Thu | Jan 17, 2019

JaRistotle’s Jottings | Explaining the unexplained wealth

Published:Thursday | October 18, 2018 | 12:00 AM

Recently, there was a landmark case in the United Kingdom (UK) under the aegis of an Unexplained Wealth Order (UWO), wherein a foreign national who had reportedly spent in excess of £16 million in Harrods department store over a 10-year period was mandated to explain to the National Crime Agency how she and her family could afford such luxuries.


What is an Unexplained Wealth Order?


As reported by Dominic Casciani, home affairs correspondent for the BBC News, a UWO is "a new power which has been designed to target suspected corrupt foreign officials who have potentially laundered stolen money through the UK, an attempt to force the owners to disclose their wealth. If a suspected corrupt foreign official, or their family, cannot show a legitimate source for their riches, then a law enforcement agency can apply to the High Court to seize the property".

The UK Home Office Circular 003/2018 outlines in greater detail the apparatus for applying UWOs, citing "a UWO requires a person who is reasonably suspected of involvement in, or of being connected to a person involved in serious crime, to explain the nature and extent of their interest in particular property, and to explain how the property was obtained, where there are reasonable grounds to suspect that the respondent's known lawfully obtained income would be insufficient to allow the respondent to obtain the property".

Truly a powerful tool in the law-enforcement arsenal that can allow investigators to focus on property owners whose acquisitions and holdings are not in congruence with the benchmark salaries for their professed or known professions.


UWOs in Jamaica


It is reasonable to expect that as countries such as the UK tighten the noose on international money launderers, such vagabonds will shift their operations elsewhere, targeting countries where there are less stringent and inquisitive legislation.

Jamaica should be very concerned at this prospect, given the absence of UWO-like legislative instruments. We should also bear in mind that many of our CARICOM partners offer 'Economic Citizenship' to paying foreign nationals, oftentimes with few questions asked.

When one thinks of the numerous cases of politicians, public servants and foreign and Jamaican nationals with no known source of legitimate income whose lifestyle far exceeds what their 'legitimate' salaries would normally allow them to afford, UWOs could prove to be a potential game changer if such power were to be placed in the right hands.

UWOs could prove to be useful in the fight against corruption and high-end criminality in Jamaica, effectively putting suspects on the back foot as the burden would rest with them to explain the source of their wealth and to convince the relevant law enforcement agency as to the legitimacy of their assets. Failure to respond and submission of deceptive or false explanations would result in the freezing of those assets by the courts until an acceptable explanation is proffered.

Another key strength of UWOs is that it penetrates the corporate veil: once an individual is in any way associated with an asset they can be 'served' and are then obligated to respond. Responses in turn lead to further UWOs until all is revealed. No hiding spots.

Needless to say, UWOs would certainly not be in the best interest of corrupt politicos and other purveyors of crime and corruption, especially politically related corruption.

It will therefore be interesting to see how such an enhancement for the UK plays out in the Jamaican arena once awareness spreads, or if through international pressure the government has to implement such 'best practice' measures. One way or the other, UWOs seem inevitable.

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