Financial Crimes in UK Law

Looking behind the maxims, there are two broad discernible policy reasons for the common law doctrine of illegality as a defence to a civil claim. One is that a person should not be allowed to profit from his own wrongdoing. The other, linked, consideration is that the law should be coherent and not self-defeating, condoning illegality by giving with the left hand what it takes with the right hand.

In assessing whether the public interest would be harmed in that way, it is necessary a) to consider the underlying purpose of the prohibition which has been transgressed and whether that purpose will be enhanced by denial of the claim, b) to consider any other relevant public policy on which the denial of the claim may have an impact and c) to consider whether denial of the claim would be a proportionate response to the illegality, bearing in mind that punishment is a matter for the criminal courts.

The discretion which is imported by section 6(6) giving rise to the power to make a just order is very strictly limited. It does not appear to us, assisted as we have been by Mr Friesner who has considerable experience in the area of confiscation proceedings, that there is any simple answer to the question. It seems to us on further reflection that the answer must be this.

I interject by way of brief technical excursus that a spread bet on listed shares is on analysis a contract for differences, based on movements in the quoted share price over a specified period. In the case of IG Index the client was required, as Mr Mirza told me, to deposit 15–20% of the initial share price and maintain a deposit to at least this level as the price moved. The level of the deposit meant that substantial gearing, of at least 5 times, could be achieved.

In my judgment the structure and content of the 2000 Act amply demonstrate that it must have been the Parliamentary intention that the FSA would be able to institute proceedings under Part V of the 1993 Act without consent from outside. In the light of section 61(2) of the 1993 Act, and not overlooking paragraph 4 of Schedule 1 to the 1987 Act and the absence of such provision in the 2000 Act, section 402(1) is not tightly drawn.

If imprisonment is necessary, and if a very short sentence is not enough, and if it is not appropriate to suspend the sentence altogether, then partial suspension should be considered. Great care must be taken to ensure that the power is not used in a way which may serve to increase the length of sentence. Great care must be taken to ensure that the power is not used in a way which may serve to increase the length of sentence.

In short, the purpose for which the information is furnished is not limited to an accounting purpose; the document itself has to be made or required for an accounting purpose but once that is satisfied then any statement that is false in a material particular is sufficient to Justify a conviction once the other requirements of the section are also satisfied.