Charged with money laundering

The mother of idiots is always pregnant.

There arise some situations where the first question is: Are you a crook or an idiot?  Sometimes being the latter leads one into becoming the former.  Where this personnel (sic) assistant's position is is probably for a jury to decide.  I think he needs a (good) lawyer.

Naivity isn't (yet) a crime (well not in all cases), but not everyone has the highly developed cynicism of the AWEB following.

I dont know whether its because I have worked for HMRC or whether I have legal qualifications but I find this riotously silly; of course he should not have done it and accepted payments into his or her bank account. Goodness gracious, even as a matter of straightforward commonsense one should know the verification of every single payment into that account. I dont know why it is that the person whom we are discussing could not have got a regular job and then have been paid a salary, rather than have odd money laundered through his or her account. It seems utter folly to me. From my knowledge of the system I expect that criminal legal aid will be available; I expect my friends who know something about that subject will be laughing their socks off. Other than all of that I have very little to say, except that the person has been completely mugged off.

In fact so daft, are you sure this is not some attempt at viral marketing ?

What if a normal PA is helping with hiding the proceeds of crime ? Perhaps cooking the books or paying cash wages they know no tax has been paid on ?

This would be less obvious and the PA would not be required to report it ?

Would/ could their assets be subject to confiscation as presumably their wages would also be from the proceeds of crime ?

This is a perfect example of where someone claims that they did not know they were committing an offence, but, where the court will take the attitude that no one could possibly be that stupid, and convict anyway.

As regards the police interview, I do wish that people would realise that no matter how innocent they are, the police dont interview to "investigate", they dont interview to get to the truth, they interview suspects for one reason only - to get more evidence against them.  The best policy is to say nothing or very little, and before replying to any question beyond your name and address, discuss your proposed response with your solicitor.

Never, ever, respond to what appears to be an innocent question - every question in interview is loaded and intended to build a case against you. 

 OK, so the individual may have been naive, but who has not also almost fallen for a scam? It is only my knowledge, gleaned through research, that transactions involving Nigeria (which includes Lagos) are high risk and must be avoided like the plague (read the CIA's website). This person may have entered into this arrangement in genuine innocence. The internet is changing the way business is done in many industries and with the changes in the employment relationship that have occurred in recent years it may well have appeared plausible that this was a legitimate arrangement. Employees are more and more required to bring their own resources into the employment relationship. For example, I was required to use my credit or debit card to pay for my hotel bills and out-of-pocket expenses when I travelled abroad on behalf of the firm I recently worked for. Yes,my outlays were re-imbursable on production of receipts but is this not a case of my previous employer using my bank or credit card facilities? 

Anyway, how do the authorities know it was money laundering? Has the provenance of the so-called laundered funds be ascertained as criminial and as stemming from a predicate offence? Has the Nigerian party been arrested and charged? Can this really be a strict liability crime? I understood that strict liability was a doctrine that the legislature and the courts eschewed and I find it surprising that modern legilsation, such as POCA and the MLRs, should re-introduce it.

I wonder what the CPS hopes to achieve by proceeding with this prosecution.

 I have just re-read the accused's enquiry. It does not say he has been charged with money laundering - it says he has been charged with fraud.

The case is interesting because friends of mine recently advertised their holiday let on Gumtree. The advert attracted two men, and although my friends did not like the cut of their jib, they agreed to let. The let proceeded without incident.

Several weeks later, the same two men returned for a second let. After they had gone, the holiday home was broken into by would be long-let tenants, who had been scammed out of £900 as a deposit/ monthly rent, by the two departed men. On the same day, several other groups of would be long-let tenants turned up at the house seeking possession against the significant sums of money they had paid over to these two men to secure a tenancy. Altogether about £5,000 had been scammed this way by these two men who had created false tenancies on my friends' property. Fortunately, the tenants who had broken in (late at night) agreed to leave and they, along with my friends, reported the matter to the Police.

The Police were utterly disinterested despite several groups of would be tenants who has been similarly scammed by the same men on the same property reporting the matter. "It is a civil matter", was the Police's response. Their other response was that because the aggregate of the scam did not exceed £5k "there is nothing we can do".

In the light of this thread, it occurs to me that my friends could have been charged with fraud. Who is to say they were not "in on the act" and profited from the false tenancies fraudulently created by the two scammers? My friends were absolutely devastated on behalf of the would be tenants who had lost significant sums of money and who were East European immigrants, working very hard in menial jobs, and by all accounts were very nice, but naive, individuals. Innocents abroad is the expression that comes to mind.

It was not Gumtree who were at fault. They were very keen to hand over their information to the Police once the requiste request had been received. No such request from the Police came. The local MP simply took the side of the Police when the matter was raised with him, ie, "it is a civil matter". There was no forensic investigation despite my friends' attempts to preserve evidence at the property for as long as commercial pressures would allow.The upshot is that these two nasty criminals have got away with it despite their activities having being tracked by members of an investigative team from the print media over the last two years. They are serial offenders apparently and their photographs matched.

My friends now use a professional and secure on-line booking and payment engine to take bookings and payments. Only debit or credit card payments are accepted and this has been enough to scare off scammers as payments by this means leave a trail so that scammers can be identified and tracked. There is no need for the overly intrusive and overly bureacratic measures required by MLR, eg, photographic identification, 2 recent utility bills bearing the address, et al, (stool samples?). 

I describe this incident to contrast it with the case that gives rise to this thread. 

By the way, David, I suggest there is a fine line between strict liability and the criterion that the accused "should have known". If the accused did not know, or did not suspect, then no mental component actually existed at the time of the act. How is this distinguishable from strict liability? Both criteria find someone guilty of a crime even though no mental component need exist. 

I suspect the criteria of "should have known" is based on the standard legal maxim of what the reasonable man would have known, ie the man sitting reading the newspaper in the underground or the man on the Clapham omnibus. Lets face it, the chances of someone not knowing that there are an abundance of scams issuing from Nigeria are about as limited as someone forgetting to breath.

If its in the public domain that people are creating scams in Nigeria then the judge will probably concede that the defendant should have known. This principle has already been established in the Twitter cases; if you know there is an injunction then you knew not to breach it.

Then there comes to the case in point the principle that someone allowed their account to be used for profit, to benefit from the money laundering. Of course the actus reus in the case we are discussing is beyond reasonable doubt. But as we know cases can go up and down with factors of mitigation and aggravation, so the person whom we are debating might get away with as little as a conditional discharge or binding over. On the other hand they could go inside for 18 months. Its all rather in the lap of the Gods.

Morale of the tale is dont allow strangers to filter money through your account.

I have just agreed to rent a house through Gumtree. Am I minimising the risk sufficiently by doing an ID check on the landlord?  The check would include the bank account into which the deposit is paid.

 These distinctions defeat me! So there is a continuum starting with "fanciful", moving to "possible", then to "probable", through to "certain".

What about "remote", "unlikely", "likely", and "certain"?

At least numbers on a probability scale can be attached to these labels. So far as I can see there has been no attempt to do this with the judicial "clarifications". This would help people like me (and many others I suspect) if this was done. Just some thoughts.

As for it being reasonable to assume that everyone knows that Nigerians are a high risk group to deal with then this is simply unfair. There are still millions of people who do not use the internet, much less have knowledge of on-line scams, or that Nigerians are a high risk group. What about the old lady who gets scammed by a Nigerian? Is she to blame because she should have known? No, that is blaming the victim. Equally, one should not assume that everyone who enters into a transaction with a Nigerian should know, solely on that criterion, that the transaction is likely to be dodgy.

With regard to not letting third parties pass transactions through one's own bank account, I raised this very point with my previous employer because of their insistence that I must meet the costs of overseas travel. My employer was essentially using my credit card and/or debit card to meet its liabilties. I was in fact charged double for a hotel bill whilst in Italy and was lucky to recover it when I returned several months later. The maxim "don't let anyone pass transactions through your bank account" can not be absolute because an employer can require an employee to do precisely that. This is despite the risk of loss that an employee might incur as a consequence.

I think that this test needs to be refined to "the man on the Clapham omnibus from the same age and socio-economic group as the accused".

There is still a significant chunk of the population who are naive and trusting and frankly a bit behind the times when it comes to the electronic age.  This is not a crime.

I think it would be an interesting survey to ask a sample of people whether they have heard of "Nigerian Scams".

Sample one from the queue of OAPs at the Post Office in a small market town or inner city area.

Sample two taken from a wine bar in the City of London at lunchtime.

I also suspect that the case in question probably evolved over time starting with a plausable situation that changes one step at a time.  That is the way a clever con artist will set up his victim. 

It is easy for us to sit in judgement of our fellow man, a) because we know about money laundering and, b) because we have the benefit of hindsight.  I don't think that it is as clearcut as some of the posts suggest.

My view would be that the case should hinge on comparing the timescale of the set up to the "drop" ie if the accused acted like a normal pa for the six months and then in the last week before the police arrived the deposits occurred I would look more favourably than if the dodgy deposits happened more or less straightaway.   It is not clear from the post if the six months is from the start of the "job" or from the first deposit.

Thanks for the idea about the Land Registry David. I don't think my ID check shows up mortgages. Can anyone recommend a provider for credit checks?   I don't do them for my clients.

Good evening. Yes I am inclined to accept your point about us accountant types knowing about money laundering and a lot of other things besides. Thats what makes us so old and tired of life - LOL.

Regarding the point about the reasonable man, you must take this up with Lord Atkins and other judges. They coined the term reasonable man. It came into practice in judging the common law cases but I think is much used in criminal ones as well. It means the man of average intelligence such as one would find on the Clapham omnibus, or maybe would have found on the Clapham omnibus in 1932, if I can make light of it.

I still think that a lot of judges would make the point that with the amount of information that there is out there that it would be downright foolhardy to say that the average person does not know about money laundering. However, there must still I suppose be those out there that might be led down the garden path by our crafty friends from other continents. My point is, does the law differentiate between those who have just been unlucky, or just downright criminal. And where is the crossover between these two entities.

 @ Donald

I can assure you that the vast majority of the population does not know about money laundering. The way it is defined in the UK makes it a technical crime in many instances and quite divorced from the notions of the man on the Clapham Omnibus (or should that be Croydon now that Clapham is quite gentrified?). For example, the man on the Clapham Omnibus would not equate the non-declaration of a cash job done by a plumber to HMRC with money laundering. To equate such a low level crime with such a serious offence as money laundering defies commonsense and is clearly nonsense, whatever the legislature says. Citing the man on the proverbial omnibus does not support your contention that it is reasonable to presume that everyone knows about money laundering.

Yes but thats the entire point, Stephen. That the ordinary man or woman in the street cannot claim ignorance of the law. That is one of the founding principles of the law in this country. Or so the judges keep saying. Obviously I just cant wholeheartedly agree with this notion, in the same way that I just cannot subscribe to the theory of the man in the Clapham Omnibus. Nonetheless thats the theory of it. Most of us who subscribe to these pages however know that the Proceeds of Crime Act, the Serious Crime Act and the Money Laundering Regulations are extremely complex legal instruments and are not the kinds of things to which "ordinary" folk would routinely refer.

So my point is a bit of a squaring of the circle. Whilst you have the judiciary claiming that people ought to have known (like I said that the poor soul who got the money into his account ought to have known) and then you have an equally weighted body of opinion on the other side, which says that how could anyone have known about such complex regulations?

Someone mentioned about juries earlier. The fact is that juries in complex cases have very largely been abolished. That is because it is thought that they cannot understand the complex nuances required to judge serious fraud cases.

All in all I can see this leading to a situation whereby the knowledge required of the laws of this country is reduced and emasculated and known only to a body of experts. Its the kind of nightmare scenario predicted by Orwell and others. One can already see this situation in the rise of the secret injunction. All in all it dont look good for law in the UK.

It is known as a Money Mule scam.

I think equating this to paying company expenses through credit cards is confusing the issue a bit. Regardless of whether you are happy doing it or not, when you pay business expenses from your own resources, you know they are legitimate. This is because you are the one incurring them on behalf of the company you work for. That is somewhat different to letting money from sources you know nothing about pass through your bank account.

I am also of the school of thought that many have no idea about the prevalence of these. It is also equally naive to believe that these are always badly worded cackhanded and obvious frauds.

I am aware of one case albeit a little while ago but still at a time when at least the more financially aware were aware of these scams.

The victim ended up doing 18 months despite being warned he was being defrauded (prison because he in effect stole to finance the the money being requested by the fraudsters). The fraud was clever, well constructed and carried out with skill and aplomb; the victim even visited Nigeria twice in the process.

I always have sympathy with the genuine victims of fraud however naive it may appear to be on the surface. 

A quick survey in my office suggests that only one person apart from me is aware of money mule scams, and and only a few more are aware of the problems with Nigeria.  I do sometimes get accused of being racist for suggesting that transactions with Nigerians should be subjected to greater scrutiny than transactions with other people.

Most people, when they see something like that think that the scam is to get your bank account number so they can drain your account, and you can safeguard against that by opening a new account which you don't use for anything else.

There's nothing racist in it at all. If the scam were operated in London by white people, it would still be the same thing. Thats political correctness gone mad.

The scam is to launder money through a person's bank account, so that dirty money becomes clean. Its a similar scam to "fake marriages" which is also a scam operated from parts of Africa. Nice girl seeks husband and go to England to settle down. £30,000 later and the poor bloke realises he has been well and truly had.

That last thing has actually happened to someone I have known; he was a teacher and you would have thought he was more educated than that. However, as they say, there's one born every minute!  One can only feel sadness at the waste of it all.

Donald I agree that there is no racism involve and we must state the facts as they are, however one must also realise that although some of the earlier scams originated from Africa, since the late 1990s and early 2000s with the advent of the internet most are now coming from eastern europe and Asia but people are still referring to them as the Nigerian fraud.

If you look at the letters some may bear African names but further check on the computer IP address will show that they are not from Africa, so if every time something happens and a pronouncement is made that it is Nigerian scam without checking, that is where the racism comes in and not political correctness. We as professionals must be able to do our jobs without fear or intimidation, but also must accept that some are lazy and will throw a blind statement around.

The good thing is that African countries are working with the FBI, SOCA, Interpol, Europol and others to combat this problem. It is not all Nigerian or African and if anyone thinks that, then they can not find solution to the problem. I am sure you have heard of the RussianUkrainne.

We have a lot to contribute to the prevention of fraud through our Anti fraud, Forensic Accounting & Audit, Compliance and other assurance service and we must do it with open mind.

of a couple of sites, my experience is that the scam emails known as Nigerian fraud which are usually either of the deceased millionaire variety or purporting to be from young ladies seeking love are usually from one of four or so West African countries when one checks the IP address of the originator. Through a networking site these are sent as private messages.

Of course some of these fraudsters pretend to be Arab princes or from other countries around the world, but the fashion for these is still mainly in West Africa. It is a simply a reality and nothing to do with racism. In fact the reason they are called 419 frauds is because this is the number of the statute in Nigerian law which the Government there uses to crack down on such frauds.

I recently came across a cleverer scam which would have been easy to fall victim to.

I bought some shares in a small plc six or seven years ago - Motionposter.  They had a good innovative product that could not fail.  Moving posters for underground train systems.  Yes, you guessed it, it all went wrong and the company went bust.

Last year I had a telephone call from an American sounding person who knew I had held shares in MP plc.  They advised that the shares had been restructured and the intellectual property was now worth millions and my shares now had a value of £70,000 (I bought them for £750!).  They were acting for a company that wanted to take over MP plc and in secret they were trying to acquire as many shares as they could.  All I had to do was sell my shares directly to them in secret and for this they needed my bank account details.........

I assume they asked for more than just bank details. Surely they would need your user ID and password to get any money out of you.

As this was a phone call rather than an e-mail one I said that I wasn't interested and hung up at that point!

This was actually the second call, the first had been to sow the seed.  In a perverse way I was impressed with this scam as they:

a)  Knew I had owned shares in that particular company.

b)  Had my home phone number.

c)  Had a semi sensible story about intellectual property/share reorganisation that was specific to the company.

d)  Had a full blown website.

The scam would have been for me to send an insurance/admin fee in advance of the sale.

 The official advice is never to respond to these scam emails. 

I am often tempted to respond with a bogus reply, either to screw their scheme up or else to bring them into the open so they reveal details about themselves such as their identities or whereabouts. I have not yet done this. What is the rationale behind the advice to refrain from replying?

I think you should, false names, different bank accounts, etc etc.

The official response is we cannot be bothered, you need to buy some insurance from our friends, thats how the money goes round.

If they turn up, start world war three, the police will have to turn up then.

At the end of the day the only thing that will stop it, is if it is not cost effective.

I had some interesting conversations with a boiler room scam, the guy thought I was serious about investing 5 or 10

When he confirmed (third call) $5K I said no £5 sterling, he was really pissed. lol didn't phone again.

It is very difficult to tell the difference sometimes though we get calls from the police or fire service thanking us for our contribution last year, would we like to make another (except we did not contribute last year and would not on account of speeding tickets ! lol)

These were probably legitimate as no one tells the truth anymore.

Do these criminals buy databases from legitimate sources or have they constructed their own from Dustbins and missing HMRC files ?

If you want to see what happens when someone responds to a 419 scam take a look at the "Ebola Monkey" site.  There are a number of e-mail exchanges set up by an American with a sense of humour with the scammers.  Be warned though some of the humour is rather "adult" in nature!

 Some of the email chains between the scammers and the respondent are very funny. Well worth a look if anyone has the time!