Proceeds of Crime Act 2002, section 72

Serious default

Part 2 Confiscation: England and Wales

(1)If the following three conditions are satisfied the Crown Court may order the payment of such compensation as it believes is just.

(2)The first condition is satisfied if a criminal investigation has been started with regard to an offence and proceedings are not started for the offence.

(3)The first condition is also satisfied if proceedings for an offence are started against a person and—

(a)they do not result in his conviction for the offence, or

(b)he is convicted of the offence but the conviction is quashed or he is pardoned in respect of it.

(4)If subsection (2) applies the second condition is that—

(a)in the criminal investigation there has been a serious default by a person mentioned in subsection (9), and

(b)the investigation would not have continued if the default had not occurred.

(5)If subsection (3) applies the second condition is that—

(a)in the criminal investigation with regard to the offence or in its prosecution there has been a serious default by a person who is mentioned in subsection (9), and

(b)the proceedings would not have been started or continued if the default had not occurred.

(6)The third condition is that an application is made under this section by a person who held realisable property and has suffered loss in consequence of anything done in relation to it by or in pursuance of an order under this Part.

(7)The offence referred to in subsection (2) may be one of a number of offences with regard to which the investigation is started.

(8)The offence referred to in subsection (3) may be one of a number of offences for which the proceedings are started.

(9)Compensation under this section is payable to the applicant and—

(a)if the person in default was or was acting as a member of a police force, the compensation is payable out of the police fund from which the expenses of that force are met;

(b)if the person in default was a member of the Crown Prosecution Service or was acting on its behalf, the compensation is payable by the Director of Public Prosecutions;

[F337 (ba)if the person in default was a [F338 National Crime Agency officerF338] , the compensation is payable by [F339 the National Crime AgencyF339] ;F337]

(c)if the person in default was a member of the Serious Fraud Office, the compensation is payable by the Director of that Office;

F340 (d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(e)if the person in default was an officer of the Commissioners of Inland Revenue, the compensation is payable by those Commissioners.

[F341 (ea)if the person in default was an immigration officer, the compensation is payable by the Secretary of State;F341]

[F342 (f)if the person in default was an accredited financial investigator and none of paragraphs (a) to (e) apply, the compensation is payable in accordance with paragraph (a), (c) [F343 , (da)F343] or (e) of section 302(7A) (as the case may require).F342]

Definitions used in section 72 1

the court

(10) In this section, sections 120 to 140 and Schedule 3 “the court” means—

(a)the Court of Session, where a trial diet or a diet fixed for the purposes of section 76 of the Procedure Act in proceedings for the offence or offences concerned is to be, is being or has been held in the High Court of Justiciary;

(b)the sheriff exercising his civil jurisdiction, where a diet referred to in paragraph (a) is to be, is being or has been held in the sheriff court.

Defined in s.119(10) · see it in the full Act

Cases considering section 72 5

An Informer v A Chief Constable

[2012] EWCA Civ 197 · 29 February 2012Limits

Compensation for loss caused by a restraint order requires serious default and that the investigation would not otherwise have continued to the stage causing the loss. The court declined to create a negligence remedy for non-disclosure falling short of that statutory threshold. (see paras [51]–[53]; [73]; [163])

A v ACC

[2017] EWHC 301 (QB) · 15 February 2017Interprets

The court applied the statutory compensation scheme and assessed whether its conditions were satisfied. The claim failed because the second condition was not made out. (see paras [4]-[6]; [21]-[23]) The court treated the power to award compensation as conditional on satisfaction of the three statutory conditions. No compensation was ordered because the conditions were not all established. (see paras [4]-[6]; [21]-[23]) The court found that a criminal investigation had begun and that proceedings had not been started. The first statutory condition was therefore satisfied. (see paras [4]-[5]) The court considered the two elements of the second condition: serious default and whether the investigation would have continued without it. Serious default was conceded, but the causation element was not established. (see paras [4]-[5]; [16]; [21]) The court accepted that the police had committed a serious default in making the restraint application without disclosing material relevant to the claimant’s position. The default could be collective and need not be attributed to an individual officer. (see paras [14]-[16]) The court interpreted “would not have continued” as referring to continuation of the investigation to the stage at which the order causing the claimed loss was made. On the evidence, that condition was not satisfied. (see paras [18]-[21]) The court identified the third condition as requiring realisable property and loss caused by something done in relation to it under the statutory restraint regime. The court considered that this condition was not established, although it was unnecessary to decide the point. (see paras [4]-[5]; [22]) The court set out the statutory allocation of responsibility for compensation according to whether the default was by the police or the Crown Prosecution Service. The allocation was not otherwise analysed. (see para [4]) The provision was set out to identify the police fund from which compensation would be payable where the default was by a police force. It was not otherwise analysed. (see para [4]) The provision was set out to identify responsibility for compensation where the default was by the Crown Prosecution Service. It was not otherwise analysed. (see para [4])

Virgin Media Ltd, R (on the application of) v Zinga

[2014] EWCA Crim 52 · 24 January 2014Limits

The absence of a Crown Court compensation remedy for serious default by a private prosecutor did not alter the ordinary meaning of prosecutor in Part 2. (see paras [27]-[29]) The listed persons responsible for compensation following serious default did not include private prosecutors. The court held that omission could not restrict the meaning of prosecutor elsewhere in Part 2. (see paras [27]-[29])

What each judgment says about section 72 is in the case-law panel in the full Act.

Explanatory note

129.Section 72 provides for compensation to be paid to a person whose property has been affected by the enforcement of the confiscation legislation. Compensation is only payable where an investigation is started but proceedings are never brought, or the defendant is not convicted of an offence, or his conviction is quashed, or he is pardoned. In all cases, there must have been a serious default on the part of one or more of the enforcement authorities specified in subsection (9). The restriction to serious default cases is based on the principle that the restraint and realisation of property is ancillary to a criminal trial in the same way as the detention of a person pending trial. In neither case is compensation paid on acquittal as a matter of course.

130.Section 72 is largely based on earlier legislation except that the provisions have been extended to cover the situation where an investigation is started but proceedings are never brought. Under the Act, it will be possible for a restraint order to be made as soon as a criminal investigation has been started (at present, this is only possible where proceedings have been started or are about to be). Therefore, compensation will in future be payable, subject to criteria including the serious default test, from the beginning of an investigation, not only where proceedings have been started.

All the explanatory notes for the Act

Amendments and notes

8 notes from legislation.gov.uk

Amendments

  1. F337S. 72(9)(ba) inserted (25.1.2010) by Policing and Crime Act 2009 (c. 26), ss. 61(2)(a), 116(1); S.I. 2009/3096, art. 3(g)
  2. F338Words in s. 72(9)(ba) substituted (7.10.2013) by Crime and Courts Act 2013 (c. 22), s. 61(2), Sch. 8 para. 114(a); S.I. 2013/1682, art. 3(v)
  3. F339Words in s. 72(9)(ba) substituted (7.10.2013) by Crime and Courts Act 2013 (c. 22), s. 61(2), Sch. 8 para. 114(b); S.I. 2013/1682, art. 3(v)
  4. F340S. 72(9)(d) omitted (27.3.2014) by virtue of The Public Bodies (Merger of the Director of Public Prosecutions and the Director of Revenue and Customs Prosecutions) Order 2014 (S.I. 2014/834), art. 1(1), Sch. 2 para. 23
  5. F341S. 72(9)(ea) inserted (25.6.2013) by Crime and Courts Act 2013 (c. 22), s. 61(2), Sch. 21 para. 19 (with Sch. 21 para. 40); S.I. 2013/1042, art. 4(k)
  6. F342S. 72(9)(f) inserted (25.1.2010) by Policing and Crime Act 2009 (c. 26), ss. 61(2)(b), 116(1); S.I. 2009/3096, art. 3(g)
  7. F343Word in s. 72(9)(f) inserted (25.1.2018) by Tax Collection and Management (Wales) Act 2016 (anaw 6), ss. 186(1)(2), 194(2); S.I. 2018/33, art. 2(j)

Commencement

  1. I62S. 72 in force at 24.3.2003 by S.I. 2003/333, art. 2, Sch.