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England and Wales High Court (Administrative Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Administrative Court) Decisions >> Serious Organised Crime Agency v Olden  EWHC 610 (QB) (25 March 2009)
Cite as:  Lloyd's Rep FC 375,  EWHC 610 (QB)
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QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL
B e f o r e :
| SERIOUS ORGANISED CRIME AGENCY
|- and -
MR IVAN KROLICK (instructed by MJP Justice Ltd) for the RESPONDENT
Hearing dates: 19th, 20th, 21st, 22nd, 23rd, 26th & 27th January, 2009
Crown Copyright ©
Mr Justice Holroyde:
a. Real property at Flat 4, Plas Dyffryn, Parc y Bryn, Aberystwyth ("4 Plas Dyffryn") and 1 Side Street, Penparcau, Aberystwyth (" 1 Side St");
b. The current balances in 2 National Westminster bank accounts held by Messrs Bishop & Light, solicitors who previously acted for Mr Olden;
c. A residential caravan at Aberystwyth Holiday Village;
d. A Mitsubishi Shogun car, Y104 ENN; and
e. The proceeds of sale of a Mazda car, CU52 XPA.
"We conclude that the judge did not address his mind to the question of PC Lodwig's state of mind, and that had he done so he should have concluded that he did not have material on which to find that PC Lodwig had the necessary suspicion. It follows in our view that the arrest was unlawful and that the interview and searches that resulted from the arrest were also unlawful. Since the material that was discovered by the police in the interview and by the searches was of considerable importance in the case, the appeal must succeed."
"The Respondent's case is that information and documents passed to the Claimant by the South Wales Constabulary, and any extracts of evidence at the criminal trial of the Respondent which is relied on by the Claimant, should be excluded as evidence in the trial, on the grounds that such information and documents was acquired by the South Wales Constabulary as a result of, and consequential to the unlawful arrest of the Respondent on 4th August 2004, and accordingly its retention by the police, and its use by the Claimant is unlawful, and in breach of the Respondent's Human Rights. "
"Because at this stage I want to cooperate with yourselves as much as possible and I don't see the need for a solicitor at this stage. However, I might need to speak to one later on."
In his evidence before me, Mr Olden said firmly that the answers he gave in interview were truthful, and if he got anything wrong it was only by genuine error.
a. Not very much money passed through the bank accounts in the name Olden, into which benefit payments were made. There was no challenge to her evidence on this point, and I infer from it that Mr Olden took deliberate steps to keep his assets in false names. That inference is strengthened by Mr Olden's admission in evidence that the debt which led to his bankruptcy remains unpaid, despite the very substantial sums of money which have passed through his hands in the intervening years.
b. She had identified as far as was possible the banking transactions referable to the property sales and purchases.
c. She has not been able to identify any source of funds coming into Mr Olden's hands except his benefit payments, the rental income he received from letting out his properties, the proceeds of selling properties, and winnings from gambling. She had not found any legitimate source of income since the date of Mr Olden's bankruptcy in March 1998, and Mr Olden (who, I note, has not paid any income tax since 1996) had not given her any evidence of any such legitimate income. Thus whilst she could not say that the moneys paid into the bank accounts were necessarily the proceeds of mortgage fraud, she had not been able to find any legitimate source for those moneys.
d. In addition to mortgage frauds, the only other type of deception which she could identify as possibly having been committed by Mr Olden was a failure to declare to the Revenue his income from freelance tax advisory work – if he did in fact receive any such income, as to which there was no evidence except what Mr Olden said.
e. All the mortgages were repaid, largely uneventfully (she had seen some correspondence about arrears, but nothing which seemed to her significant).
a. Treharne St was bought for £23,000 on 25.03.99 in the name Ellis, with 95% of the purchase price being provided by a mortgage advance from the Bradford & Bingley. The vendor was Paul Cooper, who signed the Land Registry form TR1 to confirm that he had received £23,000 from Ellis. It was sold on 13.10.06, the proceeds of sale being paid into one of the restrained bank accounts. I refer below to the evidence Mr Olden gave about this property. On the Bradford & Bingley application form Mr Olden made the following entries:
i. He gave the name and date of birth of Ellis.
ii. He left blank the space marked "any other name(s) used in the last 5 years"
iii. He said he was employed as an accountant by PCA Haulage at a salary of £30,800, and had been so employed for 9 years
iv. In the section for monthly outgoings, he wrote (or caused someone else to write) "Nil" next to "loans/credit agreements"
v. In response to the question "Have you experienced any financial difficulties such as mortgage or rent arrears within the last 3 years; bankruptcy …" he wrote "N/A".
vi. He gave a false NI number.
vii. In a part of the form dealing with his application for building and contents insurance he ticked "No" in answer to the question "Have you ever been … convicted of … any criminal offence …".
viii. He produced as evidence of identification a passport in the name Ellis. The copy of the passport application form (p372) shows that he had fraudulently obtained this passport with the assistance of Paul Cooper.
ix. He signed to confirm that the information he had given in this application was true. In fact, it was of course completely false.
x. He supported the application with a letter purporting to come from PCA Haulage and to be signed by the company secretary Elizabeth Chope. This too was entirely false.
b. Rushton Rd was bought for £42,000 on 17.06.99 in the name Ellis, with 80% of the purchase price being provided by a bridging loan from Cherry Tree Finance and the balance coming from one of the bank accounts. On 01.12.99 it was sold by Ellis to Batters for £48,000, 90% of which was advanced to Batters by Direct Line. On 22.08.01 Batters remortgaged the property to Bristol & West for £56,250. In his application to Bristol & West for this mortgage, in answer to the question "Have you ever … been made bankrupt?", Batters ticked the "No" box. Finally, on 19.04.04 it was sold by Batters for £86,000 and the net proceeds of £23,894 were paid into one of the bank accounts
c. Edward St was bought for £37,000 on 20.06.99 in the name Ellis, with 90% of the purchase price being provided by a mortgage advance from Abbey National and the balance coming from one of the bank accounts. The application form to Abbey National included the following: "I have never been bankrupt. I have never had a court order for debt registered against me. I have never failed to keep to a credit agreement or had a property repossessed". On 18.08.00 it was sold by Ellis to Batters for £58,000, with Batters taking out an Abbey National mortgage for £55,100. This released to Ellis equity of £21,172, most of which was paid into one of the bank accounts. On 17.05.04 the property was sold by Batters for £126,000, and the net proceeds of £66,487 were paid into one of the bank accounts.
d. Upperton Gardens was bought for £36,000 on 26.04.99 in the name Ellis: no details of the mortgage application are available. On 01.08.99 it was sold by Ellis to Dubrey for £45,000, 90% of which was a mortgage advance to Dubrey from Direct Line. On 06.07.01 Dubrey sold to Batters for £67,000, releasing equity to Dubrey of £23,978 which was paid into one of the bank accounts and later used to buy Llangyfelach Rd. Batters borrowed 85% of his purchase price from Bristol & West, the source of the deposit being untraced. Finally, on 23.10.03 Batters sold for £105,000: the net proceeds of sale were used to buy Llys Gwyn, with the remainder being paid into one of the bank accounts.
e. Gainsborough Rd, the subject of evidence to which I refer below, was bought for £69,000 on 04.06.99 in the name Ellis, with 90% of the purchase price being provided by a mortgage advance from Standard Life. On the application form, Dubrey claimed to earn £1,910 net per month, and named Mrs Chope of PCA Haulage as his employer's contact. He left blank the box next to the request to provide details "if you … have been bankrupt …". The property was sold on 23.11.04 for £112,772, the net proceeds of £55,966 being paid into one of the accounts.
f. Tower Bridge Rd was bought for £80,000 on 17.08.99 in the name Dubrey, with 90% of the purchase price being provided by a mortgage advance from Standard Life. It was sold on 11.12.02 for £147,000, with the net proceeds of £72,535 being paid into one of the accounts.
g. Llangyfelach Rd was bought on 04.09.00 in the name Dubrey, using money from the sale of Edward St. It was later mortgaged to Bristol & West Investments PLC along with 2 of the other properties. On 15.10.01 Dubrey sold this property to Batters for £24,500, nearly all of which was borrowed by Batters from Bristol & West: Dubrey used some of the proceeds to buy Hirwaun Pl, and the remainder went into one of the accounts. On 07.06.05 Batters sold for £65,000, and the net proceeds of £38,406 were paid into one of the accounts.
h. Adare St was bought for £11,000 on 06.01.00, in the name Dubrey. It was purchased outright with a deposit of £1,100 paid at auction and the balance (together with solicitor's fees) being paid out of one of the bank accounts. Mr Olden accepted in cross-examination that at the time of purchase he intended to raise a loan to cover at least part of the purchase price. On 25.02.00 Dubrey mortgaged the property to Blemain Finance for £5,300. On 17.03.00 Dubrey sold to Batters for £18,000: Batters borrowed £15,300 from Abbey National by way of mortgage, the deposit of £2,700 being paid from a source which cannot be identified. Finally, on 06.05.05 Batters sold the property for £39,000, with the net proceeds of £36,558 being paid into one of the accounts.
i. High St was bought for £14,000 on 27.03.00 in the name Dubrey. Part of the purchase price came from the proceeds of selling Adare St 10 days earlier; part came from the bank accounts; and there was a mortgage to Blemain Finance for £6,733. Although that was the evidence of Miss O'Brien, which I accept, Mr Olden in cross-examination said that he could remember the money borrowed from Blemain but could not say where the balance came from: he said "It would need a lot of thought", a proposition which I find impossible to accept in the circumstances of these proceedings, which have taken some time to come to trial and of course follow a lengthy criminal prosecution and appeal. On 17.11.00 Dubrey remortgaged this property and 2 others to Bristol & West Investment for a total of £38,500. On 11.05.01 Dubrey sold to Batters for £33,000, of which £28,000 was borrowed by Batters from Bristol & West. On 14.04.05 Batters sold the property for £50,000, and £47,588 was paid into one of the bank accounts.
j. 36 HGC was bought for £12,000 on 08.11.00 in the name Dubrey. The source of the purchase price was part of a mortgage advance from Bristol & West Investments: I accept the evidence of Miss O'Brien to that effect, notwithstanding that in cross-examination Mr Olden put forward a different account. He said that the property was bought for cash, and that he clubbed together with two friends to buy it. He did not name the friends, and he accepted that he had never previously advanced this account. He said that was because "I hadn't appreciated that SOCA were interested in where the money came from". Again, in the circumstances of these proceedings I find myself quite unable to believe that claim. On 29.06.01 Dubrey sold to Batters for £25,500, of which Batters borrowed £20,400 from Future Mortgages. On 22.04.05 Batters sold for £46,000, and net proceeds of £43,652 were paid into one of the bank accounts.
k. Kimberley Way was bought for £55,500 on 15.08.01 in the name Batters. Batters borrowed £47,175 from Bristol & West by way of mortgage; the source of the deposit of £8,485 cannot be identified. Batters sold for £102,000 on 27.05.05, and the net proceeds of £48,191 were paid into one of the bank accounts.
l. Llys y Brenin was bought for £70,000 on 04.09.01 in the name Batters. Batters borrowed £59,500 from Bristol & West by way of mortgage; the source of the deposit of £11,522 cannot be identified. Batters sold on 13.04.05 for £157,000: the proceeds of sale were used in part to redeem mortgages on High St, Adare St and HGC, and the balance of £21,401 was paid into one of the bank accounts.
m. Hirwaun Pl was bought for £15,000 on 16.10.01 in the name Dubrey. There was no mortgage: the purchase price was paid from the proceeds of the sale of Llangyfelach Rd on the previous day, together with £1,500 from one of the bank accounts. On 13.03.02 Dubrey sold for £12,000, and net proceeds of £10,253 were paid into one of the bank accounts.
n. Pavia Ct was bought for £40,750 on 27.11.01 in the name Batters. Batters borrowed £36,675 from Direct Line by way of mortgage; the source of most of the deposit of £4,350 cannot be identified. Batters sold for £66,750 on 14.11.03, and net proceeds of £26,912 were paid into one of the bank accounts.
o. Chandlers Ct was bought for £55,000 on 27.06.03 in the name Batters. Batters borrowed £49,500 from Direct Line by way of mortgage; the deposit and legal fees were paid using money from one of the bank accounts. In connection with this property, Mr Olden was anxious to make the point that in his criminal trial, prosecution evidence had been given to the effect that Direct Line did not lend to bankrupts, and that he had immediately telephoned Direct Line to confirm that that was not the case by posing as someone who was thinking of making an application for a mortgage. However, when asked for more detail about this, he had to accept that in his telephone call he had not said that in addition to being bankrupt he would be using a false name, a false date of birth and a false income when applying for the mortgage. Batters sold for £67,500 on 28.06.05, and net proceeds of £22,930 were paid into one of the bank accounts.
p. 1 Mayfair Ct was bought for £22,000 on 16.01.03 in the name Dubrey. There was no mortgage: the purchase price was paid with money from one of the bank accounts which represented part of the proceeds of selling Tower Bridge Rd about a month earlier. Dubrey sold for £23,000 on 23.06.03, and net proceeds of £22,598 were paid into one of the bank accounts.
q. Llys Gwyn was bought for £32,000 on 24.10.03 in the name Batters. There was no mortgage: the purchase price was paid using funds from the sale on the previous day of Upperton Gardens. On 06.05.05 Batters sold for £44,000, and net proceeds of £42,039 were paid into one of the bank accounts.
r. Fairview Ct was bought for £30,000 on 22.10.03 in the name Dubrey. There was no mortgage: the purchase price was paid using funds drawn from one of the bank accounts. On 05.05.04 Dubrey sold for £26,000, and net proceeds of £23,916 were paid into one of the bank accounts.
s. 4 Plas Dyffryn was bought for £155,000 on 19.12.05 in the name Batters, with the consent of the CPS and using money from one of the restrained bank accounts. I say more about this property below. At one stage it was contended by Mr Olden that the consent given by the CPS meant that the property could not be the proceeds of criminal conduct. That contention was, quite rightly, abandoned by Mr Krolick.
t. 1 Side St was bought for £77,000 on 11.07.07 in the name Olden, with the consent of SOCA and using money from one of the restrained bank accounts. I say more about this property below. As with 4 Dyffryn Place, a similar contention was initially advanced by Mr Olden but was not pursued before me.
a. Carole Orange of Bradford & Bingley said that although she did not know anything about Mr Olden's position, she could confirm that "had Ronald Olden, as an unemployed, undischarged bankrupt applied to Bradford & Bingley plc for a mortgage, his application would have been rejected".
b. Maurice Webb, the investigator whom I have already mentioned, said that Mr Olden had obtained 8 mortgages with Bristol & West using two false names. In his witness statement, he confirmed that "had Bristol & West been aware that any of the information given within the applications was false, and that the applicant was not who he claimed to be, that the applications would have been rejected and that no monies would have been advanced. If we had been aware that Ronald Olden was an undischarged bankrupt then we would not have lent him any monies". In his oral evidence he added that they expect the application form to be filled in truthfully: if someone does not tell the whole truth, it may alter the picture which the underwriter is considering. The very fact that Mr Webb began his investigation once he was contacted by the real Mr Batters is itself wholly impossible to reconcile with Mr Olden's claim that the false details he had given were immaterial to the granting of the advances.
c. Mr Stewardson, of Blemain Finance, accepted that Blemain at the material time was a sub-prime lender and did lend to persons with financial problems. He confirmed that for Blemain it was the value of the security, not the value of the person, which was important. They accepted self-declaration of income and would lend to a discharged bankrupt, though not (to his knowledge) to any undischarged bankrupt. He was cross-examined about publicity material which clearly suggested Blemain would be willing to lend despite other adverse lending: he said that the material was aimed at brokers and was intended to invite applications. But, he said, Blemain did have and apply their own criteria when considering a specific application, and "we would reject an application in a false name".
d. Rebecca Betts of Abbey National said she could confirm that "if Abbey National had been aware that any of the information or supporting documents in respect of any mortgage account application had been false, incorrect or misleading then the application would have been rejected and no monies would be advanced".
"(1) A person obtains property through unlawful conduct (whether his own conduct or another's) if he obtains property by or in return for the conduct.
(2) In deciding whether any property was obtained through unlawful conduct –
(b) it is not necessary to show that the conduct was of a particular kind if it is shown that the property was obtained through conduct of one of a number of kinds, each of which would have been unlawful conduct"
"s304: (1) Property obtained through unlawful conduct is recoverable property
(2) But if property obtained through unlawful conduct has been disposed of (since it was so obtained), it is recoverable property only if it is held by a person into whose hands it may be followed. …
S305: (1) Where property obtained through unlawful conduct ('the original property') is or has been recoverable, property which represents the original property is also recoverable property.
(2) If a person enters into a transaction by which –
(a) he disposes of recoverable property, whether the original property or property which (by virtue of this Chapter) represents the original property, and
(b) he obtains other property in place of it,
the other property represents the original property. …
S306: (1) Subsection (2) applies if a person's recoverable property is mixed with other property (whether his property or another's).
(2) The portion of the mixed property which is attributable to the recoverable property represents the property obtained through unlawful conduct.
(3) Recoverable property is mixed with other property if (for example) it is used –
(a) to increase funds held in a bank account,
(b) in part payment for the acquisition of an asset …
S307: (1) This section applies where a person who has recoverable property obtains further property consisting of profits accruing in respect of the recoverable property.
(2) The further property is to be treated as representing the property obtained through unlawful conduct."
"1. In civil proceedings for recovery under Part 5 of the Act the Director need not allege the commission of any specific criminal offence but must set out the matters that are alleged to constitute the particular kind or kinds of unlawful conduct by or in return for which the property was obtained.
2. A claim for civil recovery cannot be sustained solely on the basis that a respondent has no identifiable lawful income to warrant his lifestyle."
"I would emphasise the word 'solely' in the second declaration. Lack of lawful income to support the respondent's lifestyle may be a very relevant factor in painting the overall picture."
"Based on my current investigations of the Respondent and taking into consideration his previously spent convictions for 'Making a false statement or representation to obtain benefit' I believe that the source of this money is a further deception or deceptions by the Respondent."
"That house is not owned in any way by me and it is nothing to do with anything that's happened here. It's a house that a friend of mine has bought as an investment. … I had actually considered renting it from him and living in it myself because I wasn't sure I wanted to keep any of these properties. But he knows nothing whatsoever about this."