In R v GH [2015] UKSC 24 the Supreme Court considered that money deposited in an account by investors was criminal property, so that the individuals accused (B and H) were entering into, or becoming involved in, an arrangement that they knew or thought would allow for the retention, use or control of criminal property for the purposes of section 328(1) of the Proceeds of Crime Act 2002 (POCA).

B set up four ‘ghost’ websites under the false pretence of offering discounted motor insurance.

Prior to the websites going live, B recruited H to open two bank accounts for the purpose of channelling the proceeds.

At trial B pleaded guilty to various offences.

H, however, claimed that he had no case to answer because the money received into the bank accounts was not criminal property when the money was paid into the accounts. The Court of Appeal upheld H’s submission. The prosecution subsequently appealed to the Supreme Court.

The Supreme Court unanimously allowed the appeal.

The money from investors was lawful at the time of payment, but changed character when paid into the bank accounts.

The money became criminal property as a result of B’s fraud rather than the arrangement between B and H.

Therefore, it was right to regard H as entering into, or becoming concerned in, an arrangement for the purpose of retaining criminal property for the benefit of another when he set up the bank accounts.

A copy of the judgment is available. http://bit.ly/1GEnSOf