London Capital and Finance

Botheredin

GDB2222 wrote: »

The key word in Proceeds of Crime Act is crime. This only applies after a successful criminal prosecution. That's a matter for the police, the CPS, and the SFO.

What is more, a confiscation order under POCA takes money away from the criminal and gives it to the government, not the investors. It does not help investors and may make it harder for them.

BTW, I do not wish to imply anybody involved with this company has done anything criminal.

Not quite...

Seizure and detention of cash

The Proceeds of Crime Act 2002 (POCA 2002) creates a regime enabling the search for, seizure and forfeiture of cash in the UK. Cash may be searched for, seized and detained if the officer has reasonable grounds for suspecting that it is recoverable property or is intended by any person to use in unlawful conduct.

HM Revenue and Customs officers, police officers, immigration officers and accredited financial investigator (AFI) have extended search powers in respect of cash connected with unlawful conduct. Searches can be conducted of private premises (including vehicles on private property), people and vehicles in public places and officers are given specific powers to aid them undertake such searches. See Practice Note: Cash searches under the Proceeds of Crime Act 2002.

For a summary of the conditions which must be met for searches to be conducted of premises, vehicles and person, see: Cash searches—checklist.

The cash may be seized even if the officer only has reasonable grounds for suspecting part of it to be recoverable property or intended for use in unlawful conduct, provided it is not reasonably practicable to seize only part. See Practice Note: Cash seizure and detention.

The cash may only be seized in whole or in part provided it exceeds the minimum amount (currently £1,000).

If cash is seized, officers have 48 hours in which to either:

•
return the money
•
seek an extension of time in which to detain the cash (this may be extended by an order made by a magistrates' court, initially by no more than three months up to a maximum of two years)
•
serve a forfeiture notice, or
•
issue forfeiture proceedings
The magistrates' court may make the order on the satisfaction of two conditions:

•
there are reasonable grounds for suspecting the cash is recoverable property and its continued detention is justified while its derivation is investigated, or consideration is given to bringing proceedings against a person for an offence with which the cash is connected or such proceedings have been started and not concluded, and
•
there are reasonable grounds for suspecting the cash is intended to be used in unlawful conduct and its continued detention is justified while its intended use is further investigated, or consideration is given to bringing proceedings against any person for an offence with which the cash is connected or such proceedings have been commenced and not concluded
If cash is detained for more than 48 hours it must be paid into a interest-bearing account at the first opportunity and the interest accruing on it is to be added to it on its forfeiture or release.

The person from whom the cash was seized may apply to the magistrates' court for an order that cash detained be released in whole or in part. The court must be satisfied before releasing the cash that the conditions for its detention are no longer met. An officer may, after notifying the magistrates' court on whose order the cash is being detained, release the whole or part of it, if satisfied that the detention is no longer justified. Only the person from whom the money is seized may apply to the court for its release. See Practice Note: Applying for the return of seized cash and forfeiture.

Forfeiture of cash

Seized cash can be forfeited in two ways under the POCA 2002. The cash can be the subject of administrative forfeiture under the POCA 2002, s 297A (forfeiture without court order) and the court may order the forfeiture of cash or any part of it under the POCA 2002, s 298 (forfeiture by court order).

A senior officer may give a forfeiture notice to any person in relation to cash which has been detained under the POCA 2002, s 295(2). The forfeiture notice allows law enforcement agencies to forfeit detained cash without a court order in uncontested cases. This administrative process is designed to speed up the process of forfeiture and free up valuable time in magistrates’ courts.

A senior office may serve a forfeiture notice to forfeit all or part of detained cash if he/she is satisfied that the cash is recoverable property or is intended for use in unlawful conduct. When a notice is served, the cash is detained until the cash is forfeited, the notice lapses or the cash is released. If no objection is made to the notice, then the cash is automatically forfeited after the expiry of the period set by the notice, see Practice Note: Forfeiture of cash without court order.

While cash is being detained, an application for the forfeiture of the whole or part of it may be made to the magistrates' court by the Commissioners of Customs and Excise, a constable or an AFI.

The court may order the forfeiture of the cash or any part it if it is satisfied that it is recoverable property or is intended for use in unlawful conduct. The civil burden of proof applies to decide whether conduct is unlawful. See Practice Notes: Forfeiture of cash by court order and Cash forfeiture hearing procedure.

Where the recoverable property belongs to joint tenants, one of whom is a joint owner, the forfeiture order may not apply to the joint owner's share, eg in the case of a joint bank account into which drug trafficking proceeds have been paid by one signatory and clean money by the other, the proportion representing the clean money will not be caught by a forfeiture order. If the former withdraws all the cash and it is subsequently seized, the court must distinguish between the clean and the dirty money and return the innocent share of the cash.

Any party who is aggrieved by a forfeiture order may appeal to the Crown Court within 30 days from when the order is made. The appeal will be a rehearing. If the court grants the appeal it may order the release of the cash.

After the determination or disposal of any appeal, the cash forfeited and any accrued interest must be paid to the Consolidated Fund.

Any person who claims that the cash detained or any part of it belongs to him may apply to the magistrates' court for the cash or part of it to be released to him. The court may make an order releasing the cash if it appears to it that:

•
the applicant was deprived of the cash to which the application relates or of property which it represents, by unlawful conduct
•
the property he was deprived of was not, immediately before he was deprived or it, recoverable property, and
•
the cash belongs to him
The court may order the cash to which the application relates to be released to the applicant or to the person from whom it was seized if:

•
the applicant is not the person from whom the cash to which the application relates was seized, and
•
it appears to the court that the cash belongs to the applicant, and
•
the court is satisfied that the relevant conditions are no longer met or an application has been made for forfeiture that the court decides not to grant, and
•
no objection to the return of the cash to the applicant is made by the person from whom the cash is seized
The proviso that there must be no objection from the person from whom the cash was seized is intended to prevent the court from becoming involved in a complicated ownership dispute between the person from whom the cash was seized and the rightful owner of the cash.

Recoverable property

While property obtained through unlawful conduct is recoverable property, if such property has been disposed of, it is only recoverable if it is held by a person into whose hands it may be followed. Where property has been sold to a purchaser in good faith without notice of the unlawful conduct, or the person who obtained it is untraceable or dead, the property will not be recoverable. If the person to whom the property has been passed then in turn passes it on, the enforcement authority will be able to follow the property along the train of transactions.

Property that represents property obtained through unlawful conduct can be traced. If a person enters into a transaction where he disposes of the recoverable property (the original property) and obtains other property in place of it, the other property represents the original property. For example, when a stolen car is sold, the proceeds of the sale represent the original property and the enforcement authority will be able to trace into those proceeds and recover them. See: Cash searches—checklist.

If a person's recoverable property is mixed with other property (whether his or another's) the portion of the mixed property that is attributable to the recoverable property represents the property obtained through unlawful conduct.

Property ceases to be recoverable if:

•
it is given in payment following a judgment in civil proceedings based on the defendant's unlawful conduct
•
it is paid following a compensation order and then would otherwise be recoverable
•
it is paid following a restitution order and the sum received, or property obtained, would otherwise be recoverable
•
it is paid following an order of the court or a requirement of the Financial Conduct Authority (restitution orders and the FCA's own power to require restitution)
•
it is subject to a restraint order, or
•
it has been taken into account in deciding an amount of benefit for the purposes of making a confiscation order

masonic

What's missing from this discussion is that the Serious Fraud Office has already questioned 4 individuals regarding this case and released them all without charge. That's not to say the investigation is over, but it shows little sign of moving more quickly than a civil case brought by the administrators under the Companies Act would.

Malthusian

The short version of what Botheredin posted is: no, the police don't have to wait for a guilty verdict to seize assets.

In addition, I don't believe the POCA means that the proceeds of fraud would go to the government and not victims. I haven't checked chapter and verse but I can't believe the POCA causes the Government to trump the victims' existing civil claim against the assets. That would be monstrous.

If you make a load of money through illegal drug dealing, and the Government succeed in seizing it, then the proceeds would go to the Government. However the proceeds of fraud, if seized, still legally belong to the victims.

Note that if the victims are compensated by the FSCS the FSCS takes their place in the queue for any recoveries from the administration and from individuals.

masonic

Malthusian wrote: »

The short version of what Botheredin posted is: no, the police don't have to wait for a guilty verdict to seize assets.

It's also possible for the administrators to secure an emergency freezing injunction against the assets of those whom they have evidence of having acted improperly. This might be a logical next step for the two of four individuals who have not repaid bondholder money that was "resting" in their personal bank accounts.

Sledger

masonic wrote: »

It's also possible for the administrators to secure an emergency freezing injunction against the assets of those whom they have evidence of having acted improperly. This might be a logical next step for the two of four individuals who have not repaid bondholder money that was "resting" in their personal bank accounts.

That's good news Masonic. From what I have read all of the Companies formed by the "GANG" sters of Directors only IOG appears to be a genuine loan. This is a PONZI scheme where this gang set up load of shell companies purely as a front to move money.and syphon it off. The Brown fields in DR are still brown no activity, so where are the $$$$ The Bodmin site loan for repairs has done what? Goldfinger loaned 20m for what? and the prime horses have bolted or sold so was the 20M to buy a bulldozer to demolish the stable. 2 of the 4 have agreed to cough up what they pocketed but what will they still conceal a big chunk of it. .Next thing we will hear is Kuntall saying he stashed it in Blackmore. Surely there is enough evidence from the S&W report that they have acted improperly to get a freezing injunction and cant understand why that was not done weeks back when the 4 were arrested.

GDB2222

masonic wrote: »

What's missing from this discussion is that the Serious Fraud Office has already questioned 4 individuals regarding this case and released them all without charge. That's not to say the investigation is over, but it shows little sign of moving more quickly than a civil case brought by the administrators under the Companies Act would.

The Tesco fraud trial is an example. In Autumn 2014 the alleged fraud came to light, but it took over 4 years for the directors involved to be acquitted.

https://www.bbc.co.uk/news/business-46459884

masonic

Sledger wrote: »

That's good news Masonic. From what I have read all of the Companies formed by the "GANG" sters of Directors only IOG appears to be a genuine loan. This is a PONZI scheme where this gang set up load of shell companies purely as a front to move money.and syphon it off. The Brown fields in DR are still brown no activity, so where are the $$$$ The Bodmin site loan for repairs has done what? Goldfinger loaned 20m for what? and the prime horses have bolted or sold so was the 20M to buy a bulldozer to demolish the stable. 2 of the 4 have agreed to cough up what they pocketed but what will they still conceal a big chunk of it. .Next thing we will hear is Kuntall saying he stashed it in Blackmore. Surely there is enough evidence from the S&W report that they have acted improperly to get a freezing injunction and cant understand why that was not done weeks back when the 4 were arrested.

If, as you contend, the individuals behind this are gangsters who set out to swindle bondholders, then it is likely they will have been busy disposing of assets ever since the FCA got involved. A freezing injunction is only of value when the individuals still have significant assets in their name.

MTFII

First post !

Hi - as a veteran campaigner for retail bondholders I am taking a good look at the London Capital Finance mess and it does look like a carefully planned 'operation' to exploit regulatory loopholes etc. There are a couple of curious things I have noticed which are not mentioned in the S&W report so wonder whether anyone here has any thoughts?

1. the latest archived versions of the LCF website contain the follow on 'Other Bonds' which I have not seen mentioned elsewhere and which I cannot reconcile with anything in LCF's statutory 'accounts':

Other Bonds

London Capital and Finance Plc has issued another bond not available to investors via this website (the “Additional Bond”). The Additional Bond issue amounting to £25,000,000 has been offered to a single investor. The money raised from the Additional Bond is to be used for the same purposes as the amounts raised from the bonds on this website (the “Website Bonds”), and the investor in the Additional Bond will benefit from the same security arrangements as the Website Bonds (as described in more detail in the ‘Security’ section of this website).

£25m borrowed from a single party is a big deal so why is it on the website if not true? Perhaps to give comfort to potential investors that LCF had a very big funder?

2. Archived versions of the LCF website as late as Feb 2018 state that both the website and Information Memorandums have been approved under s21 of FSMA by Sentient Capital. For example:

London Capital & Finance Plc (“LC&F;”) offer bonds with fixed interest rates and are asset backed for security. A detailed presentation of each bond offered can be found in the respective Information Memorandum, which has been approved for promotion for the purposes of section 21 of the Financial Services and Markets Act 2000 (“FSMA”) by Sentient Capital London Limited (“Sentient”) of 1 Royal Exchange Avenue, London, EC3V 3LT. Sentient is authorised and regulated by the Financial Conduct Authority with FRN 679298.

I have not seen mention of Sentient by S&W or elsewhere. Based on previous failures of similar firms it may be useful to victims if Sentient have approved information on which they have relied rather than where LCF have approved their own information following the ludicrous permission they were given by the FCA on 7 June 2016.

Supercalafragalistic

More activity by sfo
https://www.timeslocalnews.co.uk/tunbridge-wells-news/police-investigating-missing-237million-handed-new-leads?fbclid=IwAR3P_CaKPC8SjZWAc6ixSGsjUCYNklBtWdjgO8qW4w158zU8GFFJPKYt_ws

Reaper

Good to have you on board MTFII. I'm a fan of your previous campaigning.

You are right it was Sentient Capital who signed off the S21 but I think it makes little difference. Firstly because even if they could be sued they have trivial assets. Secondly the worst and most deceptive advertising was by Surge rather than LCF, and I don't think (I would need to check) they did any S21 sign offs for Surge.

The one-off investor is odd. However while it was set up for them perhaps they never actually went through with it. If I had that much to invest I would send an accountant over to do some due diligence first and can well imagine them saying to drop it if they either found something dodgy or (more likely) LCF were unwilling to divulge details about their existing loans.