UWOs were brought into the UK legal system in January 2018 to complement the UK's criminal regime under the Criminal Financing Act 2017. According to the 2017 Impact financial assessment, the UK was unusually prone to crime due to the size of the financial services industry and the London real estate market attracting overseas Investors.
UWO asks an individual to explain their source of wealth. The properties of persons who do not provide sufficient explanation about the origin of assets are registered as "salvageable property" under the POCA with a civil rescue order.
At this point, the UWO was a government response to individuals who little is known about the source of wealth. UWO places responsibility on judicial authorities in revealing the source of assets that appear disproportionate to the known legal wealth of the defendants. The high court can request a UWO for any property.
UWOs take advantage of the reverse liability principle in combating money laundering. Orders are made ineffective if the accused provides sufficient explanation regarding the source of wealth. However, the defendant wins the argument if no contrary description or evidence is presented. However, the information obtained in connection with UWO cannot be used in criminal jurisdiction.
Why Are UWOs Needed?
There is ample evidence that the UK has become a viable port for corruption and money laundering activities. The limitation of UK law enforcement to seize corrupt property makes things more difficult. It is almost impossible to sanction a suspected fortune without a legal conviction.
At this point, UWO was a reaction to the UK government against unexplained wealth, money laundering, and bribery. To detect money laundering, one must first explain the source of wealth. A wealth of unknown origin is illegal.
When is UWO a Requirement?
The National Crime Agency is the central institution benefiting from UWO practices. However, UWOs can be used by the Serious Fraud Office (SFO), HM Revenue and Customs Administration (HMRC), and the Financial Conduct Authority (FCA). If one of these investigating authorities comes across property worth more than 50,000 £, they can demand a UWO request to the Supreme Court.
Before the Supreme Court considers whether a UWO should be awarded, the UWO will think whether the person being sought meets specific criteria. These criteria can be listed as follows:
1) Being a person who has the status of Politically Exposed Person (PEP) or not a European Economic Area citizen.
The politically exposed person may be at greater risk of money laundering. Therefore, Companies may be the subject of UWO if they have a connection with a PEP or someone suspected of a serious crime.
2) The person who is a serious criminal suspect.
Giving a UWO to a person suspected of a serious crime or who has been linked to someone who committed a serious crime must first be convinced of the court. In this context, the court should only be persuaded by reasonable grounds provided by civil standards. Serious crime can include:
- drug trafficking
- child abuse
- Money laundering
- human trafficking
- tax evasion.
3) Having more than £ 50,000 in asset income.
On the other hand, A property does not have to be within the UK to be the subject of UWO. Any property outside the United Kingdom can be considered and evaluated as a UWO subject. Property is defined as any material and moral property. Therefore, it is sufficient for the defendant to have adequate authority over the property to become a UWO subject.