Jacob Gross v R

For offences under sections 328 and 329 of the Proceeds of Crime Act 2002, the prosecution must prove that the property derives from criminal conduct and that the defendant knew or suspected that it was criminal property. It need not prove that the defendant knew or suspected the precise criminal activity generating the proceeds. Particulars of the nature of that activity may be required for fairness, but an explanatory note in an indictment does not create an additional mens rea requirement. A late direction restating the statutory test does not make a trial unfair where the case has not materially changed and no prejudice is shown. The convictions were safe and the appeal was dismissed.

The appellant was convicted at the Crown Court at Southwark of entering into an arrangement concerning criminal property, contrary to section 328 of the Proceeds of Crime Act 2002, and acquiring criminal property, contrary to section 329. He was sentenced to concurrent suspended terms of imprisonment and disqualified from acting as a company director.

The criminal property consisted of proceeds processed through merchant accounts and linked to the unlawful online sale of prescription-only and counterfeit medicines. The appellant accepted that the monies represented the benefit of criminal conduct, but maintained that he believed they came from the lawful sale of Maxxes. The jury were directed that the prosecution did not need to prove that he knew or suspected the specific sale of those medicines, only that he knew or suspected that the monies were criminal property. The central issue was whether that direction, given after a jury question, rendered the trial unfair.

The appeal was dismissed. The convictions were safe.

1. Proof of criminal property. The prosecution must prove that property derives from criminal conduct. In R v Anwoir [2008] EWCA Crim 1354, the court identified proof of specified unlawful conduct or circumstances giving rise to the irresistible inference that the property could only derive from crime. The agreed facts established the actus reus on both counts.
2. Predicate offence and mens rea. There is no requirement to prove a specific predicate offence. However, where the nature of the criminal activity can fairly be particularised, particulars should be given, as stated in DPP v Bholah [2011] UKPC 44. The statutory mens rea remained knowledge or suspicion that the monies were criminal property. The prosecution did not have to prove knowledge or suspicion that the proceeds came specifically from prescription-only or counterfeit medicines.
3. Meaning of suspicion. The court adopted the description in R v Da Silva [2006] EWCA Crim 1654. Suspicion requires a possibility that is more than fanciful, but need not be clear, firmly grounded, targeted on specific facts, or based on reasonable grounds.
4. Indictment and jury directions. The explanatory note identifying the online sale of medicines did not require the prosecution to prove that particular conduct as part of the appellant’s knowledge or suspicion. The judge had already directed the jury that acceptance, or possible acceptance, of the appellant’s account that he believed the product was lawful would require acquittal. The further direction correctly stated the statutory test and did not invite speculation about unrelated crimes.
5. Fairness. R v Acheampong [2018] 1 Cr.App.R 7 and R v Ali [2014] EWCA 948 concerned materially different late changes to the prosecution case which caused prejudice. Here there was no change of case, and the defence could not identify a materially different approach or evidence that would have resulted from the direction. The trial was fair and the appeal was dismissed.

• Court of Appeal (Criminal Division): On 23 January 2024, the appeal against conviction was dismissed and the convictions were held safe: [2024] EWCA Crim 21.
• Crown Court at Southwark: On 18 November 2022, the appellant was convicted after trial. On 2 December 2022, he received concurrent suspended sentences of 21 months and a three-year company-director disqualification.