Confiscation orders: progress review Contents

Conclusions and recommendations

1.Far from increasing, the number of confiscation orders imposed has fallen. Law enforcement and prosecution agencies are still missing opportunities to impose confiscation orders with the number imposed falling from an unsatisfactory 6,392 in 2012–13 to 5,839 in 2015–16 when over a hundred times as many offenders were convicted of a crime. Agencies continue to use different criteria to determine when to use confiscation orders and there remains insufficient awareness and knowledge among the staff involved of the relevant legislation and when to seek an order. The police’s National Lead Officer for Serious and Organised Crime is planning to review the knowledge and skills of officers within each police force in the next 12 months and develop further training to help improve awareness and knowledge.

Recommendation: The Home Office should work with the law enforcement and prosecution agencies involved to develop a plan to improve knowledge and awareness of relevant legislation amongst their staff, and ensure they agree and apply a common set of selection criteria for considering cases for confiscation orders, by the end of 2016.

2.Only £190 million of the £1.9 billion confiscation order debt can realistically be collected sending the wrong message to taxpayers, victims and criminals—that crime pays. The amount owed by criminals continues to increase, with total outstanding debt now standing at £1.91 billion at the end of March 2016. This is a 30% (£450 million) increase since January 2014, when the previous committee took evidence on this matter. The enforcement agencies have made some improvements and confiscated £42 million more in 2015–16 than in 2012–13. However, HM Courts & Tribunals Service estimate that only 10% of the total debt is realistically collectable and, for high value orders over £1 million, enforcement rates are only at 22%, which is too low, particularly for serious criminals who care more about losing their assets than going to prison. Much of the debt is historic with over 60% of the value relating to orders 5 years old or more, which the Home Office considers to have little prospect of collecting. However, enforcement agencies provide little public information on performance, for example, on why so much debt is uncollectable, the rates of enforcement and progress in enforcing priority high value cases.

Recommendation: The Home Office needs to do more to explain why so much of the accumulated debt is unlikely to be collected, highlight what is collected against recent confiscation orders and set out how it is tackling uncollected debt to show that crime does not pay. This should include publicly reporting collection rates and progress on the priority cases. The Home Office should implement this as part of its communication plan by the end of 2016.

3.The fall in the numbers of experienced financial investigators risks weakening the enforcement of orders. Financial investigators are key to successful enforcement, especially those with the experience to tackle complex cases. However, the number of financial investigators has fallen by 6% (82) between September 2013 and September 2015 to 1,358, due to budget cuts and increased private sector demand for their skills. Law enforcement agencies look to obtain expertise from the private sector but we are concerned that agencies are not addressing the problem of retention adequately.

Recommendation: The Criminal Finances Board, supported by the College of Policing, should review the cost effectiveness of employing financial investigators across law enforcement agencies and report back to the Committee by the end of March 2017 on what action will be taken to ensure sufficient numbers are recruited and retained.

4.It is not clear whether disrupting crime or collecting criminals’ assets is the primary objective of confiscation orders. Although the Home Office was clear that cutting crime was the overall objective for all law enforcement agencies, it has still not set out how confiscation orders should be best used to achieve this. The government policy for confiscation orders has five objectives, all of which we recognise are important, but the Home Office has not prioritised between them. The Home Office and police both indicated that crime disruption was most important, yet they use the amount of income confiscated as the sole measure of success for confiscation orders. As a result, individual law enforcement agencies are left to decide how best to allocate resources in pursuit of objectives that may be conflicting, for example, pursuing easier high value orders at the expense of the more difficult but disruptive orders on criminal activity.

Recommendation: The Home Office should set out clearly, by the end of September 2016, how the objectives for confiscation orders should be prioritised and what constitutes success.

5.Poor information on performance and cost prevent law enforcement and prosecution agencies from deciding when and how best to use confiscation orders. The Home Office leaves decision making on the use of confiscation orders to over 160 individual law enforcement and prosecution agencies. There is, however, no national dataset on the performance, cost and effectiveness of confiscation order usage and enforcement activities, to inform these agencies about when and how best to use them. There is a particular lack of information on the disruptive effect on crime, one of the objectives of the confiscation order policy.

Recommendation: The Home Office, supported by the College of Policing, should develop an evidence base on the effectiveness of confiscation orders, particularly their effect in disrupting crime, by the end of March 2017 to help law enforcement and prosecution agencies to determine when and how best to use them.

6.The incentive scheme to encourage the many bodies involved to confiscate proceeds of crime remains ineffective. The changes made by the Home Office since 2013 to the incentive scheme have failed to address the previous Committee’s recommendations. The scheme remains aligned to just one of the Home Office’s policy objectives, confiscating the proceeds of crime, and continues to fail to reflect the relative contribution and effort each body makes, with the Home Office still receiving 50% of confiscated assets despite its having no operational role. The need for most bodies to spend the incentive funding in year also builds too much short-termism for effective reinvestment. The Home Office acknowledged that reform of the scheme was still ongoing, citing the current Government’s manifesto commitments to increase the funding for the police and potentially reward more of their efforts. These reform proposals were currently with Ministers for implementation by 2017–18.

Recommendation: The Home Office should reform the incentive scheme in accordance with the Committee’s previous recommendation, by better aligning it to objectives and linking effort and reward. It should also explore with HM Treasury how incentive funding can be used for longer term investment. Reform should be completed by the 2017–18 financial year.

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1 July 2016