Criminals choosing jail over forfeiting assets, say MPs
- 21 March 2014
- From the section UK Politics
Too many major criminals are being allowed to keep their ill-gotten gains, an influential group of MPs says.
They are choosing jail rather than handing over cash, cars, homes, jewellery and other proceeds of crime, the public accounts committee found.
Just 26p in every £100 of criminal proceeds was clawed back by authorities last year, it said.
The Home Office has promised to close legal loopholes being exploited by criminals to keep assets.
Confiscation orders were launched more than a decade ago by Labour to attack organised crime by depriving the perpetrators of the "criminal lifestyle" that motivated them.
But many convicted criminals served with the orders manage to hide their assets overseas or choose to serve longer jail sentences rather than hand them over to the authorities.
The Home Office says it will legislate to close loopholes and toughen sentences for non-compliance "as soon as Parliamentary time allows".
"We are also working closely with international partners, including Spain, to drive up the amount we confiscate," it said in a statement.
The spokesman added: "Over the last three years we have seized more than £477m of criminal assets — a record amount. We have also frozen assets worth more than £1.5bn and returned £65m to victims."
But the Home Office has also been forced to accept that a proportion of the £490m currently owed by convicted criminals will never be recovered - and will have to be written off.
It a speech last December, then Security Minister James Brokenshire said the Home Office had asked the National Crime Agency "to analyse the stock of unenforced orders to identify those that are realistically enforceable".
He added: "Once identified, the courts, the Crown Prosecution Service and the NCA will work together to enforce them, relentlessly."
The Public Accounts Committee suggested the difficulty of enforcing confiscation orders might be deterring the authorities from seeking to deprive criminals of their booty.
In 2012-13, 6,932 confiscation orders were made - but a total of 680,000 offenders were convicted of a crime in that period.
Those who owe the largest sums - likely to be drug gangs, people traffickers or fraudsters who can afford top lawyers to fight confiscation in court - are less likely to see their orders enforced than small-time crooks.
There was an enforcement rate of nearly 90% for orders under £1,000 compared to 18% for orders over £1m.
And while different government departments spent £100m administering confiscation orders, only £133m was confiscated, it said.
Committee chairman Margaret Hodge said: "Crime should not pay, but we found too many criminals who are subject to an order to confiscate the proceeds of crime choosing to spend extra time in prison rather than paying up.
"£490m is owed by criminals who have served or are serving more time in prison for non-payment.
"This suggests these sentences provide little deterrence and that the sanctions are not working and need toughening up.
"The idea behind confiscation orders is to hit criminals where it hurts - in their pockets - so that serious and organised criminals do not profit from the misery of others.
"However, poor implementation has meant not enough confiscation orders are being made and not enough is being done to enforce them once they have been made."
She said the system was a "shambles" and in urgent need of reform.
Figures released last month show wide variations between police forces when it comes to pursuing criminal assets, with one force, Merseyside, apparently far ahead of the rest.
The force made 89 confiscation orders for assets worth more than £50,000 in 2012-13, compared with just a handful in most other force areas.
The Merseyside force - which covers one of the recognised hotspots for organised crime in the UK - recently merged its economic crime unit and criminal asset team to form a new unit, with more than 50 staff, to pursue crime proceeds in a more "pro-active" way, working closely with other agencies such as HM Revenue and Customs.
Det Ch Insp Dave McCaughrean, who heads the force's specialist support and intervention team, said: "Once we have got the money off them, we keep going back until their criminal lifestyle is damaged."