The Criminal Finances Bill has been amended by the House of Commons to allow the government to freeze the UK assets of international human rights violators.
The amendment has been likened to the “Magnitsky Act” passed by the US Congress in 2012, which was named for a Russian lawyer who died in jail after exposing fraud by corrupt officials. It proposes to extend the definition of “unlawful conduct” in the Proceeds of Crime Act 2002 (POCA) so that property obtained through the commission of “gross human rights abuses” can be subject to civil recovery orders. “Unlawful conduct” is currently defined as criminal conduct in the UK or criminal conduct outside the UK which would also be regarded as criminal conduct if it occurred in this jurisdiction. “Gross human rights abuse or violation” is defined to include the torture of any person who sought to expose illegal activity by public officials or who sought to obtain, exercise, defend or promote human rights and fundamental freedoms, or other conduct involving the cruel, inhuman or degrading treatment of a person. The conduct must have been carried out by or at the instigation or acquiescence of a public official or person acting in a public capacity. The amendment also captures conduct by any person who directs, sponsors, profits from or materially assists the commission of a gross human rights abuse or violation.
The amendment received broad cross-party support and it has been praised for sending a “major signal” to human rights abusers. In practical terms, much of the conduct that is described by the amendment already meets the current definition of “unlawful conduct” in POCA. Furthermore, the categories of property that could be obtained through the commission of gross human rights violations, which would not already be obtained as a result of some other criminal conduct, are likely to be extremely limited.
A second proposed amendment was withdrawn before the third reading in the House of Commons. That amendment sought to introduce an offence of failure to prevent economic crime, where a relevant body is guilty of an offence if a person commits an economic criminal offence when acting in the capacity of an “associated person”. The proposed offence is currently the subject of a separate call for evidence which the government published in January. The call for evidence closes on 24 March 2017.
The Bill has now passed its first reading in the House of Lords, with the second reading scheduled for early March. The Home Secretary has indicated that the Bill will receive Royal Assent in Spring and the provisions are expected to come into effect later this year.