NW & Ors, R v

For offences under sections 327 and 328 of the Proceeds of Crime Act 2002, the Crown must prove at least the type or class of criminal conduct from which the alleged criminal property derived. It need not prove a particular offence, offender or occasion, but cannot rely on a wholly unparticularised allegation that money had no lawful source.

Proof by circumstantial evidence remains available. Where the evidence permits a jury, applying the criminal standard, to infer criminal conduct, that inference creates no reversal of the legal burden of proof.

The Crown appealed under section 58 of the Criminal Justice Act 2003 against a terminating ruling at Bournemouth Crown Court. The judge had upheld submissions of no case to answer on counts alleging money laundering under sections 327 and 328 of the Proceeds of Crime Act 2002.

The Crown alleged that more than £105,000 transferred from the United Kingdom to Jamaica was criminal property. It relied on the defendants’ apparent lack of lawful means and associated circumstances, but could not identify any particular criminal activity or class of activity which generated the money. The central issue was whether section 340 required the Crown to prove at least the type or class of underlying criminal conduct.

1. Appeal dismissed. The trial judge was right to hold that the Crown could not establish that the funds were criminal property merely by showing that they had no apparent lawful origin.

2. The court rejected the judge’s additional view that the Crown’s proposed case involved a reversal of the burden of proof. Circumstantial evidence may found an inference that property derives from criminal conduct, provided that the inference satisfies the criminal standard of proof and the jury is properly directed. An evidential need for an explanation does not transfer the legal burden of proof.

3. However, sections 327 and 328 require proof that the property was a benefit from, or represented a benefit from, criminal conduct as defined by section 340 of the Proceeds of Crime Act 2002. Properly construed, that requires the Crown to identify and prove at least the class or type of crime said to have produced the property. It does not require proof of a specific offence committed by a particular person on a particular occasion.

4. The civil-recovery cases of R (Director of Assets Recovery Agency) v Green and Szepietowski concerned differently worded provisions in Part 5. Their direct reasoning was therefore distinguishable. But their underlying concern with the statutory balance between effective enforcement and elementary fairness applied equally to Part 7. Parliament could not have intended that a cardinal element of a criminal charge could be left wholly without particulars.

5. The court did not determine the separate defendant-specific submissions that the evidence was insufficient. Those issues had not been decided below because the terminating ruling had disposed of the trial.

• Court of Appeal (Criminal Division): dismissed the prosecutor’s appeal under section 58 of the Criminal Justice Act 2003 ([2008] EWCA Crim 2).
• Bournemouth Crown Court: on 27 April 2007, upheld submissions of no case to answer and made a terminating ruling on the money-laundering counts. The jury was discharged.