Ginwalla, R. v

Under the Criminal Justice Act 1988, confiscation assumptions may be applied to property held during the relevant period after a qualifying course of criminal conduct. The defendant bears the burden of showing that a particular assumption is incorrect or would create a serious risk of injustice. Where legitimate income and criminal receipts are mixed, the court need not conduct an artificial item-by-item tracing exercise. Criminal expenditure may free legitimate money for other expenditure, and conversely. The court should use a sensible and fair method of calculation, while taking practical steps to avoid serious injustice.

The appellant pleaded guilty at Gloucester Crown Court to eight offences of obtaining property by deception and asked for 39 further matters to be taken into consideration. Confiscation proceedings followed under the old statutory regime in the Criminal Justice Act 1988.

On 31 August 2004, the Crown Court found that he had benefited from criminal conduct by £123,275.32 and made a confiscation order for that amount. The appeal challenged the judge’s application of the statutory assumptions to unexplained bank lodgements and seven properties. The central issue was whether the judge had been required to trace the source of each property deposit in detail before attributing a proportion of the properties’ equity and rental income to criminal conduct.

1. The appeal was dismissed. The Crown Court had not erred in making a confiscation order for £123,275.32.
2. The judge correctly treated the real property as engaging the assumption in section 72AA(4)(a) of the Criminal Justice Act 1988. Once the assumption was made, it was for the appellant to show, on the balance of probabilities, that it was incorrect in relation to particular property or that making it would create a serious risk of injustice.
3. The judge was entitled to mitigate possible injustice by using the properties’ equitable rather than market value and by attributing only a proportion of that value to criminal conduct. His calculation reflected both the unexplained lodgements and the legitimate income available to the appellant, while avoiding double counting.
4. A detailed tracing of each payment into and out of each bank account was not required. The appellant had mixed legitimate and criminal receipts, with transfers between accounts. Treating a particular payment in as the specific source of a payment out would have been artificial. Use of criminal proceeds for one expense could release legitimate funds for another. Detailed tracing might be appropriate to avoid injustice in another case, but the evidence did not require it here.
5. The court accepted that confiscation assumptions must be applied fairly, consistently with McIntosh v Lord Advocate and another [2001] 3 WLR 107. The judge’s adverse credibility findings, coupled with his allowances in the appellant’s favour, showed no lack of fairness or actual injustice. Questions concerning prosecution costs and recovery of defence costs were adjourned for written submissions.

• Court of Appeal (Criminal Division): dismissed the appeal against the confiscation order: [2005] EWCA Crim 3553.
• Gloucester Crown Court: the appellant pleaded guilty on 15 September 2003 to eight counts of obtaining property by deception. On 31 August 2004, the court made a confiscation order of £123,275.32.