate sought. The court left open whether the appropriate course was to refuse any certificate or to calculate it after presuming that the applicant had obtained a reasonable return, with reasonable presumptions made against a non-disclosing wrongdoer.