Serious Organised Crime Agency v Perry & Ors

A disclosure order under Part 8 of the Proceeds of Crime Act 2002 may be made in relation to property held in the United Kingdom which is reasonably suspected to derive from unlawful conduct abroad, even where the persons concerned are outside England and Wales. The court must construe any claimed extra-territorial restriction by reference to clear statutory language and the Act’s purpose. The statutory requirements concerning substantial value and public interest are questions of fact. A bare assertion is insufficient, but the court may draw reasonable inferences from the evidence. Because disclosure orders are intrusive, applications should contain sufficiently particularised evidence and the practice of determining difficult cases solely on the papers merits reconsideration.

SOCA obtained an ex parte disclosure order under sections 357 and 358 of the Proceeds of Crime Act 2002 in support of a civil recovery investigation concerning substantial assets held in United Kingdom bank accounts. The respondents, who were resident in Israel, challenged the order and related information notices.

The respondents argued that the court lacked jurisdiction to make orders affecting persons outside England and Wales. They also alleged inadequate evidence, material non-disclosure and improper exercise of discretion. The central issue was whether the statutory disclosure-order regime could operate where foreign unlawful conduct was suspected to have generated property situated in the United Kingdom.

1. Jurisdiction. The application was dismissed. The fact that the respondents were, or might have been, outside England and Wales did not prevent the court making a disclosure order. Foreign unlawful conduct may constitute unlawful conduct for civil recovery purposes under section 241(2)(a) of the Proceeds of Crime Act 2002.
2. The statutory purpose included preventing the United Kingdom from becoming a safe haven for the proceeds of crime, wherever the underlying conduct occurred. Property situated in the United Kingdom was therefore sufficient to support a civil recovery investigation and disclosure order. Any additional connection was in any event supplied by United Kingdom accounts, business interests, a postal address and past residence.
3. Section 461(2) identified the parts of the United Kingdom in whose courts orders under Part 8, Chapter 2 could be made. It did not impose a territorial limitation on the persons or property affected by those orders.
4. The ordinary presumption against extra-territorial application required clear statutory language before an Act could operate abroad. That principle did not defeat the application in this case. The relevant provisions, read in their statutory and legislative context, supported the making of the order.
5. The requirements in section 358 were factual questions. The court was not a rubber stamp, and a bare assertion would not suffice. Nevertheless, the evidence showed substantial assets in the jurisdiction which arguably represented criminal proceeds, and reasonable inferences could be drawn that the requested information would be of substantial value and that obtaining it was in the public interest. The statement therefore contained sufficient material.
6. There had been no material non-disclosure, the discretion in section 357(1) had not been wrongly exercised, and there was no need to consider submission to the jurisdiction. The information notices consequently stood with the disclosure order.
7. The judge expressed reservations, as obiter observations, about determining difficult and intrusive disclosure-order applications solely on paper. An oral ex parte hearing, with the applicant’s representatives and the maker of the evidence present, might sometimes be preferable. The respondents had not, however, been disadvantaged in this case.