On 28 April 2014, David Green QC, the Director of the UK’s Serious Fraud Office (“SFO”) announced the opening of a criminal investigation into possible money laundering arising from suspicions of corruption in Ukraine.
In furtherance of the new UK investigation, the SFO also announced that it had obtained a restraint order freezing approximately $23m of assets in the UK in connection with this case. For reasons of confidentiality, no further details were provided.
As reported earlier, the EU designated 18 Ukrainians on 6 March 2014, alleging embezzlement and moving illegally obtained funds overseas. A previous blog also reported that the UK hosted a conference on Ukrainian asset recovery in London this week. The latest announcement by the SFO will be seen as part of that initiative.
Section 444 of the Proceeds of Crime Act 2002 makes provision for freezing UK property at the request of a foreign country. Such restraint orders can also be granted from the start of a UK criminal investigation. The restraint order in this matter would have been granted by the Crown Court, following a request from Ukraine, acted upon by the SFO. The Crown Court judge would need to have been satisfied that:
- the request identified relevant property in the UK.
- a criminal investigation had been commenced in Ukraine for which this request was made.
- there was reasonable cause to believe that the defendant had benefitted from his criminal conduct, and
- there was a risk that the identified property would be dissipated.
Any affected person, served with such an order can apply to the Court to have it varied or discharged.