Court of Appeal throws out attempt to review rejection of unexplained wealth orders

Out-Law News | 30 Jun 2020 | 9:10 am | 2 min. read

The English and Welsh Court of Appeal (CoA) has rejected an attempt by the National Crime Agency (NCA) to have the High Court’s discharge of several Unexplained Wealth Orders (UWOs) reviewed, saying the appeal had “no real prospects of success”.

The NCA had appealed against a High Court ruling which overturned the grant of UWOs it had obtained over three London properties ultimately owned by Dariga Nazarbayeva and Aisultan Nazarbayev, the daughter and grandson of Nursultan Nazarbayev, the former president of Kazakhstan.

The NCA claimed the properties were acquired “as a means of laundering the proceeds of unlawful conduct” by a now-deceased former Kazakh official, Rakhat Aliyev, who was ex-husband and father respectively to Nazarbayeva and Nazarbayev.

The NCA’s UWOs were granted against the registered owners of the properties, who challenged the agency’s application in the High Court. They said the purchases of the three properties were unconnected to Aliyev and his supposed criminal activities and that he was never the ultimate beneficial owner of the properties.

Cameron Fiona

Fiona Cameron

Senior Practice Development Lawyer

Courts have to be mindful of the fact that UWOs interfere with fundamental rights and accordingly must be made in a proportionate manner.

UWOs were introduced in 2018 by the Criminal Finances Act 2017, and provide law enforcement with a tool to obtain information and documentation in relation to property that appears to be disproportionate to the known income of an individual or company. One of their primary aims is to give law enforcement a means to access evidence that would otherwise not be available.

In her order, reported by Global Investigations Review (3 page / 6.4MB PDF), Lady Justice Carr said the NCA needed to succeed in overturning all of the High Court’s findings in relation to each statutory requirement for making the UWOs. She added there was no real prospect of an appellate court interfering with the findings and said Mrs Justice Lang, in the High Court, had correctly applied the relevant statutory and legal tests.

Lady Justice Carr said there was no compelling reason for an appeal in this case to be heard, although UWOs were a relatively new area which “may at the appropriate time benefit from further judicial interpretation”. She said such matters would be better addressed in an appeal with a real prospect of success.

With appellate courts generally reluctant to interfere with findings of fact made by lower courts, corporate crime specialist Fiona Cameron of Pinsent Masons, the law firm behind Out-Law, said it was always going to be hard for the NCA to succeed in overturning the High Court’s decision in this case.

“The decision should not, however be seen as casting doubt on the usefulness of UWOs in the NCA’s fight against corruption; the matter was highly fact specific, and the Court of Appeal was at some pains to make this clear,” Cameron said.

“Although the threshold for the making of UWOs is relatively low, the case makes it clear that sufficient supporting evidence is still required and if it is not there, there can be no justification for the order. Courts have to be mindful of the fact that UWOs interfere with fundamental rights and accordingly must be made in a proportionate manner,” Cameron said.

Cameron said it was unlikely that the case would put the brakes on further UWO applications by the NCA.

“The NCA has previously stated that it has a number of UWO applications in the pipeline and that it will ‘use all the legislation at our disposal to pursue suspected illicit finance and we will continue to do so’,” Cameron said.

“As a relatively new tool, case law such as this can be expected to throw up some challenges as the courts and law enforcement get to grips with practical application of the legislation on UWOs. Those set out in this case are far from insurmountable in the right case in future,” Cameron said.