IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
(MR JUSTICE NEWMAN)
Strand, London, WC2A 2LL
Friday 16th March 2001
B e f o r e :
LORD JUSTICE ROBERT WALKER
LORD JUSTICE KEENE
| ABBAS KASSIMALI GOKAL
|- and -
|SERIOUS FRAUD OFFICE
Smith Bernal Reporting Limited, 190 Fleet Street
London EC4A 2AG
Tel No: 020 7421 4040, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
Mr A Hacking QC & Mr R Boyle & (Miss F. Jackson attended to receive the Judgment)
(instructed by Serious Fraud Office) appeared for the Respondent.
Crown Copyright ©
LORD JUSTICE KEENE :
"The defendant and his family ran a huge international business involving shipping and other activities. There were over 200 companies, known as the Gulf Group. The group's main bank was The Bank of Credit and Commerce (BCCI) who, over the years, lent vast amounts of money to the group. The Crown alleged and established that BCCI had to keep the Gulf Group going because, if it failed, its level of borrowing was such that BCCI would fail too. Gulf became unable or unwilling to pay its debts. The Crown alleged and established that by 1985 the Gulf Group was insolvent and dependent upon the continued funding and financial support of BCCI to avoid its total financial collapse. Further lending had to be done secretly. The allegation in relation to the first count of conspiracy was that, between 1985 and 1991, officers of BCCI and Gulf conspired to create false documents to deceive the auditors and to cover secret lending to keep Gulf afloat. The allegation in the second count alleged a conspiracy between 1987 and 1991, between the same people, to defraud depositors by a new, secret, financial structure, which deceived the auditors, Price Waterhouse, concealed the relationship between BCCI and Gulf and facilitated additional funding of Gulf; this, the Crown said, kept BCCI afloat."
"he has benefited from that offence or from that offence taken together with some other offence of which he is convicted in the same proceedings or which the court takes into consideration in determining the sentence, and which is not a drug trafficking offence."
"... a person benefits from an offence if he obtains property as a result of or in connection with its commission and his benefit is the value of the property so obtained."
"The sum which an order made by the court under this section requires an offender to pay must be at least the minimum amount, but must not exceed -(a) the benefit in respect of which it is made; or
(b) the amount appearing to the court to be the amount that might be realised at the time the order is made, whichever is the less."
"The amount that might be realised at the time a confiscation order is made is:(a) the total of the values at that time of all the realisable property held by the defendant, less (b) ... ... ...
together with the total of all the values at that time of all gifts caught by this Part of this Act."
"(a) any property held by the defendant; and
(b) any property held by a person to whom the defendant has directly or indirectly made a gift caught by this Part of this Act."
"A gift (including a gift made before the commencement of this Part of this Act) is caught by this Part of this Act if(a) it was made by the defendant at any time after the commission of the offence, or, if more than one, the earliest of the offences to which the proceedings for the time being relate; and
(b) the court considers it appropriate in all the circumstances to take the gift into account."
"(1) If on an application by the defendant in respect of a confiscation order, the High Court is satisfied that the realisable property is inadequate for the payment of any amount remaining to be recovered under the order the court shall issue a certificate to that effect, giving the court's reasons.
(2) For the purposes of sub-section (1) above -(a) in the case of realisable property held by a person who has been adjudged bankrupt or whose estate has been sequestrated the court shall take into account the extent to which any property held by him may be distributed among creditors; and
(b) the court may disregard any inadequacy in the realisable property which appears to the court to be attributable wholly or partly to anything done by the defendant for the purpose of preserving any property held by a person to whom the defendant had directly or indirectly made a gift caught by this Part of this Act from any risk of realisation under this Part of this Act."
"But, even if that were not the case, I have to say I found Mr Gokal's evidence on that matter wholly unconvincing and I cannot act on it. He was entirely unable to explain how these alleged private funds had been deployed."
"It is quite clear from evidence that I have heard and from what Mr Gokal has himself said in reply to cross-examination, and I confine myself to that, that he continued in active business after 1991. It is also quite clear from what he himself has said that his own affairs were mixed up with those of his companies and I have every reason to think that he will have taken steps to protect his funds.
In those circumstances I do not feel able to act upon his assertion that he has no funds. I do not feel able to find that he has discharged even the burden to the civil level that rests upon him of showing the amount that might be realised is less than the amount that I have found to be the amount of his benefit. On those grounds therefore I make a confiscation order in the sum of his benefit of £2,943,115."
"In order to conclude that the defendant had realisable assets in the companies he would have had to identify unpledged assets, and to have then considered whether the defendant had an interest in them. There was no evidence upon which he could conclude that the defendant had realisable assets in the companies."
"I just mention one matter that was relied upon by Mr Gokal and adduced by him in evidence: that is to say that during his control and custody of the companies in the Gulf Group he had, he said, from his private funds contributed considerable amounts of money to his companies. That is in fact irrelevant to the matter before me, unless there could be established, which there has not been, that specific sums of money identified in the previous proceedings as passing in to Mr Gokal's personal control have, in fact, been returned to his companies or otherwise dissipated. "
"The applicant, having secured the penny in the form of disregard by the trial judge of the company assets, now wants the bun in the form of credit for what they may realise."
"The total under this head which forms part of the amount that might be realised under section 74(3)(b) is, as the prosecution have calculated, £635,860."
Lord Justice Robert Walker:
LORD JUSTICE SIMON BROWN: