Implementing unexplained wealth orders in South Africa – what are the options?

This paper aims to focus on the use of unexplained wealth orders (UWOs) in South Africa as a civil method to act upon lifestyle audit results that have indicated wealth from unknown, possibly unlawful, sources.

This paper applied a comparative methodology. Legislation and the application of UWOs in Ireland, the UK and Australia were compared with the situation in South Africa.

It is proposed that South Africa includes UWO legislation within its Prevention of Organised Crime Act or be established as a separate piece of legislation. Also, South Africa should follow both the civil and criminal route to target the proceeds of crime.

Corruption in South Africa is rampant and, without the necessary legislation, impossible to fight. For these purposes, this paper proposes measures to be used from a civil forfeiture perspective.

Since the 1990s, immense focus has been placed by scholars not only on prosecuting criminals but also on depriving them of their criminal wealth. The acquisition of money through criminal activities is usually financially motivated (Van Jaarsveld, 2011); hence, the common argument: If a conviction results in a prison sentence, as well as the removal of the proceeds, the motivation will be eliminated (Alexander, 2015, p. 36). Murray (2015, p. 42) concurs by stating that criminals should not benefit from their crimes.

In the literature, different terms are used for the concept of criminal wealth: “proceeds of crime” (Proceeds of Crime Act 2002, UK; Young, 2009); “illicit financial flows” (Goredema, 2011); “illicit proceeds” (Kroeker, 2014); “unexplained wealth” (Rider, 2015); and “illicit enrichment” (Abu-Morad et al., 2016; Susanti, 2015; Wilsher, 2006). The South African Prevention of Organised Crime Act 1998 (POCA SA) refers to the “proceeds of unlawful activities”, while the Prevention and Combating of Corrupt Activities Act 2004 (PRECCA) refers to “illicit acquisition of personal wealth”.

To curb and recover criminal wealth, the United Nations Convention Against Corruption (UNCAC) (Article 20) proposes the criminalisation of illicit enrichment, which is defined as “a significant increase in the assets of a public official that he or she cannot reasonably explain in relation to his or her lawful income” (UNODC [United Nations Office on Drugs and Crime], 2004). It is, however, listed as a mandatory crime, subject to signatory country’s constitution and fundamental principles. Therefore, international consensus seems to support the reversing of the ownership of criminal wealth as a tool to combat financially motivated crime (Alexander, 2015, p. 36). Many signatory countries have criminalised illicit enrichment, while those who have not, have opted for civil action as an alternative.

Two examples are the UK and Australia who target the proceeds derived from criminal activities through unexplained wealth order (UWO) laws – a civil confiscation and forfeiture jurisprudence. With UWOs, the state shifts the burden of proof to the owner of a property who needs to prove the legitimacy of the source of funds used to acquire such property (Booz Allen Hamilton, 2011, p. 1). This allows for individuals to be held liable for forfeiture of assets related to unaccounted wealth (Bell et al., 2012, p. 5), and it allows the state to identify, seize and confiscate assets which are not in proportion to an individual’s standard of living.

Soopramanien (2018, p. 51) explains the rationale behind the implementation of UWOs. Firstly, it acknowledges the challenges associated with criminal proceedings against sophisticated criminals by decriminalising the judicial procedure; secondly, it deprives criminals of the financial reward connected with their criminal activities. UWOs have successfully been introduced in Ireland, Columbia and Australia as a mechanism for overcoming the obstacles encountered in asset recovery cases (Soopramanien, 2018, p. 46). UWOs are aimed at anyone suspected of being involved in serious and organised crime and are not limited to public officials as per the illicit enrichment definition (Keen, 2017, p. 11).

In August 2022, the South African Revenue Service (SARS) announced a new initiative to confiscate criminal proceeds in line with the Financial Action Task Force (FATF) recommendation. This recommendation – under Chapter 3: Legal System and Operational Issues, immediate outcome 6(f) – states that the Financial Intelligence Centre (FIC), the South African Police Service and SARS should cooperate effectively and form task teams to address major predicate offenses, money laundering and terrorist investigations [FATF (Financial Action Task Force), 2021].

This new initiative, to be led by the FIC, will consist of SARS, the National Prosecuting Authority (NPA), the Directorate of Priority Crime Investigation and the Department of Justice and operate under the auspices of the anti-corruption task team. The aim is to make it more cost effective, faster and easier to investigate and recover assets acquired through suspected illicit activities such as corruption, fraud, tax evasion and money laundering.

The initiative will also investigate whether existing South African legislation can be effectively used for such purposes or whether a separate UWO legislative framework, as seen in the UK, Ireland and Australia, is needed. Finally, the initiative will test how inter-agency cooperation can be operationally achieved to expand the limits of current legislation by creating case law through court proceedings.

This article focuses on the use of UWOs in South Africa. It investigates the possibility of applying a civil method to act upon lifestyle audit results that have indicated wealth from unknown sources, possibly being criminal wealth. The research methodology entailed a comparative study between South Africa and Ireland, the UK and Australia. The latter three countries were selected as they have successfully implemented strategies to address the UNCAC’s provisions. The article comprises four sections following the introduction; an overview of the application of UWOs in Ireland, Australia and the UK; a discussion on the possible application of UWOs in South Africa; and a conclusion with recommendations.

The confiscation of assets can take one of two legal routes. In a conviction-based confiscation, the accused is deprived of their assets based on the crimes they have been convicted of. A non-conviction-based forfeiture is brought as an action against the property itself, or in rem, and requires the State to prove that the property is the instrumentality or proceeds of a crime (Booz Allen Hamilton, 2011, p. 1). Although they are classified under non-conviction-based asset confiscation, UWOs differ from traditional non-conviction-based asset forfeiture in some respects, such as the reverse burden of proof (Bell et al., 2012, p. 5) where the owner bears the onus of proving the property was obtained legally (Martini, 2015).

Countries applying such or similar provisions include the UK, Australia, Ireland, Italy and Bulgaria (Moiseienko, 2022). These provisions aim to deprive criminals of acquiring or benefiting from unlawful activities. Therefore, the forfeiture procedure is instituted against a person and not a property and the State does not have to prove that the property in question is a proceed of crime (Martini, 2015).

Many authors have written about the human rights element of applying the reverse burden of proof (Boles, 2014; Peters, 2018; Wilsher, 2006). In two instances, related to the policies of Italy and Georgia, the European Court of Human Rights (ECtHR) ruled that the right to enjoyment of one’s possessions is proportionate to the objective of the policies applied. In Georgia, if a public official is charged with an economic crime, it is presumed that their property constitutes the proceeds of crime. Therefore, in non-conviction-based confiscations the ECtHR is willing to uphold presumptions of criminal origin if they are justified by a pressing social need (Moiseienko, 2022).

Following the deaths of a crime reporter and a detective at the hand of organised criminals, the Irish public was eager to support criminal laws. The 1996 Proceeds of Crime Act (POCA [Ireland]) received no legal challenges from civil parties or private bar organisations, and concerns raised by academics and other organisations were not strong enough to challenge the new Act (Keen, 2017, p. 10).

In 1996, Ireland was the first European country to legislate a civil forfeiture regime. The Irish two-pronged approach in dealing with illicit wealth is underpinned in POCA (Ireland) and the Criminal Assets Bureau Act 1996. The term “UWO” is not used explicitly, and although the legislation has features similar to the UWO concept (Reurts, 2017), it also contains unique procedures, making it difficult to classify (Dornbierer, 2021, p. 82). Nevertheless, it has proven to be a successful tool in recovering the proceeds of crime (Dornbierer, 2021, p. 82).

In terms of POCA (Ireland) – which is based in civil procedure – the court may, on application by an authorised officer, make an order under section 2 which requires the respondent to prove that the property in question is not the proceeds of criminal conduct. This order will apply for 21 days, unless an application under section 3 can be brought which will apply for up to seven years (Keen, 2017, p. 9). To make the order, the court must be satisfied that the specified person is in possession or control of the said property which constitutes, directly or indirectly, the proceeds of crime or was acquired with proceeds of crime, and of which the value is not less than £13 000 (section 4 of Proceeds of Crime [Amendment] Act 2016). In terms of section 8, the court may further rely on “belief” [¹] evidence submitted by the law enforcement officer. Furthermore, under section 9, the court may request the respondent to furnish an affidavit specifying the property of which they have possession or control, as well as the respondent’s income or sources of income, which includes the reverse onus mechanism as seen in similar unexplained wealth laws of other countries.

The Criminal Justice (Corruption Offences) Act (2018) has a provision under which a presumption of corrupt enrichment can be made regarding property held by a public official. If a public official, during the proceedings of a separate corruption offence, is found to have failed to declare the property in their Statement of Registrable Interests, the presumption can be made that the property was illicitly derived from an act in relation to their time in office, unless the contrary is proved (section 16).

Booz Allen Hamilton (2011, p. 1) states that Ireland is the most successful country in relation to the system of UWOs, as the 2005 amendment to POCA (Ireland) contained the establishment of a specialised body responsible for implementing the rules, the Criminal Assets Bureau (CAB) (Martini, 2015).

Ireland has a relatively high success rate in civil-based confiscation proceedings, and research indicates that criminals might be moving their illicit gains to other jurisdiction in fear of seizure (Reurts, 2017). With its high level of awareness among the public, the CAB is thus seen as a robust and effective tool against organised criminals (Keen, 2017, p. 10).

From 2017 to 2021, the CAB has reported confiscation under section 2 of €89,221m and under section 3 of €78,105m. In 2019 and 2020, a total amount of €53m in cryptocurrency was seized [CAB (Criminal Assets Bureau), 2017; CAB, 2018; CAB, 2019; CAB, 2020; CAB, 2021]. These numbers are high in comparison to those of asset-recovery counterparts in other jurisdictions (Keen, 2017, p. 9).

The structure of CAB is multidisciplinary with a free sharing of information between its departments, namely, the police, social welfare and revenue services. This means that all expertise can be exploited in every case. In addition, once a person becomes the target of the CAB, the proceeds of crime can be taxed, which puts law enforcement in a powerful position (Keen, 2017, p. 10).

Western Australia was the first jurisdiction in Australia to adopt UWO legislation in 2000 when the decision was taken that reversing the burden of proof in civil proceedings is a justifiable means to tackle criminal wealth (Martino, 2022). In the Supreme Court case Director of Public Prosecutions for Western Australia v Gypsy Jokers Motorcycle Club Inc (2005), Judge Templeton stated:

Australia is a federation of six states and two territories, with the federal government (the Commonwealth) and each state and territory having criminal law powers (Grano, 2009, p. 125). Therefore, Australia also has unexplained wealth legislation at Commonwealth, state and territory levels (Reeves and Wilcock, 2022). Under federal laws, the Proceeds of Crime Act 2002 (POCA [Australia]) covers UWO provisions under Parts 2–6. The unexplained wealth laws enable a court to issue an order and the recipient of the UWO must prove on a balance of probabilities that their wealth was lawfully acquired. If not, the court may order the person to pay the difference between their total wealth and legitimate wealth to the relevant jurisdiction (Mills and Barker, 2018; Parliamentary Joint Committee, 2012).

POCA (Australia) provides for four types of confiscation orders: forfeiture orders; pecuniary penalty orders; UWOs; and literary proceeds orders (Martini, 2015). In turn, the UWO regime provides for three types of UWOs. Firstly, an unexplained wealth restraining order restricts a person’s ability to deal or dispose of the property. Secondly, a preliminary UWO requires a person to attend court to enable the court to decide whether or not a UWO should be issued. Thirdly, a UWO – which in effect is the confiscation order – will require the person to repay the difference between total and legitimate wealth (Mills and Barker, 2018; Reurts, 2017).

While POCA (Australia) sets out the general rules and steps to follow in a UWO, state legislation defines the rules and requirements (Martini, 2015). Important differences exist between the various state UWO regimes. For example, in New South Wales, the Supreme Court will issue a UWO under section 28 A of the Criminal Assets Recover Act 1990 if it is in the public’s interest to do so and the court finds reasonable suspicion that the person was involved in or acquired property deriving from, serious crime-related activities (Miralis, 2021). In South Australia, the Serious and Organised Crime (Unexplained Wealth) Act 2009 allows for the confiscation of any wealth which has not been lawfully acquired (Miralis, 2021). However, the simplest form of UWO is the one applied in various Australian states, where a law enforcement authority can apply for a non-conviction-based confiscation in relation to any wealth of which the respondent is unable to prove the legitimacy (Moiseienko, 2022).

The National Cooperative Scheme on Unexplained Wealth was introduced with the passing of the Unexplained Wealth Legislation Amendment Act 2018. The aim was not to replace any unexplained wealth laws at federal, state or territory level, but to enhance those regimes by providing a coordinated scheme for sharing information, giving access to information-gathering powers and, among participating jurisdictions, sharing arrangements for seized assets (Mills and Barker, 2018).

Due to the operational structure of the Australian Government, each state or territory has to individually report on its UWO outcomes. One example is the Corruption and Crime Commission (CCC) which was established in 2004 in Western Australia for this purpose.

The CCC deals with serious misconduct and corruption by public officers with the aim to improve the integrity of the Western Australian public sector (CCC [Corruption and Crime Commission], 2020a). In 2018, the CCC was bestowed with an unexplained wealth function which enabled them to investigate and litigate unexplained wealth and criminal benefits under the Criminal Property Confiscation Act 2000 (CCC, 2021, p. 34).

In unexplained wealth matters, the CCC does not need to prove a connection to an offence. The reverse burden of proof is applied as the respondent must rebut the presumption that the property in question was acquired unlawfully (CCC, 2021, p. 34).

Since 2019, the CCC has received 69 potential unexplained wealth matters: 42 from the public, 25 from Western Australian public authorities and 2 from federal. At the end of 2021, ten matters were ongoing with AUS$6m of frozen property, and two matters had been resolved in the Supreme Court resulting in confiscation worth AUS$11.7m (CCC, 2020b, p. 66; 2021, p. 35).

Owing to its financial stability, trusted legal system and vast international footprint, the UK is a favoured place for criminals to launder their illicit wealth (Keen, 2017, p. 8). In April 2016, the UK Government published an Anti-Money Laundering Action Plan in response to a Risk Assessment in Money Laundering and Terrorist Financing conducted in 2014 (Home Office and HM Treasury, 2014). The assessment revealed that, in cases where the UK assets had been bought with laundered funds, evidence was not available to pursue criminal prosecutions (Shalchi, 2022, p. 9). Action 11 of the Plan addressed the consideration of imposing an obligation on a person or entity to explain the origin of their assets in support of an investigation such as a UWO. It further stated that the government should explore whether the offence of illicit enrichment (as per the UNCAC) will be an effective anti-corruption tool in the UK (Home Office and HM Treasury, 2016).

In the UK, a UWO is a court order issued against a person, relating to a certain property, requiring an explanation of the nature and extent of the respondent’s interest in the property, the nature of the funds used to obtain the property and any other information required by the order (Hanratty, 2022). UWOs were introduced by the Criminal Finances Act 2017, Sections 1 to 6, to strengthen the capacity of law enforcement agencies to confiscate proceeds of crime, specifically corruption. The Economic Crime (Transparency and Enforcement) Act, 2022 significantly improved the UWO regime (Moiseienko, 2022; Shalchi, 2022, p. 9). Also, the Act has a retrospective effect in that it can be applied in respect of property acquired before the Act came into effect (Allen and Overy, 2017, p. 17).

Prior to the implementation of these Acts the confiscation of criminal property was “conviction-led”, meaning that law enforcement had to prove that a criminal offence had been committed before proving that the proceeds (money or property) in question were obtained illegally (Shalchi, 2022, p. 6). The Proceeds of Crime Act 2002 (POCA UK) included Civil Recovery Orders (CROs) as a tool to confiscate criminal property without having to prove an underlying criminal offence (Shalchi, 2022, p. 7). However, seeking a CRO was appropriate in only a limited number of cases. For example, cases with ample evidence would prefer criminal prosecution, whereas cases with little evidence struggled to convince the court to grant a CRO (Shalchi, 2022, p. 8).

Enforcement authorities such as the National Crime Agency (NCA), the Serious Fraud Office, the Financial Conduct Authority, His Majesty’s Revenue and Customs and the Director of Public Prosecutions apply to the High Court for a UWO (Auld and Watts, 2022; Shalchi, 2022, p. 10). The civil standard applies and the court application must be clear on three matters:

1. who it is against;

2. what property it relates to and reasonable cause believing the person holds the property; and

3. a reasonable basis suspecting the person’s income is inconsistent with the value of the property (Fischer and Clifford, 2018, p. 28) or that there are reasonable grounds to believe that the property has been obtained in an unlawful manner (Auld and Watts, 2022).

A UWO can be made against a politically exposed person (PEP [²]); or, with reasonable grounds for suspicion, a person suspected of being involved (or connected with someone involved) in a serious crime; or responsible officers [³]. For the court to issue the order, it must be satisfied that the said person holds [⁴] the property; that there is reasonable cause to believe that the person’s known sources of income are insufficient for the purposes of obtaining such property; or that there are grounds to suspect that the property has been obtained through unlawful conduct; and that the property’s value is at least £50 000 (Auld and Watts, 2022; Moiseienko, 2022; Shalchi, 2022, p. 11). Notably, according to sections 52 and 53 of the Economic Crime (Transparency and Enforcement) Act (2022), the legal costs incurred by the respondent are not paid by the enforcement authority bringing the application, but by the respondent themselves.

In addition to the UWO application, the enforcement authority can also apply for an interim freezing order, up to 186 days, in respect of the property to prohibit the respondent, or any other person with an interest in the property, from dealing with the property (Hanratty, 2022; Shalchi, 2022, p. 13).

The recipient of the order can either comply and provide evidence regarding the property and additional information required by the UWO; or the recipient can fail to respond. The time frame in which to comply will be specified in the order (Fischer and Clifford, 2018, p. 36).

In the event of compliance, with a freezing order in place, the enforcement authority has 60 days to review the information and decide on the matter before the respondent can have the interim freezing order lifted. If the respondent does not respond or provides no reasonable excuse, the property may be seen as proceeds of crime and a claim can be made to the court to confiscate the property under Part 5 of POCA UK 2002 [section 362 C(2)], unless the respondent can, on a balance of probabilities, satisfy the court that it was not acquired as the proceeds of crime (Hanratty, 2022; Shalchi, 2022, p. 14). In such circumstance the burden of proof is reversed as the State no longer must prove that the property constitutes the proceeds of crime (Moiseienko, 2022).

A UWO can thus be seen as an investigative tool to ease the process of obtaining a CRO by reversing the burden of proof as it does not grant law enforcement any new or additional powers to confiscate assets. This approach is, however, different to that of other countries (Moiseienko, 2022).

As the UWO is a civil action, the respondent does not have a right to remain silent as in a criminal prosecution (Shalchi, 2022, p. 14). However, the respondent is protected against self-incrimination because the details in the response cannot be used as evidence in criminal proceedings, under POCA UK 2002 (section 362 G) (Fischer and Clifford, 2018, p. 46). The respondent is therefore compelled to respond or risks losing their property. Given the harsh consequences of non-compliance, enforcement authorities are advised to carefully evaluate the response received as there is a fine line between a less than satisfactory response and an unsatisfactory response, of which only the latter will lead to confiscation (Moiseienko, 2022). Nevertheless, it is a criminal offence to make a false or misleading statement when responding to a UWO (Hanratty, 2022; Shalchi, 2022, p. 14).

In February 2018, the UK saw its first UWO, issued against the wife of Jahangir Hajiyev, the former Chairman of the International Bank of Azerbaijan, in relation to the London property owned by a company in the British Virgin Islands, with him being the ultimate owner of the company. He had been convicted and sentenced to 15 years’ imprisonment in Azerbaijan for various criminal offences including fraud and embezzlement pertaining to his time in office. The court granted the UWO application by the NCA together with an interim freezing order in respect of the property, which the NCA believed was held by the wife (Moiseienko, 2022; Shalchi, 2022, p. 16). Mrs Hajiyeva appealed the UWO on the grounds that her husband was not a PEP, but the appeals were dismissed by the High Court and the Court of Appeal at the end of 2020. This case has not been finalised to date (Shalchi, 2022, p. 16).

In January 2019, the NCA obtained UWOs against eight properties owned by Mansoon Mahmood Hussain, who was suspected of being involved in serious crime connected to violent gangs and using these properties to launder the proceeds of criminal activities. Mr Hussain responded to the UWO, but his reckless responses implicated him in an even bigger case. In August 2020 he agreed to hand over 45 properties and other assets valued at almost £10m (Huan and Sangaran, 2021; Moiseienko, 2022; Shalchi, 2022, p. 16).

The UK saw its first failed application in May 2019 (NCA v Baker and Others) when the NCA obtained three UWOs and an interim freezing order against a property argued to have been bought with laundered funds originating from Rakhat Aliyev, a Former Deputy Minister of foreign affairs in Kazakhstan who had died in an Austrian prison. The court set aside the application by the respondents due to unreliable and unjustified assumptions in the NCA’s case (Huan and Sangaran, 2021; Moiseienko, 2022; Shalchi, 2022, p. 17).

As of February 2022, the only enforcement body in the UK to have obtained UWOs was the NCA, with nine UWOs relating to four cases with an estimated value of £14.2m. No UWO was obtained during 2020 and 2021 (possibly due to strict COVID-19 regulations) (Hanratty, 2022; Shalchi, 2022, p. 18).

The application of UWOs in the UK is too recent for it to be deemed a success or a failure, but it has been a bold move in English law to introduce such measure in the fight against corruption (Moiseienko, 2022).

South Africa has no legislation such as UWOs to investigate unexplained wealth. The main legislation in the South African legal framework dealing with the recovery of proceeds of crime consists of POCA SA and PRECCA. Although the Supreme Court of Appeal held that the provisions of POCA SA “are designed to reach far beyond organised crime and apply also to cases of individual wrongdoing”, in Director of Public Prosecutions v Van Staden, POCA SA was established to disrupt the effects of organised crime (Aslett, 2018, p. 247).

The preamble to POCA SA outlines the objectives of Chapters 5 and 6 of the Act, which relate to criminal and civil forfeiture, respectively. Chapter 5 (criminal forfeiture) aims to deprive the accused of any benefit (as defined by POCA SA) they have derived from the offence of which they were convicted. Chapter 6 (civil forfeiture) focuses on tainted property: property that has been used to commit an offence and requires on a “balance of probabilities” that the property in question is the actual proceeds from unlawful activities [section 13(5)] or is an instrumentality of an offence (as set out in Schedule 1 of POCA SA). Chapter 6 is aimed at imposing a measure to strip the respondent of property derived from unlawful activities and not as a penalty inflicted against a person (Booz Allen Hamilton, 2011, p. 38). Forfeiture under Chapter 6 of POCA SA is a two-stage process: a preservation order is obtained, as provided for in section 38; and the property is forfeited to the State.

In Mohunram NO and others v NDPP and Another (2002), Judge Cloete, after considering the constitutionality of Chapter 6, concluded that the provisions of section 38 were inconsistent with the Constitution. The Bill of Rights, Chapter 2 of the Constitution, serves to protect the rights of individuals, which includes property rights. The Constitution [section 7(2)] imposes a duty on the State to protect, promote and respect these rights. However, the Constitutional Court declined to confirm the order of constitutional invalidity. Chapter 6 is, therefore, constitutionally valid, but making orders under Chapter 6 requires constitutional considerations (Kruger, 2013, p. 115).

In July 2022, the Cullen Commission (established to inquire into money laundering in British Columbia, Canada) called for UWOs to address illicit wealth (Lorinc, 2022). This decision is important for South Africa, as the Canadian Charter of Rights and Freedoms is similar to the SA Bill of Rights (Hogg, 1998).

In South Africa, PRECCA is the main anti-corruption legislation and provides for the investigation and prosecution of corruption offences. Sections 22 and 23 of PRECCA allow for the prosecution to investigate persons and their property if such persons maintain a standard of living or possess wealth that is disproportionate to their lawful means (Pragal, 2006). In terms of section 23, the National Director of Public Prosecutions (NDPP) should approach a judge in chambers with a view to ordering such an inquiry. If the judge allows such an inquiry, the person is summoned and questioned, with a shield against the use of the evidence in a criminal proceeding. However, section 23 has never been applied since 2004, which raises serious concerns about its practicality and applicability to the curbing of corruption.

The UNCAC country review stated that South Africa had, in terms of PRECCA section 23, “a detailed mechanism to facilitate the investigation of suspected cases of illicit enrichment by public officials” (PRECCA, 2017, p. 14). The phrase “mechanism to facilitate the investigation of” is perhaps the reason why this section has not been applied, as it lacks detail on the sanctions to be imposed on a person found living disproportionately to their lawful income. In addition, the NDPP – the head of the NPA and the person with the authority to review a decision to prosecute or not – is listed as the person responsible for bringing the application, which means that the initial complaint should have come through the NPA in the first place. In essence, this might hinder the process as other anti-corruption agencies such as the Special Investigating Unit (SIU) perceivably have the necessary investigation powers to bring such application, possibly also with the required evidence.

The SIU is a government investigative and civil recovery agency focused on addressing financial crime relating to the misuse of public resources (Bruce, 2019, p. 3). However, in terms of the Special Investigating Units and Special Tribunals Act 1996 (SIU Act), investigations are initiated only by the President’s proclamation, which poses as risk as it provides significant powers to the President.

The AFU, a unit within the NPA, was established in 1999 to ensure the effective implementation of the asset forfeiture provisions contained in the POCA SA. Schedule 1 of POCA SA states that instrumentalities flowing from crimes committed under PRECCA, will be susceptible to asset confiscation. This means that the AFU possesses over the necessary powers, under POCA, to execute civil confiscation as per a UWO. However, it is proposed that the POCA legislation be expanded to include jurisprudence on UWOs or an alternative piece of legislation should be created for the executing of UWOs specifically.

Following the suggestions by the Royal United Services Institute to the UK Government (Keen, 2017, p. viii), South African legislators will need to consider implementing the following before instituting a civil measure such as UWOs:

• a law enforcement team with strong expertise, such as the CAB in Ireland;

• a law enforcement agency with strong funding and support, as UWOs are addressed to wealthy individuals and many cases will be appealed;

• collaboration among law enforcement agencies, each focusing on their powers, to share information in the execution of UWOs; and

• the political will to support the curbing of corruption.

UWOs are a civil confiscation and forfeiture jurisprudence aimed at targeting the proceeds of illicit wealth. Ireland and Australia have successfully introduced UWOs, while the UK has introduced noteworthy legislation, albeit in its early stages.

South Africa, a signatory State to the UNCAC, has not criminalised illicit enrichment, but has recently introduced an initiative of inter-agency cooperation to address the confiscation of criminal proceeds under available civil legislation. The overall aim is to determine whether separate UWO legislation is needed and to test whether inter-agency cooperation can be achieved.

This article investigated the possibility of introducing UWOs in South Africa by comparing the use of and legislation applicable to UWOs in Australia, Ireland and the UK. The unexplained wealth laws of these countries provide for non-conviction-based asset forfeiture without the requirement of an established predicate offence. They also contain the reversal of the burden of proof, requesting the respondent to explain the source of the property in question.

In the UK, the application of a UWO differs from the other two countries in that property is (mostly) recoverable when the respondent fails to comply. Furthermore, PEPs are specifically mentioned, whereas Australia and Ireland focus on any person reasonably suspected of being involved in a serious crime. Another difference relates to the UK enforcement agency’s having to be satisfied with the respondent’s reply; in Australia and Ireland, the court has to be satisfied before making the final order.

In line with the ECtHR, a strong argument exists that reversing the burden of proof to address social problems, such as corruption, is acceptable. However, the UK’s provisions do not per se adopt this view, as the reverse burden of proof is applicable in circumstances relating to non-compliance with a UWO. Although it is seen as a criminal offence to provide misleading or false information in a UWO, it is unclear as to how the UK will address such a matter.

With regard to UWOs in South Africa, it is clear that a new piece of legislation should be developed, possibly drawing from the requirements of the UK’s UWOs, but without the focus on PEPs. In the UK, the UWO laws are contained within the Criminal Finances Act, and in Australia and Ireland within their respective POCA legislation. For South Africa, it is proposed that UWO legislation be included either within POCA or as a separate piece of legislation to address criminal wealth. Importantly though, it is not a question of choosing between the civil or the criminal route, but of using both to target the proceeds of crime and rid society of corruption.

It is lastly suggested that South Africa pay attention to the Royal United Services Institute recommendations in the UK on how to successfully implement UWOs:

• a law enforcement team with strong expertise;

• a law enforcement agency with strong funding and support;

• inter-agency cooperation; and

• the political will to support the curbing of corruption.

The authors would like to thank Adv Marnus Steyn for his input and guidance in this study, as well as the Workwell Research Unit at the North-West University for its support in this project, which was completed under the sub-programme ReTORIC (Research and Teaching in Organised and Integrity Crimes).