Business Crime Work

Avoiding Business Crime

If you are an owner of a business or work in a business that you want to support, it is important to understand how the business can be put at risk because somebody either involved in the business or connected with it acts in a criminal manner. If/when the criminality is discovered by the authorities the whole business could be at risk with consequent danger for the continuation of any employment.

The longer criminality continues the more likely it will be found out and the more likely a prosecution will close down the business due to the likely financial repercussions. Some people will genuinely find it difficult to determine what is clever business on the one hand and what is dishonest behaviour on the other. Understanding what areas of criminal law might apply to your industry is a start to help you to identify and avoid problems. However, if your are looking to get involved in a change of business activity and you have any concerns about potential criminal activity we can assist you by discussing the business opportunity and helping you to appreciate where issues might arise.

Contact Dennis Clarke to discuss your needs and agree a fee structure to deal with this. At the same time why not have a policy to deal with other eventualities that are usually ignored but which will be expensive if no plan is in place. See our business section for more.

Business Orders

The powers of investigation to obtain business orders available under Part 8 of the Proceeds of Crime Act 2002 (POCA) for the purpose of a criminal confiscation order include Production Orders, Search and Seizure Warrants, Customer Information Orders, Account Monitoring Orders and Disclosure Orders. In addition, financial institutions make suspicious activity reports (SARs) to the Serious Organised Crime Agency (SOCA), who in turn pass these on to financial investigators to make enquires. These provide a fruitful source of intelligence that may ultimately result in a successful prosecution with a confiscation order being made. All business orders need to be taken seriously. There is no doubt that business orders are an important part of the investigator’s arsenal. Business orders have to be taken seriously.

Production Orders

These are one form of business orders and they allow financial investigators to obtain information about the financial affairs of a person subject to a confiscation, money laundering or civil recovery investigation, most usually in relation to his or her bank accounts. A production order requires the person in possession or control of the material to produce it to an appropriate officer to take away, or give an appropriate officer access to it within the period stated in the order. This is usually seven days unless the judge decides that a longer or shorter period is appropriate.

Power of entry

Another example of business orders is a production order which does not automatically give a right of entry onto premises. If a production order requires a person to give an appropriate officer access to material, section 347 allows the judge, on application by an appropriate officer, to make an order to grant entry. This order requires any person entitled to grant entry to the premises to allow an appropriate officer to enter those premises to obtain access to the material. A production order cannot require the production of, or grant access to, material that is legally privileged or excluded material. Section 348(2) defines privileged material as being any material, which the person would be entitled to refuse to produce on grounds of legal professional privilege in proceedings in the High Court. Material is not subject to legal professional privilege merely because it is held by a lawyer. In R v Central Criminal Court ex parte Francis and Francis the House of Lords held that documents were not subject to legal professional privilege if they were held with the intention of furthering a criminal purpose.

Search and Seizure Warrants

A search and seizure warrant under section 352 authorises an officer to enter and search the named premises, and to seize and retain any material found which is likely to be of substantial value to the investigation for which the warrant was sought. If a production order has not been complied with and there are reasonable grounds for believing that material is on specified premises, if it would not be appropriate to make a production order because it is not practicable to communicate with any person against whom the production order may be made and if entry to the premises will not be granted unless a warrant is produced or the investigation would be seriously prejudiced unless an appropriate person arriving at the premises is able to secure immediate entry then a search and seizure warrant may be appropriate.

Customer Information Orders

On the application of a constable, an officer of HMRC, a member of staff at SOCA or an accredited financial investigator the Crown Court may make a s. 363 customer information order that a financial institution on receipt of a notice in writing provide the customer information requested. Customer information in relation to a person and a financial institution is information about whether a person holds or has held account(s) at a financial institution solely or jointly with another.

Individual’s Accounts

If such accounts are or have been held, the definition of customer information is set out in s. 364(2) and will include the account number or numbers; the person’s full name and date of birth; the most recent and any previous address; the date or dates of account opening and/or closing; such evidence of identity obtained by the financial institution for the purpose of the money laundering regulations; the personal details (name, date of birth, addresses) of joint account holders; the account numbers of any other accounts to which the individual is signatory and the details of the other account holders.

Incorporated and Unincorporated Associations

If the specified person is a company, limited liability partnership or similar body incorporated or established outside the UK, then customer information is defined in s. 364(3) and will include the account number or numbers; the person’s full name, a description of the business which the person carries on, the country or territory in which it is incorporated and any company number, any VAT number assigned to it, its registered office and previous registered offices, the date or dates of the account opening and/or closing, such evidence of identity obtained by the financial institution for the purpose of the money laundering regulations. and the full name, date of birth, current and previous addresses of account signatories.

Account Monitoring Orders

An account monitoring order (see section 370) allows law enforcement agencies to observe/monitor the transactions in an account for up to 90 days at a time. The order is available for both confiscation and money laundering investigations, and will specify the manner and timescale for the information to be given. As with customer information orders, account monitoring orders may be made on the application of a constable, an officer of HMRC, member of staff of SOCA or an accredited financial investigator.

Disclosure Orders

Section 357 of POCA, as originally enacted, gave the Assets Recovery Agency power to apply to for disclosure orders. The Serious Crime Act 2007, which abolished the Assets Recovery Agency, transferred the powers to obtain disclosure orders to the Director of Public Prosecutions and the Director of the Serious Fraud Office in relation to confiscation investigations and additionally to SOCA in respect of civil recovery investigations. Applications for disclosure orders may not be made in relation to money laundering investigations: see s 357(2). The Attorney General has given guidance for investigatory and prosecution authorities.

Dragged into Investigation

The powers of investigation available under Part 8 of the Proceeds of Crime Act 2002 (POCA) for the purpose of a criminal confiscation order include Production Orders, Search and Seizure Warrants, Customer Information Orders Account Monitoring Orders and Disclosure Orders. In addition, financial institutions make suspicious activity reports (SARs) to the Serious Organised Crime Agency (SOCA), who in turn pass these on to financial investigators to make enquires. These provide a fruitful source of intelligence that may ultimately result in a successful prosecution with a confiscation order being made.So says the CPS.

Production Orders

These allow financial investigators to obtain information about the financial affairs of a person subject to a confiscation, money laundering or civil recovery investigation, most usually in relation to his or her bank accounts. A production order requires the person in possession or control of the material to produce it to an appropriate officer to take away, or give an appropriate officer access to it within the period stated in the order. This is usually seven days unless the judge decides that a longer or shorter period is appropriate.

Power of entry

A production order does not automatically give a right of entry onto premises. If a production order requires a person to give an appropriate officer access to material, section 347 allows the judge, on application by an appropriate officer, to make an order to grant entry. This order requires any person entitled to grant entry to the premises to allow an appropriate officer to enter those premises to obtain access to the material.

A production order cannot require the production of, or grant access to, material that is legally privileged or excluded material. Section 348(2) defines privileged material as being any material, which the person would be entitled to refuse to produce on grounds of legal professional privilege in proceedings in the High Court.

Material is not subject to legal professional privilege merely because it is held by a lawyer. In R v Central Criminal Court ex parte Francis and Francis [1988] 3 All ER 775 the House of Lords held that documents were not subject to legal professional privilege if they were held with the intention of furthering a criminal purpose.

Fraudulent Trading

The usual way that an investigation begins for fraudulent trading is for the liguidator of a company to report this for a criminal investigation to begin. If you find yourself involved in such an investigation it is excellent advice to seek expert legal assistance at the earliest opportunity and preferably before any interview takes place.

Dishonesty is an essential ingredient of the offence being investigated. Unfortunately for you everyone is now blessed with 20/20 hindsight and will want to proceed on the basis that what is now apparent to them ought to have been obvious to you when decisions were made by you in good faith and for the benefit of the business, its creditors and its customers. By coming to the experts we can work with you to identify the likely areas where the investigators will want to concentrate their questions and seek to ensure you are ready to give your full explanation to show why the decisions taken were the right ones at the time.

If allegations of fraudulent trading are brought against you the chances are that you will also face the full rigours of the Proceeds of Crime Act which adds significantly to the work, complexity, and the severity of the consequences if convicted. All of these matters need to be considered as the case proceeds to ensure your interests are fully protected. You do need the advice of solicitors who are used to all aspects of these cases and not just your local solicitor who is known to appear in the local courts.

Over many years we have demonstrated our skill in dealing with all manner of complex allegations and fraudulent trading is just one of the specialist areas we are renowned for.

If you believe you have made a mistake in a choice of solicitors or if you began with a duty solicitor, we can advise you on how to change representation. This is not a problem. We are often asked to take over cases from other firms.

Phishing

Phishing is the act of sending an e-mail to a user falsely claiming to be an established legitimate enterprise in an attempt to scam the user into surrendering private information that will be used for identity theft. The e-mail directs the user to visit a web site where they are asked to update personal information, such as passwords and credit card and bank account numbers. The Web site, however, is bogus and set up only to steal the user’s information.

Recent years have seen the proliferation of phishing scams in which users received e-mails supposedly from banks, eBay, Amazon, delivery companies all tempting the target to give up account or credit card details with various tricks. Perhaps an account is about to be suspended unless the target clicks on the provided link and updates the account or credit card information that will prevent an action happening.

Those responsible for the phishing are very adept at hiding their identities. The software tools available to disguise identity are many and varied. Unfortunately this means that the investigators identify the wrong people when information is received from ISP’s. Investigators do not necessarily have the training to question the accuracy of the information they are given and will often accept the information without question and consequently put too strong a case to you.

With any investigation where particular expertise is needed you ought to instruct the expert solicitors as early as possible to make sure help is given to try to end your involvement in the investigation.