Biggest ever proceeds of crime case nets $10 million
The Crown Office has used Proceeds of Crime legislation to seize £6.5 million in the biggest ever recovery from a single case, the Lord Advocate, the Right Honourable Elish Angiolini QC, announced today.
The cash has been recovered from Moscow-based businessman Anatoly Kazachkov (64) after a suspicious bank transfer of $10 million from an account in Hungary to a Scottish bank in 2004.
The initial investigation was sparked by information received by the Scottish Crime and Drug Enforcement Agency. The Civil Recovery Unit at the Crown Office then used Proceeds of Crime legislation to have the money restrained.
The Scottish Money Laundering Unit carried out extensive international enquiries to trace the source of the funds. The trail led to Russia where - with the assistance of the Russian authorities - further evidence of false documents and stolen identities was uncovered.
Anatoly Kazachkov and others provided an audit trail for the source of the funds, but this was discredited after Scottish and Russian investigators connected the funds to a Russian bank, which was bankrupted in 2004 in relation to money laundering offences.
In 2008, the case was passed to the Civil Recovery Unit to investigate whether the money could be retrieved through the Proceeds of Crime Act 2002. A recovery order was made on 28 April 2010 and the funds released to the Crown Office today. The money will be invested in community projects around Scotland.
The Lord Advocate said today:
"I am pleased to announce the biggest single recovery we have made so far using the Proceeds of Crime legislation.
"This case not only highlights the successful collaboration between the Civil Recovery Unit and Scottish law enforcement agencies including SCDEA, but also the effective international co-operation secured from the Russian authorities.
"Financial crime undermines legitimate hard-working businesses and threatens the future stability of our economic growth. The dedicated specialists in our Civil Recovery Unit will continue to use the POCA legislation to ensure that unlawfully obtained assets are recovered and the proceeds used directly to benefit our communities across Scotland.
"Just as important as the recovery of the funds is the disruption that the POCA legislation allows us to cause to those who would seek to profit from organised crime."
Lesley Thomson, Area Procurator Fiscal for Glasgow, and the COPFS POCA Champion said:
"This case illustrates not only the strength but also the flexibility and versatility of the Proceeds of Crime legislation.
"Working with our law enforcement colleagues, we are able to select the very best tools to achieve the detection and disruption of organised crime - whether that is through prosecution or civil recovery."
Deputy Chief Constable Gordon Meldrum, Director General, Scottish Crime and Drug Enforcement Agency (SCDEA) said:
"This significant recovery demonstrates the value and effectiveness of the Proceeds of Crime Act in tackling crime at all levels and literally forcing individuals to pay for their criminal activity.
"What this particular case also demonstrates is our absolute determination to follow the money trail wherever it leads us. This three-year investigation led our officers to make inquiries in a number of countries across Europe and beyond, and collaborative working practices with a range of law enforcement partners at home and abroad have undoubtedly contributed to this successful outcome.
"We are committed to making best use of the POCA legislation and as an agency, we will continue to use whatever means we have at our disposal to make it harder for criminals to hide their illegal earnings."