Understanding Civil Forfeiture Laws

Civil asset forfeiture is defined as when personal assets are seized by law enforcement if there is reason to believe these assets have been acquired or used in illegal activity. Between April 2010 and March 2018, £1.6 billion of illegal funds were seized by the Home Office under asset forfeiture laws.

A guilty verdict doesn’t have to be reached for your assets to be seized, yet gaining your civil assets back can be challenging. Therefore, if your client’s assets have been seized, it’s important to seek legal advice from a barrister with extensive knowledge of civil asset forfeiture laws.

Civil Asset Forfeiture Laws

Is civil forfeiture legal? Yes. Under the Proceeds of Crime Act 2002 (POCA), a police or customs officer can seize £1000 and upwards from an individual, providing there is sufficient reason to believe the cash was illegally obtained or will be used illegally. This includes seizing assets from individuals who are already residing in or are trying to enter the country.

Based on suspicion of illegal activity connected to the funds, a civil forfeiture application has to be made to the Magistrate’s Court. If law enforcement can prove these assets have been sourced via criminal conduct, they can apply for permanent forfeiture.

What Assets Can be Seized in Forfeiture?

In most criminal activity cases, illegal assets will ultimately find a way to be turned into cash, such as through money laundering. As a result, it’s common for large amounts of cash to be seized under civil asset forfeiture laws. However, under the Criminal Finances Act 2017, other items over the value of £1000 can be seized, such as jewellery, watches, artwork, precious metals and gems.

How Long Can Money Be Seized Under Civil Asset Forfeiture Laws?

The seizure of cash falls under criminal law. Therefore, once the assets have been seized, they can be held for up to 48 hours. Nonetheless, permits can be granted by the Magistrates Court for the civil assets to be kept for longer.

If a permit is granted, law enforcement can keep seized assets for up to two years. However, a court order must be granted every six months for the investigation to be carried out. In this case, the funds will be held in a secure account that accrues interest until the court proceedings are complete.

What is the Difference between Civil Forfeiture Laws and Asset Forfeiture Laws?

Asset Forfeiture Laws

Asset forfeiture laws apply to instances where law enforcement confiscate assets from criminals who have obtained the cash through illegal means. They can also apply to situations where a private or corporate tenant has breached the contract of their lease.

Civil Forfeiture Laws

As previously mentioned, civil forfeiture laws apply to situations where law officials can confiscate funds temporarily or potentially permanently before there is any court ruling that the individual has broken any laws.

Cash forfeiture is a civil law matter rather than a criminal matter, meaning the court can only order forfeiture if there is evidence that the money was ‘more likely than not’ obtained illegally or going to be used for illegal activity.

Is There a Way To Recover Civil Asset Forfeiture?

Regaining access to your assets once they’ve been seized can be inherently difficult. However, under Part 1 of the Criminal Finances Act 2017, if you can prove that the funds or high-value items are legitimate, you may be able to recover your assets.

Therefore, it’s best to keep the receipts of any large cash transactions that you have been involved with in case you are accused of breaking asset forfeiture laws. If you deal in cash and are self-employed, be aware that you may be asked to prove these transactions for tax purposes. For instance, if you are an art dealer you need to register with HMRC to protect yourself against civil asset forfeiture.

How to Protect Yourself Against Asset Forfeiture?

Situations do arise where you are wrongly accused of asset forfeiture. However, this typically happens if there is suspicion of further crimes being committed, such as money laundering. One of the clear signs of money laundering is when an individual or business has large amounts of cash with no evidence explaining where this cash has come from. For example, it’s quite uncommon for an individual to have more than £1000 in cash around their home as online banking is the more popular means of keeping your money safe.

What to Do if You’ve Been Affected by Civil Asset Forfeiture?

We hope that you now understand the definition of civil forfeiture and the many forms asset forfeiture takes. If your assets have been seized under forfeiture laws or you find yourself in forfeiture proceedings, it’s important to immediately seek legal advice. Please don’t hesitate to get in contact with our team of experienced barristers, who will be able to support your case.