Civil Recovery Of The Proceeds Of Crime And Unlawful Conduct In Bermuda And The Cayman Islands: Recent Developments

• Published date: 13 June 2022
• Subject Matter: Finance and Banking, Litigation, Mediation & Arbitration, Criminal Law, Financial Services, Trials & Appeals & Compensation, White Collar Crime, Anti-Corruption & Fraud, Civil Law
• Law Firm: Conyers
• Author: Mr Alex Potts QC and Tonicia Williams

As leading international financial centres, both Bermuda and the Cayman Islands have detailed legislation in place providing methods for the civil recovery by Governmental agencies of the proceeds of crime and unlawful conduct, in the form of Bermuda's Proceeds of Crime Act 1997 and the Cayman Islands' Proceeds of Crime Act (2020 Revision) respectively, and associated procedural rules.

The Proceeds of Crime legislation provides the enforcement authorities in Bermuda and the Cayman Islands with an extensive armoury of legal tools by which to freeze, and to recover, property which is, or which represents, the proceeds of crime and unlawful conduct, applying just the civil standard of proof, even in the absence of a criminal prosecution or a criminal conviction.

These legal tools include, for example, the use of civil recovery orders, property freezing orders, interim receiving orders, and vesting and realisation orders.

The primary purposes of civil recovery proceedings are to ensure that property derived from criminal conduct is taken out of circulation and use, and to enforce a measure of recovery for the benefit of the state, and society at large.

As illustrated by the Cayman Islands' Director of Public Prosecution's Policy Guidance Notes dated 24 January 2020, civil recovery proceedings can be considered and pursued in a wide range of circumstances, including in cases where:

• the only known criminality has occurred outside of the jurisdiction, and the relevant offence does not attract extra-territorial liability so as to justify a local criminal prosecution;
• there is no identifiable living suspect who is within the jurisdiction, or who is realistically capable of being brought within the jurisdiction;
• proceeds of crime can be identified but cannot be linked to any individual suspect or offence;
• a law enforcement or prosecuting authority considers that there is insufficient evidence to justify a criminal prosecution or criminal conviction to the criminal standard of proof (i.e. beyond reasonable doubt), but sufficient evidence to satisfy the civil standard of proof (i.e. the balance of probabilities);
• a prosecution has been conducted, but has not resulted in a conviction, despite the apparent strength of the evidence;
• there appears to be an urgent need to take action to prevent offending, or secure the proceeds of crime, in advance of a future criminal prosecution;
• it is not practicable to investigate or prosecute all of those with a peripheral...