Vous êtes sur la page 1sur 22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

Respondingtoafinancialcrime
investigation
14March2013

Printthispracticenote

Legalstatus

ThispracticenoteistheLawSociety'sviewofgoodpracticeinthisarea.Itisnotlegaladvice.[Readmore]
PracticenotesareissuedbytheLawSocietyfortheuseandbenefitofitsmembers.TheyrepresenttheLaw
Society'sviewofgoodpracticeinaparticulararea.Theyarenotintendedtobetheonlystandardofgoodpractice
thatsolicitorscanfollow.Youarenotrequiredtofollowthem,butdoingsowillmakeiteasiertoaccounttooversight
bodiesforyouractions.
Practicenotesarenotlegaladvice,nordotheynecessarilyprovideadefencetocomplaintsofmisconductorof
inadequateprofessionalservice.Whilecarehasbeentakentoensurethattheyareaccurate,uptodateanduseful,
theLawSocietywillnotacceptanylegalliabilityinrelationtothem.
ForqueriesorcommentsonthispracticenotecontacttheLawSociety'sPracticeAdviceService.

Professionalconduct
TheSRAhaspublishedaHandbook,whichsetsoutalltheSRA'sregulatoryrequirements.Itoutlinestheethical
standardsthattheSRAexpectsoflegalpracticesandpractitionersandtheoutcomesthattheSRAexpectsthemto
achievefortheirclients.
Therearetenmandatoryprincipleswhichapplytoallaspectsofpractice.TheycanbefoundintheSRAHandbook.
Youshouldalwaysbearinmindthetenprinciplesandusethemasyourstartingpoint.
Thosewhichareparticularlyrelevantinthiscontextareasfollow:
Upholdtheruleoflawandtheproperadministrationofjustice
Actwithintegrity
Donotallowyourindependencetobecompromised
Complywithyourlegalandregulatoryobligationsanddealwithyourregulatorsandombudsmeninanopen,
timelyandcooperativemannerand
Behaveinawaythatmaintainsthetrustthepublicplacesinyouandintheprovisionoflegalservices.
TheSRAHandbookincludesaCodeofConduct,whichreplacestheSolicitors'CodeofConduct2007.ThenewCode
establishesoutcomesfocusedconductrequirementsandeachchapteroutlinesoutcomesandindicativebehaviours.
Asdetailedbelow,chapter4whichpertainstoclientconfidentialityandchapter5whichpertainstoyourrelationship
withthecourtareparticularlyrelevantwhenrespondingtofinancialcrimeinvestigations.

SRAPrinciples
TherearetenmandatoryprincipleswhichapplytoallthosetheSRAregulatesandtoallaspectsofpractice.The
principlescanbefoundintheSRAHandbook.
TheprinciplesapplytosolicitorsormanagersofauthorisedbodieswhoarepractisingfromanofficeoutsidetheUK.
TheyalsoapplyifyouarealawyercontrolledbodypractisingfromanofficeoutsidetheUK.

Contents[show]
1Introduction
1.1Whoshouldreadthispracticenote?
1.2Whatistheissue?

http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

1/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

2Ethicalobligationsondisclosure
2.1Generalcomments
2.2Confidentialinformation
2.3Informationsubjecttolegalprofessionalprivilege
2.4Expressundertakingsofconfidentialitytothecourt

3Discussinglawenforcementrequestsandorders
3.1Generalcomments
3.2Discussionswithlawenforcementagencies
3.3Discussionsinhouseandwiththirdparties
3.4Discussionswithclients

4Powerstoobtainmaterialwithoutentry
4.1Generalcomments
4.2Noticetodiscloses61SeriousandOrganisedCrimeandPoliceAct2005(SOCPA)
4.3Noticetodiscloses2CriminalJusticeAct1987(CJA)
4.4Productionorders.345ProceedsofCrimeAct2002
4.5Disclosureorders357ProceedsofCrimeAct2002
4.6Noticetoproduces20TaxesManagementAct1970(TMA)
4.7Productionorders20BATaxesManagementAct1970
4.8ProductionOrderSchedule1PoliceandCriminalEvidenceAct1984(PACE)

5Powerstoenterandobtainmaterial
5.1Generalcomments
5.2Yourrightsandresponsibilities

6Maintainingacompleterecord
6.1Copyingfiles
6.2Forwardingfilestoanothersolicitor
6.3Voluntaryreturn
6.4Applicationtothecourt

7Powersofarrest
7.1Arrestwithoutawarrant
7.2Arrestwithawarrant
7.3Yourrightsandresponsibilities

8Answeringquestionsandprovidingstatements
8.1Questionsandstatementsabouttheclient
8.2Questionsandstatementsaboutyourinvolvement

9Moreinformation
9.1LawSocietyproductsandservices
9.2Other

10Terminology

1Introduction
1.1Whoshouldreadthispracticenote?
Allsolicitorsshouldreadthispracticenote,particularlymanagingorseniorpartners,directorsofrisk,practice
managers,moneylaunderingreportingofficersorstaffappointedtorespondtoenquiriesfromlawenforcement.

1.2Whatistheissue?
SolicitorsplayakeyroleinfacilitatingbusinessandfinancialtransactionsthatunderpintheUKeconomy.
Becauseofthisimportantrole,criminalsmaytargetyourservicestohelpthemcommitfinancialcrimesortolaunder
theproceedsofthosecrimes.
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

2/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

Asaresult,lawenforcementmayseekaccesstoclientfilestoinvestigatewhethertheclient,andpossiblyyouora
fellowsolicitor,havecommittedacriminaloffence.
Whileyouarerequiredtocomplywiththelaw,youarealsorequiredtokeepyourclient'sinformationconfidential.
Thispracticenoteaimstoprovidepracticalassistanceonhowtomanagethesecompetingobligationsandprovides
ashortoverviewofthemainpowersavailabletolawenforcementwhenconductingfinancialcrimeinvestigations.
Ifyouarethesubjectofafinancialcrimeinvestigation,orarestillunsureofhowtoappropriatelycomplywitha
requestfromlawenforcement,youshouldseeklegaladvicefromaspecialistcriminallawsolicitor.

2Ethicalobligationsondisclosure
2.1Generalcomments
Asasolicitoryouhaveadutyofconfidentialitytoyourclients,formerclientsandinsomecases,prospectiveclients.
Allreferencesinthispracticenotetoclients,willalsoincludeformerclients,andwhererelevant,prospectiveclients.
Someoftheinformationyouholdwillalsobesubjecttolegalprofessionalprivilege.
Thissectioncoverswhenthoseprofessionalandlegalobligationsapply,howthoseobligationsmaybeoverridden
andhowtopracticallymanagerequestsfromlawenforcementagencies.

2.2Confidentialinformation
Chapter4oftheSRACodeofConductprovidesthatyoumust:
keeptheaffairsofclientsconfidentialunlessdisclosureisrequiredorpermittedbylawortheclientconsents.
Chapter5oftheSRACodeofConductprovidesthatyoumust:
complywithcourtorderswhichplaceobligationsonyou.
Theobligationofconfidentialityextendstoallmattersrevealedtoyou,fromwhateversource,byaclient,orsomeone
actingontheclient'sbehalf.
Thismeansthatyoumustnotvolunteerinformationaboutaclienttolawenforcementagencies,butyoumustprovide
informationwhereyouarerequiredbylaworacourtorder.
Ifyouareapproachedbyalawenforcementagencyforinformationaboutaclientortransactiontheyare
investigating,youmustaskifyoucaneither:
seektheclient'sconsenttoprovidetheinformationor
beservedwithanoticeororderrequiringdisclosure.
Theagencymaymakereferencetosection29oftheDataProtectionAct,whichprovidesthatyouwillnotbein
breachofthatActwhenprovidinginformationforthepurposesoftheprevention,detectionorinvestigationofcrime.
HoweverthissectiondoesnotoverrideyourobligationofconfidentialityundertheSRACodeofConduct.

2.3Informationsubjecttolegalprofessionalprivilege
2.3.1Whatislegalprofessionalprivilege?
Legalprofessionalprivilege(LPP)isaprivilegeagainstdisclosure,ensuringclientsknowthatcertaindocumentsand
informationcannotbedisclosedatall.Itrecognisestheclient'sfundamentalhumanrighttobecandidwithhislegal
adviser,withoutfearoflaterdisclosuretohisprejudice.
LPPdoesnotextendtoallinformationthatlawyershaveadutytokeepconfidential.LPPonlyprotectsthose
communicationsfallingundereitherofthetwoheadsofprivilegeadviceprivilegeorlitigationprivilege.LPPonly
appliestoinformationheldbysolicitorsandtheiremployees,barristersandinhouselawyers.
Part7oftheProceedsofCrimeAct2002(POCA)introducestheconceptofprivilegedcircumstances,whichextends
totaxadvisors,auditorsandaccountants,aswellasindependentlegaladvisorswheretheyactintheregulated
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

3/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

sectorforthepurposesofantimoneylaunderinglaws(relevantprofessionals').Privilegedcircumstancesmay
provideanexemptionfromtherequirementtomakeadisclosureunderPOCA,butthisexemptiondoesnotprovide
anyprotectionforthepurposesofrespondingtotheordersandnoticescoveredbythispracticenote.
ReadmoreaboutprivilegedcircumstancesintheLawSociety'santimoneylaunderingpracticenote.

2.3.2Adviceprivilege
Communicationsbetweenalawyers,actinginhiscapacityasalawyer,andaclient,areprivilegediftheyareboth:
confidential,and
forthepurposesofseekinglegaladvicefromasolicitororprovidingittoaclient
Communicationsarenotprivilegedmerelybecauseaclientisspeakingorwritingtoyou.Theprotectionappliesonly
tothosecommunicationswhichdirectlyseekorprovideadviceorwhicharegiveninalegalcontext,thatinvolvethe
lawyerusinghislegalskillsandwhicharedirectlyrelatedtotheperformanceofthelawyer'sprofessionalduties.
[PassmoreonPrivilege2ndedition2006]
Allcommunicationsbetweenalawyerandhisclientrelatingtoatransactioninwhichthelawyerhasbeeninstructed
forthepurposeofobtaininglegaladvicearecoveredbyadviceprivilege,notwithstandingthattheydonotcontain
adviceonmattersoflawandconstruction,providedthattheyaredirectlyrelatedtotheperformancebythesolicitor
ofhisprofessionaldutyaslegaladviserofhisclient.[ThreeRiversDistrictCouncilandothersvtheBankofEngland
[2004]UKHL48at111]
Thiswillmeanthatwhereyouareprovidinglegaladviceinatransactionalmatter(suchasaconveyance)theadvice
privilegewillcoverall:
communicationswith,
instructionsfrom,and
advicegivento
theclient,includinganyworkingpapersanddraftsprepared,aslongastheyaredirectlyrelatedtoyour
performanceofyourprofessionaldutiesasalegaladviser.
Caselawhelpsfurtherdefinewhatadviceprivilegecovers.
Communicationssubjecttoadviceprivilegeinclude:
Asolicitor'sbillofcostsandstatementofaccount[ChantvBrown(1852)9Hare790]
InformationimpartedbyprospectiveclientsinadvanceofaretainerwillattractLPPifthecommunications
weremadeforthepurposeofindicatingtheadvicerequired[MinstervPriest[1930]AC588perLordAtkinat
584]
Communicationsnotsubjecttoadviceprivilege:
notesofopencourtproceedings[ParryvNewsGroupNewspapers(1990)140NewLawJournal1719]arenot
privileged,asthecontentofthecommunicationisnotconfidential.
conversations,correspondenceormeetingswithopposinglawyers[ParryvNewsGroupNewspapers(1990)
140NewLawJournal1719]arenotprivileged,asthecontentofthecommunicationisnotconfidential.
aclientaccountledgermaintainedinrelationtotheclient'smoney[NationwideBuildingSocietyvVarious
Solicitors[1999]P.N.L.R.53.]
anappointmentsdiaryortimerecordonanattendancenote,timesheetorfeerecordrelatingtoaclient[Rv
ManchesterCrownCourt,exp.Rogers[1999]1W.L.R.832]
http://www.bailii.org/ew/cases/EWHC/Admin/1999/94.html
conveyancingdocumentsarenotcommunicationsonotsubjecttoadviceprivilege[RvInnerLondonCrown
Courtexp.Baines&Baines[1988]QB579]

2.3.3Litigationprivilege
Thisprivilege,whichiswiderthanadviceprivilege,protectsconfidentialcommunicationsmadeafterlitigationhas
started,orisreasonablyinprospect,betweeneither:
alawyerandaclient
alawyerandanagent,whetherornotthatagentisalawyer
alawyerandathirdparty
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

4/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

Thesecommunicationsmustbeforthesoleordominantpurposeoflitigation,either:
forseekingorgivingadviceinrelationtoit
forobtainingevidencetobeusedinit
forobtaininginformationleadingtoobtainingsuchevidence

2.3.4Crime/fraudexception
LPPprotectsadviceyougivetoaclientonavoidingcommittingacrime[BullivantvAttGenofVictoria[1901]AC
196]orwarningthemthatproposedactionscouldattractprosecution[ButlervBoardofTrade[1971]Ch680].LPP
doesnotextendtodocumentswhichthemselvesformpartofacriminalorfraudulentact,orcommunicationswhich
takeplaceinordertoobtainadvicewiththeintentionofcarryingoutanoffence[RvCox&Railton(1884)14QBD
153].Itisirrelevantwhetherornotyouareawarethatyouarebeingusedforthatpurpose[BanqueKeyserUllmanv
Skandia[1986]1LloydsRep336].
Itisnotjustyourclient'sintentionwhichisrelevantforthepurposeofascertainingwhetherinformationwas
communicatedforthefurtheranceofacriminalpurpose.Itisalsosufficientthatathirdpartyintendsthelawyer/client
communicationtobemadewiththatpurpose(egwheretheinnocentclientisbeingusedbyathirdparty)[Rv
CentralCriminalCourtexpFrancis&Francis[1989]1AC346].

Ifyouknowthetransactionyou'reworkingonisacriminaloffence,youriskcommittingan
offenceyourself.Inthesecircumstances,communicationsrelatingtosuchatransactionarenot
privilegedandshouldbedisclosed.
Ifyoumerelysuspectatransactionmightconstituteamoneylaunderingorotheroffence,thepositionismore
complex.Ifthesuspicionsarecorrect,communicationswiththeclientarenotprivileged.Ifthesuspicionsare
unfounded,thecommunicationsshouldremainprivilegedandarethereforenondisclosable.
Ifyoususpectyouareunwittinglybeinginvolvedbyyourclientinafraud,thecourtsrequireprimafacieevidence
beforeLPPcanbedisplaced[O'RourkevDarbishire[1920]AC581].Thesufficiencyofthatevidencedependson
thecircumstances:itiseasiertoinferaprimafaciecasewherethereissubstantialmaterialavailabletosupportan
inferenceoffraud.Whileyoumaydecideyourselfifprimafacieevidenceexists,youmayalsoaskthecourtfor
directions[FinersvMiro[1991]1W.L.R.35].

2.3.5Canprivilegedmaterialeverberequested?
LPPinformationcanbedisclosedif:
theclientconsentsorhaswaivedprivilege
thecrime/fraudexceptionappliesor
itisinextricablylinkedtoseizablematerial.
ThepowertorequestorseizedocumentsdoesnotextendtomaterialthatissubjecttoLPPandthisshould
bestatedonthefaceoftherelevantnoticeororder.
Iftheorderissilent,youshouldcomplywiththeorderonthebasisthatLPPmaterialisnotincluded,butraise
thiswiththeinvestigatingofficer.
Ifthecourtissatisfiedthateitherthecrime/fraudexceptionappliesthisshouldberecordedonthefaceofthe
warrant.
IfLPPmaterialisinextricablylinkedtoseizablematerialanditisnotreasonablypracticabletoseparateitout,
investigatingofficersmayseizeandretainallofthematerialtoexamineitelsewhere.However,theuseofthispower
issubjecttotheprovisionsintheCriminalJusticeandPoliceAct2001,which,amongotherthings,giveyoutheright
tobepresentatareviewofthematerialandapplytoajudgeforthematerialtobereturned.
Forexample:investigatingofficersmayretainawholecomputerharddrivethatcontainsadocumentwhichis
evidenceofanoffence,iftherestoftheharddriveisneededtoprovewhenthatdocumentwascreated,amendedor
deleted.
Finally,parliamentcanoverrideLPPinstatute,bytheuseofexpresswordsornecessaryimplication.Parliamenthas
notdecidedtoadoptthiscoursewithanyofthepowersconsideredinthisnote.
IfthelawenforcementagencyclaimsthatthestatutetheyareactingunderentitlesthemtoLPPmaterial:
thisshouldbeexpresslystatedonthefaceofthenoticeandtheorder,and
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

5/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

theagencymustbeabletoidentifytherelevantstatutoryprovisiontoyou.

2.3.6Whathappensifthereisadisputeoverprivilegedmaterial?
TheremaybeoccasionswhereyoubelievethatcertainmaterialissubjecttoLPPandthelawenforcementagency
disagrees.Differentapproachestomanagingthisdisputemaybemoreappropriatedependingonthecircumstances.
Clientconsent
Legalprofessionalprivilegebelongstotheclient,nottothelawyer,sotheclientcanalwaysconsenttoprivilege
beingwaived.Howeverthereareissuestoconsideraboutwhetheritisappropriatetodiscussanoticeororderwith
theclient.(seespeakingwithclientsformoreinformation)
IfLPPmaterialisprovidedtoalawenforcementagencywithouttheclient'sconsent,theclientcanchallengetheuse
ofthatmaterialinanysubsequenttrial,bringanabuseofprocessapplicationagainsttheagencyandeithermakea
regulatorycomplaintortakecivilactionagainstyouasthesolicitor.
Noticetoproduce
Ifyouhavebeenservedwithanoticeorordertoproduceinformationwhere:
thecourthasnotindicatedthattheyaresatisfiedthatthecrime/fraudexceptiondoesnotapply,and
theinvestigatingofficerbelievesthatnoneoftheinformationonthefilewouldbeLPPmaterialorthatthey
shouldhaveaccesstotheLPPmaterial,
theinvestigatingofficermayeither:
askthatyouprovidethematerialtoanindependentcounseltodeterminewhetheritiscoveredbyLPP,or
obtainafurtherordertospecificallystatethatthecrime/fraudexceptionappliestomaterialinthiscase.
Youmayalsosuggestthatthematerialisreviewedbyindependentcounselineventofadisagreement.
YouwillnotbeinbreachofyourconfidentialityobligationsorofLPPifyouvoluntarilyagreetohaveindependent
counselreviewthematerial.
Ifindependentcounselisused,thecostswillusuallybesharedbetweenlawenforcementandthelegalpractice.
IfyoudisagreewithindependentcounselastowhetherLPPappliestoparticularmaterial,youmayhavetoapplyto
thecourtforreturnofthematerialtoresolvetheissue.
Ifafurtherorderisobtained,youshouldbegiventheopportunitytoattendandmakerepresentationstothecourt.
IfthelawenforcementagencymaintainsthattheyshouldbegivenaccesstoalltheLPPmaterialandhasfailedto
ensurethatthiswasincludedonthefaceoftheorder,youshouldnothavetobearthecostsfortheapplicationto
rectifythis.
However,iftheapplicationrelatestowhetheraspecificdocumentisprivilegedornot,theagencymayseekcosts
againstyoufortheapplication,especiallyifyoudeclinedtheopportunitytohaveindependentcounselreviewthe
material.
Searchwarrants
Ifmaterialisseizedpursuanttoawarrant,investigatingofficersmayinstructindependentcounseltobeavailable
duringasearchtoprovideanopiniononwhetheradocumentissubjecttoLPP.
Independentcounselmustnotactivelyparticipateinthesearchorarbitratedisputesovermatterssuchasthescope
ofthewarrantorwhatmaterialshouldbeprovided.Theirroleislimitedtoprovidinganopinion,whenrequestedbythe
investigatingagencythathasinstructedthem,onwhethermaterialisormaybesubjecttoLPP.Thisprocesswas
approvedbythecourtinRvHMCE,expartePopely&Anr[1999]STC1016.
Thelawenforcementagencybearsthecostofinstructingcounsel.
WherethereisadisputeaboutLPPthatisnotresolvedduringthesearch,thematerialwillbeplacedinablueplastic
bagandsealed.Thisprocessmaybeusefulwhere:
independentcounselisinattendanceduringthesearchandyoudisagreewiththeirviewonLPP
independentcounselisnotinattendanceandthereisadisputeaboutwhetheradocumentissubjecttoLPP,
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

6/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

or
LPPmaterialisinextricablylinkedtononprivilegedmaterial.
Thematerialwillbetakenbytheagencyandwillremainsealeduntilthedisputeisresolved,orinthecaseof
inextricablylinkedmaterial,untilitcanbeseparatedbyindependentcounsel.
Youhavetherighttobepresentatthereviewofthematerialandapplytoajudgeforthematerialtobereturned.
IfLPPmaterialisinadvertentlyseizedduringasearch,itmustbereturnedassoonasreasonablypracticable.Ifyou
believethishasoccurred,youshouldraisethiswiththeinvestigatingofficerinitially,althoughifthisisdisputed,you
mayneedtoinitiatecourtproceedingsforitsreturn.
Whereanapplicationtothecourtismade,theinvestigatingofficersinpossessionofthematerialhaveaduty
pursuanttotheCriminalJusticeandPoliceAct2001tosecureitpendingtheoutcomeoftheapplication.Thisduty
willarisewheneveritisclaimedthatseizedmaterialcontainsmaterialprotectedbyLPPandmeansthattheseized
materialcan'tbecopied,examinedorotherwiseusedwithouttheapplicant'sconsentorwithoutdirectionsfromthe
court.

2.4Expressundertakingsofconfidentialitytothecourt
Ifyouhavebeeninvolvedinactingforclientsinlitigation,youmayhavereceiveddocumentsondisclosureinthose
proceedings,whicharesubjecttoanexpressundertakingtothecourtnottousethosedocumentsotherthanfor
thosecivilproceedings.
Anorderobtainedbyalawenforcementagencyfromacriminalcourtdoesnotoverrideyourobligationtothecivil
court.
Youshouldconsiderseekinglegaladviceonyourobligationsinsuchcircumstancesandontheappropriatenessof
makinganapplicationtotherelevantcivilcourttodischargeyoufromtheundertakingforthepurposeofcomplying
withthecriminalcourtorder.

3Discussinglawenforcementrequestsandorders
3.1Generalcomments
Inadditiontomeetingyourobligationsofconfidentiality,theremaybeanumberofotherrestrictionsonyourabilityto
discussthelawenforcementinvestigationwithothers.
Youshouldhaveclearprocessesinplaceformanagingrequestsfromlawenforcementagencies,dealingwithclients
whoarethesubjectofinvestigationsandliaisingwithrelevantthirdparties.
Youshouldlookatanycourtorderornoticeyouaregiventoseewhetherthereisanondisclosure'provision.You
mustcomplywithsuchaprovision.
Youshouldconsiderwhetheranydiscussionyouareabouttohaveregardingtheorderornoticeislikelytoprejudice
aconfiscation,civilrecoveryormoneylaunderinginvestigation,contrarytosection342oftheProceedsofCrimeAct
2002.
Youshoulddocumentallsuchdiscussionsinafileheldseparatelytothemainclientfile.

3.2Discussionswithlawenforcementagencies
Youshouldensurethatallstaffareawareofwhointheofficeisresponsibleforreceivingandrespondingtorequests
fromlawenforcementagencies.Staffshoulddirectallqueriestothatpersonimmediately,ratherthanengageinany
discussionswiththeagenciesthemselves.

3.2.1Preorderenquiries
Itisnotunusualforalawenforcementagencytocontactlegalpracticesinordertodiscusswhethertheyholdfiles
whicharerelevanttoaninvestigationandthelikelytimeframesforcomplyingwithanynoticeororder.
Thispresentsachallengeforlegalpractices,whowillwanttoensurethattimeframesincludedwithininitialnoticesor
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

7/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

ordersarerealistic,butwhomustkeeptheirclient'sdetailsconfidential.
Wheretheclientisawarethattheyarethesubjectofaninvestigationandhasspecificallyinstructedyoutointeract
withthelawenforcementagencyontheirbehalf,youshouldhavediscussionswiththeagencywithintheremitof
yourinstructions.
Inallothercasesyoushouldadvisetheinvestigatorthat:
youareprofessionallypreventedfromconfirmingordenyingthatyouactfortheclient(unlessthisisalreadya
matterofpublicrecord)andthatyoucannotprovidethemwithanydetailswithoutarelevantnoticeororder
ifanorderissoughtandtherearerelevantfilesheldinyouroffice,youshouldbeabletocomplywiththeorder
withinthestandardsevendayperiod(orsuggestalongerperiodifyouthinkthefilesarelikelytobeextremely
voluminous)and
ifrelevantfilesarearchived,itwilltakeyouanadditionalXworkingdaystoobtainsuchfiles.
Youshouldprovidetheinvestigatorwiththenameofthepersontowhomanynoticeororderistobeaddressed.
Youmayasktheinvestigatorwhether,ifthepersonunderinvestigationisyourclient,theywouldobjecttoyou
seekingconsentfromthatpersontoprovidetheinformation.However,thisdiscussionislikelytobemore
straightforwardonceyouareactuallyinreceiptoftheorder.

3.2.2Discussionsafterreceivinganorder
Evenonceanorderisprovided,confidentialitywillstillapplytoinformationheldoutsideofthescopeoftheorderand
youshouldbecarefulaboutvolunteeringyouropinionsaboutyourclient'sconductorthefactsofthecase,especially
withoutspecificinstructionsfromtheclient.
Formoreinformationseesection8Answeringquestionsandmakingstatements.

3.2.3Makingasuspiciousactivityreport
Alawenforcementagencycannottransfertoyoutheirsuspicionthataclientisinvolvedinmoneylaundering.
However,oncetheyhaveadvisedyouthattheyareinvestigatingaclientforacriminaloffencewherethereisa
benefitaccruingtotheclient,youhaveawarningsignthataclientmaybeinvolvedinmoneylaundering.
Themoneylaunderingreportingofficer(MLRO)atyourpracticeshouldreviewthefilesyouholdontheclientto
assesswhethertheynowhaveasuspicionofmoneylaundering.
Onceanorderisserved,youshouldbearinmindthatthethresholdrequiredbylawenforcementagenciestoobtaina
courtorderorwarrantishigherthanthatrequiredforareportonmoneylaundering.
However,theremaybereasonswhyyourMLROwouldstillnotsubmitasuspiciousactivityreportatthisstage,such
asinformationonthefilewhichdemonstratesthattheclient'sfundsarefromalegitimatesource.
Evenifyoudecideyounowhavearelevantsuspicion,youshouldcarefullyconsidertheissueofprivilegeandwhat
informationisabletobeprovidedwithinanysuspiciousactivityreport.

3.3Discussionsinhouseandwiththirdparties
3.3.1Discussionswithinthelegalpractice
Youshouldrestrictaccesstoinformationregardinglawenforcementinvestigationstothosestaffwhoneedtobe
involved.
Youshouldensurethatthecomplianceofficerforlegalpractice(COLP)isawareoftheinvestigation.
Youmayseekadvicefromothersinthelegalpracticewhospecialiseincriminallaw,legalprofessionalprivilegeor
otherrelevantareas,toassistincomplyingwithanynotices,ordersorwarrants.
Dependingonthefactsofthesituationyoumaydiscussthematterwithseniormanagement,marketingand/orHRto
ensurethelegalpracticeisabletoappropriatelydealwithanyreputationalorinternaldisciplinarymattersthatarise.

http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

8/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

3.3.2DiscussionswiththeLawSocietyortheSRA
YoumaycontacttheLawSociety'sPracticeAdviceServicetoseekadviceonthisorotherrelatedpracticenotes.
YoumaycontacttheSRAEthicsHelplinetoseekadviceonyourethicalobligations.
Inbothcases,youshouldnotprovidedetailswhichidentifytheclientorsendacopyoftherelevantnoticeororder.

3.3.3Discussionswithlawyers
Youmayseeklegaladvicefromaspecialistcriminallawsolicitoronhowto:
complywithanynoticesororders,
respondtotheinvestigation,and
manageyourrelationshipwithyourclient.
TheLawSociety'sFindASolicitorServicecanassistyouinlocatinganappropriatespecialist.

3.3.4Discussionswithinsurers
Youshouldconsiderwhetherthepoliceinvestigationisanotifiableincidentforthepurposesofyourprofessional
indemnityinsurancecoverage.Ifitis,youshouldconsidercarefullyhowtoprovidetherelevantinformationtoyour
insurersothatitistreatedwithappropriateconfidentiality.

3.4Discussionswithclients
3.4.1Decidingwhethertodiscussorderswithclients
Youshouldconsiderwhointhefirmwillengagewiththeclientinrelationtotheirongoingretainerand,ifappropriate,
theinvestigation.
UnderOutcome4.2oftheCodeofConductyoumust:
maketheclientawareofallinformationmaterialtothatretainerofwhichtheindividualhaspersonal
knowledge.
Whenalawenforcementagencyisengagedinthecovertpartofaninvestigation,theywillgenerallynotwantthe
clienttobeawareoftheinvestigation.
However,asimplerequestfromaninvestigatororalettermarkedconfidentialisnot,ofitself,enoughtooverrideyour
dutyofdisclosuretotheclient.
Asoutlinedat3.1above,youwillbeprecludedfromhavingdiscussionswithyourclientif:
theorder,noticeorwarrantspecificallyprohibitsdisclosure,or
thereisaspecificprovisioninthelegislationwhichcreatesanoffence,suchass342oftheProceedsofCrime
Act.
Youshouldcarefullyconsiderthewordingofanyspecificprovisions.
Generallytocommitsuchanoffenceyouwouldhavetoknoworsuspectthatyourdisclosureislikelytoprejudicean
investigationoftherelevanttype.Whiletheremaybeanexemptionforprovidinglegaladvice,thatexemptionwillnot
applyifyouradviceisfurtheringafraudorcriminalpurpose.
Theviewsoftheinvestigatorwillberelevantastowhetheryouarelikelytoprejudicetheinvestigation,buttheyare
notdeterminative.Youshouldconsiderobtainingspecialistlegaladvicebeforehavingdiscussionswiththeclient.
Ifyoudecidethatyouareprecludedfromdiscussingthepoliceinvestigationwiththeclient,youshouldconsider
whetherthisnowputsyouinapositionofconflictandwhetheryoushouldterminateyourretainerwiththeclient.You
shouldstillmakeassertionsofprivilegewherenecessaryoverinformationheldinrelationtotheclientandcontinueto
respecttheirconfidentiality.

http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

9/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

3.4.2Providinglegaladvice
Whereitisappropriatetohavediscussionswiththeclient,youshouldexplain
thelawenforcementrequestorordertothemandyourobligationstocomplyand
thatitisacriminaloffenceforthemtodestroyevidenceorseektointimidatewitnesses.
Youshouldconsiderwhethertheservingoftheorderonyouandthepossibilitythatyoumaybeawitnessagainst
yourclientnowmeansthataconflictexistssuchthatyoucannotcontinuetorepresenttheclient.
Youshouldconsiderencouragingthemtoseekindependentlegaladviceontheinvestigation,includingonissues
aroundwaivingprivilegeandprovidinginformationintheabsenceofanorder.

3.4.3Chargingforcompliancewithanorder
Compliancewithanotice,orderorsearchwarrantmayinsomecasestakeasignificantamountoftimeand
resources.
Whobearsthatcostmaydependonthetermsofyourengagementletter,especiallywhereyoucannotdiscussthe
existenceofthenoticeororderwiththeclient.
Firmsshouldconsiderincludingwithintheirtermsofengagementaprovisionwhichstatesthatthefirmwillchargethe
clientforrespondingtoalllawfulnoticesandordersfromlawenforcementagenciesrelatingtothisretainer.The
provisionshouldalsonotethatthefirmmaynotbeabletodiscusstheircompliancewiththenoticeororderwiththe
client.
Ifyouhavenotincludedsuchaterminyourtermsofengagementandyouareunabletodiscusstheorderwiththe
clienttoseektheirinstructionstocomplywiththeorder,youwillnotbeabletopassthecostsofcomplianceonto
them.
Wherethereisariskofprejudicinganinvestigation,carefulconsiderationshouldbegiventohowthechargeonthe
billiswordedsoasnottoalerttheclienttotheexistenceoftheorder.

4Powerstoobtainmaterialwithoutentry
4.1Generalcomments
Thereareanumberofpowersallowinginvestigatingofficerstorequestdocumentsandotherinformationinrelationto
aninvestigation.
Generallythesepowersallowinvestigatingofficerstoissuenoticesorapplyforcourtorderswhichrequireyouto:
producedocumentsand/or
discloseinformation,includingansweringquestions.
Inmostcases,thenoticeororderwill:
beappliedforwithoutnotice,althoughinvestigatingofficersmaymakesomepreorderenquiries
notcoverLPPmaterial
needtobecompliedwithinsevendays.
Themainnoticesandordersusedinfinancialcrimeinvestigationsare:
Noticetodiscloses61SeriousandOrganiseCrimeandPoliceAct2005
Noticetodiscloses2CriminalJusticeAct1987
Productionorders345ProceedsofCrimeAct2002
Disclosureorders357ProceedsofCrimeAct2002
Noticetoproduces20TaxesManagementAct1970
Productionorders20BATaxesManagementAct1970
ProductionorderSchedule1PoliceandCriminalEvidenceAct1984
Eachisdiscussedinmoredetailbelow.
Whenyoureceiveanoticeorordertoprovideinformationtolawenforcementyoushouldcheckthefollowing:
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

10/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

Whatstatutoryprovisionisthenoticeororderissuedunder?
Whatdoesthenoticeororderrequireyoutodo?
Youshouldensurethatthenoticeororderisspecificaboutwhatisbeingaskedfor.Ifthenoticeororderis
draftedtoowidely,thiscouldbegroundsforquashingit.[GittinsvCentralCriminalCourt[2011]EWHC131
(Admin)PowerHynesvNorwichMagistratesCourtandtheChiefConstableofNorfolk[2009]EWHC1512
(Admin)]
Whendoyouneedtocomplyby?
IsLPPmaterialcovered?

4.2Noticetodiscloses61SeriousandOrganisedCrimeandPoliceAct
2005(SOCPA)
4.2.1Keyfeatures
Anoticetodiscloseunders61ofSOCPAmaybeissuedwheretheinvestigatingauthority:
hasreasonablegroundsforsuspectingthatarelevantoffenceisbeingcommitted,
knowsthepersontowhomitisdirectedhasinformation,and
hasreasonablegroundsforsuspectingthatinformationislikelytobeofsubstantialvaluetotheinvestigation.
Therelevantoffencesinclude:bribery,POCAlifestyleoffences,terrorismoffencesandcertaintaxoffences.
Thenoticewillrequireapersontoanswerquestions,provideinformationorproducedocumentstoaconstable,
SeriousOrganisedCrimeAgency(SOCA)officerorHMRevenue&Customs(HMRC)officer.
Oncethosedocumentsareproduced,theinvestigatingauthoritymay:
takecopiesorextractsfromthosedocuments
requireyoutoprovideanexplanationofthem
Ifyoucannotproducethedocuments,theinvestigatingauthoritymayrequireyoutostate,tothebestofyour
knowledgeandbelief,wheretheyare.
LPPmaterialisnotabletoberequestedbythenoticetodisclose,howeverasasolicitoryoumayspecificallybe
requiredtogivethenameandaddressofyourclient.

4.2.2Whocanusethispower?
Anoticetodisclosemaybeissuedbythe:
directorofpublicprosecutions(ordelegatedstaff)
LordAdvocate(ordelegatedstafffromtheProcuratorFiscal)
directorofpublicprosecutionsforNorthernIreland(ordelegatedstaff)

4.2.3Notice
Asthisisnotacourtorder,thedecisiontoissuethenoticetodiscloseismadewithoutnoticetothepersonrequired
todisclosetheinformation.

4.2.4Timeframes
Thenoticetodisclosewillcontaininformationonhowtoprovidetheinformationrequestedandbywhen.

4.2.5WhathappensifIdon'tcomply?
Ifyoufailtocomply,theinvestigatorcanobtainawarranttoenterandseizetherelevantmaterial.

4.2.6CanIchallengethenotice?
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

11/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

Theprocessforchallengingthenoticeisjudicialreview.

4.3Noticetodiscloses2CriminalJusticeAct1987(CJA)
4.3.1Keyfeatures
Anoticetodiscloseunders2oftheCJAmaybeissuediftheSeriousFraudOffice(SFO)hasreasonablegroundsfor
suspectingthatanoffenceinvolvingseriousorcomplexfraudhasbeencommitted.
Thenoticetodisclosewillrequireyoutoproducespecifieddocumentsthatappeartoberelevanttoaninvestigation.
Oncethosedocumentsareproduced,theSFOmay:
takecopiesorextractsfromthosedocuments
requireyouprovideanexplanationofthem
Ifyoucannotproducethedocuments,theSFOmayrequireyoutostate,tothebestofyourknowledgeandbelief,
wheretheyare.
LPPmaterialisnotabletoberequestedbythenoticetodisclose,howeverasasolicitoryoumayspecificallybe
requiredtogivethenameandaddressofyourclient.
ThenoticetodisclosemayalsoallowtheSFOtoaskyoutoanswerquestionsorprovideinformationonanymatter
relevanttoaninvestigation.

4.3.2Whocanusethispower?
AnoticetodisclosemaybeissuedbytheDirectoroftheSFOandanyinvestigatorauthorisedbyhimtoexercise
thesepowersonhisbehalf.

4.3.3Notice
Asthisisnotacourtorder,thedecisiontoissuethenoticetodiscloseismadewithoutnoticetothepersonrequired
todisclosetheinformation.

4.3.4Timeframes
Thenoticetodisclosewillcontaininformationonhowtoprovidetheinformationrequestedandbywhen.

4.3.5WhathappensifIdon'tcomply?
Ifyoudonotcomplywithasection2noticetheSFOmayapplyforasearchandseizurewarrantusingsection2(5)
oftheCriminalJusticeAct1987.
Youmaybeprosecutedifyou:
failtocomplywithasection2notice,
givefalseormisleadinginformation(eitherknowinglyorrecklessly),or,
falsify,conceal,destroyordisposeofdocumentsthatwouldberelevanttoaninvestigation.
Ifconvictedyoumaybefinedorsentencedtoatermofimprisonment.

4.3.6CanIchallengethenotice?
Theprocessforchallengingthisnoticeisjudicialreview.

4.4Productionorders.345ProceedsofCrimeAct2002
4.4.1Keyfeatures
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

12/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

Aproductionordermaybegrantedaspartofaconfiscation,moneylaunderingorcivilrecoveryinvestigation.
Aproductionorderrequiresyoutogivespecifiedmaterialtoaninvestigatingofficertotakeaway,ortogivean
investigatingofficeraccesstothatmaterial.
Iftheinformationspecifiedintheorderisstoredonacomputer,youmustproducetheinformationorgiveaccesstoit
sothatitisvisibleandlegible(egprinttheinformation).Costscannotbeclaimedfordoingthis.
Oncetheinformationhasbeenproduced,itmayberetainedaslongasisnecessary,or(ifthematerialisneededfor
legalproceedingsandwouldotherwisebeunavailable)untilthoseproceedingsareconcluded.
Aproductionordercannotrequireyoutoproduce,orgrantaccessto,LPPorexcludedmaterial.
Aproductionordermaybeusedinconjunctionwithanordertograntentryunders347oftheProceedsofCrimeAct
2002.

4.4.2Whocanusethispower?
Section378ofPOCAsetsoutwhoisanappropriateofficerforeachtypeofinvestigation.
Inrelationtoaconfiscationinvestigation,anyofthefollowingmayapplyforaproductionorder:
anaccreditedfinancialinvestigator
apoliceconstable
anofficerofHMRC
SOCA
Inrelationtoamoneylaunderinginvestigation,thefollowingmayapplyforaproductionorder:
anaccreditedfinancialinvestigator
apoliceconstable
anofficerofHMRC
Inrelationtoacivilrecoveryinvestigation,thefollowingmanyapplyforaproductionorder:
SOCA
thedirectorofpublicprosecutions
thedirectoroftheSeriousFraudOffice,hisstaff,and
accreditedfinancialinvestigatorsemployedbytheSFO.

4.4.3Notice
Productionorderswillnormallybeappliedforwithoutnotice,althoughpreorderenquiriesmaybemade.

4.4.4Timeframes
Thetimelimitforcomplyingwithproductionordersisusuallysevendays,unlessthejudgegrantingtheorder
specifiesalongerorshorterperiodforcompliance.

4.4.5WhathappensifIdon'tcomply?
Failuretocomplywithaproductionordermayresultinproceedingsagainstyouforcontemptofcourtandcouldlead
toafine,prisonsentenceorsequestrationofassets.
Ifyoudonotcomplywithaproductionorder,anappropriateofficermayalsoapplyforasearchandseizurewarrant
undersection352(6)ofPOCA.

4.4.6CanIchallengethenotice?
Youmayapplytothecourttohavetheordervariedordischargedifitrelatestoeitheraconfiscationormoney
launderinginvestigation.
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

13/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

Youcannotapplyifitrelatestoacivilrecoveryinvestigation.
Theordercanbevariedonseveralgrounds,suchasinadequatedescriptionofthematerialsought,seekingaccess
tounauthorisedmaterial(suchasLPPmaterial)ornotidentifyingthecorrectclient.

4.5Disclosureorders357ProceedsofCrimeAct2002
4.5.1Keyfeatures
Adisclosureordermaybemadeduringconfiscation,civilrecoveryandexploitationorproceedsinvestigations.
Adisclosureordermayrequireyoutodoanyofthefollowing:
answerquestionsataspecifiedtimeandplace
providespecifiedinformationinatimeandmannerspecified
producedocumentsinaspecifiedmannerandwithinaspecifiedtime.
Adisclosureordercanonlybemadeiftherearereasonablegroundsforbelievingthattheinformationprovidedwillbe
ofsubstantialvaluetoaninvestigationandthatitisinthepublicinterestfortheinformationtobegiven.
Adisclosureordercannotrequireyoutoprovideanyanswers,informationordocumentsthatwouldbesubjectto
LPP.However,youmayberequiredtoprovideconfidentialinformation,suchasthenameandaddressofyourclient.

4.5.2Whocanusethispower?
Thefollowingpeoplemayapplyforadisclosureorder:
thedirectorofSOCA
thedirectorofpublicprosecutions
thedirectorofpublicprosecutionsforNorthernIreland
thedirectoroftheSeriousFraudOffice
thedirectorofRevenue&Customs
thedirectorofRevenue&CustomsprosecutionsforNorthernIreland

4.5.3Notice
Adisclosureordermaybeappliedforwithoutnoticeoronnotice.
Whereitisappliedforonnotice,youmayattendthecourtandmakerepresentationsabouttheappropriatenessof
issuingtheorderoraboutthecontentoftheorder.

4.5.4Timeframes
Theinvestigatingofficerwillsetthetimelimitforcompliancewithadisclosureorder.Youmayrequestmoretimeto
complywitharequirementinadisclosureorder.
Thecircumstancesinwhichanextensionwillbegrantedwillvaryfromcasetocase,butmayinclude:
theneedtoobtainprofessionaladvice
difficultyinobtainingtherequiredinformationordocuments
aninterviewee'savailability
ForfurtherinformationonwhenanextensionwillbegrantedseetheAttorneyGeneral'sguidance(PDF)

4.5.5WhathappensifIdon'tcomply?
Ifyoudonotcomplywithadisclosureorder,anappropriateofficermayalsoapplyforasearchandseizurewarrant
unders352oftheProceedsofCrimeAct2002.
Ifyoudonotcomplywithadisclosureorderorknowinglyorrecklesslymakeamisleadingstatementinresponseto
suchanorder,thenyoucommitanoffenceundersection359ofPOCA.
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

14/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

Noncompliancewithadisclosureordercanleadtouptosixmonths'imprisonmentora5000fine.
Knowinglyorrecklesslymakingafalseormisleadingstatementcanleadtotwoyears'imprisonmentandanunlimited
fine.

4.5.6CanIchallengethenotice?
Youmayapplytothecourttohavetheordervariedordischargedifitrelatestoeithera:
confiscationor
moneylaunderinginvestigation
Youcannotapplyifitrelatestoacivilrecoveryinvestigation.
Theordercanbevariedonseveralgrounds,suchasinadequatedescriptionofthematerialsought,seekingaccess
tounauthorisedmaterial(suchasLPPmaterial)ornotidentifyingthecorrectclient.

4.6Noticetoproduces20TaxesManagementAct1970(TMA)
4.6.1Keyfeatures
Anoticetoproduceissuedunders20ofTMA(asamendedbytheFinanceAct2008)willrequireyoutoprovide
informationorproducedocumentsinordertoinvestigatethetaxpositionofanotherperson.'Documents'includes
electronicrecords.
Youmayproduceacopyofthedocumentrequestedunlessyouareaskedtoproducetheoriginaldocument.HMRC
officersmaycopyormakeextractsfromthedocuments.Theymayalsoremoveandretainthedocumentfora
reasonableperiodwherenecessary.
HMRCcannotrequireyoutoproduceanyinformationthatissubjecttoLPP.
HMRChasissuedguidanceontheuseofthesepowersinitscompliancehandbook.

4.6.2Whocanusethispower?
InspectorsandofficersofHMRC.

4.6.3Notice
Asthisisnotacourtorder,thedecisiontoissuethenoticetoproduceismadewithoutnoticetothepersonrequired
toproducetheinformation.

4.6.4Timeframes
Thetimeframeforcomplyingwillbespecifiedinthenotice.

4.6.5WhathappensifIdon'tcomply?
Ifyoufailtocomplywithaninformationnoticewithoutareasonableexcuse,youmaybeliabletoa300penaltyplus
dailypenaltiesofupto60adayifthefailurecontinues.
Failuretocomplyincludesconcealing,destroying,disposingofadocumentafteraninformationnoticehasbeen
receivedorafterbeinggiveninformalnotificationthatadocumentisrequired.Concealing,destroyingordisposingof
adocumentfollowinganinformationnoticeisanoffenceandmayleadtoafineorimprisonment.
Ifyouaregivenapenalty,youmayappealtotheFirstTierTribunalagainstthedecisiontoimposeapenaltyorthe
amountofthepenalty.Ifyouappeal,youmustgivewrittennoticeofyourintentiontodosotoHMRCwithin30days
ofthepenaltybeingimposedandstateyourgroundsforappeal.

http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

15/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

4.6.6CanIchallengethenotice?
Ifyouaregivenaninformationnotice,youmayappealagainstthenoticeitselforanyrequirementinthenoticeifit
wouldbeundulyoneroustocomplywithit.AppealsmustbemadetotheFirstTierTribunal.
However,youmaynotappealifthenoticerelatestostatutoryrecordsorifthenoticewasapprovedbytheFirstTier
Tribunal.
YoumustgivewrittennoticeofyourappealtotheHMRCofficerwhogaveyoutheinformationnoticewithin30days
ofthedateonwhichitwasgiventoyou,statingyourgroundsforappeal.TheFirstTierTribunalmayconfirm,varyor
setasidetheinformationnoticeorarequirementwithinit.

4.7Productionorders20BATaxesManagementAct1970
4.7.1Keyfeatures
Acircuitjudgemayissueanorderunders20BAofTMArequiringyoutodeliverdocumentstoHMRCifthereare
reasonablegroundsforsuspectingserioustaxfraudhasoccurred.Thedocumentsarelimitedtothosewhichmay
provideevidenceofthefraud.

4.7.2Whocanusethispower?
AuthorisedofficersofHMRC.

4.7.3Notice
YoumustbegivenwrittennoticeofHMRC'sintentiontoapplyforsuchanorder.Thisnoticemustbegiventoyouno
lessthanfiveworkingdaysbeforethehearingoftheapplication.
Youareentitledtoappearandbeheardatthehearingoftheapplicationunlessthejudgeissatisfiedthatthiswould
prejudicetheinvestigation.
Thenoticemustspecify:
thedate,timeandplaceforhearingtheapplication
thedocumentswhicharethesubjectoftheapplication
adescriptionofthesuspectedoffencetowhichtheapplicationrelates
thenameofthepersonsuspectedoftheoffence.
IfyouaregivennoticeofHMRC'sintentiontoapplyforanorder,youmustnotconceal,destroy,alterordisposeof
anydocumenttowhichtheapplicationrelateswithoutpermissionfromthejudgeorwrittenpermissionfromHMRC.
Youarepermittedtodiscussthefactoftheapplicationwithyourclient,forthepurposeofprovidinglegaladvice.

4.7.4Timeframes
Youwillgenerallyhave10workingdaysfromthedatetheorderisservedonyoutocomply,unlesstheorder
specifiesalongerorshorterperiod.

4.7.5WhathappensifIdon'tcomply?
Ifyoudonotcomplywithanordertodeliverdocuments,youmaybeprosecutedforcontemptofcourt.

4.7.6CanIchallengethenotice?
Theprocessforchallengingtheorderisjudicialreview.

4.8ProductionOrderSchedule1PoliceandCriminalEvidenceAct1984
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

16/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

(PACE)
4.8.1KeyFeatures
AjudgemayissueanorderunderSchedule1ofPACE1984requiringyoutoproducespecialprocedurematerialifhe
issatisfiedthatthedocumentsarelikelytoberelevantevidenceorofsubstantialvaluetoaninvestigationintoan
offence.
Specialprocedurematerialisdefinedbysection14ofPACE1984.Itincludes:
materialacquiredorcreatedinthecourseofanytrade,business,professionorotheroccupationforthe
purposeofanypaidorunpaidofficewhichisheld:
subjectanexpressorimpliedundertakingtoholditinconfidence,or
subjecttoarestrictionorobligationsuchasthosementionedinsection11(2)(b)forexamplealegislative
obligationofsecrecy.
journalisticmaterialthatisnotexcludedmaterialundersection11.
Specialproceduredoesnotincludematerialthatissubjecttolegalprofessionalprivilegeorexcludedmaterial.

4.8.2Whocanusethispower?
Policeconstables
SOCAstaffthatareauthorisedundersection43ofSOCPA2005

4.8.3Notice
YouwillbegivennoticeofanapplicationforaSchedule1orderandtheapplicationwillbeinterpartes.
Onceyouhavereceivednoticeofanapplication,youmustnotdestroy,conceal,alterordisposeofthematerialthat
theapplicationrelatestowithoutaleavefromajudgeorwrittenpermissionfromaconstable.

4.8.4Timeframes
ThetimeframeforcomplyingwithaSchedule1orderisusuallysevendaysfromthedateoftheorder,unlessthe
orderspecifiesotherwise.

4.8.5WhathappensifIdon'tcomply?
IfyoudonotcomplywithaSchedule1order,ajudgemayissueasearchwarrantauthorisingapoliceconstableto
findandseizethematerial.Youmaybeprosecutedforcontemptofcourt.

4.8.6CanIchallengethenotice?
Theprocessforchallengingtheorderisjudicialreview.

5Powerstoenterandobtainmaterial
5.1Generalcomments
Thereareanumberofpowersallowinginvestigatingofficerstoobtainordersorwarrantstoenterpremisesinorderto
searchforand/orseizematerialthatisrelevanttoaninvestigationorevidenceofanoffence.
Themainordersandwarrantsusedinfinancialcrimeinvestigationsare:
Entryorders347ProceedsofCrimeAct2002
Magistrates'Warrants8PoliceandCriminalEvidenceAct1984
SearchandSeizureWarrants66SeriousandOrganisedCrimeandPoliceAct2005
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

17/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

SearchandSeizureWarrants352ProceedsofCrimeAct2002
SearchandSeizureWarrants2CriminalJusticeAct1987
SearchandSeizureWarrantschedule5TerrorismAct2000
SearchandSeizureWarrantschedule1PACE1984
Whereoneofthesepowersisused,itwilleitherbebecauseyouhavefailedtocomplywithanearliernoticeororder,
orthelawenforcementagencyconcernedhasreasonablegroundstosuspectthatyouarecomplicitinthecriminal
activity.
Insuchcircumstancesyouneedindependentspecialistlegaladvice.
Forthisreasonthepracticenotedoesnotdiscussthedifferentpowersindetail,butoutlinesyourgeneralrightsand
responsibilitiesshouldanentryorderorwarrantbeexecutedagainstyourofficeorhome.
ThereisdetailedadviceforlawenforcementonconductingsearchesinthePACECodeofPracticeBwhichcanbe
obtainedfromtheHomeOfficewebsite.

5.2Yourrightsandresponsibilities
Thelegalpracticeshouldidentifyseniorstaffwhowillberesponsibleforliaisingwithlawenforcementofficersinthe
eventofasearch.
Receptionstaffshouldbeawareofwhothosestaffmembersareanduponbeingshownanorderbytheinvestigating
officers,shouldcontacttherelevantstaffmembers.
Thefollowingadvicein5.2.15.2.3isdirectedatthestaffmemberswhoareresponsibleforliaisingwithlaw
enforcementduringthesearch.

Initialentry
Whenalawenforcementofficerseeksentrytoyourofficeyoushouldbepoliteandcooperatewithintheparameters
oftherequirements.Anythingyousayordonotsaytotheofficersmaybeusedinlatercourtproceedings.
Youshouldchecktheorderorwarrantforthefollowing:
thestatutorypowerthattheorderorwarrantisissuedunder
thedateofissue
thepremisestobesearched
whomayenterthepremises,forexampleiftheSRAistoaccompanylawenforcementduringthesearch,the
relevantSRAstaffshouldbenamedontheorderorwarrant
whatmaterialiscoveredbythewarrant
whethermaterialsubjecttoLPPiscovered.
Ifyouaresatisfiedthatthewarrantgivestheinvestigatingofficerthepowertoenterandsearchthepremises,you
shouldnotobstructtheinvestigatingofficersintheirsearchorpreventaccesstomaterial.
Iftheaboveisnotsatisfactory(forexampleifthewarrantscheduleofdocumentstobesearchedforhasbeen
detachedfromthecopyofthewarrantprovidedtooccupier),thesearchisunlawfulandthereisnorightforthe
officerstoretainanythingseized.
Youshouldthenmakerepresentationstothateffectandmakesurethattheyarerecordedpendinganylatercourt
application.Ifyouhaveanyconcernsaboutthewarrant,raiseitwiththeofficersanddocumentit.

Legalrepresentation
Youshouldasktheofficerswhethertheywillwaitforyourlawyerstoarrive.
Theofficersarenotlegallyobligedtowait,butmaydoso,ifyoucanprovideatimeframeandwaitingwillnot
unreasonablydelaythesearch.
Iftheinvestigatingofficerswanttoaskquestionsofstaff,youshouldestablishthebasisonwhichtheyproposeto
askquestions.Duringthesearchthisshouldberestrictedtoquestionstoassistincomplyingwiththetermsofthe
warrantororder,suchasidentifyingwhererelevantmaterialiskept.

http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

18/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

Anyotherquestioningofstaffshouldbedoneinthepresenceofthelegalpractice'slawyers.Seesection8formore
details.

Duringthesearch
Youshouldasktheinvestigatingofficerswhattheyarelookingforand,wherepossible,decidetogetherthe
processesbywhichthesearchwilltakeplace.
Youshouldconsidertakingstepstohaveclientsleavetheofficeandtocancelotherappointmentsduringthe
expecteddurationofthesearch.
Youshouldemailallstafftoinformthemofthesearchandadvisethemoftheneedtocooperatewiththe
investigationandtonotdestroyanydocumentation.
Youshouldallocateanumberofseniorstaffmemberstoshadowtheinvestigatingofficers,toensurethatthe
investigationiscarriedoutlawfullyandtotakearecordofdocuments/articlesseized.
Alawfulinvestigationrequiresthatthepremisesbesearchedonlytotheextentrequiredforthepurposeforwhichthe
warrantwasissued.
Thismeansthatasearchcannotbemadeinplaceswherethedocuments/articlesspecifiedinthewarrantcouldnot
possiblybefoundorforlongerthannecessarytofindthem.
Aseniormemberofstaffcandirectofficerstowheredocuments/articleslistedinthewarrantarekeptanddirectthem
awayfromirrelevantroomsorprivilegedmaterial.
Seniormembersofstaffcanensurethatthesearchisbeingcarriedoutwithminimaldisturbancetothepremisesand
onlyreasonableforceisusedifnecessary,forexample,toopenlockedfilingcabinets.
Youshouldkeepawrittenrecordof:
alltheofficers'requestsandquestions
anyanswersprovidedand
anydocuments/articlesseizedorcopied.
Ifyoubelieveadocumentisprivileged,youshouldmaketheinvestigationofficerawareofthisand,incaseofa
dispute,usethebluebagprocessdetailedinsection2.3.5.

6Maintainingacompleterecord
6.1Copyingfiles
Seizureandretentionofdocumentsandothermaterialbyinvestigatingofficerscanposesignificantproblemsfor
solicitors.
Itmaypreventyoufrommaintainingacompleteclientfile,orinthecaseofcomputersbeingseized,fromrunning
yourofficeintheinterveningperiod.
Italsocouldleadtodifficultiesifyouarerequiredtoaccountforyouractionstoyourregulatororothersinthefuture
andyounolongerhavetheinformationyouneedtodefendyourself.
Youshouldmakecopiesandkeeprecordsofanyfilesordocumentsthathavebeendisclosedfollowingreceiptofa
noticeorordertoproduce.
Whendocumentsareseizedfollowingasearch,theinvestigatingofficersmustmakeadetailedrecordofthesearch,
includingalistofdocuments/articlesseized,uponreturntothepolicestation.Theofficersmustprovidethefirmthis
listuponrequest.
Shouldthedocuments/articlesberetained,youhavetherighttorequestarecordofthoseseizedwhichmustthenbe
providedwithinareasonabletimeframe.
Youalsohavearighttoaccessthedocuments/articlesseizedand/ortophotographsorphotocopiesofthose
documents/articles.
Additionally,theofficersmustonlyretainanoriginaldocument/articlewhenaphotographorcopyisnotsufficient.
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

19/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

Aftertheinvestigation,youshouldcollatecopiesofalldocuments/articlesseizedandprovidethistothelegal
practice'slawyersforreviewwhowillbegintoassessthestrengthoftheallegations.

6.2Forwardingfilestoanothersolicitor
Ifyourclientchangestheirsolicitorandrequeststhattheirfilebesenttotheirnewfirm,youshouldsendthemacopy
ofthefile.
Youshouldnotordinarilyincludeacopyofawarrant,orderornoticeservedonyouunlessyoucouldbesurethatin
doingsoyouwerenotdoinganactlikelytoprejudicetheinvestigationscontrarytos342POCAorothersimilar
legislativeprovision.
Wheretheclientisunawareofthewarrant,orderornotice,youshouldnotincludeitinthefile,andyoushouldkeep
allcorrespondenceandattendancesrelatingtotheorderseparatefromtheclientfile.Seesection3.4Discussions
withclients.
Youshouldretaincopiesofanythingdisclosedunderanoticetoproduceorseizedduringasearch/orthewholefile
incaseyouneedtoaccountforyouractionsinfuture.

6.3Voluntaryreturn
Dependingonthecircumstances,theseizedmaterialmaybereturnedtoyouattheendoftheinvestigationby
investigatingofficers.

6.4Applicationtothecourt
AnyonewitharelevantinterestinseizedpropertymayapplytotheCrownCourt(orinsomeinstances,theHigh
Court)forthepropertytobereturned.
Amongotherthings,thecourtcanorderthatthematerialbereturnedorexaminedbyanindependentthirdparty.You
canalsoapplytothemagistratescourtforthereturnofthepropertyundersection1ofthePolice(Property)Act
1897.

7Powersofarrest
7.1Arrestwithoutawarrant
Unders24ofthePoliceandCriminalEvidenceAct1984apoliceconstablemayarrestyouwithoutawarrantifhe
reasonablysuspectsyouofbeingguiltyofanoffence,orifhereasonablybelievesyouarecommittinganoffenceor
abouttocommitone.
Theconstablemustreasonablybelievethatitisnecessarytoarrestyouforanyofthefollowingreasons:
toascertainyournameandaddress
topreventyoucausingorsufferingphysicalinjury,lossordamagetopropertyorcommittinganoffence
againstpublicdecency
toallowpromptandeffectiveinvestigationofanoffence
topreventyoudisappearingandthusavoidingprosecution.
Ifyouarearrested,apoliceconstablemayenterandsearchanypremisesoccupiedandcontrolledbyyouifhe
suspectsthatthereisevidenceonthepremisesrelatingtotheoffenceforwhichyouhavebeenarrested.
Theconstablemayseizeandretainanyevidencehefindsasaresultofthatsearch.
Unlessyourpresenceatthesearchisnecessaryfortheeffectiveinvestigationoftheoffence,suchasearchmustbe
authorisedinwritingbyapoliceinspector.

7.2Arrestwithawarrant
Undersection1oftheMagistratesCourtAct1980amagistratemayissueanarrestwarrantforanypersonwhohas,
orissuspectedtohave,committedanoffence.
http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

20/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

Ifyouarearrested,apoliceconstablemayenterandsearchwithoutawarrantanypremisesoccupiedandcontrolled
byyouifhesuspectsthatthereisevidenceonthepremisesrelatingtotheoffenceforwhichyouhavebeenarrested.
Theconstablemayseizeandretainanyevidencehefindsasaresultofthatsearch.
Unlessyourpresenceatthesearchisnecessaryfortheeffectiveinvestigationoftheoffence,suchasearchmustbe
authorisedinwritingbyapoliceinspector.

7.3Yourrightsandresponsibilities
Uponarrest,apoliceconstablemustinformyouofyourarrestandalsoofthegroundwhichexistforyourarrest.
Youmustbetoldinsimplelanguagethatyouarebeingdeprivedofyourlibertyandthereasonsforit,includingthe
natureofthesuspectedoffenceandwhereandwhenitwasallegedlycommitted.
Iftherearereasonablegroundstosuspectyouhavecommittedanoffence,theofficermustcautionyoubefore
askinganyquestionsabouttheoffenceifyouranswersorsilencemaybegiveninevidencetoacourtina
prosecution.
Thereisnorighttoalawyeratthetimeofarrest,butifyouareheldinpolicecustodyoranyotherpremises,you
havetherighttoindependentlegaladviceandtoconsultasolicitorprivatelyatanytime.
FurtheradviceforlawenforcementonusingtheirpowersofarrestarecontainedinPACECodeofPracticeGwhich
isavailablefromtheHomeOfficewebsite.

8Answeringquestionsandprovidingstatements
8.1Questionsandstatementsabouttheclient
Therequirementtomaintainconfidentialityandprotectlegalprofessionalprivilegeextendstovoluntarilyanswering
questionsfromlawenforcementofficersandprovidingwitnessstatementstothemaboutyourclient'sinvolvement.
Youmayanswerquestionsaboutapersonwhoisnotaclientofyourfirm,asthiswillnotbreachtheconfidentiality
rule,butonlytotheextentthatsuchanswersdonotrevealconfidentialinformationaboutaclient.
Aclientmaygiveyouinstructionstoengagewithlawenforcementagenciesontheirbehalf.Youshouldseekclear
instructionsonhowyouaretoengagewithlawenforcementandwhethertheclientisagreeingtoawaiveroflegal
professionalprivilege.
Alternatively,anotice,orderorwarrantmayrequireyoutoanswerquestionsputbyinvestigators.Thiswillextendto
informationwhichisconfidential,butnottoinformationwhichprivileged.Youmayonlydiscussinformationwhichwas
subjecttoLPPiftheclientconsentsoryouhaveprimafacieevidencethatthecrime/fraudexceptionappliesandthe
informationisnolongersubjecttoLPP.
Ifyouareaskedtoprovideawitnessstatement,youshouldrequestthatyoubesummonsedasawitness.
Whereyouarerequiredtoprovideanswerstoquestionsorwitnessstatementsandeither:
youarenotpermittedtodiscussthiswiththeclient,or
youhaveprimafacieevidencethatthecrime/fraudexceptionapplies
youmustconsiderwhetheryouareinaconflictpositionandwhetheryoucancontinuetoactfortheclient.
Whereyounolongeractfortheclientyoumustconsiderthequestionssubjecttoyourobligationsofprivilegeand
confidentialityassetoutbelow.

8.2Questionsandstatementsaboutyourinvolvement
Therequirementtomaintainconfidentialityandprotectlegalprofessionalprivilegeextendstovoluntarilyanswering
questionsfromlawenforcementandprovidingwitnessstatementstothemaboutyourowninvolvement.
Youshouldseekspecialistlegaladvicewherelawenforcementisaskingquestionsaboutyourinvolvementwitha
clientorinrelationtoaspecificretainer,astheremaybepotentialcriminal,regulatory,andcivilconsequences.

http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

21/22

16/02/2015

RespondingtoafinancialcrimeinvestigationTheLawSociety

9Moreinformation
9.1LawSocietyproductsandservices
ForadviceonhowtocomplywithaninvestigationbytheSRAreadourpracticenoteonInvestigatorypowers.

9.2Other
Mostnotices,ordersandwarrantsarecoveredbyprovisionsofSchedule1ofthePoliceandEvidenceAct1984.The
HomeOfficehasissuedguidancetolawenforcementagenciesonhowtoapplyforandusethesepowers.

10Terminology
MustAspecificrequirementinlegislationorofaprinciple,rule,outcomeorothermandatoryprovisionintheSRA
Handbook.Youmustcomply,unlesstherearespecificexemptionsordefencesprovidedforinrelevantlegislationor
theSRAHandbook.
ShouldOutsideofaregulatorycontext,goodpracticeformostsituationsintheLawSociety'sview.Inthecaseof
theSRAHandbook,anindicativebehaviourorothernonmandatoryprovision(suchasmaybesetoutinnotesor
guidance).
Thesemaynotbetheonlymeansofcomplyingwithlegislativeorregulatoryrequirementsandtheremaybe
situationswherethesuggestedrouteisnotthebestpossibleroutetomeettheneedsofyourclient.However,ifyou
donotfollowthesuggestedroute,youshouldbeabletojustifytooversightbodieswhythealternativeapproachyou
havetakenisappropriate,eitherforyourpractice,orintheparticularretainer.
MayAnonexhaustivelistofoptionsformeetingyourobligationsorrunningyourpractice.Whichoptionyouchoose
isdeterminedbytheprofileoftheindividualpractice,clientorretainer.Youmayberequiredtojustifywhythiswas
anappropriateoptiontooversightbodies.
Clientthepersonforwhomyouactandincludesprospectiveandformerclients.

http://www.lawsociety.org.uk/supportservices/advice/practicenotes/financialcrimeinvestigations/

22/22