Nicholas Medcroft KC

Money laundering in the supply chain: the use of “adequate consideration” to “cleanse” criminal property

Section 329 (2)(c) of the Proceeds of Crime Act 2002 exempts a person from criminal liability where criminal property is acquired for adequate consideration. Previous authority appeared to suggest that the provision of adequate consideration had the effect of "cleansing" criminal property. Thus, anyone who subsequently dealt with the property would not commit a money laundering offence.

In Rex (on the application of World Uyghur Congress) and National Crime Agency [2024] EWCA Civ 715, 26 June 2024 the Court of Appeal rejected this interpretation. In a decision which will have significant implications for businesses and professional advisors, the court held that the “adequate consideration” exemption is no more than a personal exemption. It has no impact on the status of the property as criminal property or recoverable property. It does not therefore operate to cleanse tainted property.

Reforming corporate criminal liability: a missed opportunity to modernise the law

In June 2022 the Law Commission presented the government with ten options for reforming the law of corporate criminal liability, with specific focus on economic crime. In this article we address what we consider to be the key weakness in the Commission’s approach, together with those options which are most likely to provide coherent alternatives, or at least sensible improvements, to the current law. While we take the view that the Law Commission missed the opportunity to reject the identification doctrine altogether as both anachronistic and inherently unsuited to establishing culpability in modern corporate contexts, we welcome the proposed increased emphasis on “failure to prevent” models of liability and the recognition that an administrative system for the imposition of monetary penalties can provide valuable additional means of redress.