R v GH
Money is criminal property for the purposes of money laundering offences only if it was criminal property before the act of arrangement, so funds paid by fraud victims into an account were not laundered by opening the account.
Facts
GH agreed to allow bank accounts in his name to be used to receive money paid by victims of an online car insurance fraud, run by others. He was charged with entering into an arrangement which he knew or suspected facilitated the acquisition, retention, use or control of criminal property by another, contrary to section 328 of the Proceeds of Crime Act 2002. The judge held that there was no case to answer, because the money paid by the victims was not criminal property at the time of the arrangement.
Legal principle
The Supreme Court held that the judge had been right. Lord Toulson said that the property must be criminal property at the time when the arrangement operates on it, and that the offence under section 328 does not apply to property which is legitimate at the time of the arrangement and only becomes criminal property as a result of the arrangement. The money paid by the victims was not criminal property when it was paid into the accounts, and only became so as a result of the fraud, so GH had not committed the money laundering offence, although he could have been charged with fraud.
Related cases on financial crime, sanctions and market misconduct
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- National Crime Agency v Baker [2020] EWHC 822 (Admin)
- National Crime Agency v Hajiyeva [2020] EWCA Civ 108
- R v Da Silva [2006] EWCA Crim 1654, [2007] 1 WLR 303
- R v Hayes [2015] EWCA Crim 1944
- R v Hayes and Palombo [2025] UKSC 29
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