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||Neutral Citation Number:  EWHC 31 (Admin)
||Case No: CO/5909, 5971, 5979 and 6548/2011
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION. ADMINISTRATIVE COURT
ON APPEAL FROM
(1) District Judge Tubbs (20.4.2011)
(2) District Judge Tubbs (4.5.2011)
||Royal Courts of Justice
Strand, London, WC2A 2LL
B e f o r e :
Mr Justice Simon
Mr Justice Wilkie
|| Ujwal Jethwa
The Government of the United States of America
Mr Matthew Radstone (instructed by Dobsons Solicitors) for Ujwal Jethwa
Mr Julian Atlee of Atlee, Chung and Company for Michaela Berney
Mr Joel Smith (instructed by Tuckers Solicitors) for Asif Khan
Mr Nicholas Yeo (instructed by Blackfords LLP) for Ali Kanuga
Mr Daniel Sternberg (instructed by the CPS) for the Respondent
Hearing date: 13 December 2011
HTML VERSION OF JUDGMENT
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Mr Justice Simon:
- These are appeals brought under s.103 of the Extradition Act 2003 from the decisions of District Judge Tubbs dated 20 April 2011 in the case of Mr Khan, Mr Jethwa and Ms Berney, and dated 4 May 2011 in the case of Mr Kanuga, sending the cases to the Secretary of State for her decision as to whether they should be extradited.
- The extradition of each of the appellants to the United States of America has been sought in a request supported in an affidavit sworn on 16 November 2010 by Matthew L Swartz, an assistant US Attorney for the Southern District of New York. The exhibits to this affidavit in each case comprise a number of supporting documents.
- Exhibit A is a sealed indictment returned by a grand jury in the United States District Court for the Southern District of New York on 4 November 2010, superseded by an indictment returned by the grand jury on 1 September 2011. The indictment contains 9 counts: count 1 (conspiracy to commit bank and wire fraud), count 2 (bank fraud), count 3 (wire fraud), count 4 (conspiracy to commit access device fraud), count 5 (access device fraud), count 6 (access device fraud – device-making equipment), count 7 (access device fraud), count 8 (conspiracy to commit international money laundering), count 9 (aggravated identity theft). Exhibit B is a warrant for the arrest of each of the appellants. Exhibit C contains the provisions of the relevant law of the United States of America. Exhibit D is a photograph of the appellants.
The facts relied on
- The appellants are alleged to have been part of a conspiracy to defraud and to launder money. The prosecution case is that the conspirators stole or took possession of point of sale access card reader devices and replaced the stolen devices with dummy devices which did not function. 'Skimmers' would then be inserted into the card readers to record the data on cards inserted into the devices and the Personal Identification Numbers (PINs) on those cards. The conspirators then returned and replaced the dummy devices with the adapted card readers. These adapted devices were then used to steal card data and PINs.
- An example of this activity occurred on 24 January 2010 when Mr. Kanuga, Mr. Jethwa and Ms Berney entered a shop in Amsterdam called 'Vero Moda' and stole one of the access device readers. On the same day the stolen device was modified by two other members of the conspiracy named as Irfan Khan (not Asif Khan) and Zeshan Mian. The modifications included the addition of a GSM chip in the card reader which could be used to transmit messages, including SMS or 'text' messages and data, over a mobile phone network. On or around 25 January 2010 the altered device was then returned to 'Vero Moda' by Mr Kanuga and others.
- Mr Khan was among the members of the alleged conspiracy who travelled to New York to orchestrate the withdrawal of cash from Automated Teller Machines (ATMs), which included providing instructions to participants in the conspiracy on how to conduct the ATM transactions.
- On 6 and 7 March 2010 Mr Jethwa and Mr Khan together with others, withdrew cash from accounts that were not their own at approximately 85 different locations in New York City. There were at least 1,110 transactions and a total of approximately $260,000 in cash was withdrawn. The transactions took place within a very short space of time, and were carried out using fraudulently obtained access devices including account numbers and PINs. These included access devices which had been obtained using the altered device that had been placed in the 'Vero Moda' shop in Amsterdam in January 2010.
- The money fraudulently obtained in this way was then laundered out of the USA. A number of different methods were used. On 10 March 2010, in New York, Mr Khan discussed with Mr Jethwa the possibility of using an informal money exchange system to remove the money.
- On 12 March 2010 Mr Jethwa and others travelled from New York City to Toronto carrying cash that had been fraudulently obtained. On the same date a co-conspirator received approximately $9,000 in New York which had been fraudulently obtained. This co-conspirator transferred the money in a series of smaller transactions via Western Union to Mr Jethwa (using another name) in the United Kingdom. Additionally, money was sent out of the USA using an informal banking system known as 'Hawala' banking. This involved the transfer of value from sender to recipient without the movement of funds or exchange of promissory financial instruments.
- In summary, the allegation against the Appellants is that they and others, participated in a conspiracy to defraud, which was carried out by stealing and adapting point of sale devices including the one in Amsterdam; and that the access devices, including account details and PINs, which were fraudulently obtained in pursuance of the conspiracy were used to withdraw large sums of money in New York. The Appellants and others are also alleged to have conspired to conceal the proceeds of their fraudulent activity and to transfer it out of the United States.
Proceedings in the United States
- On 4 November 2010 a Federal Grand Jury in the Southern District of New York returned an indictment against the appellants and others, charging the 9 counts described above. On the same date Magistrate Judge Gabriel Gorenstein of the United States District Court for the Southern District of New York issued Warrants for the arrest of each of the Appellants based on the indictment of the Grand Jury (Exhibit B, referred to above).
Proceedings in the United Kingdom
- The substantive extradition hearing in the case of Ms Berney, Mr Jethwa and Mr. Khan took place before District Judge Tubbs on 16 February 2011. The District Judge heard evidence from Ms. Berney and submissions from all parties on the issues raised and reserved judgment. On 20 April 2011 she gave a written judgment in which she rejected the arguments raised on behalf of these appellants, and sent their cases to the Secretary of State for her decision on whether their extradition should be ordered.
- The final extradition hearing in the case of Mr Kanuga took place on 4 May 2011, with submissions being made by both sides in substantially similar terms to those made earlier on behalf of Mr. Khan and Mr. Jethwa. The District Judge gave judgment at the conclusion of this hearing in which she rejected the arguments raised on behalf of Mr. Kanuga and sent his case to the Secretary of State.
- The Secretary of State ordered the extradition of Ms. Berney, Mr. Jethwa and Mr. Khan on 13 June 2011, and Mr Kanuga 28 June 2011.
The statutory provisions
- Section 78 sets out the initial stages of the extradition hearing.
(2) The Judge must decide whether the documents sent to him by the Secretary of State consist of (or include) -
(a) the documents referred to in section 70(9); [the request and the Secretary of State's certificate]
(b) particulars of the person whose extradition is requested;
(c) particulars of the offence specified in the request;
(d) in case of a person accused of an offence, a warrant for his arrest issued in the category 2 territory ...
(3) If the Judge decides the question in subsection (2) in the negative he must order the person's discharge.
(4) if the Judge decides that question in the affirmative he must decide whether -
(a) the person appearing or brought before him is the person whose extradition is requested
(b) the offence specified in the request is an extradition offence;
(c) copies of the documents sent to the judge by the Secretary of State have been served on the person.
(6) If the judge decides any of the questions in subsection (4) in the negative he must order the person's discharge.
- Section 87 is concerned with a consideration of the appellants' Human Rights.
(1) If the judge is required to proceed under this section (by virtue of section 84 [where the person has not been convicted] ...) he must decide whether the person's extradition would be compatible with the Convention rights within the meaning of the Human Rights Act 1998.
(2) If the judge decides the question in subsection (1) in the negative he must order the person's discharge.
(3) If the judge decides that question in the affirmative he must send the case to the Secretary of State for his decision whether the person is to be extradited.
- Section 137 defines an extradition offence for the purpose of s.78(4)(b), where the person is accused rather than subject to a sentence.
(2) The conduct constitutes an extradition offence in relation to the category 2 territory if these conditions are satisfied
(a) the conduct occurs in the category 2 territory
(b) the conduct would constitute an offence under the law of the relevant part of the United Kingdom punishable with imprisonment ... for a term of 12 months ...
(c) the conduct is so punishable under the law of the category 2 territory (however it is described in that law).
(4) The conduct also constitutes an extradition offence in relation to the category 2 territory if these conditions are satisfied
(a) the conduct occurs outside the category 2 territory and no part occurs in the United Kingdom
(b) the conduct would constitute an offence under the law of the relevant part of the United Kingdom punishable with imprisonment ... for a term of 12 months ...
(c) the conduct is so punishable under the law of the category 2 territory (however it is described in that law).
The issues raised on the appeal
Mr Jethwa and Mr Khan
- Mr Smith (on behalf of Mr Khan) supported by Mr Radstone (on behalf of Mr Jethwa) limited his challenge to counts 3, 6 and 8. He advanced the argument on two interlinked bases. First, the conduct alleged in these counts was insufficiently particularised. Secondly and consequently, this meant that the Court could not be satisfied that they were extraditable offences.
- Mr Smith referred to the case of Dudko v. The Government of the Russian Federation  EWHC 1125 (Admin) which established the principle that the test under s.78(2)(c) in Part 2 of the Act should be read as including 'the more comprehensive phraseology used in s.2(4)(c)' as applied in Part 1 cases.
- Section 2(4)(c) of the Act requires,
Particulars of the circumstances in which the person is alleged to have committed the offence, including the conduct alleged to constitute the offence, the time and place at which he is alleged to have committed the offence and any provision of the law of the category 1 territory under which the conduct is alleged to constitute an offence.
- There is no issue as to the law of the United States as it applies to the offences charged in the indictment. However, Mr Smith submitted that the section 2(4)(c) criteria was the bare minimum of what must be shown in a Part 2 case. He pointed to the decision in Von der Pahlen v. The Government of Austria  EWHC 1672 (Admin) where Dyson LJ said  that the language of s.2(4)(c) should be given its plain and ordinary meaning.
The subsection requires the warrant to obtain particulars of the circumstances in which the person is alleged to have committed the offence. These particulars must include four elements: (1) the conduct alleged to constitute the offence; (2) the time, and (3) the place where he is alleged to have committed the offence; and (4) any provision of law under which the conduct is alleged to constitute an offence ... The difficulties in the present case centre on element (1). The use of the word 'particulars' indicates that a broad omnibus description of the alleged criminal conduct, 'obtaining property by deception', to take an English example, will not suffice.
- He also relied on Ektor v. National Public Prosecutor of Holland  EWHC 3106 (Admin) and the judgment of Cranston J at  in which he said,
... the person sought by the warrant needs to know what offence he is said to have committed and to have an idea of the nature and extent of the allegations against him in relation to that offence. The amount of detail may turn on the nature of the offence. Where dual criminality is involved the detail must also be sufficient to enable the transposition exercise to take place.
- Mr Smith drew attention to the affidavit of Mr Schwartz at §24 in which he set out the elements of count 3 (wire fraud):
(1) A scheme or artifice to defraud or obtain money or property by materially false and fraudulent pretences, representations or promises, (2) [the accused] knowingly and wilfully participated in the scheme or artifice to defraud, with knowledge of the fraudulent nature and with specific intent to defraud, and (3) in execution of that scheme [the accused] used or caused the use of interstate wires.
He submitted that there was no indication of how Mr Khan was said to have been involved in such a scheme or how any relevant transmission occurred.
- For the Respondent, Mr Sternberg submitted that the time was specified (from at least in or about March 2010 through to about August 2010) and the place was specified (the Southern District of New York). The conduct was dealt with in the particulars of count 3 of the indictment,
[Irfan Khan, Kanuga, Jethwa, Berney and others known and unknown] stole and transmitted via electronic mail, text message, and telephone to Jethwa and Asif Khan and others known and unknown, fraudulently-obtained access devices that Jethwa, Asif Khan, and others known and unknown, used to withdraw cash ...
- Mr Sternberg argued that it was clear from Mr Schwartz's affidavit that the case against the Appellants was that the 1,110 fraudulent withdrawals in New York City were made using stolen account information obtained in the Netherlands and the United Kingdom.
- Count 6 charges the offence of Access Device Fraud (device making equipment). In §13 of the Indictment it is said the Appellants,
unlawfully, wilfully and knowingly, and with intent to defraud, in an offense affecting interstate and foreign commerce did produce, traffic in, have control of and custody of and possess device making equipment, to wit, Jethwa and Asif Khan and others known and unknown, had control and custody of , and possessed equipment to make counterfeit access devices using fraudulently obtained access devices.
- Mr Smith submitted that it was unclear what conduct was being alleged against his client; and, in particular, how, when and where the device-making equipment was used?
- Mr Sternberg argued that it was necessary to look at the entirety of Mr Schwartz's affidavit. What was alleged was that Mr Khan and his associates must have cloned at least 15 cards, and they must have had device-making equipment in the US in order to have gained access to the cash from the ATMs in New York City. There was nothing to suggest that the device-making equipment was used anywhere else.
- This is a charge of Conspiracy to Commit International Money Laundering. Mr Smith submitted that the conduct alleged against his client was insufficiently particularised for him to understand the case against him. In §9 of his affidavit, where Mr Schwartz deals with the money-laundering conspiracy, there is no mention of Mr Khan; and in §17 of the Indictment, which deals with the overt acts carried out pursuant to the conspiracy all that is said about Mr Khan's involvement is that,
On or about March 10, 2010, while in New York ... Asif Khan spoke to Jethwa, and others known and unknown, about moving money, which had been obtained from other people's bank accounts using fraudulently-obtained access devices, outside the United States through the use of an informal money exchange system.
Mr Smith complained that there was no detail of what was said.
- Mr Sternberg submitted that it was clear that what was being alleged against Mr Khan and Mr Jethwa was that, as part of the money-laundering conspiracy, they had been in contact about the way in which the fraudulently obtained money was to be realised. He relied on the case of Lacorre v. High Instance Court of Paris  EWHC 2871 (Admin) at  where the Court concluded that conversations between conspirators planning or in pursuit of the conspiracy taking place in a particular country were sufficient to ground an extradition offence of conspiracy.
- It was Mr Smith's further submission that the insufficient particulars of the conduct relied on meant that the Court could not be satisfied that the offences charged were extradition offences within the meaning of s.137 of the Act: namely, conduct which was criminal in the United Kingdom at the time when the alleged offence was committed.
- Mr Sternberg submitted that there was sufficient particularisation to establish that the offences were extradition offences.
- It was the contention of Mr Yeo (on behalf of Mr Kanuga) that the District Judge was wrong in her conclusions both as to the sufficiency of particularisation and whether the charges were extradition offences. The allegations in relation to Mr Kanuga were not clearly articulated. The only direct reference to him was in relation to the theft of the electronic access card reader from 'Vero Moda' in Amsterdam on 24 January 2010 and the return of the doctored device the following day. He pointed out that §§6 and 7 of Mr Schwartz's affidavit introduced this allegation as 'an example' of conduct which might be relied on, thereby introducing uncertainty as to whether, and to what extent, further conduct might be relied on. He described it as 'a device to widen the scope' of conduct which would be relied on after Mr Kanuga's extradition.
- Mr Yeo relied on an observation in Sandi v, Craiova Court  EWHC 3079 (Admin) at  that in a Part 1 accusation warrant,
A significant level of particularisation is required to enable the person sought to be extradited to identify exactly what he might face at trial.
Like Mr Smith and Mr Radstone he relied on the argument about particularisation to reinforce his argument under s.137 that the extent to which these were extradition offences was unclear, particularly since it was not said that he went to the United States.
- In reply Mr Sternberg submitted that the use of the phrase 'for example' did not introduce uncertainty or lack of specificity. The charges were no broader than the indictment. This was made clear from §16 of Mr Schwartz's affidavit
The United States requests the extradition of Kanuga for the offences charged in counts 1-9.
He argued that the indictment was clear in its terms. So far as the conspiracy counts was concerned, certain specified overt acts were relied on which limited the effect of any reference to 'for example' in Mr Schwartz's affidavit. If the charges were to be extended, the permission of the Secretary of State would be sought, as it would in any other case where a specialty issue arose.
- Mr Atlee's submissions were also directed to all the counts on the indictment and were similar to those on behalf of Mr Kanuga. He observed that, in the case of Ms Berney, the only direct allegation was confined to an involvement in stealing the electronic access card reader from 'Vero Moda' in Amsterdam. He went through each count, and submitted that there was a singular lack of any particularisation as to where, how and in what way she was involved in the alleged offences; there being no suggestion that she was ever in the United States or Canada. He submitted that only impermissible guess-work would fill in what was otherwise a complete lack of particularisation. Mr Atlee relied on an observation of Pitchford J (as he then was) in Lacorre v. High Instance Court of Paris  EWHC 2871 (Admin) in which it was stated at  before a review of the authorities,
It is open to this court to draw natural inferences, but not by guesswork, to fill an obvious gap in the information provided in the warrant.
- Mr Sternberg submitted that Ms Berney's role was clearly set out in the Indictment: either as a conspirator with an assigned role or as an aider or abetter to the substantive offences.
- Although a number of cases were cited, the principles which apply in this case can be stated relatively shortly
i) Section 78(2)(c) in Part 2 of the Act requires the same degree of particularisation as is required in s.2(4)(c) in Part 1 of the Act; see Dudko (above), Thomas LJ at .
ii) The particulars in s.2(4)(c), and thus s.78(2)(c), must include the four elements described by Dyson LJ in Von der Pahlen (see above)
(1) the conduct alleged to constitute the offence; (2) the time, and (3) the place where he is alleged to have committed the offence; and (4) any provision of law under which the conduct is alleged to constitute an offence ... The use of the word 'particulars' indicates that a broad omnibus description of the alleged criminal conduct, 'obtaining property by deception', to take an English example, will not suffice.
Like Dyson LJ at , I would not be prescriptive about how far the warrant or request should go. It is likely to depend on the facts of the case.
iii) In practical terms, as Cranston J said at  in Ektor (see above), the request must,
set out a description, not in legal language, of how the alleged offence is said to have occurred. In particular, the description must include when and where the offence is said to have happened and what involvement the person named in the warrant had … A balance must be struck between, in this case, the need on the one hand for an adequate description to inform the person, and on the other the object of simplifying extradition procedures. The person sought by the warrant needs to know what offence he is said to have committed and to have an idea of the nature and extent of the allegations against him in relation to that offence. The amount of detail may turn on the nature of the offence. Where dual criminality is involved, the detail must also be sufficient to enable the transposition exercise to take place.
See also Sandi (above) at 
iv) I am doubtful whether the requested person has to be informed 'exactly' the case he has to meet at trial as was suggested in Sandi.
v) It is open to the Court to fill an obvious gap in the information provided in the warrant or request by natural inferences, but not by mere guesswork, see Pitchford J in Lacorre (see above) at  and the cases there cited.
vi) When considering whether it is an extradition offence the Court is not concerned with where the offence was committed, see the speech of Lord Hope in Cando Armas.
 … It is now well established that the physical presence of the defendant in the territory is not required so long as the effects of his actions were intentionally felt there. That rule is matched by its corollary which is that, if the effects of those actions were intentionally felt here, criminal jurisdiction can be exercised in respect of their effect irrespective of where the actions took place that gave rise to them.
 … Actings elsewhere will be sufficient to constitute conduct in that territory so long as their intended effect was to bring about harm within that territory …
vii) The importance of the effect of the conduct and the place where it occurs applies to a joint enterprise case, see Pill LJ in Jeffrey Tesler v The United States of America  EWHC (Admin) 52 at .
The effect of the appellant's involvement in a joint enterprise with United States entities acting in the United States, provided the necessary connection. The sophistication of the scheme does not defeat that connection and neither does the cross-border aspect of the case or the involvement of entities from other jurisdictions.
viii) The conduct does not have to give rise to the same offence in English law; but the same conduct that gives rise to an American offence, must give rise to an English offence, see Mauro v. The United States of America  EWHC 150 (Admin) Maurice Kay LJ at . See also at ,
The court has to be satisfied (to the criminal standard: section 206) that 'the conduct would constitute an offence' under the law of England and Wales: section 137(2)(b). This does not mean that the requesting state must prove the guilt of the person in English law. That would be absurd and would be a higher test than the prima facie case which had to be established under earlier legislation. The words 'would constitute an offence' simply mean 'would, if proved, constitute' the English offence.
- Counts 1, 4 and 8 are charges of conspiracy. As Mr Schwartz says in his affidavit to convict the appellants of conspiracy the Prosecution would have to prove that, (1) two or more persons entered an agreement to commit the underlying offence (for example, bank fraud or international money laundering), (2) the requested person knowingly became a member of that conspiracy to commit the underlying offence, (3) at least one co-conspirator committed one overt act in furtherance of the conspiracy.
- The indictment describes the time and the place of the conspiracy and an overt act is set out in relation to the Appellants Jethwa and Khan. In the words of Cranston J in Ektor at  the Appellants know what offences they are said to have committed, and the nature and extent of the allegations against them. In my view the request properly particularises the conduct of these Appellants in relation to these three conspiracies. The same is true of the Appellants Kanuga and Berney in respect of counts 1 and 4. In respect of count 8 however the only conduct alleged against them is entirely separate from the substantive offence of money-laundering and so cannot be said to particularise such an offence committed by either of them.
- In relation to counts 2, 5, 7 and 9, the charge against Ms Berney and Mr Kanuga is not that they were directly involved as primary participants, but that they were aiding and abetting the substantive offences by their conduct. It is clear that those who are involved in stealing credit card details do so for illegal purposes. Such illegal purposes include bank fraud, access device fraud and identity theft. In my view the request properly particularises the conduct alleged to constitute the offence, the time and the place (in each case the State of New York) where these two Appellants are alleged to have committed the offence, as well as the nature and extent of the allegations against them.
- In the light of these conclusions it is unnecessary to deal separately with the arguments as to whether counts 1, 2, 4, 5, 7, 8 and 9 are extradition offences.
- For count 3 (substantive wire fraud) the Prosecution must show that the Appellants used interstate wires or caused them to be used. In relation to this count, I accept the submissions of the Appellants and for the reasons they advanced. In my judgment the conduct required to be shown is not present.
- For count 6 (access device fraud) the Prosecution must show that the Appellants 'produced, trafficked in, had control or custody of, possessed, or attempted to produce or traffic in or possess device making equipment.' It is likely that such device making equipment was used; but this is not a matter on which the Court should be invited to speculate or guess. In my judgment the conduct required has not been sufficiently particularised.
- Accordingly I would allow the appeal of all the Appellants in relation to counts 3 and 6, and I would allow the appeal of Mr Kanuga and Ms Berney in respect of count 8. I would otherwise dismiss the appeals of all the Appellants, with the consequence that all the Appellants should be discharged in relation to counts 3 and 6. In addition, Mr Kanuga and Ms Berney should be discharged in relation to count 8; and the extradition should proceed in respect of all Appellants on counts 1, 2, 4, 5, 7 and 9 and in addition in respect of Mr Jethwa and Mr Khan in respect of count 8.
Mr Justice Wilkie:
- I agree.
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