Proceeds of Crime Act 2002

• (6) The second condition is that there are reasonable grounds for suspecting that the cash is intended to be used in unlawful conduct and that either—

• (a) its continued detention is justified while its intended use is further investigated or consideration is given to bringing (in the United Kingdom or elsewhere) proceedings against any person for an offence with which the cash is connected, or

• (b) proceedings against any person for an offence with which the cash is connected have been started and have not been concluded.

• (7) An application for an order under subsection (2) may also be made in respect of any cash seized under section 294(2), and the court, sheriff or justice may make the order if satisfied that—

• (a) the condition in subsection (5) or (6) is met in respect of part of the cash, and

• (b) it is not reasonably practicable to detain only that part.

• (8) An order under subsection (2) must provide for notice to be given to persons affected by it.

Interest

296

• (1) If cash is detained under section 295 for more than 48 hours (calculated in accordance with section 295(1B)), it is at the first opportunity to be paid into an interest-bearing account and held there; and the interest accruing on it is to be added to it on its forfeiture or release.

• (2) In the case of cash detained under section 295 which was seized under section 294(2), the officer of Revenue and Customs , constable , SFO officer or accredited financial investigator must, on paying it into the account, release the part of the cash to which the suspicion does not relate.

• (3) Subsection (1) does not apply if the cash or, as the case may be, the part to which the suspicion relates is required as evidence of an offence or evidence in proceedings under this Chapter.

Release of detained cash

297

• (1) This section applies while any cash is detained under section 295.

• (2) A magistrates’ court or (in Scotland) the sheriff may direct the release of the whole or any part of the cash if the following condition is met.

• (3) The condition is that the court or sheriff is satisfied, on an application by the person from whom the cash was seized, that the conditions in section 295 for the detention of the cash are no longer met in relation to the cash to be released.

• (4) An officer of Revenue and Customs, constable , SFO officer or accredited financial investigator or (in Scotland) procurator fiscal may, after notifying the magistrates’ court, sheriff or justice under whose order cash is being detained, release the whole or any part of it if satisfied that the detention of the cash to be released is no longer justified.

Forfeiture

Forfeiture

298

• (1) While cash is detained under section 295 , 297C or 297D , an application for the forfeiture of the whole or any part of it may be made—

• (a) to a magistrates’ court by the Commissioners of Customs and Excise , an accredited financial investigator , a constable or an SFO officer,

• (b) (in Scotland) to the sheriff by the Scottish Ministers.

• (2) The court or sheriff may order the forfeiture of the cash or any part of it if satisfied that the cash or part—

• (a) is recoverable property, or

• (b) is intended by any person for use in unlawful conduct.

• (3) But in the case of recoverable property which belongs to joint tenants, one of whom is an excepted joint owner, the order may not apply to so much of it as the court thinks is attributable to the excepted joint owner’s share.

• (4) Where an application for the forfeiture of any cash is made under this section, the cash is to be detained (and may not be released under any power conferred by this Chapter) until any proceedings in pursuance of the application (including any proceedings on appeal) are concluded.

Appeal against forfeiture

299

• (1) Any party to proceedings for an order for the forfeiture of cash under section 298 who is aggrieved by an order under that section or by the decision of the court not to make such an order may appeal—

• (a) in relation to England and Wales, to the Crown Court;

• (b) in relation to Scotland, to the Sheriff Principal;

• (c) in relation to Northern Ireland, to a county court.

• (2) An appeal under subsection (1) must be made before the end of the period of 30 days starting with the day on which the court makes the order or decision.

• (3) The court hearing the appeal may make any order it thinks appropriate.

• (4) If the court upholds an appeal against an order forfeiting the cash, it may order the release of the whole or any part of the cash .

Application of forfeited cash

300

• (1) Cash forfeited under section 298, and any accrued interest on it—

• (a) if forfeited by a magistrates’ court in England and Wales or Northern Ireland, is to be paid into the Consolidated Fund,

• (b) if forfeited by the sheriff, is to be paid into the Scottish Consolidated Fund.

• (2) But it is not to be paid in—

• (a) before the end of the period within which an appeal under section 299 may be made, or

• (b) if a person appeals under that section, before the appeal is determined or otherwise disposed of.

Supplementary

Victims and other owners

301

• (1) A person who claims that any cash detained under this Chapter, or any part of it, belongs to him may apply to a magistrates’ court or (in Scotland) the sheriff for the cash or part to be released to him.

• (2) The application may be made in the course of proceedings under section 295 or 298 or at any other time.

• (3) If it appears to the court or sheriff concerned that—

• (a) the applicant was deprived of the cash to which the application relates, or of property which it represents, by unlawful conduct,

• (b) the property he was deprived of was not, immediately before he was deprived of it, recoverable property, and

• (c) that cash belongs to him,

the court or sheriff may order the cash to which the application relates to be released to the applicant.

• (4) If—

• (a) the applicant is not the person from whom the cash to which the application relates was seized,

• (b) it appears to the court or sheriff that that cash belongs to the applicant,

• (c) the court or sheriff is satisfied that the release condition is met in relation to that cash, and

• (d) no objection to the making of an order under this subsection has been made by the person from whom that cash was seized,

the court or sheriff may order the cash to which the application relates to be released to the applicant or to the person from whom it was seized.

• (5) The release condition is met—

• (a) in relation to cash detained under section 295, if the conditions in that section for the detention of the cash are no longer met,

• (b) in relation to cash detained under section 297C or 297D, if the cash is not recoverable property and is not intended by a person for use in unlawful conduct, and

• (c) in relation to cash detained under 298, if the court or sheriff decides not to make an order under that section in relation to the cash.

Compensation

302

• (1) If cash detained under this Chapter was seized in England, Wales or Northern Ireland the person to whom the cash belongs or from whom it was seized may make an application to a magistrates' court for compensation if—

• (a) the cash is not forfeited in pursuance of a forfeiture notice, and

• (b) no forfeiture order is made in respect of the cash.

• (1A) If cash detained under this Chapter was seized in Scotland the person to whom the cash belongs or from whom it was seized may make an application to the sheriff for compensation if no forfeiture order is made in respect of the cash.

• (2) If, for any period beginning with the first opportunity to place the cash in an interest-bearing account after the initial detention of the cash for 48 hours (calculated in accordance with section 295(1B)), the cash was not held in an interest-bearing account while detained, the court or sheriff may order an amount of compensation to be paid to the applicant.

• (3) The amount of compensation to be paid under subsection (2) is the amount the court or sheriff thinks would have been earned in interest in the period in question if the cash had been held in an interest-bearing account.

• (4) If the court or sheriff is satisfied that, taking account of any interest to be paid under section 296 or any amount to be paid under subsection (2), the applicant has suffered loss as a result of the detention of the cash and that the circumstances are exceptional, the court or sheriff may order compensation (or additional compensation) to be paid to him.

• (5) The amount of compensation to be paid under subsection (4) is the amount the court or sheriff thinks reasonable, having regard to the loss suffered and any other relevant circumstances.

• (6) If the cash was seized by an officer of Revenue and Customs, the compensation is to be paid by the Commissioners of Customs and Excise.

• (7) If the cash was seized by a constable, the compensation is to be paid as follows—

• (a) in the case of a constable of a police force in England and Wales, it is to be paid out of the police fund from which the expenses of the police force are met,

• (b) in the case of a constable of a police force in Scotland, it is to be paid by the Scottish Police Authority,

• (ba) in the case of a constable of the Police Service of Scotland, it is to be paid by the Scottish Police Authority,

• (c) in the case of a police officer within the meaning of the Police (Northern Ireland) Act 2000 (c. 32), it is to be paid out of money provided by the Chief Constable.

• (7ZA) If the cash was seized by an SFO officer, the compensation is to be paid by the Director of the Serious Fraud Office.

• (7ZB) If the cash was seized by a National Crime Agency officer, the compensation is to be paid by the National Crime Agency.

• (7A) If the cash was seized by an accredited financial investigator who was not an officer of Revenue and Customs , a constable, an SFO officer or a National Crime Agency officer, the compensation is to be paid as follows—

• (a) in the case of an investigator—

• (i) who was a member of the civilian staff of a police force, including the metropolitan police force, (within the meaning of that Part of that Act Part 1 of the Police Reform and Social Responsibility Act 2011 ), or

• (ii) who was a member of staff of the City of London police force,

it is to be paid out of the police fund from which the expenses of the police force are met,

• (b) in the case of an investigator who was a member of staff of the Police Service of Northern Ireland, it is to be paid out of money provided by the Chief Constable,

• (c) in the case of an investigator who was a member of staff of a department of the Government of the United Kingdom, it is to be paid by the Minister of the Crown in charge of the department or by the department,

• (d) in the case of an investigator who was a member of staff of a Northern Ireland department, it is to be paid by the department,

• (da) in the case of an investigator who was exercising a function of the Welsh Revenue Authority, it is to be paid by the Welsh Revenue Authority,

• (e) in any other case, it is to be paid by the employer of the investigator.

• (7B) The Secretary of State may by order amend subsection (7A).

• (7C) If any cash is detained under this Chapter and part only of the cash is forfeited in pursuance of a forfeiture notice, this section has effect in relation to the other part.

• (8) If a forfeiture order is made in respect only of a part of any cash detained under this Chapter, this section has effect in relation to the other part.

• (9) The power in subsection (7B) is exercisable by the Department of Justice (and not by the Secretary of State) so far as it may be used to make provision which could be made by an Act of the Northern Ireland Assembly without the consent of the Secretary of State (see sections 6 to 8 of the Northern Ireland Act 1998).

“The minimum amount”

303

• (1) In this Chapter, the minimum amount is the amount in sterling specified in an order made by the Secretary of State after consultation with the Scottish Ministers and the Department of Justice .

• (2) For that purpose the amount of any cash held in a currency other than sterling must be taken to be its sterling equivalent, calculated in accordance with the prevailing rate of exchange.

Chapter 4 — General

Recoverable property

Property obtained through unlawful conduct

304

• (1) Property obtained through unlawful conduct is recoverable property.

• (2) But if property obtained through unlawful conduct has been disposed of (since it was so obtained), it is recoverable property only if it is held by a person into whose hands it may be followed.

• (3) Recoverable property obtained through unlawful conduct may be followed into the hands of a person obtaining it on a disposal by—

• (a) the person who through the conduct obtained the property, or

• (b) a person into whose hands it may (by virtue of this subsection) be followed.

Tracing property, etc.

305

• (1) Where property obtained through unlawful conduct (“the original property”) is or has been recoverable, property which represents the original property is also recoverable property.

• (2) If a person enters into a transaction by which—

• (a) he disposes of recoverable property, whether the original property or property which (by virtue of this Chapter) represents the original property, and

• (b) he obtains other property in place of it,

the other property represents the original property.

• (3) If a person disposes of recoverable property which represents the original property, the property may be followed into the hands of the person who obtains it (and it continues to represent the original property).

Mixing property

306

• (1) Subsection (2) applies if a person’s recoverable property is mixed with other property (whether his property or another’s).

• (2) The portion of the mixed property which is attributable to the recoverable property represents the property obtained through unlawful conduct.

• (3) Recoverable property is mixed with other property if (for example) it is used—

• (a) to increase funds held in a bank account,

• (b) in part payment for the acquisition of an asset,

• (c) for the restoration or improvement of land,

• (ca) for the discharge (in whole or in part) of a mortgage, charge or other security,

• (d) by a person holding a leasehold interest in the property to acquire the freehold.

Recoverable property: accruing profits

307

• (1) This section applies where a person who has recoverable property obtains further property consisting of profits accruing in respect of the recoverable property.

• (2) The further property is to be treated as representing the property obtained through unlawful conduct.

General exceptions

308

• (1) If—

• (a) a person disposes of recoverable property, and

• (b) the person who obtains it on the disposal does so in good faith, for value and without notice that it was recoverable property,

the property may not be followed into that person’s hands and, accordingly, it ceases to be recoverable.

• (2) If recoverable property is vested, forfeited or otherwise disposed of in pursuance of powers conferred by virtue of this Part, it ceases to be recoverable.

• (3) If—

• (a) in pursuance of a judgment in civil proceedings (whether in the United Kingdom or elsewhere), the defendant makes a payment to the claimant or the claimant otherwise obtains property from the defendant,

• (b) the claimant’s claim is based on the defendant’s unlawful conduct, and

• (c) apart from this subsection, the sum received, or the property obtained, by the claimant would be recoverable property,

the property ceases to be recoverable.

In relation to Scotland, “claimant” and “defendant” are to be read as “pursuer” and “defender”.

• (4) If—

• (a) a payment is made to a person in pursuance of a compensation order under Article 14 of the Criminal Justice (Northern Ireland) Order 1994 (S.I. 1994/2795 (N.I. 15)), section 249 of the Criminal Procedure (Scotland) Act 1995 (c. 46) or Chapter 2 of Part 7 of the Sentencing Code or in pursuance of a service compensation order under the Armed Forces Act 2006, and

• (b) apart from this subsection, the sum received would be recoverable property,

the property ceases to be recoverable.

• (4A) If—

• (a) a payment is made to a person in pursuance of a slavery and trafficking reparation order under section 8 of the Modern Slavery Act 2015, and

• (b) apart from this subsection, the sum received would be recoverable property,

the property ceases to be recoverable.

• (4A) If—

• (a) a payment is made to a person in pursuance of a slavery and trafficking reparation order under Schedule 2 to the Human Trafficking and Exploitation (Criminal Justice and Support for Victims) Act (Northern Ireland) 2015, and

• (b) apart from this subsection, the sum received would be recoverable property,

the property ceases to be recoverable.

• (5) If—

• (a) a payment is made to a person in pursuance of a restitution order under section 27 of the Theft Act (Northern Ireland) 1969 (c. 16 (N.I.)) or Chapter 3 of Part 7 of the Sentencing Code or a person otherwise obtains any property in pursuance of such an order, and

• (b) apart from this subsection, the sum received, or the property obtained, would be recoverable property,

the property ceases to be recoverable.

• (6) If—

• (a) in pursuance of an order made by the court under section 382(3) or 383(5) of the Financial Services and Markets Act 2000 (c. 8) (restitution orders), an amount is paid to or distributed among any persons in accordance with the court’s directions, and

• (b) apart from this subsection, the sum received by them would be recoverable property,

the property ceases to be recoverable.

• (7) If—

• (a) in pursuance of a requirement of the Financial Conduct Authority, the Prudential Regulation Authority or the Bank of England under or by virtue of section 384(5) of the Financial Services and Markets Act 2000 (power ... to require restitution), an amount is paid to or distributed among any persons, and

• (b) apart from this subsection, the sum received by them would be recoverable property,

the property ceases to be recoverable.

• (7A) If—

• (a) a payment is made to a person in pursuance of an unlawful profit order under section 4 of the Prevention of Social Housing Fraud Act 2013, and

• (b) apart from this subsection, the sum received would be recoverable property,

the property ceases to be recoverable.

• (8) Property is not recoverable while a restraint order applies to it, that is—

• (a) an order under section 41, 120 or 190, or

• (b) an order under any corresponding provision of an enactment mentioned in section 8(7)(a) to (g).

• (8A) Property is not recoverable while it is detained under or by virtue of section 44A, 47J, 47K, 47M, 47P, 122A, 127J, 127K, 127M, 127P, 193A, 195J, 195K, 195M or 195P.

• (9) Property is not recoverable if it has been taken into account in deciding the amount of a person’s benefit from criminal conduct for the purpose of making a confiscation order, that is—

• (a) an order under section 6, 92 or 156, or

• (b) an order under a corresponding provision of an enactment mentioned in section 8(7)(a) to (g),

and, in relation to an order mentioned in paragraph (b), the reference to the amount of a person’s benefit from criminal conduct is to be read as a reference to the corresponding amount under the enactment in question.

• (10) Where—

• (a) a person enters into a transaction to which section 305(2) applies, and

• (b) the disposal is one to which subsection (1) or (2) applies,

this section does not affect the recoverability (by virtue of section 305(2)) of any property obtained on the transaction in place of the property disposed of.

Other exemptions

309

• (1) An order may provide that property is not recoverable or (as the case may be) associated property if—

• (a) it is prescribed property, or

• (b) it is disposed of in pursuance of a prescribed enactment or an enactment of a prescribed description.

• (2) An order may provide that if property is disposed of in pursuance of a prescribed enactment or an enactment of a prescribed description, it is to be treated for the purposes of section 278 as if it had been disposed of in pursuance of a recovery order.

• (3) An order under this section may be made so as to apply to property, or a disposal of property, only in prescribed circumstances; and the circumstances may relate to the property or disposal itself or to a person who holds or has held the property or to any other matter.

• (4) In this section, an order means an order made by the Secretary of State after consultation with the Scottish Ministers and the Department of Justice, and prescribed means prescribed by the order.

Granting interests

310

• (1) If a person grants an interest in his recoverable property, the question whether the interest is also recoverable is to be determined in the same manner as it is on any other disposal of recoverable property.

• (2) Accordingly, on his granting an interest in the property (“the property in question”)—

• (a) where the property in question is property obtained through unlawful conduct, the interest is also to be treated as obtained through that conduct,

• (b) where the property in question represents in his hands property obtained through unlawful conduct, the interest is also to be treated as representing in his hands the property so obtained.

Insolvency

Insolvency

311

• (1) Proceedings for a recovery order may not be taken or continued in respect of property to which subsection (3) applies unless the appropriate court gives leave and the proceedings are taken or (as the case may be) continued in accordance with any terms imposed by that court.

• (2) An application for an order for the further detention of any cash to which subsection (3) applies may not be made under section 295 unless the appropriate court gives leave.

• (2A) An application for an order for the further detention of any property to which subsection (3) applies may not be made under section 303L unless the appropriate court gives leave.

• (2B) An application for the making of an account freezing order under section 303Z3 in respect of an account in which is held money to which subsection (3) applies, or an application under section 303Z4 for the extension of the period specified in such an order, may not be made unless the appropriate court gives leave.

• (3) This subsection applies to recoverable property, or property associated with it, if—

• (a) it is an asset of a company being wound up in pursuance of a resolution for voluntary winding up,

• (b) it is an asset of a company and a voluntary arrangement under Part 1 of the 1986 Act, or Part 2 of the 1989 Order, has effect in relation to the company,

• (c) an order under section 286 of the 1986 Act, Article 259 of the 1989 Order or section 54 of the 2016 Act (appointment of interim trustee or interim receiver) has effect in relation to the property,

• (d) it is an asset comprised in the estate of an individual who has been made bankrupt or, in relation to Scotland, of a person whose estate has been sequestrated,

• (e) it is an asset of an individual and a voluntary arrangement under Part 8 of the 1986 Act, or Part 8 of the 1989 Order, has effect in relation to him, or

• (f) in relation to Scotland, it is property comprised in the estate of a person who has granted a trust deed within the meaning of the 2016 Act.

• (4) An application under this section, or under any provision of the 1986 Act or the 1989 Order, for leave to take proceedings for a recovery order , or to apply for an account freezing order under section 303Z3, may be made without notice to any person.

• (5) Subsection (4) does not affect any requirement for notice of an application to be given to any person acting as an insolvency practitioner or to the official receiver (whether or not acting as an insolvency practitioner).

• (6) References to the provisions of the 1986 Act in sections 420 and 421 of that Act, or to the provisions of the 1989 Order in Articles 364 or 365 of that Order, (insolvent partnerships and estates of deceased persons) include subsections (1) to (3) above.

• (7) In this section—

• (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (b) the 1986 Act means the Insolvency Act 1986 (c. 45),

• (c) the 1989 Order means the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)),

• (d) the 2016 Act means the Bankruptcy (Scotland) Act 2016

and in subsection (8) “the applicable enactment” means whichever enactment mentioned in paragraphs (b) to (d) is relevant to the resolution, arrangement, order or trust deed mentioned in subsection (3).

• (8) In this section—

• (a) an asset means any property within the meaning of the applicable enactment or, where the 2016 Act is the applicable enactment, any property comprised in an estate to which that Act applies,

• (b) the appropriate court means the court which, in relation to the resolution, arrangement, order or trust deed mentioned in subsection (3), is the court for the purposes of the applicable enactment or, in relation to Northern Ireland, the High Court,

• (c) acting as an insolvency practitioner has the same meaning as in section 433,

• (d) other expressions used in this section and in the applicable enactment have the same meaning as in that enactment.

Delegation of enforcement functions

Performance of functions of Scottish Ministers by constables in Scotland

312

• (1) In Scotland, a constable engaged in temporary service with the Scottish Ministers in connection with their functions under this Part may perform functions, other than those specified in subsection (2), on behalf of the Scottish Ministers.

• (2) The specified functions are the functions conferred on the Scottish Ministers by—

• (a) sections 244(1) and (2) and 256(1) and (7) (proceedings in the Court of Session),

• (b) section 267(2) (trustee for civil recovery),

• (c) sections 271 and 272(5) (agreements about associated and joint property),

• (d) section 275(3) (pension schemes),

• (e) section 282(1) (exemptions),

• (f) section 283(5) and (8) (compensation),

• (g) section 287(2) (financial threshold),

• (h) section 293(1) (code of practice),

• (i) section 298(1) (forfeiture),

• (j) section 303(1) (minimum amount).

• (k) section 303B(3) (listed asset);

• (l) section 303H(1) (code of practice);

• (m) section 303O(1)(b) (forfeiture);

• (n) section 303Y(3) (minimum value);

• (o) section 303Z8(3) (minimum amount);

• (p) section 303Z14(2)(b) (forfeiture).

• (q) section 303Z20(3) (cryptoassets);

• (r) section 303Z25 (codes of practice);

• (s) section 303Z28(5)(b) (further detention of seized cryptoasset-related items);

• (t) section 303Z32(5)(b) (further detention of seized cryptoassets);

• (u) section 303Z34(4) and (5)(b)(i) (release of cryptoassets and cryptoasset-related items);

• (v) section 303Z35(5) (crypto wallets);

• (w) section 303Z41(2)(b) (forfeiture of cryptoassets);

• (x) section 303Z42(10) (forfeiture of cryptoassets: supplementary);

• (y) section 303Z44 (agreements about associated and joint property);

• (z) section 303Z45(10) (associated and joint property: default of agreement);

• (z1) section 303Z46(2) (continuation of crypto wallet freezing order pending appeal);

• (z2) section 303Z47(1) (sections 303Z41 to 303Z45: appeals);

• (z3) section 303Z57(7)(b) (detained cryptoassets: detention of proceeds of conversion);

• (z4) section 303Z58(6)(b) (frozen crypto wallets: detention of proceeds of conversion);

• (z5) section 303Z60(2) (forfeiture of converted cryptoassets);

• (z6) section 303Z61(1) (appeal against decision under section 303Z60).

Restriction on performance of Director’s functions by police

313

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Interpretation

Obtaining and disposing of property

314

• (1) References to a person disposing of his property include a reference—

• (a) to his disposing of a part of it, or

• (b) to his granting an interest in it,

(or to both); and references to the property disposed of are to any property obtained on the disposal.

• (2) A person who makes a payment to another is to be treated as making a disposal of his property to the other, whatever form the payment takes.

• (3) Where a person’s property passes to another under a will or intestacy or by operation of law, it is to be treated as disposed of by him to the other.

• (4) A person is only to be treated as having obtained his property for value in a case where he gave unexecuted consideration if the consideration has become executed consideration.

Northern Ireland courts

315

In relation to the practice and procedure of courts in Northern Ireland, expressions used in this Part are to be read in accordance with rules of court.

General interpretation

316

• (1) In this Part—

• “account forfeiture notice” (in Chapter 3B) has the meaning given by section 303Z9(3),

• “account freezing order” (in Chapter 3B) account forfeiture notice” (in Chapter 3B) has the meaning given by section 303Z1(3)(a),

• “associated property” (in Chapter 2) has the meaning given by section 245,

• “bank” (in Chapter 3B) has the meaning given by section 303Z7,

• “building society” (in Chapter 3B) has the meaning given by section 303Z1(6),

• “cash” has the meaning given by section 289(6) or (7),

• “constable”, in relation to Northern Ireland, means a police officer within the meaning of the Police (Northern Ireland) Act 2000 (c. 32),

• “country” includes territory,

• “the court” (except in sections 253(2) and (3) and 262(2) and (3) and Chapters 3, 3A , 3B, 3C, 3D, 3E and 3F ) means the High Court or (in relation to proceedings in Scotland) the Court of Session,

• “cryptoasset” has the meaning given by section 303Z20;

• “crypto wallet” has the meaning given by section 303Z20;

• “dealing” with property includes disposing of it, taking possession of it or removing it from the United Kingdom,

• “the Department of Justice” means the Department of Justice in Northern Ireland;

• “electronic money institution” (in Chapter 3B) has the meaning given by section 303Z1(6),

• “enforcement authority”— in relation to England and Wales, means the Financial Conduct Authority, Her Majesty's Revenue and Customs, the National Crime Agency, the Director of Public Prosecutions ... or the Director of the Serious Fraud Office, in relation to Scotland, means the Scottish Ministers, in relation to Northern Ireland, means the Financial Conduct Authority, Her Majesty's Revenue and Customs, the National Crime Agency, the Director of the Serious Fraud Office or the Director of Public Prosecutions for Northern Ireland,

• “enforcement officer” (in Chapter 3B) has the meaning given by section 303Z1(6),

• “excepted joint owner” has the meaning given by section 270(4),

• “interest”, in relation to land—in the case of land in England and Wales or Northern Ireland, means any legal estate and any equitable interest or power,in the case of land in Scotland, means any estate, interest, servitude or other heritable right in or over land, including a heritable security,

• “interest”, in relation to property other than land, includes any right (including a right to possession of the property),

• “interim administration order” has the meaning given by section 256(2),

• “interim receiving order” has the meaning given by section 246(2),

• “justice of the peace”, in relation to Northern Ireland, means lay magistrate;

• “listed asset” (in Chapter 3A) has the meaning given by section 303B,

• “the minimum amount” (in Chapter 3) has the meaning given by section 303,

• “the minimum amount” (in Chapter 3B) has the meaning given by section 303Z8

• “the minimum value” (in Chapter 3A) has the meaning given by section 303Y,

• “part”, in relation to property, includes a portion,

• “payment institution” (in Chapter 3B) has the meaning given by section 303Z1(6),

• “PPO receiver” has the meaning given by section 255G(2);

• “premises” has the same meaning as in the Police and Criminal Evidence Act 1984 (c. 60),

• “prohibitory property order” has the meaning given by section 255A(2);

• “property freezing order” has the meaning given by section 245A(2);

• “property obtained through unlawful conduct” has the meaning given by section 242,

• “recoverable property” is to be read in accordance with sections 304 to 310,

• “recovery order” means an order made under section 266,

• “relevant court” has the meaning given by section 303Z1(6),

• “relevant financial institution” (in Chapter 3B) has the meaning given by section 303Z1(6),

• “relevant officer” (in Chapter 3A) has the meaning given by section 303C(9),

• “respondent” means—where proceedings are brought by the enforcement authority by virtue of Chapter 2, the person against whom the proceedings are brought,where no such proceedings have been brought but the enforcement authority has applied for a property freezing order, an interim receiving order, a prohibitory property order or an interim administration order, the person against whom he intends to bring such proceedings,

• “senior officer” (in Chapter 3B) has the meaning given by section 303Z2(4),

• “share”, in relation to an excepted joint owner, has the meaning given by section 270(4),

• “unlawful conduct” has the meaning given by section 241,

• “value” means market value.

• (2) The following provisions apply for the purposes of this Part.

• (3) For the purpose of deciding whether or not property was recoverable at any time (including times before commencement), it is to be assumed that this Part was in force at that and any other relevant time.

• (4) Property is all property wherever situated and includes—

• (a) money,

• (b) all forms of property, real or personal, heritable or moveable,

• (c) things in action and other intangible or incorporeal property.

• (5) Any reference to a person’s property (whether expressed as a reference to the property he holds or otherwise) is to be read as follows.

• (6) In relation to land, it is a reference to any interest which he holds in the land.

• (7) In relation to property other than land, it is a reference—

• (a) to the property (if it belongs to him), or

• (b) to any other interest which he holds in the property.

• (8) References to the satisfaction of the enforcement authority’s right to recover property obtained through unlawful conduct are to be read in accordance with section 279.

• (8A) In relation to an order in England and Wales or Northern Ireland which is a recovery order, a property freezing order, an interim receiving order or an order under section 276, references to the enforcement authority are, unless the context otherwise requires, references to the enforcement authority which is seeking, or (as the case may be) has obtained, the order.

• (8B) An enforcement authority in relation to a part of the United Kingdom may take proceedings there for an order under Chapter 2 of this Part in respect of any property or person, whether or not the property or person is (or is domiciled, resident or present) in that part of the United Kingdom.

• (9) Proceedings against any person for an offence are concluded when—

• (a) the person is convicted or acquitted,

• (b) the prosecution is discontinued or, in Scotland, the trial diet is deserted simpliciter, or

• (c) the jury is discharged without a finding otherwise than in circumstances where the proceedings are continued without a jury.

• (10) References (in Chapter 3B) to an account being operated by or for a person are to be read in accordance with section 303Z1(3)(b).

Part 6 — Revenue Functions

General functions

Director’s general Revenue functions

317

• (1) For the purposes of this section the qualifying condition is that the National Crime Agency has reasonable grounds to suspect that—

• (a) income arising or a gain accruing to a person in respect of a chargeable period is chargeable to income tax or is a chargeable gain (as the case may be) and arises or accrues as a result of the person’s or another’s criminal conduct (whether wholly or partly and whether directly or indirectly), or

• (b) a company is chargeable to corporation tax on its profits arising in respect of a chargeable period and the profits arise as a result of the company’s or another person’s criminal conduct (whether wholly or partly and whether directly or indirectly).

• (2) If the qualifying condition is satisfied the National Crime Agency may serve on the Commissioners of Inland Revenue (the Board) a notice which—

• (a) specifies the person or the company (as the case may be) and the period, and

• (b) states that the National Crime Agency intends to carry out, in relation to the person or the company (as the case may be) and in respect of the period, such of the general Revenue functions as are specified in the notice.

• (3) Service of a notice under subsection (2) vests in the National Crime Agency, in relation to the person or the company (as the case may be) and in respect of the period, such of the general Revenue functions as are specified in the notice; but this is subject to section 318.

• (4) the National Crime Agency—

• (a) may at any time serve on the Board a notice of withdrawal of the notice under subsection (2);

• (b) must serve such a notice of withdrawal on the Board if the qualifying condition ceases to be satisfied.

• (5) A notice under subsection (2) and a notice of withdrawal under subsection (4) may be in respect of one or more periods.

• (6) Service of a notice under subsection (4) divests the National Crime Agency of the functions concerned in relation to the person or the company (as the case may be) and in respect of the period or periods specified in the notice.

• (7) The vesting of a function in the National Crime Agency under this section does not divest the Board or an officer of the Board of the function.

• (8) If—

• (a) apart from this section the Board’s authorisation would be required for the exercise of a function, and

• (b) the function is vested in the National Crime Agency under this section,

the authorisation is not required in relation to the function as so vested.

• (9) It is immaterial whether a chargeable period or any part of it falls before or after the passing of this Act.

Revenue functions regarding employment

318

• (1) Subsection (2) applies if—

• (a) the National Crime Agency serves a notice or notices under section 317(2) in relation to a company and in respect of a period or periods, and

• (b) the company is an employer.

• (2) The general Revenue functions vested in the National Crime Agency do not include functions relating to any requirement which—

• (a) is imposed on the company in its capacity as employer, and

• (b) relates to a year of assessment which does not fall wholly within the period or periods.

• (3) Subsection (4) applies if—

• (a) the National Crime Agency serves a notice or notices under section 317(2) in relation to an individual and in respect of a year or years of assessment, and

• (b) the individual is a self-employed earner.

• (4) The general Revenue functions vested in the National Crime Agency do not include functions relating to any liability to pay Class 2 contributions in respect of a period which does not fall wholly within the year or years of assessment.

• (5) In this section in its application to Great Britain—

• (a) “self-employed earner” has the meaning given by section 2(1)(b) of the Social Security Contributions and Benefits Act 1992 (c. 4);

• (b) “Class 2 contributions” must be construed in accordance with section 1(2)(c) of that Act.

• (6) In this section in its application to Northern Ireland—

• (a) “self-employed earner” has the meaning given by section 2(1)(b) of the Social Security Contributions and Benefits (Northern Ireland) Act 1992 (c. 7);

• (b) “Class 2 contributions” must be construed in accordance with section 1(2)(c) of that Act.

Source of income

319

• (1) For the purpose of the exercise by the National Crime Agency of any function vested in it by virtue of this Part it is immaterial that the National Crime Agency cannot identify a source for any income.

• (2) An assessment made by the National Crime Agency under section 29 of the Taxes Management Act 1970 (c. 9) (assessment where loss of tax discovered) in respect of income charged to tax under Chapter 8 of Part 5 of the Income Tax (Trading and Other Income) Act 2005 must not be reduced or quashed only because it does not specify (to any extent) the source of the income.

• (3) If the National Crime Agency serves on the Board a notice of withdrawal under section 317(4), any assessment made by the National Crime Agency under section 29 of the Taxes Management Act 1970 is invalid to the extent that it does not specify a source for the income.

• (4) Subsections (2) and (3) apply in respect of years of assessment whenever occurring.

Appeals

320

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Inheritance tax functions

Director’s functions: transfers of value

321

• (1) For the purposes of this section the qualifying condition is that the National Crime Agency has reasonable grounds to suspect that—

• (a) there has been a transfer of value within the meaning of the Inheritance Tax Act 1984 (c. 51), and

• (b) the value transferred by the transfer of value is attributable (in whole or part) to criminal property.

• (2) If the qualifying condition is satisfied the National Crime Agency may serve on the Board a notice which—

• (a) specifies the transfer of value, and

• (b) states that the National Crime Agency intends to carry out the Revenue inheritance tax functions in relation to the transfer.

• (3) Service of a notice under subsection (2) vests in the National Crime Agency the Revenue inheritance tax functions in relation to the transfer.

• (4) the National Crime Agency—

• (a) may at any time serve on the Board a notice of withdrawal of the notice under subsection (2);

• (b) must serve such a notice of withdrawal on the Board if the qualifying condition ceases to be satisfied.

• (5) Service of a notice under subsection (4) divests the National Crime Agency of the Revenue inheritance tax functions in relation to the transfer.

• (6) The vesting of a function in the National Crime Agency under this section does not divest the Board or an officer of the Board of the function.

• (7) It is immaterial whether a transfer of value is suspected to have occurred before or after the passing of this Act.

Director’s functions: certain settlements

322

• (1) For the purposes of this section the qualifying condition is that the National Crime Agency has reasonable grounds to suspect that—

• (a) all or part of the property comprised in a settlement is relevant property for the purposes of Chapter 3 of Part 3 of the Inheritance Tax Act 1984 (settlements without interest in possession), and

• (b) the relevant property is (in whole or part) criminal property.

• (2) If the qualifying condition is satisfied the National Crime Agency may serve on the Board a notice which—

• (a) specifies the settlement concerned,

• (b) states that the National Crime Agency intends to carry out the Revenue inheritance tax functions in relation to the settlement, and

• (c) states the period for which the National Crime Agency intends to carry them out.

• (3) Service of a notice under subsection (2) vests in the National Crime Agency the Revenue inheritance tax functions in relation to the settlement for the period.

• (4) the National Crime Agency—

• (a) may at any time serve on the Board a notice of withdrawal of the notice under subsection (2);

• (b) must serve such a notice of withdrawal on the Board if the qualifying condition ceases to be satisfied.

• (5) Service of a notice under subsection (4) divests the National Crime Agency of the Revenue inheritance tax functions in relation to the settlement for the period.

• (6) The vesting of a function in the National Crime Agency under this section does not divest the Board or an officer of the Board of the function.

• (7) It is immaterial whether the settlement is commenced or a charge to tax arises or a period or any part of it falls before or after the passing of this Act.

General

Functions

323

• (1) The general Revenue functions are such of the functions vested in the Board or in an officer of the Board as relate to any of the following matters—

• (a) income tax;

• (b) capital gains tax;

• (c) corporation tax;

• (d) national insurance contributions;

• (e) statutory sick pay;

• (f) statutory maternity pay;

• (g) ... statutory paternity pay;

• (ga) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (h) statutory adoption pay;

• (ha) statutory shared parental pay;

• (hb) statutory parental bereavement pay;

• (hc) statutory neonatal care pay;

• (i) student loans.

• (2) The Revenue inheritance tax functions are such functions vested in the Board or in an officer of the Board as relate to inheritance tax.

• (3) But the general Revenue functions and the Revenue inheritance tax functions do not include any of the following functions—

• (a) functions relating to the making of subordinate legislation (within the meaning given by section 21(1) of the Interpretation Act 1978 (c. 30));

• (b) the function of the prosecution of offences;

• (c) the function of authorising an officer for the purposes of section 20BA of the Taxes Management Act 1970 (c. 9) (orders for delivery of documents);

• (d) the function of giving information under that section;

• (e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (4) For the purposes of this section in its application to Great Britain—

• (a) national insurance contributions are contributions payable under Part 1 of the Social Security Contributions and Benefits Act 1992 (c. 4);

• (b) “statutory sick pay” must be construed in accordance with section 151(1) of that Act;

• (c) “statutory maternity pay” must be construed in accordance with section 164(1) of that Act;

• (d) “statutory paternity pay” must be construed in accordance with sections 171ZA and 171ZB of that Act;

• (da) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (e) “statutory adoption pay” must be construed in accordance with section 171ZL of that Act;

• (ea) statutory shared parental pay” must be construed in accordance with sections 171ZU and 171ZV of that Act;

• (eb) “statutory parental bereavement pay” must be construed in accordance with section 171ZZ6 of that Act;

• (ec) “statutory neonatal care pay” must be construed in accordance with section 171ZZ16 of that Act;

• (f) “student loans” must be construed in accordance with the Education (Student Loans) (Repayment) Regulations 2000 (S.I. 2000/944).

• (5) For the purposes of this section in its application to Northern Ireland—

• (a) national insurance contributions are contributions payable under Part 1 of the Social Security Contributions and Benefits (Northern Ireland) Act 1992 (c. 7);

• (b) “statutory sick pay” must be construed in accordance with section 147(1) of that Act;

• (c) “statutory maternity pay” must be construed in accordance with section 160(1) of that Act;

• (d) statutory paternity pay must be construed in accordance with any Northern Ireland legislation which corresponds to Part 12ZA of the Social Security Contributions and Benefits Act 1992;

• (e) “statutory adoption pay” must be construed in accordance with any Northern Ireland legislation which corresponds to Part 12ZB of that Act;

• (ea) statutory shared parental pay” must be construed in accordance with any Northern Ireland legislation which corresponds to Part 12ZC of that Act;

• (eb) “statutory parental bereavement pay” must be construed in accordance with any Northern Ireland legislation which corresponds to Part 12ZD of that Act;

• (ec) “statutory neonatal care pay” must be construed in accordance with any Northern Ireland legislation which corresponds to Part 12ZE of that Act;

• (f) “student loans” must be construed in accordance with the Education (Student Loans) (Repayment) Regulations (Northern Ireland) 2000 (S.R. 2000/121).

Exercise of Revenue functions

324

• (1) This section applies in relation to the exercise by the National Crime Agency of—

• (a) general Revenue functions;

• (b) Revenue inheritance tax functions.

• (2) Section 2B(2) does not apply.

• (3) the National Crime Agency must apply—

• (a) any interpretation of the law which has been published by the Board;

• (b) any concession which has been published by the Board and which is available generally to any person falling within its terms.

• (4) the National Crime Agency must also take account of any material published by the Board which does not fall within subsection (3).

• (5) the National Crime Agency must provide the Board with such documents and information as the Board consider appropriate.

• (6) “Concession” includes any practice, interpretation or other statement in the nature of a concession.

Declarations

325

• (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (2) Every National Crime Agency officer who is assigned to carry out any function of the National Crime Agency under this Part must, as soon as practicable after being so assigned, make a declaration in the form set out in Schedule 8 before a person nominated by the Director General of the National Crime Agency for the purpose.

Interpretation

326

• (1) Criminal conduct is conduct which—

• (a) constitutes an offence in any part of the United Kingdom, or

• (b) would constitute an offence in any part of the United Kingdom if it occurred there.

• (2) But criminal conduct does not include conduct constituting an offence relating to a matter under the care and management of the Board.

• (3) In applying subsection (1) it is immaterial whether conduct occurred before or after the passing of this Act.

• (4) Property is criminal property if it constitutes a person’s benefit from criminal conduct or it represents such a benefit (in whole or part and whether directly or indirectly); and it is immaterial—

• (a) who carried out the conduct;

• (b) who benefited from it.

• (5) A person benefits from conduct if he obtains property as a result of or in connection with the conduct.

• (6) If a person obtains a pecuniary advantage as a result of or in connection with conduct, he is to be taken to obtain as a result of or in connection with the conduct a sum of money equal to the value of the pecuniary advantage.

• (7) References to property or a pecuniary advantage obtained in connection with conduct include references to property or a pecuniary advantage obtained in both that connection and some other.

• (8) If a person benefits from conduct his benefit is the property obtained as a result of or in connection with the conduct.

• (9) Property is all property wherever situated and includes—

• (a) money;

• (b) all forms of property, real or personal, heritable or moveable;

• (c) things in action and other intangible or incorporeal property.

• (10) The following rules apply in relation to property—

• (a) property is obtained by a person if he obtains an interest in it;

• (b) references to an interest, in relation to land in England and Wales or Northern Ireland, are to any legal estate or equitable interest or power;

• (c) references to an interest, in relation to land in Scotland, are to any estate, interest, servitude or other heritable right in or over land, including a heritable security;

• (d) references to an interest, in relation to property other than land, include references to a right (including a right to possession).

• (11) Any reference to an officer of the Board includes a reference to—

• (a) a collector of taxes;

• (b) an inspector of taxes.

• (12) Expressions used in this Part and in the Taxes Acts have the same meaning as in the Taxes Acts (within the meaning given by section 118 of the Taxes Management Act 1970 (c. 9)).

• (13) This section applies for the purposes of this Part.

Part 7 — Money Laundering

Offences

Concealing etc

327

• (1) A person commits an offence if he—

• (a) conceals criminal property;

• (b) disguises criminal property;

• (c) converts criminal property;

• (d) transfers criminal property;

• (e) removes criminal property from England and Wales or from Scotland or from Northern Ireland.

• (2) But a person does not commit such an offence if—

• (a) he makes an authorised disclosure under section 338 and (if the disclosure is made before he does the act mentioned in subsection (1)) he has the appropriate consent;

• (b) he intended to make such a disclosure but had a reasonable excuse for not doing so;

• (c) the act he does is done in carrying out a function he has relating to the enforcement of any provision of this Act or of any other enactment relating to criminal conduct or benefit from criminal conduct.

• (2A) Nor does a person commit an offence under subsection (1) if—

• (a) he knows, or believes on reasonable grounds, that the relevant criminal conduct occurred in a particular country or territory outside the United Kingdom, and

• (b) the relevant criminal conduct—

• (i) was not, at the time it occurred, unlawful under the criminal law then applying in that country or territory, and

• (ii) is not of a description prescribed by an order made by the Secretary of State.

• (2B) In subsection (2A) “ the relevant criminal conduct ” is the criminal conduct by reference to which the property concerned is criminal property.

• (2C) A deposit-taking body , electronic money institution or payment institution that does an act mentioned in paragraph (c) or (d) of subsection (1) does not commit an offence under that subsection if—

• (a) it does the act in operating an account maintained with it, and

• (b) the value of the criminal property concerned is less than the threshold amount determined under section 339A for the act.

• (2D) A person (“P”) who does an act mentioned in paragraph (c) or (d) of subsection (1) does not commit an offence under that subsection if—

• (a) P is carrying on business in the regulated sector that is not excluded business,

• (b) P does the act, in the course of that business—

• (i) in transferring or handing over to a customer or client money or other property of, or owing to, the customer or client, and

• (ii) for the purposes of the termination of P’s business relationship with the customer or client,

• (c) the total value of the criminal property so transferred or handed over to the customer or client by P for those purposes is less than the threshold amount determined under section 339A for the act, and

• (d) before the act is done, P has complied with the customer due diligence duties.

• (2E) For the purposes of subsection (2D)—

• (a) business is “excluded” if it is of a description specified in regulations made by the Secretary of State for the purposes of this paragraph;

• (b) a reference to property being transferred or handed over to the customer or client includes a reference to property being transferred or handed over to another person at the direction of the customer or client;

• (c) “customer due diligence duties” means all duties imposed on P in relation to the customer or client by regulation 28(2), (3), (3A), (4), (8) or (10) of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (S.I. 2017/692) (customer due diligence measures).

• (2F) A person (“P”) who does an act mentioned in paragraph (c), (d) or (e) of subsection (1) does not commit an offence under that subsection if—

• (a) P is carrying on business in the regulated sector,

• (b) P does the act in the course of that business, on behalf of a customer or client, in operating an account or accounts maintained with P or in connection with holding any property for the customer or client,

• (c) at the time of the act, P knows or suspects that part but not all of the funds in the account or accounts, or of the property so held, is criminal property (“the relevant criminal property”),

• (d) it is not possible, at the time the act takes place, to identify the part of the funds or property that is the relevant criminal property, and

• (e) the value of the funds in the account or accounts, or of the property so held, is not, as a direct or indirect result of the act, less than the value of the relevant criminal property at the time of the act.

• (2G) Where subsection (2F) applies—

• (a) if P does the act in operating an account or accounts, the funds in the account or accounts immediately after the act are assumed to include the relevant criminal property, and

• (b) if P does the act in connection with holding any property for the customer or client, such of that property as is held by P immediately after the act is assumed to include the relevant criminal property.

• (3) Concealing or disguising criminal property includes concealing or disguising its nature, source, location, disposition, movement or ownership or any rights with respect to it.

Arrangements

328

• (1) A person commits an offence if he enters into or becomes concerned in an arrangement which he knows or suspects facilitates (by whatever means) the acquisition, retention, use or control of criminal property by or on behalf of another person.

• (2) But a person does not commit such an offence if—

• (a) he makes an authorised disclosure under section 338 and (if the disclosure is made before he does the act mentioned in subsection (1)) he has the appropriate consent;

• (b) he intended to make such a disclosure but had a reasonable excuse for not doing so;

• (c) the act he does is done in carrying out a function he has relating to the enforcement of any provision of this Act or of any other enactment relating to criminal conduct or benefit from criminal conduct.

• (3) Nor does a person commit an offence under subsection (1) if—

• (a) he knows, or believes on reasonable grounds, that the relevant criminal conduct occurred in a particular country or territory outside the United Kingdom, and

• (b) the relevant criminal conduct—

• (i) was not, at the time it occurred, unlawful under the criminal law then applying in that country or territory, and

• (ii) is not of a description prescribed by an order made by the Secretary of State.

• (4) In subsection (3) “ the relevant criminal conduct ” is the criminal conduct by reference to which the property concerned is criminal property.

• (5) A deposit-taking body , electronic money institution or payment institution that does an act mentioned in subsection (1) does not commit an offence under that subsection if—

• (a) it does the act in operating an account maintained with it, and

• (b) the arrangement facilitates the acquisition, retention, use or control of criminal property of a value that is less than the threshold amount determined under section 339A for the act.

• (6) A person (“P”) who does an act mentioned in subsection (1) does not commit an offence under that subsection if—

• (a) P is carrying on business in the regulated sector that is not excluded business,

• (b) P does the act, in the course of that business—

• (i) in transferring or handing over to a customer or client money or other property of, or owing to, the customer or client, and

• (ii) for the purposes of the termination of P’s business relationship with the customer or client,

• (c) the total value of the criminal property so transferred or handed over to the customer or client by P for those purposes is less than the threshold amount determined under section 339A for the act, and

• (d) before the act is done, P has complied with the customer due diligence duties.

• (7) For the purposes of subsection (6)—

• (a) business is “excluded” if it is of a description specified in regulations made by the Secretary of State for the purposes of this subsection;

• (b) a reference to property being transferred or handed over to the customer or client includes a reference to property being transferred or handed over to another person at the direction of the customer or client;

• (c) “customer due diligence duties” means all duties imposed on P in relation to the customer or client by regulation 28(2), (3), (3A), (4), (8) or (10) of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (S.I. 2017/692) (customer due diligence measures).

• (8) A person (“P”) who does an act mentioned in subsection (1) does not commit an offence under that subsection if—

• (a) P is carrying on business in the regulated sector,

• (b) P does the act in the course of that business, on behalf of a customer or client, in operating an account or accounts maintained with P or in connection with holding any property for the customer or client,

• (c) at the time of the act, P knows or suspects that part but not all of the funds in the account or accounts, or of the property so held, is criminal property (“the relevant criminal property”),

• (d) it is not possible, at the time the act takes place, to identify the part of the funds or property that is the relevant criminal property, and

• (e) the value of the funds in the account or accounts, or of the property so held, is not, as a direct or indirect result of the act, less than the value of the relevant criminal property at the time of the act.

• (9) Where subsection (8) applies—

• (a) if P does the act in operating an account or accounts, the funds in the account or accounts immediately after the act are assumed to include the relevant criminal property, and

• (b) if P does the act in connection with holding any property for the customer or client, such of that property as is held by P immediately after the act is assumed to include the relevant criminal property.

Acquisition, use and possession

329

• (1) A person commits an offence if he—

• (a) acquires criminal property;

• (b) uses criminal property;

• (c) has possession of criminal property.

• (2) But a person does not commit such an offence if—

• (a) he makes an authorised disclosure under section 338 and (if the disclosure is made before he does the act mentioned in subsection (1)) he has the appropriate consent;

• (b) he intended to make such a disclosure but had a reasonable excuse for not doing so;

• (c) he acquired or used or had possession of the property for adequate consideration;

• (d) the act he does is done in carrying out a function he has relating to the enforcement of any provision of this Act or of any other enactment relating to criminal conduct or benefit from criminal conduct.

• (2A) Nor does a person commit an offence under subsection (1) if—

• (a) he knows, or believes on reasonable grounds, that the relevant criminal conduct occurred in a particular country or territory outside the United Kingdom, and

• (b) the relevant criminal conduct—

• (i) was not, at the time it occurred, unlawful under the criminal law then applying in that country or territory, and

• (ii) is not of a description prescribed by an order made by the Secretary of State.

• (2B) In subsection (2A) “ the relevant criminal conduct ” is the criminal conduct by reference to which the property concerned is criminal property.

• (2C) A deposit-taking body , electronic money institution or payment institution that does an act mentioned in subsection (1) does not commit an offence under that subsection if—

• (a) it does the act in operating an account maintained with it, and

• (b) the value of the criminal property concerned is less than the threshold amount determined under section 339A for the act.

• (2D) A person (“P”) who does an act mentioned in subsection (1) does not commit an offence under that subsection if—

• (a) P is carrying on business in the regulated sector that is not excluded business,

• (b) P does the act, in the course of that business—

• (i) in transferring or handing over to the customer or client property of, or owing to, a customer or client, and

• (ii) for the purposes of the termination of P’s business relationship with the customer or client,

• (c) the total value of the criminal property so transferred or handed over to the customer or client by P for those purposes is less than the threshold amount determined under section 339A for the act, and

• (d) before the act is done, P has complied with the customer due diligence duties.

• (2E) For the purposes of subsection (2D)—

• (a) business is “excluded” if it is of a description specified in regulations made by the Secretary of State for the purposes of this subsection;

• (b) a reference to property being transferred or handed over to the customer or client includes a reference to property being transferred or handed over to another person at the direction of the customer or client;

• (c) “customer due diligence duties” means all duties imposed on P in relation to the customer or client by regulation 28(2), (3), (3A), (4), (8) or (10) of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (S.I. 2017/692) (customer due diligence measures).

• (2F) A person (“P”) who does an act mentioned in subsection (1) does not commit an offence under that subsection if—

• (a) P is carrying on business in the regulated sector,

• (b) P does the act in the course of that business, on behalf of a customer or client, in operating an account or accounts maintained with P or in connection with holding any property for the customer or client,

• (c) at the time of the act, P knows or suspects that part but not all of the funds in the account or accounts, or of the property so held, is criminal property (“the relevant criminal property”),

• (d) it is not possible, at the time the act takes place, to identify the part of the funds or property that is the relevant criminal property, and

• (e) the value of the funds in the account or accounts, or of the property so held, is not, as a direct or indirect result of the act, less than the value of the relevant criminal property at the time of the act.

• (2G) Where subsection (2F) applies—

• (a) if P does the act in operating an account or accounts, the funds in the account or accounts immediately after the act are assumed to include the relevant criminal property, and

• (b) if P does the act in connection with holding any property for the customer or client, such of that property as is held by P immediately after the act is assumed to include the relevant criminal property.

• (3) For the purposes of this section—

• (a) a person acquires property for inadequate consideration if the value of the consideration is significantly less than the value of the property;

• (b) a person uses or has possession of property for inadequate consideration if the value of the consideration is significantly less than the value of the use or possession;

• (c) the provision by a person of goods or services which he knows or suspects may help another to carry out criminal conduct is not consideration.

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• (1) A person commits an offence if the conditions in subsections (2) to (4) are satisfied.

• (2) The first condition is that he—

• (a) knows or suspects, or

• (b) has reasonable grounds for knowing or suspecting,

that another person is engaged in money laundering.

• (3) The second condition is that the information or other matter—

• (a) on which his knowledge or suspicion is based, or

• (b) which gives reasonable grounds for such knowledge or suspicion,

came to him in the course of a business in the regulated sector.

• (3A) The third condition is—

• (a) that he can identify the other person mentioned in subsection (2) or the whereabouts of any of the laundered property, or

• (b) that he believes, or it is reasonable to expect him to believe, that the information or other matter mentioned in subsection (3) will or may assist in identifying that other person or the whereabouts of any of the laundered property.

• (4) The fourth condition is that he does not make the required disclosure to—

• (a) a nominated officer, or

• (b) a person authorised for the purposes of this Part by the Director General of the National Crime Agency,

as soon as is practicable after the information or other matter mentioned in subsection (3) comes to him.

• (5) The required disclosure is a disclosure of—

• (a) the identity of the other person mentioned in subsection (2), if he knows it,

• (b) the whereabouts of the laundered property, so far as he knows it, and

• (c) the information or other matter mentioned in subsection (3).

• (5A) The laundered property is the property forming the subject-matter of the money laundering that he knows or suspects, or has reasonable grounds for knowing or suspecting, that other person to be engaged in.

• (6) But he does not commit an offence under this section if—

• (a) he has a reasonable excuse for not making the required disclosure,

• (b) he is a professional legal adviser or ... relevant professional adviser and—

• (i) if he knows either of the things mentioned in subsection (5)(a) and (b), he knows the thing because of information or other matter that came to him in privileged circumstances, or

• (ii) the information or other matter mentioned in subsection (3) came to him in privileged circumstances, or

• (c) subsection (7) or (7B) applies to him.

• (7) This subsection applies to a person if—

• (a) he does not know or suspect that another person is engaged in money laundering, and

• (b) he has not been provided by his employer with such training as is specified by the Secretary of State by order for the purposes of this section.

• (7B) This subsection applies to a person if—