Kazakh family overturn three Unexplained Wealth Orders
Unexplained Wealth Orders (UWOs) – dubbed "McMafia orders" – give authorities such as the police, HMRC, the FCA, the SFO and the NCA, the power to seize assets suspected of being acquired with the proceeds of crime.
As discussed in our blog post here, the NCA obtained UWOs against three London properties that had been acquired by Kazakh politician-turned-dissident, the late Rakhat Aliyev. The NCA argued that Aliyev had enriched himself through the corrupt use of his public position and the high-value London properties (which were beneficially owed by, Nurali Aliyev and his ex-wife Dariga Nazarbayeva) had therefore been acquired through illegitimate means.
The three UWOs were challenged before the High Court by both Nurali Aliyev and Dariga Nazarbayeva who asserted that they could prove independent and legitimate wealth for their UK property investments. The challenge was successful. The Court held that the properties were legally owned through two companies, and that "the NCA's assumption" that Rakhat Aliyev was the source of the money used to buy the three properties was ultimately "mistaken" and "unreliable". The High Court concluded that there was "cogent evidence" that Dariga Nazarbayeva and Nurali Aliyev had founded the companies which owned the homes, and had provided the money to pay for them. Ultimately, the High Court ruled that the NCA's evidence did not sufficiently prove that that Rakhat Aliyev's funds had been used to set up various offshore shell companies used to purchase the properties. As a result, the High Court discharged the UWOs.
Following the High Court's ruling, the NCA has issued a statement that it would appeal the decision. Graeme Biggar, the NCA’s Director General of the National Economic Crime Centre, has said: "These hearings will establish the case law on which future judgments will be based, so it is vital that we get this right. The NCA is tenacious. We have been very clear that we will use all the legislation at our disposal to pursue suspected illicit finance and we will continue to do so".
The case demonstrates that owing to the significant power of UWOs and their extremely restrictive effect on the respondents to which they are subject, the Court is being careful to intensely scrutinise their use. This case may provide a salutary lesson to prosecuting authorities to ensure that their evidence is completely watertight before applying for UWOs in the future.
This article was also co-authored by Laura Fabris, a Trainee Solicitor at Fieldfisher.
Please review our Covid-19 hub for updates and get in touch if you require further information.
As discussed in our blog post here, the NCA obtained UWOs against three London properties that had been acquired by Kazakh politician-turned-dissident, the late Rakhat Aliyev. The NCA argued that Aliyev had enriched himself through the corrupt use of his public position and the high-value London properties (which were beneficially owed by, Nurali Aliyev and his ex-wife Dariga Nazarbayeva) had therefore been acquired through illegitimate means.
The three UWOs were challenged before the High Court by both Nurali Aliyev and Dariga Nazarbayeva who asserted that they could prove independent and legitimate wealth for their UK property investments. The challenge was successful. The Court held that the properties were legally owned through two companies, and that "the NCA's assumption" that Rakhat Aliyev was the source of the money used to buy the three properties was ultimately "mistaken" and "unreliable". The High Court concluded that there was "cogent evidence" that Dariga Nazarbayeva and Nurali Aliyev had founded the companies which owned the homes, and had provided the money to pay for them. Ultimately, the High Court ruled that the NCA's evidence did not sufficiently prove that that Rakhat Aliyev's funds had been used to set up various offshore shell companies used to purchase the properties. As a result, the High Court discharged the UWOs.
Following the High Court's ruling, the NCA has issued a statement that it would appeal the decision. Graeme Biggar, the NCA’s Director General of the National Economic Crime Centre, has said: "These hearings will establish the case law on which future judgments will be based, so it is vital that we get this right. The NCA is tenacious. We have been very clear that we will use all the legislation at our disposal to pursue suspected illicit finance and we will continue to do so".
The case demonstrates that owing to the significant power of UWOs and their extremely restrictive effect on the respondents to which they are subject, the Court is being careful to intensely scrutinise their use. This case may provide a salutary lesson to prosecuting authorities to ensure that their evidence is completely watertight before applying for UWOs in the future.
This article was also co-authored by Laura Fabris, a Trainee Solicitor at Fieldfisher.
Please review our Covid-19 hub for updates and get in touch if you require further information.