Account Freezing and Forfeiture Orders

Account Freezing and Forfeiture Orders. Over the last year, there has been a substantial rise in the use of Account Freezing Order (AFrO) and Account Forfeiture Order (AFO) schemes under the Proceeds of Crime Act 2002 (POCA).

Increased use of AFrO and AFO

A Freedom of Information request showed that 166 orders to freeze accounts were issued by HMRC in 2019/2020 which is up 177% from the previous year.  The reasonably low threshold for authorities to obtain an AFrO makes them an obvious choice in the Prosecution tool kit to investigate potential proceeds of crime, without a criminal conviction.  However, there are ways to challenge them and the instruction of a specialist POCA lawyer is the best method.

For many years, prosecuting authorities have had the power to seize cash from anyone they suspect to have obtained it unlawfully.  It is then forfeited unless evidence can be adduced to satisfy the Court that the cash has in fact come from a legitimate source.  These powers have been extended under the Criminal Finances Act 2017 with the implementation of the AFrO and AFO scheme.

Reasonable Grounds for Suspicion

For the prosecuting authority to obtain an AFrO under Section 303Z1 of POCA they must have ‘reasonable grounds’ for suspecting that money held in a bank account is recoverable property or that it is intended for unlawful conduct.  ‘Reasonable grounds’ must be on an understandable and proper basis.  The application is usually made, without notice, to the Magistrates’ Court and the prosecuting authority must also inform the court of any reasons why the money in the account may be legitimate.

If the Court agrees to make an AFrO, the intended recipient will then be informed and the AFrO served on them.  One of the most significant decisions will then be whether the appellant wishes to challenge the order.  There may be a number of different ways to do this and instructing an expert POCA lawyer will assist in making an informed decision on how to proceed.

Challenging an Order

There is no Legal Aid funding to challenge an AFrO or AFO.  The Respondent is not facing criminal proceedings and so may find that all of their money is tied up in the frozen account.  If that is the case a specialist lawyer can seek a variation to release money to cover reasonable living expenses, legitimate business expenditure, and legal expenses if necessary.  The appellant should be able to obtain a ‘no quibble’ initial sum so get the ball rolling.

If the Respondent does not challenge the AFrO within the allotted time period an application may be made to forfeit the money in the bank account by the prosecuting authority.  They must satisfy the Court that the money held in the bank account is recoverable property or intended for unlawful conduct and if so, the money will be forfeited.  It is then distributed under the Asset Forfeiture Initiative Scheme.

There is currently no easy route to appeal an AFrO.  The legislation does not provide for this and so it is absolutely paramount that the moment you receive an AFrO you seek specialist advice.

Get the Help You Need with Account Freezing and Forfeiture Orders

How our specialist team of lawyers can help you:

  • Exclude funds for living expenses.
  • Challenge the lawfulness of any AFrO.
  • Challenge the AFrO or AFO.
  • Advise third parties.
  • Reach a settlement.

For the help and assistance you need get in touch with us today:

  • Call: 0113 244 0597
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  • Request a callback by entering your details into the form at the bottom of this page

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