From 31 January 2018, HMRC can require a person to explain the source of their wealth by applying to the High Court for an Unexplained Wealth Order (UWO).

This power derives from Chapter 1 of Part 1 of the Criminal Finances Act 2017.

  • The application will specify
    • The property in respect of which the order is sought
    • The person HMRC (or other enforcement authority) thinks owns it
  • The UWO requires the person to provide a statement
    • Setting out the nature and extent of their interest in the property
    • Explaining how they obtained it (including how any associated costs were funded)
    • If held in trust, details of the settlement (as requested)
    • Such other information as may be so specified
    • It may also require the provision of associated documents
  • The order must state
    • The form and manner of the statement above
    • The person to whom the order is to be given
    • Where it is to be given to the person (or the address to which it will be sent)
  • The time limit for response will be specified by the Court.
  • The Act does not provide any specific means of challenging the issue of an UWO.

If the person does not comply with the order, the property will be presumed to be eligible for recovery under Part 5 of the Proceeds of Crime Act 2002. False statements can be prosecuted and may be subject to imprisonment and/or a fine.

UWOs in action

The National Crime Agency secured the first UWOs under this legislation in Feburary 2018, they covered two properties worth £22m believed by a 'politically exposed person'. 

Links:

Foreign Currency

Criminal Finances Act 2017 Part 1 Chapter 1

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