Proceeds of Crime Act (POCA)

Report: 10
Date: 20 November 2008
By: Assistant Commissioner Specialist Crime on behalf of the Commissioner

Summary

This report is the latest quarterly report of the Payback Programme Board (PPB).

A. Recommendations

That members note the update.

B. Supporting information

1. The Finance Committee requested a review of Payback spending on a quarterly basis. This report is the latest quarterly update of Payback performance.

2. The Payback Programme Board (PPB) chaired by Assistant Commissioner Specialist Crime represents every Business Group in maximising police use of powers under the Proceeds of Crime Act (POCA). The Payback Programme offers a major opportunity to reduce crime and reassure the public by taking away the main incentive for committing serious & organised, gang and volume crime. The Met is a leading performer in this field seizing over £50,000 in criminal cash each day.

3. The purpose of the Payback budget is to reduce crime through mainstreaming the use of powers under the Proceeds of Crime Act 2002. This will be achieved by:

• deterring existing and would-be offenders
• building confidence that police ensure that crime does not pay
• building confidence in the Criminal Justice system
• disrupting the finance of organised criminal networks.

4. To best illustrate this performance the Implementation Team have developed a single ‘index’ that equates to the number of cases with a weighting for their value. This is now on the monthly Scorecard for Borough Commanders.

Overall Operational Performance summary

5. POCA starts with current activity, primarily ‘arrests’ of cash or assets, and finishes with the forfeiture or sale of those assets. This process can take three years or longer. The Payback Index is an amalgam of the two elements and gives a single number that equates to the number of offenders affected by POCA powers with a small weighting for monetary value. The idea is that the greater the number of people affected by POCA the greater the deterrent effect of this legislation.

Graph 1 - see supporting material

6. In 2007/8 a target of £35 million was set by the MPA for the value of assets identified by the court for seizure. In other words confiscation and forfeiture orders. This target was achieved; this was a 40% increase on 2006/7. This year’s target is £42 million, a 20% increase. We are currently on target to meet this.

7. The Green Paper on the future of policing suggests a single measure of public reassurance and the POCA Implementation Team are assessing how POCA work will contribute to this.

8. The half-year performance (i.e. final court results) of Business Groups in asset recovery is shown below. The sums shown are confiscation and forfeiture court orders imposed, not MPS income.

Source: Joint Asset Recovery Database (JARD)

Specific windfalls have been excluded. These are Regional Asset Recovery Team orders in 2004/5 for £14.1m and 2005/6 for £10.3m and one TP order for £1.8m in 2004/5. These are one - off results that are unlikely to be repeated and distort underlying performance.

9. The MPS exceeded its target relating to number of asset cases (1,000 for 2007/8). There were 227 restraint orders and 2061 cash seizures, making a total of 2288. A target of 2500 for 2008/9 has been set. This reflects the strategic effort to deliver POCA powers locally to maximize impact on volume crime.

10. The Home Office set a national all-agency target of £155 million in the 'tin box' for 2007/8. This target relates to forfeiture and confiscation amounts actually remitted to the Home Office, not the MPS measure of court orders. This target was not achieved and £137 million was received. The Home Office has attributed the shortfall to the detention of cash at borders and the Asset Recovery Agency targets not being achieved. There has been an increase in police performance. The government is concerned that it may not reach its ministerial target of £250m by 2009/10.

Payback to London communities

11. The MPA Finance Committee ratified the proposal for providing funding for community projects through the Safer London Foundation (SLF). The SLF will conduct an auditable bidding process and manage the disbursement of the £0.5m in 2008/9. The MPA Finance Committee will review their use of the funding twice a year.

The Asset Recovery Incentivisation Scheme (ARIS) Funding

12. The target of £35m above is largely composed of orders to pay that have not yet been enforced by the HM Courts Service. The amount deprived from criminals and remitted to the Home Office in 2007/8 is a lower sum, about £18.7m. Half of this (£9.3m) is retained by the Home Office and the remainder is shared with the CPS and HM Courts Service. The MPS share under the ARIS is paid quarterly in arrears and totalled £5,078,184 in 2007/8. The quarterly income in 2007/8 is shown in the table below.

Table 1

13. The MPS income via the ARIS mostly derives from police activity between three and four years ago, i.e. 2003/2005. This is because the Criminal Justice system takes this long to process the relevant criminal cases. This is longer than average because it seems that criminal cases involving criminal assets take longer to resolve than normal cases. Increasing income in 2007/8 reflects investment in POCA in the period 2003/5. This investment was the direct funding of 12 financial investigators by the Home Office (2003) and the establishment of the Home Office funded Regional Asset Recovery Team (2004).

14. The Asset Recovery Incentivisation Scheme will run until 2010. How the money is apportioned was reviewed in January 2008 and the final result of the review is still awaited (no change from the last quarterly update). The delay is attributable to a national review of asset recovery by the Prime Minister’s Delivery Unit, their report is due imminently.

Disbursement of funds
15. The bulk of the budget is still committed to funding Payback posts. In addition to the funded posts, two performance reward payments are disbursed in May and in November. Each disbursement will be of £300,000 to specialist OCUs and £300,000 to BOCUs. This is to be spent in financial year.

Abbreviations

ACPO

Association of Chief Police Officers

APACS

Assessment of Policing & Community Safety

ARIS

Asset Recovery Incentivisation Scheme

BOCUs

Borough Operational Command Units

CPS

Crown Prosecution Service

FTE

Full-time equivalents

HMCS

Her Majesty's Courts Service

JARD

Joint Asset Recovery Database

OCUs

Operational Command Units

PIB

Payback Implementation Board

POCA

Proceeds of Crime Act

POCIT

Proceeds of Crime Implementation Team

PPAF

Policing Performance Assessment Framework

PPB

Payback Programme Board

RART

Regional Asset Recovery Team

SARs

Suspicious Activity Reports

SLF

Safer London Foundation

SOCA

Serious Organised Crime Agency

C. Race and equality impact

No discernible impact has been registered during this quarter.

D. Financial implications

1. A financial spreadsheet is attached at Appendix 1 – Revised cash flow based receipts and actual expenditure on Payback Teams.

2. Improving the income stream from asset recovery depends on:

• Ensuring that the Payback budget is spent on asset recovery.
• The development of dedicated ring-fenced teams across Business Groups.
• The effective enforcement of confiscation orders, currently through a dedicated TP team.
• Minimising abstractions from this budget that do not directly improve asset recovery performance.

3. The incentivisation income is apportioned according to the money received at the Home Office, not against the amount ordered by the court. Therefore there is no correlation between the £35 million identified by the court for seizure in 2007/8 and likely income in-year. In other words uncollected confiscation orders do not count towards ARIS. The financial projections are estimates making the assumption that there will be an increase in return through the infrastructure building and the mainstreaming of POCA activity. As it is impossible to estimate the amount of confiscation orders that are collected this is a very inexact science and is being regularly reviewed against actual income.

4. The financial risk is that the income receipts fall below that predicted in the five-year plan. Project governance consists of a monthly cross Business Group Implementation board and quarterly cross Business Group Project Board, chaired by AC SC, with quarterly update reports to Investment Board and MPA Finance and Resource Committee. A reduction plan is being prepared starting with the least productive OCUs as assessed by the Payback Index. If this proves to be necessary, there is capacity in the MPS staff turnover to redeploy staff affected.

E. Background papers

None

F. Contact details

Report author(s): DCS Nigel Mawer, MPS

For more information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

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