Carey Olsen litigator and managing partner, John Greenfield, has successfully argued a case in the Royal Court which has further extended the ability of victims of criminal conduct to be able to claw back assets held in the island.
Acting for Ikea, the victim in a high-profile bribery and corruption case, which saw jail terms for those involved, Advocate Greenfield was seeking an order that assets held in Guernsey bank accounts and the profits from the sale of a Guernsey property – all amassed as a consequence of a crime – should be considered as on "constructive trust" for the benefit of Ikea and therefore returned to that company.
Two Ikea employees were convicted of corruption in the UK when they took bribes from a third party and falsified invoices totalling £15.6 million to a company that had been set up to supply goods to Ikea. A third person, who had established the company, was convicted of bribery. Ikea had already recovered approximately £12.7 million through court proceedings in Liechtenstein.
The case before the Royal Court dealt with the remainder of the assets that had been placed in Guernsey by or on behalf of the third individual.
Royal Court Judge, Russell Finch, ruled that the assets in Guernsey were deemed to be on a "constructive trust" and should indeed be handed over to Ikea.
Ikea's application had been resisted on grounds which included the argument that Ikea could not assert the benefit of a constructive trust, or proprietary claim over the funds, because there had been no finding of fraud against the party in whose name (either directly or through a company) the funds were held. The Guernsey judge rejected that argument completely and held that Ikea's claim to the funds was upheld notwithstanding the lack of a finding of fraud.
Advocate Greenfield explained, this was a significant development in the weapons available to victims of criminal conduct who wished to claim assets held by third parties in Guernsey.
"The assets in Guernsey were the last piece of the jigsaw puzzle and the ruling means that victims of this type of crime, where the proceeds of crime have been channelled through companies and property transactions etc., will have a smoother legal path to claiming those assets without having to prove fraud before doing so," Advocate Greenfield said.
For more information about Guernsey's finance industry please visit www.guernseyfinance.com.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
