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A Magnitsky clause for the UK

Speed read: Jonathan Fisher QC comments on the new ‘Magnitsky’ proposal to recover the assets of human rights abusers proposed in the UK last week. Jonathan and Bright Line Law were instructed to advise on the framing of the proposal.

On 28 November 2016 a cross-party group of MPs proposed an amendment to the Criminal Finances Bill 2016, aimed at ending the use of the UK financial and property market as a safe haven for human rights abusers. If it is passed, the amendment would expand the scope of the existing civil asset recovery regime in Part 5 of the Proceeds of Crime Act 2002, to specifically capture the wealth of those that target victims who dare to expose wrongdoing like Sergei Magnitsky who died in 2009.

Magnitsky was a courageous lawyer and auditor who dared to make a complaint of a US $230 million fraud against Russian public officials in 2007.  As a result of trumped-up charges, he was imprisoned for a year without trial in Russia. During that time, he was denied medical attention, full access to legal representation and was tortured. An independent investigation concluded he had been tortured by eight prison guards on the day of his death. Since then, not one person has been convicted in relation to either Magnitsky’s torture or the underlying fraud that he uncovered.

Bright Line Law, instructed by the Magnitsky campaign, has contributed to the framing of the new proposal which has now attracted support from a wide group of MPs led by Dame Margaret Hodge, Dominic Raab and Tom Brake, and including Dominic Grieve, Edward Garnier, Douglas Carswell, Ian Blackford and Caroline Lucas.

Aimed at ending the impunity surrounding Magnistky’s death, a Magnitsky asset-freezing and visa restriction framework has since been introduced in the US, and there are efforts to introduce similar legislation in Canada and across the European Union.

The UK Magnitsky proposal is bespoke as it does not contemplate visa restrictions and contains a number of important procedural safeguards which are tailored to the UK legal system. It is also tightly-framed as, to be triggered, there must be a nexus between the respondent and a victim of human rights abuse who has exposed wrongdoing.

The public interest in this approach is clear - it would afford protection to whistle-blowers and journalists who bravely expose corruption and other forms of serious wrongdoing. In addition, it would send a clear message that those responsible for gross abuses of human rights forfeit their ability to invest and conceal their wealth in the UK.

The proposed Magnitsky clause would operate in the following way: persons who commit human rights abuses against those daring to speak out against illegal activity would be the subject of a ‘designation order’ made by a High Court Judge. If a designation order is made, a High Court Judge could make associated property prohibition orders if considered appropriate. The primary effect of the designation order would be to trigger the civil recovery proceedings in Part 5 of the Proceeds of Crime Act 2002.

Any resistance to the clause on the basis that there are sufficient existing powers is misplaced. The Proceeds of Crime Act contains a loophole for human rights abusers who claim that their conduct was lawful in their homeland. The sanctions regime, meanwhile, is dependent on the political and security considerations of the day. Meanwhile, the UK’s proposed new Unexplained Wealth Order regime, compelling a person to explain the provenance of their assets, hinges on a disparity between a person’s income and their property first being identified, and is intended for use as an investigative tool.

A more fitting tribute to the memory of Sergi Magnitsky could not be imagined. With an eye to its historic role as promoter of the Rule of Law and fundamental civil liberties, it is time for the government to step up to the plate and support the amendment.

Jonathan Fisher QC is a practicing barrister in London and a Visiting Professor in Practice at the LSE. He was instructed by the Magnitsky Campaign to draft the amendment. 
A Magnitsky clause for the UK
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