Barnaby Hone writes for the Family Office Magazine, Summer 2024 issue. Click here to view the article on the Family Office Magazine website. 

The article discusses a significant change in UK law regarding the seizure of crypto assets suspected to be linked to criminal activity. Law enforcement agencies (LEAs) now have the authority to seize such assets under a low threshold of "reasonable suspicion," akin to the standard for arrest. LEAs can then apply for forfeiture of the assets if they can show that these assets are linked to criminal conduct on the balance of probabilities. These powers, which came into effect on April 26, 2024, are grounded in the Proceeds of Crime Act (POCA) 2002, providing a well-established legal framework for asset forfeiture.

Key points include:

  1. Expanded Powers: LEAs can search for, seize, and potentially forfeit crypto assets if suspected of being connected to criminal conduct.
  2. Legal Process: Initial seizure requires reasonable suspicion, and investigations can last up to three years, with assets frozen during this period. Final forfeiture requires a court decision based on the balance of probabilities.
  3. Court Jurisdiction: Seizures are conducted in the Magistrates Court, potentially leading to less scrutiny compared to the High Court.
  4. Victim Claims: Victims can apply for the return of assets, potentially increasing litigation and disputes over crypto asset ownership.
  5. Resource Constraints: There are concerns about the limited resources and expertise of LEAs and the courts to effectively manage these new powers.

High-net-worth individuals with crypto assets in the UK are advised to maintain clear audit trails to quickly respond to any investigations and protect their assets.

To read the full article, please click here (available via subscription service).

Barnaby specialises in all types of POCA applications, Civil and Criminal. He is regularly instructed by third parties to represent their interests. Barnaby is recognised in Chambers & Partners and The Legal 500 for his expertise in Asset Recovery and POCA work.