BOX 4.2
An Example of Pre-restraint Planning Decisions in Practice
In the course of an investigation into the corrupt activities of a government official, it was determined that asset confiscation proceedings would be brought against the official at, or shortly before, his arrest. The following is a list of the official’s assets and the considerations and decisions made with respect to restraint and management: •
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Large residential dwelling occupied by official and family. The property was included in the restraint order, and the existence of the order was noted on the title to warn prospective purchasers or secured lenders. An asset manager was not appointed; and the official and his family were permitted to remain in the dwelling on condition, as noted in the order, that the official maintain the property and pay rates, taxes, and mortgage payments. Investment seaside house (rented out by agent). Although initially thought to be an asset that would need to be managed, it was discovered that the ongoing management and profits generated were being managed by a property agent. It was decided that the asset could be adequately restrained without an asset manager by means of an appropriately drafted order requiring the property agent to pay accumulated rent into a restrained bank account. The property agent was authorized by the order to pay property outgoings and fees from rental receipts. The existence of the order was noted on the title. Small plastic fabrication factory (located in an industrial unit owned by the official) operated by a company owned by the official. It was determined that the factory was of little value: the current account balance was low and investigators suspected it was simply used as a vehicle to launder the proceeds of corruption. As a result, restraint was not sought and the business was left in the hands of the official. Within six months of the arrest, the plastic factory business folded. Industrial unit. It was discovered that the only “tenant” of the unit was the factory, and the factory had not been paying rent to the official. This property was included in the restraint order, which was noted on the title. It was determined that the factory could continue to occupy the unit without paying rent providing that it continued to maintain the buildings and pay rates and taxes. After the plastic factory business folded, the restraint order was varied by providing for the appointment of an asset manager to manage this property. He arranged to lease the property, paid the outgoings on the land and buildings from the rent, and invested the profits. Personal bank accounts and share portfolio. These were restrained, with the exception of one low-value account into which the official’s salary was paid (used by the official to pay living expenses for himself and his family). Because the share portfolio was not very large and was held in bluechip companies with a stable value, an asset manager was not appointed at the outset. After the asset manager was appointed to control the industrial unit, the share portfolio was also placed under his control. Three high-value cars. The cars were restrained and placed in the custody of law enforcement (provided for in legislation) with vehicle management procedures and facilities that enabled them to look after high-value cars properly.
Securing the Assets
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