What is an Unexplained Wealth Order in the UK?
application for a UWO in October 2018. This case referred to a property in Knightsbridge, one of London’s most exclusive neighbourhoods. The NCA also stated that “more are in the
pipeline,” suggesting it is serious about using this tool further.
It has also been put forward that up to £4.4 billion worth of UK property could be subject to UWOs over time. This is an attempt by the NCA and other organisations to force recipients of a UWO into disclosing the source of their wealth because, otherwise, it is almost impossible to charge the properties’ owners with a crime or seize the assets due to a lack of evidence.
UWO, Serious Fraud, and Money Laundering Investigations
Investigators can make an application for an Unexplained Wealth Order without giving notice to the High Court. In practice, it is commonplace for this UWO application to go hand-in-hand with an Interim Freezing Order (IFO), which stops assets being sold or transferred.
This means investigators can apply for a UWO and an IFO, without giving the intended recipient any prior knowledge of the application. If the application is successful, not only will the recipient be required to provide evidence of the legitimate source of their wealth, it is also likely that access to their assets will be restricted, by way of the accompanying Interim Freezing Order.
The ability to apply for an Unexplained Wealth Order is limited to those agencies defined as an ‘enforcement authority’, namely:
- National Crime Agency
- Her Majesty’s Revenue and Customs
- Financial Conduct Authority
- Serious Fraud Office
- Crown Prosecution Service
The authority making the application must demonstrate a “reasonable suspicion” that the recipient is involved in, or is connected to a person involved in, serious crime. Not only does it require the recipient to explain how the property/assets were obtained, but also the nature and extent of their interest in the property or assets.
You must seek legal advice if you have any concerns about a UWO. As specialists in financial law, Holborn Adams will be able to discuss any worries you might have. An Unexplained Wealth Order carries serious consequences and may be the first step towards prosecution. Call us on +44 (20) 3870 2249 or email law@holbornadams.com
What is the Controversy Surrounding UWOs in the UK?
UWOs are controversial because the authorities do not have to prove the person’s assets are the proceeds of a crime; they only need to assume criminal activity, and then it is the recipient's responsibility to prove that is not the case.
Such an Order can be imposed upon an individual, a company, trustees, and a non-EEA
Politically Exposed Person such as a politician or official. However, in the latter case, the test for granting an Unexplained Wealth Order has a lower threshold.
If a recipient of the Order is unable to explain the source of assets as required, the civil recovery powers of the Proceeds of Crime Act 2002 are likely to be engaged. Previous case examples have already demonstrated how draconian these powers are. Furthermore, this can fuel an organisation’s desire to investigate and potentially prosecute the recipient for more serious offences such as money laundering, fraud, or corruption.
How can Holborn Adams help?
Holborn Adams specialises in financial crime and the civil powers of recovery linked to the
investigation of such crimes. We can use this expertise to help those concerned they may
become subject to an Unexplained Wealth Order.
Bear in mind that a recipient does not have to be guilty of a criminal offence to be made subject to such an Order. In this situation, prior to the involvement of investigators, Holborn Adams would conduct a forensic interrogation into the source of wealth, similar to that which an investigator would carry out. Therefore, we would be able to provide tailored advice concerning the explanation of wealth and produce a bundle of evidence that could readily be provided to investigators.
Remember, a recipient may have no notice that such an Order is being sought by an
investigator. Moreover, the Unexplained Wealth Order is likely to be accompanied by an
Interim Freezing Order, which restricts any appropriate assets when in place. Most importantly, all of our investigative discoveries and advice are subject to Legal Professional Privilege. Therefore, our clients do not need to be concerned that the product of our work will end up in the hands of investigators.
We Can Even Help After the Fact
If it is too late for proactive assistance and an Unexplained Wealth Order has already been
made, Holborn Adams can still help. For starters, we can look into the issuing of the Order to ensure that the application and granting of the Order were legally correct.
Often, investigations on which the application is based will be erroneous, meaning the Order is invalid. The Court needs to be satisfied that there is “reasonable suspicion” that the recipient is involved in or is connected to a person involved in a serious crime. Legally, there needs to be intelligence or evidence to give rise to this suspicion. Holborn Adams has already been engaged to explore such suspicion in civil recovery cases.
Finally, if the Order has been made and cannot reasonably be challenged, Holborn Adams can work with the recipient to comply with the Order. These Orders can be intrusive, and the information provided mustn't go beyond the scope of the Order. Complying with the Order can also be time-consuming. Holborn Adams will work to ensure that this daunting process is dealt with as quickly as possible so that life can return to normal without delay.
If you’re worried about a UWO or any other financially sensitive legal problem, Holborn Adams can review your case and answer any questions you may have.
