Crisp & Anor, R. v

Forfeiture of cash as recoverable property does not reduce a confiscation order based on the pecuniary advantage obtained by evading excise duty and VAT. Under section 6(6) of the Proceeds of Crime Act 2002, the Crown Court’s duty to make a confiscation order becomes discretionary only where the victim’s proceedings seek recovery for the loss caused by the relevant conduct. Cash-forfeiture proceedings do not recoup the loss caused by the evasion of duty merely because the cash may derive from unlawful conduct. The state may therefore pursue both confiscation and forfeiture without double recovery or abuse of process.

The respondents pleaded guilty to being knowingly concerned in the fraudulent evasion of excise duty on tobacco. Cash was found at each respondent’s home and later forfeited in magistrates’ court proceedings as recoverable property under the Proceeds of Crime Act 2002.

In confiscation proceedings, the Recorder of Hull assessed Berry’s benefit at £26,309.18 and Crisp’s at £53,101.22. He reduced Berry’s order and made no order against Crisp because he took account of their respective forfeited cash sums. The prosecution appealed. The central issue was whether the forfeitures engaged section 6(6), so as to permit a reduction of the confiscation orders.

1. The prosecution appeals were allowed. Each respondent’s available assets exceeded his assessed benefit. The statutory duty was therefore to make a confiscation order for the recoverable amount unless section 6(6) of the Proceeds of Crime Act 2002 applied.

2. Section 6(6) did not apply. It concerns proceedings by a victim to recover loss, injury or damage sustained in connection with the offending. The state’s loss was the evaded excise duty and VAT. Proceedings under Part 5 to forfeit cash as recoverable property did not seek to recoup that loss, whether the cash derived from the charged smuggling or other unlawful conduct.

3. There was no double recovery. Applying the reasoning in R v David Smith [2001] UKHL 68, the pecuniary advantage from fraudulent duty evasion arises when the duty is evaded and is valued then. The subsequent inability to realise contraband does not alter that benefit. If cash was the product of the offending, it was an additional property benefit rather than a reduction of the benefit represented by the evaded duty. The concurrent confiscation and forfeiture proceedings were consequently not an abuse of process.

4. The court had jurisdiction because leave had been granted under section 31 to appeal the confiscation orders made on 23 January 2009. It was unnecessary to decide whether an earlier ruling could have been challenged by case stated. The court stated that it would hear counsel on the appropriate consequential orders.

1. Court of Appeal (Criminal Division): The prosecution’s appeals were allowed. The Recorder had wrongly treated the forfeited cash as engaging section 6(6) of the Proceeds of Crime Act 2002.

2. Crown Court (Recorder of Hull): On 23 January 2009, the Recorder assessed each respondent’s benefit but reduced Berry’s confiscation order and made no order against Crisp to reflect cash forfeited in separate proceedings.

3. Magistrates’ Court: Cash seized from Berry and Crisp was forfeited as recoverable property under Part 5 of the Proceeds of Crime Act 2002.