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Money laundering part 6

We have already considered the definition of criminal conduct and how that interacts with the position overseas. Before turning to consider the principal money-laundering offences under the Proceeds of Crime Act 2002 as amended, it is necessary to consider criminal property in a little more detail to understand exactly how this fits with the definitions in those substantive offences. It is particularly important to understand this because without a proper understanding of the topic you have no real prospect of understanding the nature or scope of the principal offences.

We have already seen what constitutes a criminal conduct and how the position interlinks with the overseas legal position. Section 340 defines criminal property. The first point to note is that the definition of property is extremely wide. It includes (section 340 (9)) all property whereever situated. This includes money, all forms of property, real or personal, heritable or movable and things in action and other intangible or incorporeal property. This makes it clear that cash is included within the definition of property as one would expect. Real property is land or an interest therein (hence the term real estate). Personal property is other property. That can be goods (clothes, books, cars, jewellery) or what are known as "things in action" or "choses in action" namely entitlement to sue which for example can consist of contractual rights (because you can enforce them in court if they are not complied with). Reference to intangible and incorporeal property is to property which you cannot as it were touch and feel. Land can be touched and felt, a right of way across the land cannot, so the former is corporeal and the latter incorporeal. Other intangible rights for example could include intellectual property rights. You might acquire the copyright to a literary work such as a book. In certain circumstances this can be enormously valuable. (Think Harry Potter).

Not only is the definition of property very wide but the nature of the interests in property which count is also wide (section 340 (10)). For this purpose property is obtained by person if he obtains an interest in it. Thus both the definition of property, and the definition of what constitutes obtaining property, is extremely wide.

Having established what is property, and bearing in mind what is criminal conduct, section 340 (3) then defines what is criminal property. It is such if it constitutes a person's benefit from criminal conduct or it represents such a benefit (in whole or part on whether directly or indirectly) and the alleged offender knows or suspects that it constitutes or represents such a benefit. In addition under section 340 (4) it is immaterial who carried out the conduct (i.e. the criminal conduct), who benefited from it, and whether the conduct occurred before or after the passing of the Proceeds of Crime Act 2002 (which money-laundering provisions came into force on 24th of February 2003).

We shall consider this in more detail next week, but it is important for the moment to bear in mind that the alleged offender for this purpose is the person charged with the money-laundering offences, not necessarily the person who benefited from criminal conduct, still less who committed the criminal conduct. Thus if a person has a benefit from criminal conduct they themselves can be guilty of a substantive money-laundering offence (if the property was the benefit from criminal conduct, because it would be so and the person would presumably know what it was and so would therefore know that it represented such a benefit). However a person guilty of money-laundering can be an entirely distinct person, such as a lawyer, banker, estate agent, anyone involved in a transaction. (Or for example a friend, spouse or lover). Then for this to be criminal property for the purpose of the charge against that person it not only must be criminal property in the sense that it constitutes benefit from criminal conduct, but in addition the person charged must know or suspect that it constitutes or represents such a benefit. It is always important to bear this in mind in connection with substantive offences that relate to money-laundering and criminal property, because those particular sections import the requirement of knowledge or suspicion. (Although as we shall see not all money-laundering offences require that).

Michael J. Booth QC