Proposed amendments to the Proceeds of Crime Act 2008 in respect of restraint and powers for financial investigators

Closed 11 Apr 2019

Opened 6 Mar 2019

Contact

Sean Gavin

(AML/CFT Policy Manager)

+44 1624 698369

amlcft@gov.im

Feedback updated 22 Aug 2019

We asked

A public consultation was undertaken by the Cabinet Office between the 6 March 2019 and 11 April 2019 to seek comments on proposed amendments to the Proceeds of Crime Act 2008.

The proposed amendments looked to tackle two issues identified as adversely impacting progress towards meeting recommendations made in the MONEYVAL Mutual Evaluation Report of the Isle of Man, in relation to the effectiveness of the islands confiscation regime.

The main aims of the proposed amendments are:

- to lower the level of proof required in cases being heard by courts concerning the restraint of assets, where it is suspected that the alleged offender has benefitted from criminal conduct, whilst investigations are taking place.

- to increase the powers available to civilian financial investigators in order to extend the capabilities of the Asset Recover Unit and of the Economic Crime Unit in the pursuit of the proceeds of crime.

You said

The Cabinet Office received no responses to the consultation in respect of the amendments to the islands confiscation and asset recovery regime.

We did

Whilst no responses were received in respect of the proposed amendments, the Cabinet Office felt it necessary to incorporate a new provision that requires the Court to seek reports from the applicant for a restraint order to update it as to the progress of the investigation; discharging the restraint order if proceedings are not commenced in a reasonable time. This will provide additional protection which ensures that restraint orders are being actively managed.

A revised draft will be laid before Tynwald for approval in the coming months.

Overview

We are seeking to obtain views on  proposed amendments to the Proceeds of Crime Act 2008 (POCA). These proposed amendments seek to address two issues which have been identified as adversely impacting on progress towards meeting recommendations made by MONEYVAL regarding the effectiveness of the confiscation regime in the IoM.

The first matter concerns the level of proof required for restraint; the second matter concerns the need for financial investigators in the Asset Recovery Unit and the Economic Crime Unit to be able to exercise powers under the Proceeds of Crime Act 2008 which are currently only available to police and customs officers.

Why your views matter

The MONEYVAL Mutual Evaluation Report of the IoM recommended that the effectiveness of the Island’s confiscation and asset recovery regime needed to be improved.

Currently IoM Proceeds of Crime legislation requires a higher standard of proof than the UK Proceeds of Crime Act 2002 for  restraint orders ; this has been identified as an impediment to the work of the Asset Recovery Unit; the draft Order seeks to align IoM legislation to that of the UK on which it was originally based.  A new section was also introduced into the UK Proceeds of Crime Act 2002 at 41(7B) concerning  court oversight and ongoing scrutiny to the appropriateness of an order. This has not been incorporated into the draft Proceeds of Crime (Compliance with International Standards)(No2) Order at this time. The Cabinet Office would welcome views on this requirement.  

Amendments are also sought to enable financial investigators, who now make up a significant proportion of the officers within the Economic Crime Unit and the Asset Recovery Unit, to exercise certain powers currently restricted to police and customs officers.

What happens next

The Cabinet Office, in consultation with the Asset Recovery Unit, the IOM Constabulary and other relevant authorities, including the Financial Crime Strategic Board, will take into account the feedback from the consultation prior to determining whether the draft Order requires amending.  Any changes made to the Proceeds of Crime Act 2008 by way of an Order are also subject to a two-stage Twynwald procedure.

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