Part 1: Proceeds of crime Unexplained wealth orders: England and Wales and Northern Ireland Section 1: Unexplained wealth orders: England and Wales and Northern Ireland
Section 1 inserts new sections 362A – 362I into POCA, which make provision for the court to make an unexplained wealth order (UWO). A UWO is defined in section 362A(3) as an order requiring an individual to set out the nature and extent of their interest in the property in question, and to explain how they obtained that property in cases where that person’s known income does not explain ownership of that property. It therefore allows an enforcement authority to apply for an order requiring an individual to explain the origin of assets that appear to be disproportionate to their income.
	Applications for UWOs may be made to the High Court by an enforcement authority. An enforcement authority is defined in section 362A(7), and includes the NCA, the SFO, the CPS, the Public Prosecution Service for Northern Ireland, HMRC and the Financial Conduct Authority. The High Court may make an order, provided it is satisfied that each of the requirements for making the order is fulfilled (see section 362B). In particular, the High Court must be satisfied that the respondent is a "Politically Exposed Person" (PEP), or there are reasonable grounds for suspecting that the respondent is, or has been, involved in serious crime (or a person connected with the respondent is, or has been so involved). A UWO made in relation to a non-EEA PEP does not also require suspicion of serious criminality.
	The definition of a PEP is given in section 362B(7), and means an individual who has been entrusted with prominent public functions by an international organisation or a State outside of the UK or the EEA. It also includes family members and close associates.
	The subject of the order – the respondent – and the property in question, must be specified in the order. The form and manner in which the respondent is to provide the explanation relating to the property must also be specified (section 362A(2) and (4)). The order must also specify the person to whom the explanation is to be given and give details of where the explanation is to be sent.
	Section 362A(6) places an obligation on the respondent to explain the source of the specified asset(s) within a time period that the court may specify.
	Section 362B (1)-(10) set out the requirements for making an unexplained wealth order. A key requirement is that the value of the property subject to an order is greater than £50,000 (sub-section (2)). The court must be satisfied that the respondent is a PEP or that there are reasonable grounds to suspect that the respondent or a person connected to them is (or has been) involved in serious crime (sub-sections (3) to (4), "serious crime" is defined as a list of offences as set out in Schedule 1 to the Serious Crime Act 2007 and includes drug trafficking, arms trafficking and money laundering). It is not necessary to prove to the criminal standard that the respondent, or other persons, are involved in such offences. This suspicion need not be restricted to the respondent alone. An order may be made in respect of a person who is (or has been) involved in serious crime as long as that person is associated with the respondent.
	New section 362C applies if a respondent fails to provide information, documents or other material specified in an unexplained wealth order. As mentioned in section 362A(6), a respondent has a certain period of time specified by the court to respond to an order. If, following the expiry of the response period, a respondent fails to comply without reasonable excuse, the property concerned is to be treated as "recoverable property". "Recoverable property" means property obtained through unlawful conduct. In this case, the enforcement authority must consider what action it intends to take against the property. This may include recovering the property using the civil recovery powers provided by Part 5 of POCA. If proceedings are commenced, the respondent can provide evidence to rebut the presumption that their property is recoverable.
	If, however, the respondent replies within the response period, the law enforcement agency has 60 days to consider the evidence put forward. During this period, the enforcement authority must decide whether to take no further action, or some other action such as applying for a further UWO, beginning a civil recovery investigation or applying for a recovery order under section 266 of POCA.
	By virtue of section 362E, a person commits an offence if, in purported compliance with a requirement under an unexplained wealth order, the person makes a statement that the person knows to be false or misleading in a material way, or recklessly makes a statement that is false or misleading in a material way. A person guilty of an offence is liable to conviction on indictment to imprisonment not exceeding two years and/or a fine; or on summary conviction, to imprisonment not exceeding twelve months and/or a fine.
	In addition to the specific criminal offence of making a false or misleading statement, a law enforcement agency may alternatively elect to bring contempt of court proceedings if an individual fails to comply with a UWO.
	By virtue of section 362F, a person making a statement in response to an order is protected from having that statement used in evidence against them in criminal proceedings. The exceptions to this protection are listed in sub-sections (2) and (3).
	New section 362G details the copying and retention of documents obtained under a UWO. Sub-section (3) allows the enforcement authority to copy any document supplied under the requirements of an order and they may be retained for as long as necessary in connection with a civil recovery, confiscation or money laundering investigation (as defined in section 341 POCA) to which the property is connected.
	Section 362H provides a broad definition of how an individual may "hold" property, for the purposes of sections 362A and 362B. The definition is specifically broad enough to address circumstances where property is held in trust or owned in a complex corporate structure arrangement.
	Section 362H(5) clarifies that a UWO can be served in cases where property is registered in the name of an overseas company. This makes it explicit that the UWO provisions do extend to such cases. This does not cast doubt on the scope of other powers within POCA, such as section 84 and 414, which are already used in situations, as relevant, where property is held and registered in such a scenario.
	Section 362I provides further details as to the procedure for making an application for a UWO, which may be made to a judge in chambers without notice, for example, to prevent the property from being dissipated. The enforcement authority and the respondent may apply to vary or discharge the order by virtue of sub-section (4).
	362I also ensures that court rules can be made in Northern Ireland relating to practice and procedure for unexplained wealth orders. In relation to England and Wales, the Civil Procedure Rules already provide the necessary general provision and specific provision respectively. The rule making powers and general application of the Civil Procedure Act 1997 are sufficient for these purposes in England and Wales.