NCA Will Appeal Discharged UWO

A High Court ruling has discharged three properties which were frozen by the National Crime Agency (NCA) in May last year using an Unexplained Wealth Order(UWO).

Towards the end of May last year, three properties worth in excess of £80 million, were seized by the High Court as anti-corruption and Unexplained Wealth Orders (UWO) were used for the second time.

Following fears that an unnamed foreign official, who used offshore companies to make the purchases, was using the London properties to launder money, the properties were seized until the owner was able to explain the source of funds used to finance the purchases.

The three London homes were bought for the benefit of the child and grandchild of Kazakhstan’s former president and now deceased, Rakhat Aliyev, with alleged embezzled money.

The NCA intended to hold the properties indefinitely until a thorough investigation had been completed.

This meant the homes couldn’t be sold until a conclusive decision was reached.

Dariga Nazarbayeva and Nurali Aliyev denied that the wealth used to purchase the properties was attached to any illegal activity and applied to the High Court in order for the properties to be discharged.

The High Court found in favour of the respondent, overturning all three UWOs, determining the NCAs assumptions to be ‘unreliable’.

The NCA have stated that the ‘details of this case are concerned with the ability of law enforcement to use UWOs to compel individuals to detail the source of funds used to purchase assets that they hold. This is distinct from whether the assets themselves are recoverable under the Proceeds of Crime Act 2002.’

The NCA statement insisted that legal decisions made in the legislation’s infancy will enforce future cases and could create loopholes and legal exit strategies for future seized properties. It is therefore their intention to appeal the High Court ruling.

David Rundle, Counsel in WilmerHale’s UK White Collar Defence and Investigations practice, said:

“The Court rejected the factual basis upon which the NCA sought the Unexplained Wealth Order. Irrespective of the merits in this case, the complexity of its facts demonstrates the inevitable challenge of proving the ownership, control and origin of property for these applications.”

Graeme Biggar, the NCA’s Director General of the National Economic Crime Centre, commented:

“The UK’s robust legal system is recognised worldwide and the ability to challenge decisions is a key part of that reputation. Unexplained Wealth Orders are new legislation and we always expected there would be significant legal challenge over their use.

“We disagree with this decision to discharge the UWOs and will be filing an appeal. These hearings will establish the case law on which future judgments will be based, so it is vital that we get this right.

“The NCA is tenacious. We have been very clear that we will use all the legislation at our disposal to pursue suspected illicit finance and we will continue to do so.”

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