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Proceeds of Crime Act 2002

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Changes and effects yet to be applied to Part 5 Chapter 4 Crossheading Recoverable-property:

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Recoverable propertyU.K.

304 Property obtained through unlawful conductU.K.

(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.

305 Tracing property, etc.U.K.

(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).

306 Mixing propertyU.K.

(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,

[F1(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.

Textual Amendments

F1S. 306(3)(ca) inserted (27.4.2017 for specified purposes, 31.1.2018 for E.W.S. in so far as not already in force) by Criminal Finances Act 2017 (c. 22), ss. 34(10), 58(1)(6); S.I. 2018/78, reg. 3(s)

307 Recoverable property: accruing profitsU.K.

(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.

308 General exceptionsU.K.

(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 [F2Chapter 2 of Part 7 of the Sentencing Code] [F3 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.

[F4(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.]

[F5(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 [F6Chapter 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 [F7Financial 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 F8... 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.

[F9(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).

[F10(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.

Textual Amendments

F3Words in s. 308(4)(a) inserted (28.3.2009 for specified purposes, 31.10.2009 in so far as not already in force) by Armed Forces Act 2006 (c. 52), s. 383(2), Sch. 16 para. 197; S.I. 2009/812, art. 3(a)(b) (with transitional provisions in S.I. 2009/1059); S.I. 2009/1167, art. 4

F7Words in s. 308(7)(a) substituted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 18 para. 94(3)(a) (with Sch. 20); S.I. 2013/423, art. 3, Sch.

F8Words in s. 308(7)(a) omitted (1.4.2013) by virtue of Financial Services Act 2012 (c. 21), s. 122(3), Sch. 18 para. 94(3)(b) (with Sch. 20); S.I. 2013/423, art. 3, Sch.

F10S. 308(8A) inserted (1.6.2015 for specified purposes, 1.3.2016 in so far as not already in force) by Policing and Crime Act 2009 (c. 26), s. 116(1), Sch. 7 para. 78; S.I. 2015/983, arts. 2(2)(e), 3(o); S.I. 2016/147, art. 3(i)

Modifications etc. (not altering text)

C1S. 308(4) modified (24.4.2009 for specified purposes, 31.10.2009 in so far as not already in force) by The Armed Forces Act 2006 (Transitional Provisions etc) Order 2009 (S.I. 2009/1059), art. 1(3), Sch. 1 para. 51

309 Other exemptionsU.K.

(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 [F11and the Department of Justice], and prescribed means prescribed by the order.

310 Granting interestsU.K.

(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.

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