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Criminal Offences Flashcards

1
Q

if one of these offences has been committed, what else is likely to have happened?

A
  • Will also likely be a breach of StARs (P1 & P4)
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2
Q

what are the main pieces of legislation?

A

POCA 2002 - Offences Involving Handling of Criminal Property

POCA 2002 - Offences of Relating to Information about ML

CFA 2017 – Facilitation of Tax Evasion

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3
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

who can be guilty of this?

A
  • Anyone can be guilty of these offences
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4
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

what is the max punishment?

A
  • Max sentence is 14 years imprisonment
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5
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

when will a solicitor be guilty of this?

A
  • The solicitor must know or suspect it is criminal property (CP)
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6
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

explain ‘suspicion’

A

o Suspicion = a possibility which is more than fanciful
o This is subjective and a low threshold

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7
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

what is criminal property?

A
  • Criminal property = direct or indirect benefit from criminal conduct inc. stolen property, profits, items purchased with profits
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8
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

what are the offences?

A

Arranging (s328)

Acquiring (s329)

Concealing (s327)

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9
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

explain arranging

A

A person will be guilty of s328 if they enter into or becomes concerned in an arrangement which they know or suspect facilitates the acquisition, retention, use or control of CP

Money need not pass through the solicitors’ hands, i.e. transferring a house would constitute arranging

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10
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

what are the defences to arranging?

A

ADD & overseas defence

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11
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

give an example of arranging

A

the client is buying ABC ltd. The solicitor (Sam) discovers ABC ltd obtained contracts by paying bribes, this is a criminal offence. The contracts will have generated cash for ABC ltd. Therefore, when the client acquires ABC ltd they would be acquiring PoC. If Sam facilitates the transaction, they will commit a s328 offence. Sam needs to report this to the MLRO. The transaction can only proceed if the NCA consents.

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12
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

explain the position regarding arranging and litigation

A
  • A solicitor dealing with a client’s assets in contemplation of litigation (inc. pre-action negotiations) or during litigation will not amount to arranging i.e. a solicitor can divide assets in accordance with a judgment
  • However, it will still be CP, so the solicitor must not be involved in a subsequent transaction i.e. investing settlement monies would breach s328
  • The solicitor must also make sure they do not receive any stolen property
  • The solicitor cannot rely on this if it is sham litigation
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13
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

explain acquiring

A
  • A person will be guilty of s329 if they acquire, use or have possession of CP

Typically used to prosecute people who have had no involvement of the crime but have benefited from its proceeds (i.e. family members)

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14
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

when will acquiring be relevant to a solicitor

A
  • May be relevant to a solicitor where the client is charged with a criminal offence and they suspect their fees were paid using PoC
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15
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

what are the defences to acquiring?

A

ADD, overseas defence, ACD

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16
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

explain concealing

A
  • A person will be guilty of s327 if they conceal, disguise, convert, transfer or remove CP from the UK
  • Solicitors convert (i.e. money into property) and transfer (i.e. money between parties) so must be cautious
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17
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

what are the defences to concealing?

A

ADD, overseas defence

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18
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

what is authorised disclosure a defence to?

A
  • It will be a defence to s327, s328 & s329 if the solicitor made an authorised disclosure (AD)
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19
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

who must the authorised disclosure be made by / to?

A

The solicitor themselves must made the disclosure to either:
o A constable;
o Officer of HMRC; or
o Nominated officer (i.e. MLRO)

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20
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

what happens once an authorised disclosure is made?

A
  • Once an AD is made, the officer will then need to make a suspicious activity report (SAR) to the NCA

o If the report comes from someone else, the MLRO can exercise discretion about whether to make an SAR

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21
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

does an authorised disclosure breach confidentiality?

A

no

22
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

when will the solicitor be able to rely on ADD where the disclosure is made before the prohibited act?

A

The solicitor must make the AD and obtain consent before the act takes place

The consent requirement will be satisfied if:
o There is express consent from the NCA;
o The MLRO made a SAR but they have not heard from the NCA within 7 days of making the disclosure (starting with the first working day after the disclosure is made); or
o The NCA refuse but then give consent within 31 days from the refusal date

23
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

when will the solicitor be able to rely on ADD where the disclosure is made during the prohibited act?

A

The solicitor must:
o Not have known/suspected it was CP when they began to act;
o Make the disclosure as soon as practicable after they realise; and
o Make the disclosure of their own initiative

24
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

when will the solicitor be able to rely on ADD where the disclosure is made after the prohibited act?

A

The solicitor must:
o Have good reason for their failure to disclose;
o Make the disclosure as soon as practicable after they realise; and
o Make the disclosure of their own initiative

25
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

when will the solicitor be able to rely on ADD if no disclosure is made?

A
  • It may be a defence where the solicitor intended to make an AD but had a reasonable excuse for not doing so
  • This has not been defined but might include something like information that is already in the public domain
26
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

explain the overseas defence

give an example

A
  • It will be a defence to s327, s328 & s329 if the solicitor believed the criminal conduct took place in a country where the conduct was legal

i.e. Bullfighting is illegal in the UK but legal in Spain. This defence means it is not a breach to receive a matador’s bullfight winnings.

  • The Secretary of State can override this provision, but this would likely be in extreme cases like terrorism
27
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

explain the authorised consideration defence

A

It will be a defence to s329 if the solicitor gave adequate consideration for the CP (i.e. the solicitor receives money for their fees)

The defence will fail if:
o The consideration is not adequate; or
o They knew or suspected that providing the service might help someone carry out criminal conduct

28
Q

re: POCA 2002 - Offences Involving Handling of Criminal Property

when will the authorised consideration defence fail?

A

The defence will fail if:
o The consideration is not adequate; or
o They knew or suspected that providing the service might help someone carry out criminal conduct

29
Q

re: POCA 2002 - Offences of Relating to Information about ML

who do these offences apply to?

A
  • These offences only apply to those in a regulated sector (i.e. most solicitors)
30
Q

re: POCA 2002 - Offences of Relating to Information about ML

what are the offences?

A

Failure to Disclose (s330)
Failure to Disclose – Nominated Officers (NO) (s331)
Tipping Off (s333a)
Prejudicing an Investigation (s342)

31
Q

re: POCA 2002 - Offences of Relating to Information about ML

when will a person commit failure to disclose (s330)?

A

A person will commit a s330 offence if:
o They know/suspect or ought to have known/suspected a person is engaged in ML;
o The information came to them in the course of business in a regulated sector;
o The information may assist in identifying the money launderer or property; and
o They do not make a disclosure to the MLRO or NCA as soon as practicable

ML does not need to have occurred for this offence to be committed

32
Q

re: POCA 2002 - Offences of Relating to Information about ML

what is the max punishment for failure to disclose s330?

A

max 5 years in imprisonment

33
Q

re: POCA 2002 - Offences of Relating to Information about ML

what defences are available to failure to disclose s330?

A

o Overseas defence
o Reasonable excuse for not making the disclosure
o Training  it is a defence if they have not received proper AML training
o LLP  there is no obligation to disclose information protected by LLP

34
Q

re: POCA 2002 - Offences of Relating to Information about ML

when will a person commit failure to disclose s331?

A

A nominated officer will commit a s331 offence if:
o They know/suspect or ought to have known/suspected a person is engaged in ML;
o The information came to them in their capacity as NO;
o The information may assist in identifying the money launderer or property; and
o They do not make a disclosure to the NCA as soon as practicable

35
Q

re: POCA 2002 - Offences of Relating to Information about ML

what are the defences to failure to disclose s331?

A

o Overseas defence
o Reasonable excuse
o LLP

36
Q

re: POCA 2002 - Offences of Relating to Information about ML

what are the offences under tipping off (s333a)?

A
  1. disclosing a disclosure
  2. disclosing an investigation
37
Q

re: POCA 2002 - Offences of Relating to Information about ML

what is the max punishment under tipping off (s333a)?

A

unlimited fine and/or max. 2 years imprisonment

38
Q

re: POCA 2002 - Offences of Relating to Information about ML

what are the defences to tipping off (s333a)?

A
  • Disclosure is within a group - i.e. to an employee in the same firm
  • The person does not know/suspect the disclosure will prejudice an investigation (this is yet to be tested)
  • The disclosure is made to dissuade a client from committing a criminal offence
39
Q

re: POCA 2002 - Offences of Relating to Information about ML

when will disclosing a disclosure (tipping off s333a) be an offence? Give an example.

A

Disclosing a disclosure will be an offence if:
* They inform a 3rd party of a disclosure to the NCA or other relevant individual;
* This is likely to prejudice any investigation into the disclosure;
* The disclosure is based on information obtained in the course of business of a regulated sector

  • i.e. a solicitor is instructed to purchase a house. They are concerned the house purchase money is PoC. They make a disclosure to the MLRO who reports to the NCA and they are awaiting a response. The client calls and asks why there is a delay and the secretary reveals the disclosure. The secretary is in breach of s333.
40
Q

re: POCA 2002 - Offences of Relating to Information about ML

when will disclosing an investigation (tipping off s333a) be an offence? Give an example.

A
  • They inform a 3rd party of an investigation into a POCA offence is being contemplated or carried out;
  • This is likely to prejudice any investigation into the disclosure;
  • The disclosure is based on information obtained in the course of business of a regulated sector
41
Q

re: POCA 2002 - Offences of Relating to Information about ML

when will a person commit s342 - prejudicing an investigation?

A

A person will commit a s342 offence if:

o They know or suspect a ML investigation has or is about to commence;
o They inform a third party of this; and
o This is likely to prejudice the investigation and/or leads to the falsification, concealment or destruction of relevant material
* This applies to regulated and non-regulated individuals

42
Q

re: CFA 2017 – Facilitation of Tax Evasion

when will someone be guilty of this?

A
  • It is a failure to prevent the facilitation of VAT, income tax, NI evasion
43
Q

re: CFA 2017 – Facilitation of Tax Evasion

who does this apply to?

A
  • This applies to the firm’s employees and associates persons i.e. those who perform services on their behalf such as barristers
44
Q

re: CFA 2017 – Facilitation of Tax Evasion

what type of offence is this?

A

strict liability

45
Q

re: CFA 2017 – Facilitation of Tax Evasion

what is the defence?

A
  • The firm will have a defence if they had reasonable prevention procedures in place or it was reasonable not to have such procedures in place
46
Q

re: CFA 2017 – Facilitation of Tax Evasion

what is the max punishment?

A

unlimited fine and confiscation of assets

47
Q

re: CFA 2017 – Facilitation of Tax Evasion

what must a firm do to comply with this legislation?

A

Procedures need to comply with CFA, i.e.:
o CDD procedures to address risk of tax evasion facilitation
o Firm-wide risk assessment, internal procedures, monitoring

48
Q

re: UK financial sanctions regime

what is the UK financial sanctions regime?

A

The UK Financial Sanctions Regime (FSR) is a set of measures that restrict access to funds and economic resources for people and entities that are designated as targets

the target will be placed on the sanctions list

49
Q

re: UK financial sanctions regime

what is someone called once they are placed on the sanctions list?

A

o Once on the ‘sanctions list’ they are called a designated person (DP)

50
Q

re: UK financial sanctions regime

when will a criminal offence occur?

A
  • It is an offence to receive / make payments to a DP
51
Q

re: UK financial sanctions regime

what must a firm do in accordance with this regime?

A
  • If a firm knows or reasonably suspects someone is a DP or they have committed an offence under the financial sanctions and asset freezing regime, they must inform the Office of Financial Sanctions Implementation

o A firm will need to obtain a licence before they can act

52
Q

re: UK financial sanctions regime

what consequences are in place in relation to this regime?

A
  • Firms can now be fined for their involvement in a transaction that breaches FSR, even where there is no reasonable grounds to know/suspect the breach

Legal Services (6 decks)

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