Pradip Daya (aka Pradip Chavda) v Crown Prosecution Service

An application for a certificate of inadequacy under section 83 of the Criminal Justice Act 1988 requires the applicant to prove, on the balance of probabilities, that his realisable property is inadequate to satisfy the outstanding confiscation amount.

The court cannot revisit findings made when the confiscation order was imposed. Where unidentified or hidden assets were then found to exist, the applicant must provide evidence of what happened to them and of any interest or other fruits. A sense of justice, proportionality, lapse of time or hardship cannot replace that evidential burden. The statutory process is two-stage: the High Court determines whether inadequacy exists, and the Crown Court then considers any reduction.

The applicant had been convicted of fraudulent trading, obtaining money transfers by deception and money laundering. In 2008 the Crown Court made a confiscation order under the Criminal Justice Act 1988, finding that he had unidentified assets sufficient to meet the order. The Court of Appeal later reduced the amount after a third party established ownership of one identified property, but the finding concerning unidentified assets was not set aside.

The applicant applied for a certificate of inadequacy, asserting that he was now impecunious, that the unidentified assets could not be found, and that accrued interest made payment impossible. The central issue was whether he had proved a subsequent change in circumstances making his realisable property inadequate.

1. Application dismissed. The applicant failed to prove under section 83(1) of the Criminal Justice Act 1988, on the balance of probabilities, that his realisable property was inadequate to pay the confiscation order and accrued interest.
2. Section 83 establishes a two-stage process. The High Court first decides whether the realisable property is inadequate and, if so, issues a certificate. The Crown Court then decides whether, and to what extent, the amount recoverable should be reduced.
3. The court could not go behind the Crown Court’s finding that the applicant held unidentified assets valued at £2,109,761.15. That finding could only be challenged on appeal. The applicant therefore had to explain what had happened to those assets since the confiscation order and prove a genuine change in his financial circumstances.
4. The authorities recognise that full disclosure of every asset is not invariably required. The court must maintain a sense of proportion and may allow for the passage of time, imperfect recollection and missing records. Those qualifications did not assist this applicant, whose failure to address the unidentified assets was total rather than partial.
5. The same reasoning applied to interest. Without evidence of what had happened to the unidentified assets, the court could not determine whether they had increased in value, generated profits or otherwise produced the means to meet the interest. Accrued interest and the harshness of the regime did not create a separate or residuary ground for relief. Proportionality could inform an assessment where some evidence of changed circumstances existed, but could not replace the statutory requirements.

The judgment records that the Court of Appeal previously reduced the confiscation amount after a third party established ownership of an identified property. Permission to challenge the finding concerning unidentified assets was refused. No citation for that decision is stated in the judgment.