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Money laundering part 8

The next important thing to consider in connection with criminal property and the relevant definition is precisely what knowledge or suspicion is for this purpose. Knowledge causes no real difficulty. You either know something or you don't. What is rather more problematical is the question of suspicion.

Important guidance was given on this in a case called Da Silva, [2006] EWCA Crim 1654, judgement given on 11 July 2006 by the Court of Appeal. Lord Justice Longmore delivered the judgment of the court. The appellant had been convicted of assisting another person to retain the benefit of criminal conduct knowing or suspecting that that other person was or had been engaged in criminal conduct contrary to section 93A(1)(a) of the Criminal Justice Act 1988. This therefore was not a decision under the Proceeds of Crime Act provisions, but the court considered those provisions because the question of knowledge or suspicion was common to both. The appeal related to the direction to the jury given by the judge in relation to the question of suspecting. The issue was whether the appellant knew that her husband was involved in or benefiting from criminal conduct, or whether she suspected it.

What the judge said to which exception was taken in his direction to the jury, was as follows: "So, probably, 'knowing' will not arise and what will arise instead is 'suspecting', which is a very different state of mind to knowing. To suspect something, you have a state of mind that is well short of knowing that the matter that you suspect is true. It is an ordinary English word. Members of the jury, if the Crown can show that the defendant said to herself, 'I suspect that this money is the proceeds of criminal conduct, but it may be, on the other hand, that it is not', that would fall within the definition of 'suspicion'. The dictionary definition, which I direct you is relevant, to the meaning of the word, is this. The dictionary definition of 'suspicion': 'an act of suspecting, the imagining of something without evidence or on slender evidence, inkling, mistrust'. Therefore, any inkling or fleeting thought that the money being paid into her account 9950 might be the proceeds of criminal conduct will suffice for the offence against her to be proved. ".

One point which counsel on behalf of the appellant sought to run was the suggestion that suspicion in order to form the basis of a criminal offence had to be reasonable. The argument that he sought to put forward was that either the word "reasonably" ought to be effectively inserted before the word "suspecting" in the statutory wording or the additional words "on reasonable grounds" ought to be inserted or treated as inserted after the word "suspecting". Counsel submitted that it was impossible to suppose that Parliament intended that a someone should be guilty of an offence if he or she suspected that the relevant other person was or had been engaged in criminal conduct but had no reasonable grounds for that suspicion.

The court readily rejected that. As the court put it, " We regard this as an impossible argument. This court could not, even if it wished to, imply a word such as "reasonable" into this statutory provision. To do so would be to make a material change in the statutory provision for which there is no warrant. This is all the more the case when one sees that the draftsman is aware of the difference between "suspecting" and "having reasonable grounds to suspect" and on occasion uses the latter phrase in preference to the former word. ".

At paragraph 10 of the judgment, this issue was determined as follows: " Finally on this point we would observe:-
(1) the Proceeds of Crime Act 2002, which is now the governing statute, likewise sometimes uses the words "suspects" as in e.g. section 328(1) (the equivalent of section 93A), section 330(2)(a) and section 331(2)(a) and, at other times, the phrase "reasonable grounds for suspecting" in eg sections 330(2)(b) and 331(2)(b)
(2) Mr Cifonelli's concern about inappropriate convictions is unlikely to arise in practice since, if a potential defendant in fact has no reasonable grounds to suspect that the facilitated person is or has been engaged in criminal activity, it is unlikely that a prosecution will be taking place and, if it does, extremely unlikely that a jury will decide that a defendant has a suspicion when no reasonable ground exists for entertaining such a suspicion.".

Whether the assumption in paragraph (2) be correct or not, it is clear that the court does not think that if there is actual suspicion that the fact that there are no reasonable grounds for that suspicion will amount to a defence (whatever its view as to likely prosecution or conviction: although the statutory interpretation is correct, if for example a person has admitted in interview that they suspected although cannot put forward a rational or reasonable basis for that suspicion, then one can see both that there might be a prosecution and conviction). It is also clear that it considers that to be the position under the Proceeds of Crime Act and hence money laundering offences.

The court then went on to consider suspicion and we will turn to that next week.

Michael J. Booth QC