Hussain, R. v

For confiscation under the Proceeds of Crime Act 2002, a defendant without a criminal lifestyle benefits from particular criminal conduct only if property was obtained as a result of, or in connection with, that conduct.

Property is valued at its market value, meaning its value in a lawful market. Controlled drugs which cannot lawfully be bought or sold have no market value. Their seizure before sale therefore produces no confiscatable benefit merely from the defendant’s possession of them. A benefit may arise from lawful property obtained through a sale, or from property used to acquire the drugs if that property itself derived from criminal conduct.

The respondent was convicted at Manchester Crown Court, following a retrial, of being knowingly concerned in the fraudulent evasion of the prohibition on importing diamorphine, contrary to section 170(2) of the Customs and Excise Management Act 1979. He received 12 years’ imprisonment.

The Crown Court declined to make a confiscation order. The Crown appealed, with leave, against that refusal. There was no evidence that the respondent had a criminal lifestyle, had previously imported drugs, had sold the drugs, or had acquired them using the proceeds of criminal conduct.

The central issue was whether the seized diamorphine, although valuable if sold illicitly, constituted a benefit from the respondent’s particular criminal conduct under the Proceeds of Crime Act 2002.

1. Appeal dismissed. The judge was correct to assess the respondent’s benefit as nil and to decline a confiscation order.

2. Under section 6(4)(c) of the Proceeds of Crime Act 2002, where a defendant has no criminal lifestyle, the court must decide whether he benefited from his particular criminal conduct. The relevant conduct was the offence of importing the drugs. Under section 76(4), benefit required property obtained as a result of, or in connection with, that conduct.

3. The court held that the statutory valuation provisions required the drugs to have a market value. In this context, market value meant value in a lawful market. As diamorphine could not lawfully be bought or sold, it had no market value. The court applied R v Dore [1997] 2 Cr App R(S) 152 and followed R v Ajbade [2006] EWCA Crim 368, which applied that construction to the 2002 Act.

4. Parliament had re-enacted the expression “market value” after its interpretation in Dore. The court treated that repetition as deliberate. The statutory language did not instead require valuation by reference to the value of the drugs to the offender in an unlawful market.

5. The respondent had obtained no sale proceeds and there was no evidence that the drugs had been bought with criminal property. The seized drugs therefore conferred no benefit capable of confiscation.

• Court of Appeal (Criminal Division): The Crown’s appeal against the refusal of a confiscation order was dismissed.
• Manchester Crown Court: Following a retrial, the respondent was convicted and sentenced to 12 years’ imprisonment. On 29 July 2005, Judge Atherton declined to make a confiscation order.