Richards, R v

In confiscation proceedings, benefit, its value and the defendant’s available amount are separate questions. The value of a benefit under sections 79 and 80 of the Proceeds of Crime Act 2002 is the value of the defendant’s own proprietary interest. A person with only legal title cannot be treated as having the full beneficial value of property belonging to another.

The tainted-gift provisions affect the transferor’s available amount. They do not determine the interest transferred under property law, invalidate a transfer at an undervalue, or re-vest property in the transferor. A confiscation order founded on an inconsistent attribution of beneficial ownership cannot stand.

The appellant was convicted of four money-laundering offences. While Andrew Rogers was abroad and evading the police, Rogers transferred five properties to the appellant for no real consideration. Four were later sold and their proceeds held in escrow. The remaining property was on the market.

At confiscation proceedings, the Crown Court treated the properties and proceeds, valued at £241,000, as assets available to Rogers. It also treated the same amount as the appellant’s benefit and made a confiscation order against him. The appellant appealed, contending that the beneficial interest could not simultaneously belong wholly to both men and that the tainted-gift provisions did not resolve that inconsistency.

1. Appeal allowed. The confiscation order against the appellant was quashed.
2. The court applied the three-stage structure described in R v May [2008] UKHL 28. The issue concerned the second stage: valuing the appellant’s benefit, rather than calculating his available amount.
3. Under sections 79 and 80 of the Proceeds of Crime Act 2002, the relevant value was the value of the appellant’s own interest in the properties or their proceeds. At the date selected by the Crown Court, it had found that the beneficial interest belonged to Rogers. It could not therefore also attribute the full beneficial value to the appellant, since joint beneficial ownership had not been suggested.
4. The prosecution’s reliance on the tainted-gift provisions failed. Those provisions apply only after property has been transferred. They do not decide what proprietary interest was transferred, prevent the transfer from taking effect under property law, or cause a beneficial interest to re-vest in the transferor upon a confiscation order. Their effect is instead to include the value of a qualifying gift in calculating the transferor’s available amount. Section 23 provides qualified relief if the property is genuinely unavailable; its preservation proviso would be unnecessary if the Act automatically re-vested the property.
5. The evidence did not justify a fresh finding that Rogers had intended to confer the full beneficial interest on the appellant. The appellant’s legal title, involvement in letting, and expenditure on the properties were insufficient to establish such an intention in the circumstances. A possible order based on rents was neither explored nor sought. The value of the properties remained recoverable under Rogers’s confiscation order.

• Court of Appeal (Criminal Division): allowed the appeal and quashed the appellant’s confiscation order: [2008] EWCA Crim 1841.
• Merthyr Tydfil Crown Court: on 21 November 2006, made a confiscation order against the appellant in the sum of £241,000 following his convictions for money laundering.