Jun.28, 2010

Money launderers and ­gangsters have got round laws created to snare them because of problems interpreting the rules, according to one of Scotland’s leading experts on the subject.

Kenneth Murray, head of forensic accountancy at the ­Scottish Crime and Drug Enforcement Agency, says the number of money-laundering prosecutions since the Proceeds of Crime Act (POCA) has been “disappointing”. He said even cases hailed as successes have been restricted by the approach and attitudes of prosecutors and police.

In an academic paper about “the relative lack of success in exploiting POCA through the use of money-laundering offences as a means of dismantling organised crime groups (OCGs)”, he says there have been problems interpreting legislation, and also with the assumption that a criminal offence has to be proven first.

He says he believes that to make the legislation work ­“attitudes need to be changed” among prosecutors and police.

The paper states: “Prosecutors and law enforcement need to wean themselves from the ­attitude that financial complexity is something to be feared.”

Crown Office figures show that in 2006 there were seven prosecutions and 12 ­convictions. In 2007 there were seven prosecutions and eight convictions, and in 2008 there were two prosecutions and two convictions.

Although millions have been seized in Scotland under POCA, overall amounts have been far lower than anticipated.

In 2007, Jamie Stevenson was jailed for 13 years for money-­laundering through a taxi firm linked to drug trafficking. The operation was hailed as a ­success, but Murray says it was curtailed.

“Officers involved in that case … will tell you it could and should have been better,” he said. “The head was knocked off the group, but its supply networks and much of Stevenson’s money remained pretty much intact.”

The paper states: “The incidence of money laundering prosecutions in Scotland since the advent of POCA … has by any measure been disappointing.”

Murray says the situation is improving: this year a record

£6.5 million was seized from the Russian Anatoly Kazachkov by the police and Crown Office in the biggest single recovery of criminal assets in Scotland.

A report by Her Majesty’s Inspectorate of Constabulary last year found nearly £500m had been seized in England under the Act since 2003. The total in ­Scotland was just £27.3m.

A Crown Office spokesman said: “The Crown Office and Procurator-Fiscal Service are committed to using all available tools to dismantle organised crime, including money-­laundering prosecutions where there is sufficient evidence and it is in the public interest to do so.”

He added: “We are also ­working with Criminal Justice colleagues through the Serious Organised Crime Taskforce to identify the most effective ways to make best use of Proceeds of Crime Act provisions.”