The role of civil recovery in assisting criminal investigations

Posted on: June 30th, 2011

Two recent cases in England have highlighted the role that civil recovery can play in assisting in criminal investigations.

In the first case, sentences of 7 and 13 years were handed down to Ian McGarry, a surveyor and Saghir Afzal, a property developer by the Southwark Crown Court on 14 June 2011 for their role in mortgage frauds worth a total of £49m. The scheme involved six counts of fraudulently obtaining mortgages from high profile financial institutions.

Six other individuals, including practicing solicitors, were implicated and charged in relation to the conspiracy but were acquitted after the prosecution decided to focus its investigations on McGarry and Afzal.

In the second case, police have arrested a man on suspicion of fraud of a man. The man claimed to have raised £500,000 for the well-known servicemen’s charity Help for Heroes. However, the charity said he had failed to donate this money.

Aside a criminal conviction, the key issue is fraud cases is the recovery of stolen monies. The civil courts in England (and many other countries) have developed a series of remedies to enable victims of fraud to recover losses not only from the alleged fraudster but also those who have dishonestly assisted the fraudster or received the proceeds of the fraud. The remedies include the use of freezing and search orders. There is a lower burden of proof in English civil proceedings than in English criminal proceedings which means these remedies can be used as an alternative or in addition to criminal proceedings. Even where criminal prosecutions in fraud matters fail, there may be other options available to the victim of a fraudulent scheme.