National Crime Agency v Javanshir Feyziyev & Ors

A property freezing order may be made without notice where notice would prejudice the enforcement authority’s ability to obtain a recovery order. The statutory threshold is a good arguable case that the property is recoverable property or, where relevant, associated property. This is a relatively low threshold and does not require proof that the case has a better than 50 per cent chance of success.

Recoverability may be assessed globally. The court may draw reasonable inferences from unexplained wealth, opaque corporate structures, false documents, unusual payment descriptions and the handling of property. A risk of dissipation is relevant but is not a mandatory condition. The order remains discretionary and must be proportionate, including in relation to Convention rights.

The National Crime Agency applied without notice under section 245 A of the Proceeds of Crime Act 2002 for a property freezing order over 22 London properties, a Liechtenstein bank account and rental income. The respondents included the alleged beneficial owners and a corporate legal owner of most of the properties.

The application arose during an ongoing civil recovery investigation concerning alleged corruption, fraud, money laundering and related unlawful conduct involving funds routed through multiple jurisdictions. The court had to decide whether the statutory threshold and formal requirements were met, whether the application could properly be heard without notice and in private, and whether the proposed order was a proportionate exercise of discretion.

1. Without-notice application. The evidence established a significant risk that notice would lead to dissipation of assets. That satisfied section 245 A(3) of the Proceeds of Crime Act 2002, including in relation to the corporate respondent because disclosure might prejudice enforcement.
2. Private hearing. The presumptive starting point was open justice, but publicity would defeat the object of the without-notice hearing and would be unjust to respondents who had not yet had an opportunity to answer serious allegations. The requirements of CPR 39.2(1) and (3) were therefore met.
3. Statutory threshold. There was a good arguable case that the assets were recoverable property or represented property obtained through unlawful conduct, and that any relevant associated property satisfied the statutory requirements. The expression denotes more than a case barely capable of serious argument, but does not require a better than 50 per cent prospect of success.
4. Assessment of evidence. The court was entitled to take a global approach rather than examine every transaction separately. It could draw inferences from the totality of the evidence, including unexplained lawful income, lack of documents, false or forged instruments, opaque shell companies, unusual payment narratives and the movement of funds through several jurisdictions.
5. Foreign property and conduct. The court accepted an adequate connection with England and Wales for the Liechtenstein account. It was also prepared, at this stage, to infer that the alleged foreign conduct satisfied the statutory dual-criminality requirements.
6. Discretion and order. The interference with Article 8 and Article 1 of Protocol 1 rights was lawful, pursued the legitimate aim of preventing crime and was proportionate. A risk of dissipation was a relevant factor, but not a mandatory condition. Ancillary disclosure, service and publication provisions were justified to make the order effective.

A property freezing order was made for 12 months, subject to the respondents’ rights to apply to vary or discharge it.