If you are travelling to the UK from outside of the EU or alternatively if you are leaving the EU you are obliged to declare any significant quantities of cash that you are carrying. Anyone travelling to the UK should also be aware of the draconian powers that enable the authorities to seize cash from them in the UK.
Declarations on entry or departure
Under EU law anyone who enters or leaves the EU carrying more than €10,000 (or the equivalent) in cash must make a declaration to the relevant authorities on arrival or departure. In the UK a failure to make such a declaration carries a penalty of up to £5,000. The cash may also be seized.
Powers of search and seizure – the law
Under the Proceeds of Crime Act 2002 any police, customs or immigration officer or any accredited financial investigator is entitled to search an individual or their property if they have ‘reasonable grounds for suspecting’ that they are in possession of ‘cash’ in excess of £1,000 that is either ‘recoverable property’ or is intended for use in ‘unlawful conduct’. If ‘cash’ is found they are entitled to seize and detain it if they have ‘reasonable grounds for suspecting’ that it is either ‘recoverable property’ or is intended for use in ‘unlawful conduct’.
Cash seizure – what that means in practice
First some definitions…
‘Cash’
For the purposes of the Proceeds of Crime Act ‘cash’ includes the following:
•Notes and coins of any currency
•Postal orders
•Cheques and travellers’ cheques
•Bankers’ drafts
•Bearer bonds and shares
•Other monetary instruments as specified by the Home Secretary
‘Recoverable property’
Recoverable property is simply defined as being any property that has been obtained through unlawful conduct.
‘Unlawful conduct’
Unlawful conduct is defined very broadly. It can include unlawful conduct in the UK or abroad if that conduct would also be unlawful in the UK.
The threshold for an officer to seize cash from an individual is remarkably low. Suspicion might arise because of the circumstances in which the cash is being carried or simply from the quantity of the cash in question. The officer is likely to interview you about the cash in order to determine where it is from and what it is for. If you are unable to satisfy the officer as to the source of the funds or of your intentions it is likely that the cash will be seized on the spot.
The investigation phase – the cash is detained
You should be given some paperwork by the officer, which confirms that the money has been seized under the Proceeds of Crime Act. The authorities can only hold the cash for an initial period of 48 hours. There must then be a court hearing to decide what happens next.
The authorities will generally ask for more time to investigate the cash that has been seized. The court can grant them up to 6 months at this first hearing. If the authorities need more time to investigate after this date they can reapply to the court for further extensions up to a maximum of 2 years.
During the investigation phase the authorities will try to gather more information as to the source of funds or its intended use.
Throughout this whole period the authorities will detain the cash.
The end game – forfeiture or release
At any stage during the investigation the authorities can apply to the court to keep the cash permanently. This is known as forfeiture. At the hearing the authorities must satisfy the court that the money is recoverable property or intended for use in unlawful conduct.
You can also apply to the court for the return of the cash. Obviously, you must be able to demonstrate the opposite – that the cash is neither recoverable property nor intended for use in unlawful conduct.
The test is considered on the balance of probabilities – i.e. ‘is it more likely than not?’
Conclusions
Despite the EU rules outlined above having been in force for many years now many travellers are still ignorant of the need to make the necessary declaration at customs when entering or leaving the EU. A failure to do so can have serious consequences.
It is also often a shock to individuals how easy it is for the UK authorities to summarily seize and detain cash. The process can be bewildering and if your cash has been detained you should obtain expert legal advice as soon as possible. It is often possible to secure the release of detained cash but it can take a significant amount of time to do so and it is important that your application for the return of the cash is expertly prepared.
An obvious solution to the potential pitfalls is not to carry large amounts of cash. However, there are times where this is simply unavoidable or where you might have good reason for wanting to hold cash.
Anyone who plans to travel in or out of the UK with large amounts of cash should take consider taking legal advice in advance in order to minimise the risk of it being seized.