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For some time the UK has been accused of being a hub for dirty money – especially London’s prime property market.

The Proceeds of Crime Act 2002 introduced Civil Recovery Orders (CROs) to help tackle the problem. CROs permitted the confiscation of criminal property using a lower “civil” standard of proof. Instead of needing to prove a crime was committed, law enforcement bodies only needed to show a court that on the balance of probabilities (or “more likely that not”) unlawful conduct had occurred, and the property was obtained as a result of that unlawful conduct.

However, use of CROs was limited to exceptional cases where the prospect of criminal prosecution was unavailable or undesirable. It didn’t help in the most difficult cases, such as where concrete evidence was hard to obtain because the alleged launderer was part of, or had the support of, a foreign regime.

The Criminal Finances Act 2017 therefore introduced Unexplained Wealth Orders (UWOs). Nicknamed “McMafia Orders” (after the book and TV series of the same name), these went a step further than CROs. Targeted at people linked with serious crime or who hold public office outside of Europe, they allow law enforcement to apply for a court order requiring someone to explain their interest in property and how they obtained it. If that person failed to comply, law enforcement could then apply to the court for a CRO with the benefit of a presumption that the property should be confiscated.

In theory, therefore, UWOs provide an opportunity to confiscate assets without ever having to prove that the property was obtained from criminal activity. 

Available from January 2018, the use of UWOs has been limited so far, having only been obtained in four cases as of June 2021. There have been high-profile successes and failures.

A Government money laundering risk assessment concluded in December 2020 that money laundering has probably increased since 2017, suggesting that UWOs are yet to have the desired impact.

Wider action on money laundering has been set out in the Government’s Economic Crime Plan 2019 to 2022, as discussed in our briefing Economic crime in the UK: a multi-billion pound problem.

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