England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
DIVISIONAL COURT

		Royal Courts of Justice Strand, London, WC2A 2LL
		20/12/2013

Lord Justice Fulford :

Background

1. This is an application for judicial review of three search and seizure warrants granted by Judge Pitts at Southwark Crown Court on 15 May 2013 under section 352 of the Proceeds of Crime Act 2002 ("the 2002 Act"), following an application by the Serious Fraud Office. They were executed on 22 May 2013 at the claimant's home and Betworthy Farm, the address of an associate of the claimant where the latter sometimes stays, and on a motorcar owned by the claimant's wife. Leave to apply for judicial review of the decision of 15 May 2013 was granted by Walker J on 16 October 2013.

Relevant legislation

2. Under the Proceeds of Crime Act 2002 the court needs to be satisfied that there are reasonable grounds for suspecting that the person specified in the application has benefited from criminal conduct (section 353(2)(a)). Furthermore, the material that is the subject of the application must relate to the person identified and it needs to be of likely substantial value to the investigation (section 352 (6)), in circumstances in which it is not practicable to communicate with any person entitled to grant entry to the premises, when entry will not be granted unless a warrant is produced and the investigation might be seriously prejudiced unless an appropriate person arriving at the premises is able to secure immediate entry to them (section 353(9)).

History

3. The claimant is due to stand trial on 10 February 2014 at the Southwark Crown Court on 10 counts which include conspiracy to defraud, corruption, entering into or becoming concerned in a money-laundering arrangement and transferring criminal property. In essence, the prosecution contends that a fraud ran between 2002 and 2007 in which those involved acquired virtually worthless US company shares and sold them at a huge mark up to over 2,000 UK investors thereby defrauding them of over US $100 million. The share sales teams were staffed by UK nationals who were operating out of 'boiler rooms' in Madrid, Spain. It is alleged that at least US $ 45.8 million of the monies that came from the victims passed through accounts controlled by the claimant. He was extradited from Australia in February 2012.
4. Prior to the criminal investigation by the Serious Fraud Office ("SFO"), the Serious Organised Crime Agency (now the National Crime Agency) had brought civil recovery proceedings against the claimant, in the course of which a property freezing order ("PFO") was issued on 30 March 2009. Thereafter, the claimant submitted four statements as required by the PFO, dated 13 May 2009, 27 May 2009, 9 July 2009 and 5 January 2010.
5. On 29 August 2010, the SFO obtained copies of these statements, following an application to the Divisional Court.
6. The SFO sought and was granted two restraint orders during the course of the criminal investigation.
7. The first was granted on 12 October 2010 by HHJ Stone QC, pursuant to the 2002 Act. The provision of information section was extremely detailed and touched on every aspect of the claimant's income or interest in property. This order was varied in ways that are irrelevant to the present application. Following the grant of this order, there was considerable correspondence between the SFO and Mackrell Turner Garrett ("MTG") (the claimant's solicitors), inter alia, on the issue of additional time to comply with the detailed and extensive disclosure provisions of the restraint order. In a statement dated 23 November 2010, James Atton of MTG suggested "[t]he client is a high net worth individual and given the onerous demands of the disclosure obligation set out above, the client will simply not be in a position to provide the information requested within the time provided for in the Order" [8] (albeit in the claimant's statement of 13 May 2009 he had asserted he did not have a salary and was "obliged to make ends meet by drawing down loan facilities and selling assets" [5]). On 10 December 2010 the claimant sent the SFO a statement which the SFO did not accept sufficiently complied with the disclosure requirements of the order. A second statement was sent on 14 January 2011.
8. Following a large number of complaints about non-disclosure on the part of the claimant, on 22 August 2011 the SFO wrote to MTG indicating that the claimant had not complied with the Provision of Information section of the restraint order. Some of the major suggested deficiencies were:

a) The description of a motorbike as located in "Australia" was insufficient.

b) There was a lack of evidence to support assertions in respect of an entity called Einstein's Coffee Shops. Point 5 under this heading sets out the following:

Your client's statement made in the proceedings brought by SOCA dated the 13^th of May 2009, describes that the business was bought in May 2005. Please give details of the source of the funding used to buy or set up the business? How much was paid to buy it or to start it up? The statement of the 13^th of May 2009 sets out the following after the heading "Source of funding:"

"A success fee paid to me by way of equity warrants on the initial public offering of the holding company of Einstein, MCC Capital Concepts Gmbh for the introduction of investors to the company."

We do not accept this represents full disclosure. Please provide a detailed explanation supported by evidence. Please set out who the success fee was paid by; where it was paid to; how much it was; details of the holding company of Einstein – MCC Capital Concepts Gmbh. Does your client have any interest in this company? If he does please give full details, value and location for the company and his interest in it. Please give the current value of this asset.

c) There was a lack of information in respect of the monies the claimant had been living on, as well as discrepancies between the claimant's statements in response to the order obtained by SOCA and the restraint order. It was said that the claimant's assertion that he had no salary did not properly answer the question that invited him to provide details of all forms of income, identifying the amount paid, by whom and the accounts into which it was paid. The SFO requested details of his income from between the imposition of the restraint order on 12 October 2010 until his arrest in Australia.

d) The letter requested additional information concerning assets held by the De Revell Family Trust and its relationship with Oz Managementcorp Pty Ltd. The concerns are explained as follows:

Assets held by the De Revell Family Trust – Oz Managementcorp Pty Ltd

We ask that your client clarify, in one document giving full particulars and supporting his answers with evidence, what assets he transferred into the De Revell Family Trust. We make this request because at present the information provided is contradictory.

Your client's December statement describes that the assets held by the trust are the shares in Oz Managementcorp Pty Ltd. He describes that this company does not hold any real property. If this is the case please provide details of what business this company carries out; what income is generated?

In May 2009 your client appears to have been the sole shareholder of Oz Managagementcorp Pty Ltd. In consequence, your client is required to provide details of this transfer and the asset transferred. Please ensure that this is done.

In May 2009 the position was described by your client as: Ozmanagementcorp was the trustee of the De Revell Family Trust. It owned Ozcapitalmanagementcorp Pty and Oz Propertycorp Pty and Oz Investmentcorp Pty. However in the statement provided by your client to the SFO he made no mention of the companies Oz Propertycorp Pty and Oz Investmentcorp Pty. Please ensure that your client provides a full explanation of what the position is and whether these companies continue to be owned by Ozmanagementcorp?

9. The letter ends "your client's failure to provide full disclosure in response to the requirements placed on him by the restraint order place him in breach of it. We ask that you arrange [with] your client to remedy this situation as a matter of urgency".
10. On 6 September 2011, MTG wrote to the SFO informing them that they would not be in a position to respond to the letter of 22 August 2011 until the extradition proceedings were completed. I interpolate to note that this was, in my judgment, a wholly inadequate response. The extradition proceedings did not suspend the claimant's obligation to cooperate with the relevant court orders.
11. The claimant was extradited to the UK on 1 February 2012. It is part of the SFO's case that the letter of 22 August 2011 has never been substantively answered.
12. Given the claimant was charged with offences that pre-dated the 2002 Act, a substitute restraint order was granted by Charles J in the Administrative Court on 17 October 2012, pursuant to the Criminal Justice Act 1988 ("CJA"). This order was also varied in due course. At paragraph 22 the order requires the claimant to serve a witness statement supported by documentary evidence in which he is to set out all his assets and all the assets under his control. In 34 separate paragraphs the claimant is requested to provide information about a large number of distinct items of property, including numerous companies, bank accounts and at least one trust.
13. There was then a voluminous exchange of letters and emails between the SFO and MTG on a number of issues – including the time period under the new restraint order in which he was to effect disclosure, the suggested obligation of the claimant under the restraint order to repatriate assets and payments for the claimant's benefit – culminating in the service of his witness statement on 29 January 2013. This was followed by a 19-page letter of 25 March 2013 from the SFO to MTG in which the latter set out that it did not consider that the witness statement satisfied the requirements of the restraint order. The SFO observed that save as regards statements provided for an entity called "Mackie Research Client", the claimant had not furnished the SFO with any documentary evidence, notwithstanding a recent trip to Australia which had lasted a month. For the purposes of the present judicial review proceedings, the SFO highlights the deficiencies in disclosure relating to Sea Breeze Property Investments Ltd, E Investcorp Limited, California Securities SA, a property in Clifton, Cape Town, South Africa, the Oz Group, the De Revell Family Trust and the Double Bay and Darling Point properties (all considered hereafter). Furthermore, there is a repeat in the letter of 25 March 2013 of the complaint that the claimant continued to refer to a motor bike as being located in Australia and that his account of his income was unsatisfactory. Although receipt of this letter was acknowledged in an email from MTG on 11 April 2013, by the date of the application for the warrants (15 May 2013), the SFO had not received a substantive reply on the majority of the issues that had been raised.

Application for the warrants

14. The application for the warrants was made by Ms Nicola Paget, an accredited financial investigator, in order to support confiscation proceedings that the SFO intends to launch in the event that the claimant is convicted. She was entitled to present the application pursuant to section 352(1) of the 2002 Act which allows the matter to be presented by "an appropriate officer", who is defined in section 352(5) as "a constable, and accredited financial investigator or a customs officer, if the warrant is sought for the purposes of a confiscation investigation or a money laundering investigation". The 20-page Information (the only material put before the judge by the SFO) set out that the SFO are concerned with the benefit of the claimant's alleged criminal conduct generally and not just his suggested activities that are linked to the present offences. The SFO noted that the applicable statutory regime is section 72AA(1) CJA under which the court is required to approach the claimant's assets, whether or not linked directly to the present proceedings, on the basis that they were obtained as a result of or in connection with his criminal conduct, unless this conclusion is contrary to the interests of justice. Accordingly, it is suggested this regime requires "the fullest investigation of all his assets".
15. The relevant statutory regime was summarised in the Information and particularly sections 352 and 353 of the 2002 Act. Having given an overview of the course of the proceedings against the claimant and the six others who have been charged and convicted in relation to these allegations of fraud, Ms Paget described in detail the suggested deficiencies in the information that the claimant has been under an obligation to disclose, under the civil freezing order, and the 2002 Act and CJA restraint orders, since 2002. It was set out that such material that had been provided was conflicting or inadequate in its detail. It was emphasised that the majority of his assets are located overseas in Australia, and possibly South Africa, Spain and Thailand (and I note, for instance, that in his statement of 27 May 2009, the claimant referred to his "most recent asset sale", that of his property "Monte Paraiso" in Spain which "netted him" 650,000 euros). Ms Paget gave the dates of the 8 witness statements that the claimant has provided, between May 2009 and January 2013. The complaints as to the adequacy of the information provided therein are numerous, and amongst some of the more notable examples it was alleged:

i) The location of a particular motorbike in Australia had been withheld until early May 2013.

ii) The claimant had been vague as to whether or not he is concerned with a property in South Africa in that he indicated he "may have an interest" in it.

iii) He has given contradictory accounts as to the circumstances surrounding a company called Einstein's Coffee Shops which was incorporated in Germany, in that it was unclear whether there was a holding company called Kaffee Bright (see statement 9 July 2009), whether it was connected to MCC Capital Concepts GMBH (see statement of 13 May 2009) or whether the company was involved in a disputed sale, for which he had received no proceeds (statement 29 January 2013).

iv) The claimant revealed his interest in a company, Sea Breeze Property Investments Ltd, for the first time in his statement of 29 January 2013. Some further information was provided on 3 May 2013 as regards his provisional shareholding in this company and investment by it in Australia. It is suggested this should have been revealed in response to the 2002 Act restraint order of 12 October 2010. The applicant claims to have invested £20,000 in a venture that "failed to materialise", but again no documentation has been provided.

v) In his statement of 29 January 2013 the claimant disclosed for the first time that he is the sole shareholder in Einvestcorp and California Securities SA, despite the incorporation of these companies in 2005 and 2006 respectively, in the Isle of Nevis. No supporting information had been provided for the contention that they both had been struck off. It was noted that his interest in these companies was only revealed after the claimant had been served with certain evidence connected to them by the SFO.

vi) There was evidence that the claimant had provided incorrect information as to the sale price of certain items, such as a £15,000 discrepancy in the reported and actual sale price of a Range Rover and a mini cooper.

vii) The claimant had failed to reveal a now-closed Harrods bank account.

viii) It was suggested there is credible information which links the claimant to a Formula 1 car worth £600,000 (this was based on a statement by the person who had suggested that the claimant open a particular bank account).

ix) The claimant revealed for the first time in his witness statement of 29 January 2013 that he has an interest of approximately 20% in a company called Enfinium International Holdings Ltd. He provided no dates as when this interest arose, where the company is incorporated or where it is trading. He described this as a share option that is held on trust for him but he provided no details in this regard.

x) The claimant provided no documents as regards his assets or bank accounts other than the shares he held with a share holding company in Canada Mackle Research Capital. For this company, he simply furnished the court with a financial summary showing the period 30 June 2012 – September 2012 when he filed his statement of 29 January 2013.

xi) The claimant revealed that the company Dietrich International Ventures Inc was incorporated in the Bahamas at his instruction, and he observed that it had no operational bank account. However, the evidence in the criminal proceedings reveals that over US $15 million passed through this account, and the claimant failed to reveal the destination of these monies. (I note that although in his statement of 9 July 2009 he briefly referred to two payments of $2,500,000 in relation to certain business interests, US $10 million appears to be wholly unexplained.)

xii) Clause 20 of the CJA Order of 17 October 2012 required the claimant to repatriate to a UK restrained bank account all relevant funds held in overseas bank accounts. The claimant had not complied with this requirement, notwithstanding a trip to Australia in December 2012. Save as set out below, no Australian bank accounts had been revealed or details of transfers to family trusts. As late as 3 May 2013 the claimant had been promising to provide details of the Australian accounts and to enquire as to the repatriation of funds. He had provided bank statements for one account on which the bank and the account holder's names were not included, and which only covered the period May 2009 and November 2011. No explanation was provided as to the movements of monies shown on the statement or why it was used after the imposition of the restraint order.

xiii) The claimant's means of support had been wholly unclear. He told the SFO that he had been living on unspecified gifts from family and friends. However, in his statement of 29 January 2013, he revealed for the first time that during the period of the 2002 Act order and prior to his arrest and extradition he had been withdrawing approximately £250 per week from his Australian bank accounts. However, the statements from the single, unidentified account he has revealed show withdrawals of only $337.00 between 13 May 2009 and 29 January 2013.

xiv) The claimant had provided no information as to how he is funding the rent and the bills at the property he lives in with Andrea Young (Ossington Street), an American who does not have leave to work in the UK.

16. There were other examples of non compliance which the SFO relied on which it is unnecessary to set out in this judgment.
17. The decision of the judge was confined simply to the observation "I am satisfied these orders are met and will grant them".

Reasonable grounds to suspect that the claimant had benefited from criminal conduct

18. Others have already been convicted of involvement in the fraud for which the claimant is to stand trial, and it is accepted that there are reasonable grounds for the prosecuting authorities to suspect that he has benefited from criminal conduct and, accordingly, section 353(2)(a) POCA 2002 is satisfied. This was not a live issue for Judge Pitts to consider.

Summary of the respective cases

The claimant's case

19. The claimant's case on this application for judicial review is that there were certain critical procedural failings:

e) The SFO was not represented by counsel or a solicitor.

f) The hearing was extremely short, in that the court log indicates that the warrants were granted a minute after the case was called on. The judge may not have had Ms Paget's Information for more than 35 – 40 minutes (9.40 – 10.17 am).

g) No note of the hearing before Judge Pitts was made because – save for the judge's enquiry as to the name of the trial judge – nothing was said.

h) It is suggested that the lack of submissions during the hearing on 15 May 2013, the brevity of the proceedings and the absence of a reasoned judgment mean that there was no "rigorous and fair analysis of the claims" advanced by the first defendant.

20. Furthermore, it is suggested that no reasonable tribunal would have granted the warrants if it had been properly apprised of the relevant facts, and in particular:

i) The statement of Ms Paget "fails to contain any proper analysis of the case history and criminal case against the claimant".

j) It is suggested the statement is vitiated by misrepresentations, exaggerations and non-disclosure.

k) It is argued the statement is "partisan", in that it ignored any arguments against granting the warrants, save for some "token statements". In particular, the claimant contends that that Ms Paget failed to indicate the extent of the information that had been provided.

21. Mr Trollope Q.C. on behalf of the claimant contends that the question for the judge on the merits was whether the SFO had demonstrated that the claimant's non-compliance with past orders was such that only search warrants would suffice. It is contended that this required consideration of the claimant's conduct over the relevant four-year period, and whether it was reasonable to conclude that if more information was sought he would fail voluntarily to produce it.
22. It is argued that the SFO was not entitled in any event to some of the information that it was seeking.

The respondent's case

23. Broadly, it is the case for the SFO that there were reasonable grounds to believe that the claimant had paper or electronic (computer-stored) documents in premises used by him that would throw light on his assets. It is suggested that he had failed to comply with orders for information throughout the course of these proceedings, when viewed as a whole, and that it was reasonable for the court below to conclude that he would not voluntarily provide the relevant documentation, given his past conduct as regards disclosure. Accordingly, it was suggested that it was open to the judge to conclude that the claimant was in possession of material covered by the orders and that he would refuse willingly to disclose it.
24. The central issue, therefore, is whether the claimant's previous disclosure was inadequate, such as to justify the undoubtedly intrusive step of a search and seizure warrant.
25. In summary, therefore, the case for the SFO in this regard is that:

a) The claimant's disclosure had been obscure, self-contradictory and lacking in detail and documentary support. In those circumstances, it is argued that he had revealed himself to be someone who was trying to conceal and withhold relevant information.

b) It is alleged that he had failed to provide information in the present prosecution by the SFO but also in earlier proceedings in the Crown Court and the High Court.

c) The ability of the SFO, and thereafter the court, to understand the extent of the claimant's assets in order to prevent their dissipation is a matter of significant public interest.

d) The SFO was not obliged to wait indefinitely for the claimant to provide satisfactory information, by way of new material or clarification of the material already delivered. It is suggested that this step – obtaining the warrants – was necessary in order to secure the relevant documents expeditiously and with a sufficient measure of confidence that it was complete.

26. The SFO accepts that warrants which permit forcible entry in order to seize property is a severe measure.
27. I will address these issues in two parts. First, the suggested defects in the procedure adopted on 15 May 2013 and, second, the submissions that are made as to the sufficiency and the integrity of the material provided to the court by Ms Paget.

Suggested defects in the procedure adopted on 15 May 2013

The claimant's submissions

28. The claimant reminds the court of certain principles that apply to without-notice applications for search warrants. First, the process of obtaining a search warrant ought never to be treated as a formality and all the material necessary to enable the judge to assess the merits of the application must be provided (R (Rawlinson and Hunter Trusteess) v CCC [2012] EWHC 2254 (Admin); 2013 1 WLR 1634 at [79]. As the President of the Queen's Bench Division (Sir John Thomas) stated when giving the judgment of the court in Rawlinson, "[i]t is a matter of high constitutional importance that the citizen is protected by independent judicial scrutiny from the excesses of allowing an officer of the executive to decide for himself whether to enter property and search" [78]. The judge must be provided not only with the necessary material to justify granting the warrant, but there must be full and complete disclosure that includes anything that might militate against the grant of the warrant (ibid [81]). In Rawlinson the court made express reference to the terms of the SFO manual, and the instruction that there is "a particular duty to disclose to the court all known material facts which may be relevant to the judge's decisions, including matters which indicate that the issue of a warrant might be inappropriate" (ibid [82]). The judge must be satisfied that there is sufficient material to justify the grant of the warrant (ibid [83]), in other words he has to be satisfied that there are reasonable grounds for suspicion (ibid [84]). If the underlying documentation is not provided, there is "a particularly heavy duty on the [applicant] to ensure that what is put before the judge is clear and comprehensive so that he can rely on it and form his judgment on the basis of a presentation in which he has complete trust and confidence as to it accuracy and completeness" (ibid [88]).
29. The judge's task involves detailed, anxious and intense scrutiny of the material (ibid [85]), which is to be subjected to "careful consideration and rigorous and critical analysis" (ibid [89]) and he should provide reasons, that will be a short summary of the detailed analytical process undertaken by the judge in his scrutiny of the material provided (ibid [89]). In Rawlinson this court regretted that notwithstanding the frequent occasions when it has been stated that judges must provide reasons of this kind, this is not seen as being something that should happen as a matter of course [207] (see also The Queen on the Application of S, F and L v The Chief Constable the British Transport Police and another [2013] EWHC 2189 (Admin) at [46] and [47]).
30. In this instance, as already rehearsed, the judge merely said "I am satisfied these orders are met and will grant them".
31. On 29 May 2013 the SFO indicated in a letter to the claimant that apart from those words on the part of the judge when granting the warrants and his enquiry as to the identity of the trial judge, nothing else had been said during the hearing, hence the absence of any note of the proceedings.
32. The claimant suggests that this was a complex case, in the sense that he had been subjected to repeated requests for a considerable amount of information relating to his assets, his past commercial dealings, his bank accounts and other aspects of his personal life and business activities. It is argued that the process overall reveals insufficient scrutiny of the relevant material; indeed, it is suggested this was merely a "rubber stamping" exercise.
33. The claimant relies on the authorities that establish that if the judge's decision contains apparent material omissions, including a perceived lack of reason, or the reasons appear deficient, the advocate has a duty to raise the matter with the judge (In re A and another (Children) (Judgment: Adequacy of Reasoning) [2011] EWCA Civ 1205).
34. Additionally, it is highlighted that there is an obligation on the applicant seeking an ex parte order to take a contemporaneous note of the hearing and to provide it to the party concerned (Cinpres Gas Injection Limited v Melea Limited [2005] EWHC 3180 (Pat); (2006) FSR 36). Pumfrey J, in the course of his judgment in that case, set out that the "normal practice" is for a full note to be made, and for the party obtaining interim relief without notice to give undertakings to reduce the allegations made before the judge into a witness statement to be served as soon as practicable so that the respondent can know the case that is to be met [21] (see also Interoute Telecommunications (UK) Ltd v Fashion Gossip Ltd The Times, November 10 1999). In The Queen on the Application of S, F and L v The Chief Constable the British Transport Police and another (supra), in the context of applications of this kind in the Crown Court, the Divisional Court observed that the hearings must be recorded "so that there can be no dispute about what was or was not said to and by the judge" [46].

The respondent's submissions

35. The SFO highlights that the case law demonstrates that a lack of reasons does not necessarily vitiate the decision. In Rawlinson, the court dealt with complaint as to the lack of reasons in that case in the following way:

208. It was submitted by Rawlinson and Hunter that the judge's failure to give reasons was indicative of a failure by him to scrutinise the application and to enquire why the warrants were needed. We do not accept that this can amount to an independent ground of criticism. The presentation to the judge was so deficient for the reasons we have given that no purpose would be gained by examining how the judge should have dealt with the application in his reasons and whether, if he had done so, that would have shown he had not given appropriate scrutiny to the applications.

Conclusions on the suggested defects in the procedure

36. It is regrettable that once again it is necessary to repeat that it is incumbent on judges to give reasons for their decisions on ex parte applications of this kind. Although it is recognised that in the "usual" cases that come before the Crown Court, the task of the judge is relatively straightforward (Rawlinson [86]), that does not obviate the need for the judge to provide a succinct description of the main factors that he has taken into account and his reasons for granting the warrants, particularly given the absence from the hearing of the person or persons affected when the warrants are executed. As I have already rehearsed, the extent of the reasons in these circumstances was described in Rawlinson as a short summary of the detailed analytical process the judge has undertaken in his scrutiny of the material provided [89]. Although the standard and the extent of the reasons will depend on the circumstances of the case and the subject matter under review (Flannery and Flannery v Halifax Estate Agents Ltd [2000] 1 WLR 377, 382 A – C) the judge must engage with the principal issues raised on the application and explain why he has followed a particular course. It is self-evident that in applications such as these there will usually be arguments that need to be addressed as to why the application should not be granted; indeed, in this case Ms Paget referred to particular factors potentially militating against the order she sought, and the judge should – albeit briefly – have explained why they did not cause him to refuse to issue the warrants. It is not sufficient simply to sign the warrant or warrants.
37. However, I am not persuaded that the failure by the judge to provide reasons vitiates his decision. The issues that the court needed to consider were reasonably easy to understand, and in essence the question he was required to resolve was whether it had been demonstrated that the claimant had failed to comply substantively with the orders that had been made for disclosure on a number of occasions, leading to the conclusion he would not voluntarily cooperate. If the material provided to him sufficiently supported that determination, and the SFO's presentation of the facts and the issues was fair and balanced, then it was, in my view, inevitable that the correct result would have been for the judge to make the order. Accordingly, although I deprecate the absence of reasons, I consider that the real issue on this application for judicial review is whether the Information on which the judge relied was materially defective. Put otherwise, did the application demonstrate substantive failure on the part of the claimant to disclose information such as to justify the search warrants, and was it a fair and balanced document.
38. The lack of a record of the hearing is unsurprising given it appears that the warrants were granted within a minute of the court sitting, during which time the judge simply enquired as to the name of the trial judge. If the material provided by the SFO was appropriate and the justification for the search warrants was self-evident, then it was unnecessary for the judge to investigate the issues further by putting questions to, and inviting submissions from, the representative of the SFO. It will always be a matter for the judge, having read the information provided to him, whether he needs further assistance in court. As with the claimant's submission on the suggested lack of reasons, in my view, the real issue is not whether the application was sufficiently discussed in court or the brevity of the hearing but whether the Information provided in advance – which the judge would have had an opportunity to read even if the papers were only provided to him on the morning of the 15 May 2013 – was materially defective, and it is to that issue that I turn in the next part of this judgment. Although the judge did not have the Information in his possession for a long period of time (not more than 35 – 40 minutes), it only spans 20 pages and it would not, in my view, have taken a judge experienced in these applications long to read it and to understand the issues that he needed to weigh and resolve. Although the judge should have provided reasons, this history does not reveal a "rubber stamping" exercise, as suggested by Mr Trollope.

Sufficiency and integrity of the material provided to the court

Claimant's submissions

39. The claimant advances three principle arguments under this heading:

i) The SFO failed in its obligation to make full and frank disclosure.

ii) The SFO failed to advance or refer to the factors militating against granting the search warrants or to give proper consideration to the claimant's likely response to the application.

iii) It is asserted that the "examples" of non-compliance (some of which I have set out extensively above) were "untrue, misrepresented or immaterial".

40. The claimant advances a robust attack on the Information provided by Ms Paget, and I quote from the skeleton argument:

"The Claimant's core complaint was, and is, that Nicola Paget's statement was incomplete, unbalanced, indeed partisan, and contained material omissions and misrepresentations. Furthermore the Claimant asserts that had proper disclosure been made, or scrutiny applied, no reasonable tribunal would have granted the warrants requested.

41. The claimant argues that he has supplied "lengthy witness statements and copious material" in response to the various orders that have been made for disclosure and that his representatives have gone to great lengths to assist the SFO. It is contended that although the SFO did not have to serve all of the disclosed material on the judge, it nonetheless was obliged to provide a fair and balanced summary of the claimant's compliance with the disclosure orders. It is argued that this was particularly important because one of the options that the judge should have considered, as an alternative to issuing the warrants, was the possibility of adjourning the application for further enquiries to be made as to whether compliance could be secured by alternative means.
42. Walker J ordered the claimant to provide a document that, in his submission, "represents the minimum that should have been included in the application" to the judge in the court below.
43. The claimant focuses on three areas in relation to which it is argued the suggested non compliance on his part is inaccurate.

The bank accounts

44. The claimant avers that the relevant authorities have been aware of his bank accounts since 2009, following full disclosure by the claimant, during the course of extensive correspondence. This is described as follows:

"[…] all reasonable efforts are and have been made (to) obtain the documents in question. In any event given the particulars of the account are known to the first defendant the details of that account can easily be ascertained under mutual assistance from the Australian/Austrian authorities, thus no conceivable prejudice was ever likely to arise".

Gifts

45. The claimant has been required over a period of some 10 years to provide details of gifts over £1000. It is argued that this "inevitably includes assets and/or amounts of no great value particularly in relation to an individual who has enjoyed a substantial income over that same period". It is submitted that the overall sum involved in this regard is likely to be insignificant. In all the circumstances, it is contended that "omissions and/or failures to recall precise details are much more likely to have resulted from a genuine failure of recollection rather than a deliberate concealment […]".

Hidden assets and lifestyle

46. The claimant addresses the SFO's contention that he must have hidden assets in the UK or overseas in order to fund his living and legal expenses that have exceeded £1 million by submitting that there is no evidence that he has undisclosed assets and that he has in any event provided details of the company, Autonomous Communications, and particular individuals who have lent him money. He suggests that he is not under any obligation to provide further information and that supplying the names of the company and these individuals is sufficient, particularly given there are "no grounds for […] questioning the accuracy of the information as already submitted".

Respondent's submissions

47. The SFO submits that it alerted the judge in the Information to the principal arguments that it was likely would have been made by the claimant:

JRR will undoubtedly claim, and in fact has so claimed through his solicitors, that his disclosures fully discharge the requirements of the provision of information orders. He would likely claim therefore that any criminal benefit, should he be convicted, is easily ascertainable form such information he has provided and grounds for a search warrant would not be made out. To the contrary, I believe that over the last four years, JRR's pattern of either failing to supply information, or of providing the SFO with information later or with partial vague or conflicting information gives rise to the clear inference that he has withheld financial information from the SFO. The information he has provided cannot be trusted and there is no other method of expeditiously and reliably ascertaining all the necessary information.

48. Additionally, the SFO drew the court's attention to the fact that the occupants of Betworthy Farm had no previous convictions or cautions; to the warrants that had been executed in Australia (leading to the search of his home address in New South Wales and offices in Sydney and Melbourne and the chambers of a barrister in New Zealand); to the likely submission that there would be no additional benefit to be derived from issuing further warrants in the UK; to the potential disruption that the searches would cause; and to the risk that material would be found that is subject to legal professional privilege.

27 Belvedere Avenue

49. The SFO contends, and I accept, that there remains real uncertainty as to where the claimant's principal assets are located. The property at 27 Belvedere Avenue, Wimbledon, is of high value (over £4 million) but on the material provided by the claimant he has no direct interest in the house because it is owned by 4TF(One) Limited, a company incorporated in Gibraltar, and his children are said to be the beneficial owners. In his statement of 13 May 2009, he stated "I am owed £4,419,733.84 by 4TF (One) Limited under the Facility Agreement dated 8 November 2006 between me and that company" and a document purporting to represent this agreement has been disclosed. In a statement made on 27 May 2009 the claimant suggested he had no "interest or equity" in the property, yet in affidavits provided for the purposes of matrimonial proceedings, he suggested that together with two other investors he had put monies into this house and they expected a return that would be divided three ways. As a further complication, on 13 January 2011, the claimant suggested that the trustee of the 4TF Trust is Abacus Trustees. In the criminal proceedings it is alleged that this property was bought with the monies defrauded from the innocent investors, and the SFO are of the view that the claimant (as opposed to Abacus Trustees or any other entity) controls 4TF.

Double Bay, Darling Point and other property

50. The SFO credibly asserts that there has been real uncertainty as to the reality of the claimant's interest in properties at Double Bay and Darling Point in Australia, in that the original assertion in the statement of 13 May 2009 that they were owned by Oz Propertycorp Pty Limited was amended in the statement of 29 January 2013, when the claimant accepted he is the ultimate beneficial owner. The uncertainties as to his interest in a property in South Africa remain unresolved, and the claimant has failed to reveal the address of the property, the suggested current legal owner or its approximate value. Nor has he explained the grounds on which he suspects he may have a beneficial interest in the property. Similarly, as set out above, the location of the Harley Davidson motorbike was no more specific than "Australia" notwithstanding the obligation to provide its precise location, until as late as 3 May 2013.

Einstein's Coffee shops

51. At the time of the application for the warrants, as the SFO asserts, the position as regards Einstein's Coffee shops was far from clear. On 13 May 2009 the claimant suggested he had $50,000 stake in this enterprise, and the source of the monies had been a success fee relating to Einstein's holding company, MCC Capital Concepts Gmbh. However, on 9 July 2009 Kaffee Bright was described as the holding company. The SFO sought clarification in a letter of 22 August 2011 and in the restraint order of 17 October 2012 the claimant was required to address this issue. The statement of 29 January 2013 failed to do so. Instead, the claimant suggested the company had been sold – for which scant details were provided – and he suggested he had not received any proceeds from the sale.

Sea Breeze Property Investments Limited

52. As the SFO points out, the restraint orders of 12 October 2010 and 17 October 2012 required the claimant to engage in ongoing disclosure in relation to any shares that he holds, and as regards litigation or proposed litigation. In his statement of 29 January 2013 the claimant for the first time revealed ownership of shares in Sea Breeze Property Investments Limited with an unknown value that were "subject to separate proceedings". He said that he had personally invested £20,000 with this company in or around 2005, although he suggested he was unable to recall the exact date. He set out that the "investment failed to materialise" and that there is current litigation on this issue. On 3 May 2013 the claimant for the first time sent a letter to the SFO from Sea Breeze Property Investments Limited, dated 15 October 2012.

Einvest Corp and California Securities SA

53. Again, as Mr Perry Q.C. for the SFO contends, Ms Paget accurately described the position as regards Einvest Corp and California Securities SA. The restraint orders of 12 October 2010 and 17 October 2012 require the claimant to reveal any shareholding by him on an ongoing basis. As set out above, it was only on 29 January 2013 that the claimant first revealed his interest in these two companies. As Ms Paget observed:

In his statement of 29^th January 2013 JRR also disclosed for the first time the fact he is the sole shareholder of Einvest Corp and California Securities SA, despite the companies having being incorporated in 2005 and 2006 respectively in the Isle of Nevis, he claimed that both are now struck off and provides no supporting evidence. JRR only discloses this information after evidence of this and of the company bank accounts held with Banque J Safra (Monaco) SA (where it is alleged that investor funds of just over $10million USD had been laundered) has been served as part of the criminal case against him by the SFO predicate prosecution (please refer to paragraph 23 for payments these companies made to Roger Taylor, with which JRR is permitted to live at weekends).

Motorcars

54. I accept the SFO's contention that the claimant had given materially incorrect information as regards the sale price of two vehicles, the Range Rover and Mini Cooper set out above. The SFO obtained the correct details of the transactions through an undeclared Harrods Bank Account, and it is clear from the Payment Credit Advices that they were sold for more than double the disclosed amount. Ms Paget accurately described this account to the judge as closed, but the claimant had failed to reveal it in breach of the restraint order of 17 October 2012 which required the claimant to set out:

Details of all payments and receipts above £1,000 GBP (or the equivalent value in whichever currency is appropriate at the relevant time) in value, into and out of any of the Defendant's accounts or accounts, including the amounts, source and purpose of payments and receipts, since 1^st December 2002.

55. The Formula One motor car, referred to by Ms Paget, had been raised in the context of the claimant opening the Harrods Bank Account. Ms Paget was entitled to refer to this by way of a suggestion that there were "intelligence links" between the claimant and this vehicle. The information concerning this car had been provided by the person who recommended to the claimant that he should open an account at Harrods.

Enfinium International Holdings Ltd

56. Ms Paget dealt with Enfinium International Holdings Ltd, as follows:

In his witness statement of 29^th January 2013, JRR disclosed the company Enfinium International Holdings Ltd and stated he 'considers he has a beneficial interest in the company of approximately 20%'. He gave no dates of when such an interest arose, the value of this 20% or where the company is incorporated or trading. JRR also describes this as a 'share option' which is being held on trust for him but again gives no details. Again this is the first time such information has been disclosed; […]

57. The claimant had set out the following in his statement of 29 January 2013:

Enfinium International Holdings Ltd

I consider that I have a beneficial interest in this company of approximately 20%. This interest stems from an agreement I had when the company was being formed following introductions to contacts for seed capital. It was agreed that I would have a share option to that value. That option was to be held on trust for me. This was an understanding between the parties but not written. The option was never exercised by myself as the other interested party, Benjamin Mauerberger, exercised the option in his own name, without my authority. However, I am considering obtaining legal advice with a view to taking legal proceedings as to whether or not I do have a beneficial interest in the property. Should any proceedings be commence I will inform the SFO of such in accordance with the terms of the Order.

58. By letter dated 25 March 2013, the SFO requested further details of concerning the company's incorporation and officers, the date on which he obtained the beneficial interest and the details of the person with whom his client had an agreement.
59. This information had not been provided at the time the warrants were obtained.

Australian Bank Accounts

60. The restraint orders of 12 October 2010 and 17 October 2012 required the claimant to provide details of his bank accounts along with documentary evidence. In his statements of 13 May 2009, 13 January 2011 and 29 January 2013 the applicant referred on each occasion to the same four Australian bank and the single Austrian bank accounts, and he set out their fluctuating balances. As Ms Paget suggests, the movement of monies disclosed fails to reflect the suggestion by the claimant that he has been withdrawing £250 a week from the Australian accounts on which he has been living. He did not provide any documentary records until 3 May 2013, but this only related to an Austrian account (the details of which were not revealed), covering the period between May 2009 and November 2011. No explanation was provided for the transfers of funds or why the claimant continued to use the account after the first restraint order.
61. On 12 September 2013 the claimant revealed a further Australian bank account, and in the period since the 12 October 2010 restraint order this account has held significant funds (@ Australian $ 130,000) with numerous transactions throughout the period that follow the date of the order and before and after the claimant's witness statement of 13 January 2011. Although this material was not before the judge, it profoundly undermines the claimant's assertion that there are no reasons for doubting the adequacy and accuracy of the information he has provided.

The account for Deitrich International Ventures Inc

62. As the SFO contends, there is a strong basis for suggesting that the claimant has provided inadequate information as regards Deitrich International Ventures Inc. Despite the evidence in the case – based on a letter of request to the Bahamian authorities – that in the period 1 March 2004 and 30 June 2007 the account received US $15,630,145 from the two relevant Euronet accounts, the claimant suggested in his statement of 29 January 2013 that the company has no assets and it has no operational bank accounts, and that it has been struck off. The claimant's solicitors, in response to a request for further information, simply referred the SFO to documents in the prosecution's exhibits and statements prepared for the criminal trial and made no attempt to correct, amplify or explain the apparent error in the claimant's assertion in January 2013.

Movable Assets

63. The restraint order of 17 October 2012 required the defendant to bring any movable assets save for the motorbike and certain furniture into the UK within 21 days, including monies in bank accounts. There has been extensive correspondence on this issue in which the SFO repeatedly reminded the claimant's solicitors of his obligations in this regard but the balances of the known accounts have not been transferred. The claimant failed to create an appropriate UK account and the SFO agreed to the transfer of the funds into MTG's client account, but as of the date of the application for the search warrants, none of the funds held abroad had been transferred.

The Oz Companies

64. In my view the SFO is correct in its submission that Ms Paget was justified in suggesting to the judge that the claimant was suspected of being the beneficial owner of some of the relevant companies and that his explanation, in particular, of the arrangements relating to the Oz companies had been vague, inadequate and inconsistent between his various statements. I have already set out the relevant part of the letter of the SFO dated 22 August 2011, and following a requirement in the restraint order of 17 October 2012 for a detailed breakdown of the ownership, purpose and income of all of the Oz companies, the assets they held, their investors and the history to the sale of any shares, the claimant on 29 January 2013 indicated he was "attempting to obtain documents from Nigel Westoby and his solicitors that demonstrates that he holds the Oz Propertycorp assets on trust for me". This statement was wholly at odds with the claimant's statement of 13 May 2009 in which he indicated that he was the owner, sole shareholder and director of Oz Managementcorp Pty Limited which in turn is the trustee of the De Revell Family Trust (which was said to own Oz Groupcorp Pty Limited, which in turn owns three other Oz companies). There was no mention of a trust or any interest on the part of Nigel Westoby in the statement of 13 May 2009. I consider that this unexplained change in the position as regards the Oz companies alone wholly justifies Ms Paget's observations to the judge on this issue.

The De Revell Family Trust

65. The position as regards the De Revell Family trust is also unclear. In his statement of 13 January 2011 the claimant said he was the beneficiary of the trust, whilst on 10 December 2010 he had claimed to be one of the beneficiaries. On 29 January 2013 the claimant suggested that the Family Trust had not functioned as had been intended without providing any details in support of this contention. No documentation in this regard has been provided.

Malcolm Fraser and Autonomous Communications Limited

66. As early as 13 May 2009, the claimant referred to drawing down loan facilities and selling assets without providing any details in either case. In the statement of 27 May 2009, the claimant suggested that he has not been domiciled in the UK and that his income in this country related solely to monies that have been repatriated and, certainly in part, spent via a credit card. In later statements, it is suggested that since October 2010 Malcolm Fraser based in Hong Kong and Autonomous Communications Limited ("ACM"), also based in Hong Kong, have been paying the claimant's legal fees and assisting in the maintenance and school fees of the claimant' family. Considerable sums have been paid in this regard. The restraint order of 17 October 2012 required the claimant to provide details of the relationship between the claimant and ACM and, inter alia, if the monies have constituted a loan, copies of any loan agreements. In his statement of 29 January 2013 the claimant explained that he has a loan agreement with ACM. Despite a request on 25 March 2013 for copies of the relevant loan agreement or agreements, no documentation or further information has been provided.

Conclusions on the material provided to the judge

67. I am of the view against the background of the matters set out above, and particularly the multiple areas of significant uncertainty as regards the claimant's assets and the sources of his income over a significant period of time, that the following part of Ms Paget's Information was entirely justified:

JRR may argue that having already been searched there is no more information to be obtained. However, the remit of the search warrant for confiscation purposes is wider that the predicate one obtained, due to the 'lifestyle' enquiry underway and material relevant purely to the confiscation investigation would not have been gathered. Given both the extensive and multi-jurisdictional nature of JRR's affairs and his ability to live an apparently comfortable lifestyle in a desirable part of London without even a UK bank account it is likely he is administering his affairs from the UK now, and additional valuable evidence will likely be obtained by way of this application.

68. The lengthy rehearsal set out above of the many instances where there were uncertain and contradictory accounts by the claimant as to the precise details of his finances and property (and any related transactions), and those areas for which no documents or other details have been provided, or where there has been late disclosure, leads to the conclusion that the SFO was entitled to make this application without describing in any extensive detail the other areas in which information had been provided. Although the SFO must ensure the court receives a balanced presentation – including sufficient information on any relevant disclosure by the claimant – it would not have been of assistance or proportional to provide the judge with an account of the large amount of material that the claimant has furnished over the years in relation to other areas following various court orders. Given the length of time over which the precisely particularised complaints of non-disclosure had been made, coupled with the unexplained and unjustified instances of late disclosure, the SFO was entitled to focus on those failings in its application, together with any material that related to those complaints. Indeed, the non-disclosure of the source and the destination of the unexplained US $10 or 15 million that passed through the bank account for Deitrich International Ventures Inc would, standing alone, have justified these search warrants. The court was alerted to the claimant's present contention that he has provided other information but that does not undermine the legitimacy of the SFO's contention that as regards the matters highlighted in the Information there had been, as I have just observed, serious unexplained and unjustified failings on his part that extended over a considerable period of time. There is no evidence that as regards those issues there had been material non disclosure.
69. Therefore, I reject the criticisms that are made of this application for search warrants, which was sufficiently comprehensive, and it informed the judge (without descending into unreasonable and unnecessary detail) of the claimant's likely response. Given the particular circumstances of this case, it was a fair and balanced document. The other instances of disclosure by the claimant would not have assisted the judge on the specific issues raised by the SFO.
70. It follows I would refuse this application for judicial review.

Mr Justice Silber:

I agree.