How To Discharge Or Vary A Restraint Order

If you are subject to a Restraint Order, your assets will effectively be frozen. However, you can ask the court to remove or ‘discharge’ the order. Or, you can request to have the order varied. It is essential to follow the proper procedures. Otherwise, if you breach the terms of the Restraint Order, you could be imprisoned for contempt.

Restraint orders explained

Restraint Orders are issued under the Proceeds of Crime Act 2002. This gives the court the power to:

• Immediately restrain you from dealing with your assets (section 41); and
• Require you to file a statement disclosing your assets

Investigators typically apply for a Restraint Order if there is concern that illegal profits have been generated through crime, and there is a risk that the assets will be dissipated. Unfortunately, these applications are made without any notice to the party or person who is to be affected by it. It can therefore result in parties being wrongfully caught up in the process and lawful and legitimate assets being frozen. For instance, it could be that you are innocent of the charges laid against you. Or, it could be that the charges have been laid against your spouse, relative or business partner and have nothing to do with you.

Whatever the circumstances, it is essential that you speak to our business solicitors as soon as possible. We can take steps to have the order discharged or varied. You might think that because you are innocent, you can ignore the terms of the order. However, if you do this, you can be held in contempt and imprisoned for non-compliance.

What happens when you’re served a Restraint Order?

Once a Restraint Order is made, it is served on the individuals or organisations named in the order. The assets belonging to that individual or organisation will then be frozen. Investigators normally approach the Land Registry and the banks to ensure that any assets held cannot be dealt with. If you are served with a Restraint Order, you cannot even draw money out of your current account. This would put you in breach of the order and could result in immediate imprisonment.

What should you do?

Restraint Orders are extensive in their application. Once they were only used in the most complex and serious criminal cases, their use is becoming much more widespread and routine. Evidently, this will be very problematic for you and your family. You will not be able to access your assets, and the same assets may later be subject to confiscation proceedings.

If you are in this position, there is action you can take, as you can ask the court to discharge or vary the order. To begin the process, we recommend that you contact our solicitors for help. We have vast experience in dealing with Restraint Orders and are experts in this area. We were one of the first lawyers in the country to deal with restraint proceedings soon after the Proceeds of Crime Act 2002 was introduced.

If you have been affected by a Restraint Order, or you are a third party with an interest in an asset, then please contact us immediately. We will:

• Protect your interests
• Advise you on your best course of action to discharge or vary the order
• Protect you from potential contempt proceedings and possible imprisonment
• Negotiate with the authorities to ensure you have access to your finances to cover your day-to-day expenses
• Ensure that your business interests are protected

Here are some examples where we have helped our clients discharge or vary a Restraint Order.

Applications to Discharge Restraint Order

R v. D - South Yorkshire Police

D was a businessman being investigated for conspiracy to launder money. D had several interests and a property portfolio. The police suspected D's assets were criminal in nature. We proved the assets were not criminal and pursued an application to discharge the restraint order, which was successful. Crucially, our client benefitted because the court had accepted that all of his assets were legitimate and therefore the assertion that he was involved in money laundering could no longer be made out. This also meant that the prosecution had no basis to charge our client. 

Re M (A Mortgage Company) - Lancashire Police

We were instructed by a mortgage company to vary a Restraint Order to allow it to take possession of a property. The mortgage company’s financial interests had been prejudiced when the order was made.

R v. C

We represented a third party (the defendant's wife) in these proceedings. C was an accountant and he had been cooking the books for years. We were instructed by Mrs C, who risked losing her pension and her lifelong savings. We were able to show that our client, Mrs C, had nothing to do with her husband’s criminality, and therefore, the assets should be split in the restraint proceedings. The judge was persuaded by our submissions, and we were able to secure £350,000 plus a property for the benefit of our client.

Breach of Restraint Order and Contempt Proceedings

York Trading Standards v. M – York Crown Court

Our client was the subject of a trading standards prosecution for mis-selling. During the investigation, our client was served with a Restraint Order. The trading standards department then alleged that our client had breached the order by engaging in financial transactions. We contested the alleged breach and were successful in defending our client. The judge found that the breach was not proved and our client was saved from being imprisoned.

Restraint Order and Third Party Assets and Financial Interests 

R v. P

This was a very long and complex police investigation into a local businessman and his drug dealing activities. Although we did not represent Mr P, he was a shareholder in his wife’s property development company. When Mr P was charged with drug-related offences, a Restraint Order was imposed against his assets and his wife’s assets. We instructed accountants and effectively showed that there was a distinct division between husband and wife’s assets and that they should not be treated as “one pot” for the purposes of the confiscation proceedings. We were successful in persuading the judge to ringfence Mrs P’s assets so that they could not be subject to a confiscation order at the conclusion of the case. Our approach also has important implications in relation to Mr P’s case, whom we did not represent.

R v. F

This is another example of a proactive approach being taken by us in relation to third-party assets. On this occasion, we represented the sister of the defendant. She had loaned her brother money for the purchase of a property. The Restraint Order had been served just prior to the completion of the purchase. We intervened and successfully showed that the sister's money was not criminal and should be returned. On this occasion, we were awarded costs against the prosecution as they had failed to act reasonably when we had initially approached them with our proposal.

R v. M (In the High Court)

We acted for the brother of the defendant in relation to a parcel of land in Leeds, which was the subject of confiscation proceedings. The land had been restrained to prevent its disposal. Unfortunately, Mr M’s brother was an Austrian national, and it was therefore difficult for him to provide instructions to us. There was a clear conflict between Mr M and his brother regarding the parcel of land. Mr M was more than willing to sign that way if it meant a reduction in his default sentence. Unfortunately, our client risked losing a very valuable asset. We were able to show beyond doubt that M had no legal rights concerning this land, and the prosecution’s position was undermined. The land was successfully returned to our client and costs were awarded in our client’s favour against the prosecution.