Can law enforcers show restraint when pocketing the proceeds?

The British case

As we have seen from the unhappy experiences of letting the police operate speed cameras or councils impose parking penalties, it is not always a brilliant idea to allow those who enforce the law to claim a hefty share of the proceeds. It gives them too strong an incentive to go over the top in their enforcement.

Another glaring example of this is the Proceeds of Crime Act (POCA), primarily designed in 2002 to allow the confiscation of the proceeds of drug dealing and money laundering, with a sizeable chunk of any money recovered going to the enforcement agencies that had caught the criminals.

The use of this Act was then widened out to impose often quite absurdly disproportionate penalties on other types of offender. In 2009, for instance, I reported on several cases where quite ludicrous sums had been taken off small-scale fishermen found in breach of EU quota rules, resulting in hundreds of thousands of pounds going to the Marine Fisheries Agency that prosecuted them.

A further disturbing example was a criminal trial that recently ended in Cardiff, following the prosecution by the Environment Agency (later Natural Resources Wales) of two farmer brothers, Nigel and Philip England, and their companies that run a waste business. The agency charged the brothers with 12 criminal offences, including illegal wood-chipping and composting, but above all the tipping on their farm of a large quantity of "waste" on which they had paid no landfill tax.

The agency was particularly keen to pursue this case because, under the POCA, it had demanded that first £3 million, then £5 million of the brothers’ assets be frozen – of which, if its prosecution was successful, nearly £2 million could, under Home Office rules, be kept by the agency.

As the case dragged on for years, with the agency laboriously assembling its evidence, it became, for the brothers, a nightmare. With their assets frozen, they could not borrow any money, threatening to close a business employing 200 people. The first firm of lawyers they employed to defend them ran up a bill of £350,000, without getting anywhere. Then they found a new legal team, much more clued up, ready for the moment in July when the case finally came to trial.

Over the next five weeks, the agency’s case was torn to shreds. The brothers were able to show that they did indeed have legal authorisation for their composting and wood-chipping.

But rather more interesting was the issue of that "waste" they had used to level their land. First this was estimated by the agency at 7,000 tons, then 20,000, then 25,000 – and it was on the unpaid landfill tax on this that the agency justified its freezing of the £5 million it stood to benefit from. It then threw in, at a late stage, a further claim that it was "contaminated with asbestos".

It turned out that 10,000 tons of this waste was soil originating from one of the Environment Agency’s own flood-defence schemes. Most of the rest was earth moved quite legally from one part of the farm to another. Analysis of the soil showed that only 400 tons was in any way "contaminated", most of which had come from the Environment Agency itself, which had not carried out its own analysis as the law requires. As for the asbestos, even the agency’s expert admitted that there was "probably more asbestos in this courtroom than there was on the site".

The jury found in favour of the brothers on all but one of the 12 counts, and this was a mere technicality that the prosecution agreed not to pursue. The agency is thus left looking at a £1.2 million legal bill, having had to say goodbye to the £2 million it hoped to pocket under the Proceeds of Crime Act.

The only real offenders in the story, it seemed, were those officials of the agency, who forced a responsible company to its knees and cost the taxpayers £1.2 million by so recklessly pursuing a case that should not have been brought in the first place.

Original report here

　

　

　

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