Detective chief inspector Tom Hill, head of the City of London Police’s Insurance Fraud Enforcement Department, discusses the clampdown on criminals networks continuing to use cash to cover their tracks
As the UK appears to head towards a cashless society, can the same be said for the criminal networks operating within it?
Despite the advances in blockchain technology and the apparent reliance on digital transfers, criminals continue to use cash as a means to hide or transfer their ill-gotten gains.
Why? Despite its bulk and the difficulty in moving it across international borders, cash can still be attractive to criminals given how difficult it can be for law enforcement to link it to criminal activities.
Fortunately, the cash seizure and forfeiture legislation in the UK under the Proceeds of Crime Act 2002 (PoCA) provides law enforcement with an essential tool to ensure that criminals do not benefit from their criminality, even when cash cannot be directly attributed to a specific type of crime.
Although seen by some as being draconian in its nature, the cash seizure provisions under PoCA are a vital tool for UK law enforcement in its fight against crime.
Ghost broker case
The recent forfeiture proceedings instigated by the City of London Police demonstrates the effectiveness of cash seizures.
In 2023, officers from the Insurance Fraud Enforcement Department (Ifed) executed a search warrant at the home address of a suspected ghost broker – a term commonly used for individuals who purport to be legitimate insurance brokers – who are able to sell motor insurance policies cheaply to drivers.
Typically, these policies are obtained fraudulently by the broker by using false information in the application process to reduce the premiums payable by the policyowner.
The policyholder is then charged a fee by the ghost broker for obtaining the premium at the reduced price.
It is often likely that the policyholder is completely unaware that their policy has been obtained fraudulently and is therefore invalid.
The ghost brokers are usually unregulated and promote their services under the guise of being legitimate brokers, who can obtain cheaper insurance policies for drivers.
Ultimately, this fraudulent activity means that insurance companies lose money and policyholders are unwittingly using their vehicle whilst uninsured.
During the search of a subject’s home, officers recovered over £100,000 in sterling notes.
The subject – who had been previously issued a police caution in relation to ghost broking activities – was interviewed by officers and declined to provide any explanation for the cash including how it was obtained and why he possessed it.
The subject refused to provide any evidence to show that the cash had been obtained legitimately and his annual earnings indicated declared income which failed to provide any reasonable explanation for someone possessing such a quantity of cash.
Subsequently, the Magistrates at Westminster concurred with the City of London Police’s application that there were sufficient grounds to suspect that the cash had derived from crime and awarded forfeiture of £102,970.96 to the force.
This case demonstrates not only that we are still operating in a society where criminals are prepared to use cash, but also that law enforcement has the tools and the skills to combat it.
It is right that law enforcement should look to the future and tackle the growing threats posed by criminal use of cryptocurrencies and traditional banking facilities.
However, we must never lose sight of the presence of cash laundering and the associated risks.
Ifed will continue to use its finite resources to prosecute criminals, but will also remain fair but relentless in its use of PoCA powers to disrupt organised networks by removing the cash and paying it back to continue the fight against crime.