The Court of Appeal has dismissed an appeal against the first UWO imposed under the powers the CFA gave to the NCA. The UWO had been imposed in relation to the Azeri wife of an Azeri banker.
A property had been purchased by a BVI registered company for £11.5m. The appellant stated in her application for indefinite leave to remain in the UK that she owned the company but it transpired it was owned by her husband, who had, for 14 years, including the time the property was purchased, been the chairman of an Azeri bank in which the State had a majority shareholding He had resigned a couple of months before his wife’s application for leave to remain, and was subsequently arrested in Azerbaijan and charged with various offences in connection with his employment at the bank, for which he was later convicted. The State authorities had also “arrested” the appellant in her absence in relation to avoiding an investigation into the bank. A court had found that the appellant’s extradition to Azerbaijan would not be compatible with her human rights.
The NCA had succeeded in its application for UWOs on properties and a Freezing Order. The appellant applied to discharge the UWO on eight grounds, all of which were rejected and leave to appeal was refused, as was an appeal against a decision to revoke an anonymity order. However, permission was then granted to appeal on five of the grounds, mainly on the basis it would be good to have guidance from the Court of Appeal.
On appeal, Counsel for the appellant submitted that:
- there had been an error in the interpretation of what a PEP was. He said that the appellant’s husband had indeed been above middle or junior rank, but that there was no evidence he was entrusted with prominent public functions “by the State” – and that this meant he was not a PEP. The court, and the Court of Appeal, disagreed, saying the wording in the legislation was intended to exclude UK or EEA state officials, but did not mean that the “prominent public function” had otherwise to be entrusted by the State. So the bank was a State owned enterprise, and the appellant’s husband was a PEP;
- the bank was not a State-owned enterprise, but was a commercial enterprise whose shares were partly owned by a government body. This too was rejected. As a matter of fact a Government of a non-EEA country had the majority shareholding and ultimate control of the bank;
- the “income requirement” had not been met – in other words, the court should not have been satisfied that there were reasonable grounds for suspecting the known sources of the lawfully obtained income available to the POP would have been insufficient to obtain the property. While the judge accepted that it may in some cases be fair to say that a foreign conviction did not present these reasonable grounds, the facts of this case (including that the conviction was only one of the grounds NCA relied on) meant the judge was fully entitled to reach the view that the requirement had been met;
- the judge should not have held that the UWO did not offend the rule against self-incrimination and/or spousal privilege. On appeal, the court found the judgement correct not least because the risk of the husband being prosecuted in the UK was negligible as was the risk of the responses to the request being used in Azerbaijan against the couple; and
- it was a wrong and disproportionate exercise of discretion to make the UWO. It was not necessary for the court to consider this point given that Counsel for the appellant had conceded it would fall away if the other grounds for appeal failed.