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13 July 2015

Why understanding the Serious Crime Act 2015 pays

7 mins

Crime analysis: What changes should criminal lawyers expect from the introduction of the Serious Crimes Act 2015 (SCA 2015)? Jessica Skinns explains how SCA 2015 has transformed different areas of criminal law.

Original news

Serious Crime Act 2015, LNB News 04/03/2015 101

SCA 2015 introduces a new participation offence to target people who knowingly contribute towards activities in an organised crime group. The measure is one of many to be introduced in England and Wales, with other offences covering the unauthorised possession of knives or psychoactive substances in prisons and the criminalisation of paedophile manual possession.

What aspects of SCA 2015 should law firms be paying attention to?

A number of the provisions of SCA 2015 were brought into force on 1 June 2015. The stated principal objective of SCA 2015 is to:

Ensure that law enforcement agencies have effective legal powers to deal with the threat from serious and organised crime.

In fact, SCA 2015 is broader than this. There is much in SCA 2015 that is of relevance to criminal lawyers in particular. Some key provisions include:

Changes to the confiscation regime in SCA 2015, Pt 1, Ch 1:

SCA 2015 creates an additional power via the Proceeds of Crime Act 2002, s 10A (POCA 2002) for the Crown Court to determine the proportion of the defendant’s assets that are to be confiscated. Previously, a confiscation order could only be made in a particular sum and the defendant could pay from whichever asset they wished. What follows from the new SCA 2015, s 10A power is a new right of standing for third parties in the Crown Court confiscation proceedings, so the third party might argue their share of an asset. Previously, third parties could only make such representations at the restraint or enforcement stages.

SCA 2015 inserts POCA 2002, s 11, which requires immediate payment and tightens up the circumstances in which extensions of time to pay a confiscation order may be given. It also reduces the overall aggregated maximum period from 12 months to six months.

SCA 2015 creates a new ‘compliance order’ in POCA 2002, s 13A, which permits the Crown Court, when making the confiscation order, to impose on the defendant or third parties any order it believes is appropriate for the purpose of ensuring that the confiscation order is effective. It directs that that particular consideration must be given to restrictions or prohibitions on the defendant’s travel.

SCA 2015 amends POCA 2002, s 35 to simplify and extend the sentences for failing to pay a confiscation order. For example, the sentence in default for a sum of more than £1m is now 14 years, where previously it was ten years.

SCA 2015 amends POCA 2002, s 40 to lower the threshold for imposing a restraint order. The current test is that there must be ‘reasonable cause to believe that the alleged offender has benefited from his criminal conduct’. The new test is that there need only be ‘reasonable grounds for suspecting’. It is thought that this will allow restraint orders to be imposed earlier in the investigation.

Changes to the POCA 2002 authorised disclosure regime in SCA 2015, Pt 1 Ch 4:

Previously, where money laundering was suspected, the particular transaction could not be executed and an authorised disclosure had to be made to the relevant authorities and the individual could not inform their client of the disclosure, as to do so would amount to the offence of tipping off. This gap left the organisation making the disclosure open to a potential civil claim about their failure to execute a particular transaction and has been much litigated. SCA 2015 inserts new provisions into POCA 2002, s 338, so that where an authorised disclosure is made, and that disclosure was made in good faith, no civil liability arises.

New criminal offences and powers under SCA 2015, Pts 2 and 6 SCA 2015 inserts s 37ZA into the Computer Misuse Act 1990, creating a new offence where unauthorised computer use causes ‘serious damage of a material kind’ and is intended to cover ‘critical’ damage to national infrastructure.

SCA 2015, s 45 implements in domestic law one of the UK’s obligations under the UN Convention against Transnational Organised Crime. It creates a very broadly drafted offence of participating in the criminal activities of an organised crime group, where those criminal activities are of a more serious nature–those attracting seven years imprisonment.

The definition of child cruelty under the Children and Young Person Act 1933, s 1 is amended to make explicit the fact that it includes psychological abuse, not just physical abuse.

A new offence is inserted into the Sexual Offences Act 2003, s 15A concerning sexual communication with a child. Once in force, this is intended to fill the perceived gap where communications are sent to a child but they do not invite the child to engage in sexual activity, do not amount to grooming or do not do anything grossly offensive or indecent. The new offence is not intended to cover communications between young people.

SCA 2015 adds a new offence in the Female Genital Mutilation Act 2003, s 3A of failing to protect a girl from the risk of female genital mutilation (FGM).
When it is brought into force, SCA 2015, s 76 creates a new domestic abuse offence, which defines domestic abuse as repeated controlling and coercive behaviour that has a ‘serious’ effect, such as causing fear that violence will be used or causing alarm or distress which adversely affects day-to-day activities. It does not apply to parent-child relationships, which are already covered under child cruelty legislation.

SCA 2015 extends or adds extra-territorial jurisdiction to existing offences of preparing or training for terrorism, so those who prepare or train for terrorism abroad can be tried in the UK.

Under traditional Police and Criminal Evidence Act 1984 powers of search and seizure, special status is given to journalistic material and judicial authorisation is required for its seizure. However, no such special status is afforded to journalistic material obtained via communications ‘meta’ data under the Regulation of Investigatory Powers Act 2000 (RIPA 2000). SCA 2015 inserts a requirement for the Home Secretary to issue codes of practice, which protect the public interest in protecting journalistic sources. However, it does not go as far as requiring a production order for this type of material, although it is hoped that amendments to RIPA 2000 on this point may be forthcoming following the report of the interception of communications commissioner.

What action should law firms be taking at this stage?

Firms that operate in the regulated sector, and that have cause to make an authorised disclosure where they suspect money laundering, can do so in the knowledge that the legal position regarding their lack of civil liability is now settled law.

Criminal lawyers in particular firms should be familiarising themselves with the new provisions and training their staff. SCA 2015 is not a massive change to criminal law, but it marks a subtle and nonetheless significant shift in relation to core aspects of any criminal practitioner’s work, particularly in the realm of confiscation.

What are the risks facing lawyers and law firms if they fail to take action in light of the new provisions in SCA 2015?

The risk for criminal lawyers is that they will be providing inaccurate and outdated advice. The offences of domestic abuse and to a lesser extent child cruelty come up frequently and the new offence of participating in organised crime may well become a regular feature of the landscape in the future.

What are the wider implications of SCA 2015 for criminal lawyers?

It seems likely that there will be many new prosecutions arising out of SCA 2015 or more broadly defined offences, such as:

  • child cruelty
  • domestic abuse
  • FGM
  • participating in organised crime
  • preparing for terrorism while abroad

However, whether this results in more convictions remains to be seen. Some of these types of offences are notoriously difficult to prove because they occur within the close-confines of a family unit. Alternatively, in the context of organised crime, in situations where those that may be witnesses may not be willing to give evidence due to fears of reprisals against them. In addition, extra-territorial terrorist offences, by their very nature, may require evidence being secured from abroad.

It is also unclear whether the purported tightening up of the confiscation regime will have its intended effect. It is possible to foresee Crown Courts bogged down in protracted disputes over third party assets, the terms of restraint orders and enforcement of compliance orders.

This article was first published on LexisNexis PSL

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