Proceeds of Crime: Non-Conviction Based Forfeiture at the EU Level

We are delighted to welcome this Guest Post from Dr Colin King. Dr King is Lecturer in Law at the University of Manchester. Prior to joining Manchester, he was Lecturer in Criminal Law and Evidence at the University of Leeds and Director of the University of Leeds Innocence Project. He completed his PhD – ‘The Confiscation of Criminal Assets: Tackling Organised Crime Through a “Middleground” System of Justice’ – at the University of Limerick, Ireland in 2010. He is co-editor (with Prof. Clive Walker) of ‘Dirty Assets: Emerging Issues in the Regulation of Criminal and Terrorist Assets’ to be published by Ashgate in February 2014.

 

There are significant obstacles to prosecuting those engaged in organised criminal activities, especially where criminal groups operate across legal jurisdictions. In response, law enforcement and policing agencies have turned their attention to the assets accrued via criminal means. The most famous example of this is Al Capone, who was jailed not for murder, racketeering, or extortion, but rather for tax evasion. Today the use of asset recovery against criminals, seizing the proceeds of organised crime, is seen as a vital law enforcement tool. This is unsurprising; indeed a 2011 UNODC Report – Estimating Illicit Financial Flows Resulting From Drug Trafficking and Other Transnational Organized Crimes – estimates the total value of all criminal proceeds to be approximately 3.6% of global GDP, or US$2.1 trillion. Within the EU, a European Commission Memo from 2012 – Confiscation and asset recovery: Better tools to fight crime – points to individual examples such as Italy (where organised crime revenues were an estimated €150 billion in 2011) and the UK (where organised crime revenues were estimated at stg£15 billion in 2006).

Anti-money laundering offences and post-conviction confiscation of assets have long been tools in the armoury of police and law enforcement agencies. However, these tools were widely regarded as inadequate to target assets of the upper echelons of organised crime groups.  Increasingly, a non-conviction based approach to seizing criminal assets is gaining favour. While such an approach has been adopted in, eg, Ireland (Proceeds of Crime Act 1996) and Italy (Decreto-legge 306/1992) for over two decades, other Member States have only recently implemented such a regime, including Bulgaria (Law on Forfeiture of Illegally Acquired Assets, 2012) and Romania (Law 63/2012 enacted on April 17, 2012). The non-conviction based approach – as the name suggests – allows for assets to be seized even in the absence of any criminal conviction.

The Irish model of non-conviction based forfeiture is well known, so this post wont repeat its intricacies (for an overview, see King (2013); Campbell (2007)). Instead, I want to build on a recent article printed in the Irish Independent which also refers to a thematic paper by the Irish MEP Gay Mitchell – ‘Asset Confiscation as an Instrument to Deprive Criminal Organisations of the Proceeds of their Activities’, which support moves towards an EU model of non-conviction based asset forfeiture based on the Irish model.

Organised crime, and its illicit finances, are seen as an urgent challenge to EU security, and are identified as one of five strategic objectives in the EU Internal Security Strategy in Action. The European Commission has recommended ‘recasting the EU legal framework’ and that ‘more should be done to highlight confiscation as one of the most effective ways to fight organised crime’. The current EU framework on asset recovery is set out in, amongst others, the Council Decision of 2007 and Framework Decisions in 2006, 2005, 2003, and 2001. The Commission has also proposed further developments. Yet, despite the importance of seizing criminal assets being repeatedly stressed, and placed high on the EU agenda, there remains a dearth of knowledge on the operation and impact of the increased focus on criminal assets. According to a 2012 Impact Assessment carried out for the European Commission:

‘Statistics on confiscation and asset recovery activities are scarce … Reliable data sources on the number of ongoing freezing and confiscation procedures (especially those to be executed in other Member States), the turnover of criminal organisations, the costs of judicial procedures or the administrative costs related to asset management or data collection activities are even scarcer. Therefore, the economic impacts of the foreseen actions are often difficult to quantify.’

There is a need for greater information on the impact of non-conviction based asset forfeiture – not only in terms of monetary returns, but also in relation to monetary costs as well as costs to individual rights. Such an evaluation of ‘impact’ needs to take place before an EU model of non-conviction based forfeiture is introduced. (This report by Matrix Insight is useful in that regard).

Further, it is not as simple as to say ‘we want an EU model of non-conviction based forfeiture, so lets just implement one’. There are a number of obstacles to harmonisation, especially with such a contentious measure. An obvious difficulty to harmonisation is the differing levels of constitutional protections across Member States. For example, some Member States (eg Romania) have expressed concern about the constitutionality of non-conviction based asset forfeiture, while in other Member States (eg Bulgaria) constitutional courts are currently grappling with practical and procedural issues concerning the non-conviction based approach. This has hampered recognition of such orders from jurisdictions where a non-conviction based approach is embraced (eg Ireland, Italy, UK).

We can be certain that neither Mr Mitchell’s thematic paper, nor the Commission’s proposal for a non-conviction based approach to dirty assets, will be the last we hear on this.

 

References

Campbell, L (2007) Theorising Asset Forfeiture in Ireland. 71 Journal of Criminal Law 441.

King, C (2013) Following the Money Trail: “Civil” Forfeiture of “Criminal” Assets in Ireland. In P.C van Duyne et al (eds), Human Dimensions in Organised Crime, Money Laundering and Corruption (Wolf Legal, Nijmegen) pp.265-291.

Proceeds of Crime: Non-Conviction Based Forfeiture at the EU Level

Informers in Ireland: a lack of law?

The use of informers has been criticised by the Garda Síochána Ombudsman Commission (GSOC) recently. The GSOC is investigating claims that some members of the Gardai permitted the continuation of serious criminality  in exchange for information on other criminal actors. As I’ve written before, the use of undercover police officers and informers is fraught with problems, in terms of the scope of their permitted behaviour and the possible incitement of further offences.

Covert policing and the use of informers allow for the penetration of criminal groups and enterprises, and the communication of information about their structure and actions to the authorities. Much organised crime may not involve a victim as such, or victims may be reluctant to testify, or the evidence gathered may be incomplete or unconvincing. So, the infiltration of criminal enterprises is regarded as crucial for effective policing and investigation of organised crime, whether for intelligence purposes, or to gather evidence for criminal proceedings, or both.

In Ireland there is no legislation governing the use of covert human information sources (CHIS) or informers; instead,  guidelines are in place. In contrast, in the UK the use of CHIS has become more regulated and strictly scrutinised. Although there CHIS need not be authorised under the Regulation of Investigatory Powers Act 2000 and its Scottish equivalent, so doing ensures that the operation has lawful approval. In addition, Codes of Practice have been issued, and each police force has its own policy and operating procedure.

The Covert Human Intelligence Source System and Code of Practice become organisational policy for the Garda Síochána in 2006 following judicial criticism of the handling of informers in the Morris tribunal report. The Code of Practice covers authorisation, registration, risk assessment and record keeping; for example, the recruitment, handling and management of CHIS may be given by the Assistant Commissioner at the Crime and Security Branch of An Garda Síochána only. This is more limited than the scheme in the UK where authorisation of CHIS may come from  various officers such as a superintendent in a police force, HM Revenue & Customs or a Senior Manager in the Serious Organised Crime Agency (SOCA). In neither jurisdiction is judicial approval of the use of CHIS or informers required.

In addition, the Code of Practice in Ireland states that CHIS Handlers and Controllers will be trained to ‘approved standards’, and the use of CHIS will be subject to ‘appropriate reviews’. These opaque terms are not defined in publicly available documents.

While the Code of Practice is claimed to be ‘in line with best international practice’ the lack of legislation is worrying from a due process perspective and is unlikely to be compliant with the ECHR. McDermott has noted that this non-statutory, executive action is not ‘dissimilar’ to the regime which operated in the UK prior to Malone v UK where the European Court of Human Rights found that phone tapping was not in accordance with law and that it breached Art 8 due to the fact that the relevant domestic law was obscure and could be interpreted in different ways. Therefore, procedures in Ireland appear to contravene Art 8 given that the expression ‘in accordance with the law’ in Art 8(2) requires that the measure has ‘some basis in domestic law’ and ‘refers to the quality of this law, demanding that it should be accessible to the person concerned, who must moreover be able to foresee its consequences for him or her, and compatible with the rule of law’ Malone UK [67].

The very nature of covert policing entails police officers skirting close to the limits of legality, and may, as in the case currently under investigation, involve reliance on parties with dubious records and motivations. Moreover, oversight of sources is difficult, and this is not necessarily remedied by a legal framework: as I’ve commented on before, in the UK a number of legal actions and inquiries are underway regarding inappropriate behaviour and relationships cultivated by undercover agents.  Having said that, this does not excuse the absence of legislation in this respect.

Regardless of the findings of the GSOC’s investigation, it is critical that legislation is drawn up to guide and limit the powers of the Gardai in this respect. This will ensure the legitimacy of Garda operations, and will bring practice in line with the ECHR. Ultimately, both a precise legal framework and an ethical culture of policing is required to ensure that due process norms and liberties remain safeguarded in the use of this crime control technique.

Informers in Ireland: a lack of law?

Campbell on Organised Crime

Hart Publishing has just published Organised Crime and the Law and the Law: A Comparative Analysis by Human Rights in Ireland regular contributor Dr Liz Campbell . Further details on the book are below. Readers will be delighted to learn that Hart has offered a 20% discount off the retail price to readers of HR in I.

Organised Crime and the Law presents an overview of the laws and policies adopted to address the phenomenon of organised crime in the United Kingdom and Ireland, assessing the degree to which these justice systems have been recalibrated, in terms of the prevention, investigation, prosecution and punishment of organised criminality. While the notion of organised crime itself is a contested one, States’ legal responses often treat it and its constituent offences as unproblematic in a definitional sense. This book advances a systematic doctrinal critique of relevant domestic criminal laws, laws of evidence, and civil processes.

Organised Crime and the Law constructs a theoretical framework on which an appraisal of these legal measures may be based, focusing in particular on the tension between due process and crime control, the demands of public protection and risk aversion, and other adaptations. In particular, it identifies parallels and points of divergence between the different jurisdictions in the UK and Ireland, bearing in mind the shared history of subversive threats and counter-terrorism policies. It further examines the extent to which policy transfer is evident in the UK and Ireland in terms of emulating the US in the reactions to organised crime. Continue reading “Campbell on Organised Crime”

Campbell on Organised Crime

Cuts to Operation Anvil

The Irish Times reports today that Operation Anvil, the primary operation of the Garda Síochána against organised crime in Ireland, has had its budget reduced by half to €10million.

Operation Anvil, which targets organised and gun crime specifically, was initiated in Dublin in 2005 and on a nationwide basis in 2006, and involves surveillance, Garda patrols and targeted searches and checkpoints. Despite the claims of Garda Commissioner Martin Callinan yesterday that the Garda would continue “to provide an effective intelligence-led policing service”, it is questionable whether such a drop in funding could realistically be absorbed without significant operational and investigative difficulties.

Statistics indicate a nuanced picture in relation to the broad category of non-fatal gun crime in Ireland, in contrast to the common political depiction that “the appearance of a variety of guns in the pursuit of crime has become commonplace” and that there has been a proliferation of guns in society. Continue reading “Cuts to Operation Anvil”

Cuts to Operation Anvil

White Paper on Organised and White Collar Crime

The Department of Justice has invited comment on the White Paper discussion document Organised and White Collar Crime. The paper examines the extent of and legal reactions to a vast array of crimes like drug trafficking, fraud, money laundering, white collar crime and bribery. It asserts that the complex nature of such crimes, the degree of organisation involved, and the use of technology in the perpetration of such acts warrants strategies over and above those used in traditional law enforcement. It questions whether legislative and structural approaches adopted in other jurisdictions should be implemented in Ireland in combating organised, armed gang and white collar crime.

While a range of crimes are addressed, my comments centre on the section on organised crime. Although the paper acknowledges the difficulty in defining organised crime, this does not deter it from seeking to address the phenomenon. It also adopts the dubious, morally loaded and indefinable term “gangland” which is unappealing in a formal document rather than a journalistic piece. Continue reading “White Paper on Organised and White Collar Crime”

White Paper on Organised and White Collar Crime

Conway and Mulqueen on Gangland

HrinI blogger Vicky Conway and Michael Mulqueen of UL have recently published “The 2009 Anti-Gangland Package: Ireland’s New Security Blanket?” in the Irish Criminal Law Journal. The introduction to the article gives a flavour of the insightful analysis it offers:

Between January 2009 and the Dáil summer recess, the Irish government introduced six Bills in response to the problem of organised crime, which had already been linked, in media coverage, to the deaths of 15 people that year. In the previous decade multiple Acts and Amendment Acts had attempted to address the problem which, in political and media discourse, appeared to grow since the killings of Veronica Guerin and Det. Garda Gerry McCabe in the summer of 1996. With each year, the government introduced wider powers and tougher laws. The 2009 package of legislative measures represents a significant leap forward in this trend, not least through its scheduling of organised crime offences; this creates a legal requirement for the use of the non-jury Special Criminal Court in any such trials, an unprecedented step for non-paramilitary activity. Many experts and legal practitioners have predicted that at least two of the laws that comprise the package will be challenged in Irish and possibly European courts. In this article we examine the context for the introduction of the 2009 laws and difficulties which emerge from them, both in terms of the rights they potentially breach and their likelihood of success. Of particular concern to us is how the package of measures represents an underlying shift towards viewing gangland crime as a problem of national security – a shift which risks creating a myriad of further problems. Our conclusion is that not only will the package not succeed in reducing gangland crime, by moving the State further into the realm of emergency law, the package places Ireland on a very dangerous precipice for any democratic state committed to human rights.

The ICLJ is available to read on Westlaw IE for those with a subscription.

Conway and Mulqueen on Gangland