Unexplained Wealth Orders

Transparency International have published an interesting new report: Empowering the UK to recover corrupt assets: Unexplained Wealth Orders and other new approaches to illicit enrichment an…

It addresses the ongoing problem of corrupt wealth being laundered through the UK.

The paper serves to do three things:

First, highlight the full extent of the problem – It focuses on the suspicious activity reports (SARs) that businesses are required to submit to the National Crime Agency if they are suspicious about a transaction or activity. The research highlights:

  • New analysis shows that in 2014, UK law enforcement was able to act on just 7 reports of suspicious financial transactions, identified as possibly linked to international corruption.
  • This underlines the limited powers that the UK has to restrain those transactions.

Second, bring to light an important recent case study in which the SFO were unable to act on a suspicious report.

Third, suggest solutions to this problem. Transparency International UK convened a group of experts to explore possible solutions that would enable the UK to act more decisively and proactively on corrupt assets. One option that has been developed is “The Unexplained Wealth Order (UWO)”. The UWO would do the following:

  • Require suspects relating to suspicious UK assets or transactions to have to explain legitimate and legal sources of wealth.
  • Give law enforcement more than 30 days to investigate a suspicious transactions related to corruption. The current time restriction is limiting effective investigations and suspicious transactions most often pass without any objection from law enforcement.
  • If a UWO is not responded to, or response is inadequate, then asset recovery proceedings could begin.
  • This new power would allow law enforcement agencies in the UK to start questioning and acting on corrupt assets, without having to wait for a prosecution in the home country
Practical Law David Bacon

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