Welsh and another v Secretary of State for the Home Department and Another

JurisdictionEngland & Wales
Judgment Date21 February 2006
Neutral Citation[2006] EWHC 156 (Admin)
Docket NumberCase No: CO/8663/2005
CourtQueen's Bench Division (Administrative Court)
Date21 February 2006
Between:
Howard Welsh and
Lee Hope Thrasher
Appellants
and
The Secretary Of State For The Home Department
The Government Of The United States Of America
Respondents

[2006] EWHC 156 (Admin)

Before:

Lord Justice Laws

Mr Justice Ouseley

Case No: CO/8663/2005

IN THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

DIVISIONAL COURT

Royal Courts of Justice

Strand, London, WC2A 2LL

Mr Mark Summers (instructed By Hallinan Blackburn Gittings & Nott) For The Appellants

M r Khawar Qureshi (instructed by the Treasury Solicitor) For the Secretary Of State For The Home Department

Mr Gavin Irwin (instructed By Cps) For The Government Of The United States Of America

Ouseley J:

THE FACTS

1

Howard Welsh is a UK citizen aged 62, who lived for many years in the USA with permanent residency status. Lee Hope Thrasher is a US citizen, aged 5The US Government seeks their extradition from the UK on a variety of conspiracy and substantive charges arising out of a complex advanced fee fraud involving over $31m, committed largely but not wholly in the US on US residents. It is alleged that over $20m of its proceeds have not been traced. Welsh and Thrasher contest the allegations.

2

They appeal against the decisions of District Judge Pratt given on 22 nd March 2005, which dealt with the initial stages of extradition under s78 of the Extradition Act 2003, and on 19 th April 2005 which dealt with the compatibility of extradition with their human rights under s87(3), and sent their cases to the Home Secretary. They appeal under s103 and seek orders for their discharge under s104 of the 2003 Act. These appeals raise issues as to form and procedure.

3

They also appeal under s108 against the decisions of the Home Secretary of 17 th and 19 th October 2005 to order their extradition. These appeals seek orders under s109 for their discharge by this Court, and raise issues as to specialty protection, broadly the protection for those extradited against trial or punishment for offences other than those for which they have been extradited.

4

Their extradition is governed by the Extradition Act 2003, pursuant to which the USA has been designated as a Category 2 country, but the relevant Treaty between the UK and the USA for the purposes of specialty protection remains the 1972 Treaty, as the 2003 Treaty has not been ratified by the US Senate.

5

The alleged and disputed criminal conduct underlying the extradition request can be summarised as follows. Between 1999 and 2004 the Appellants induced a number of US residents to pay substantial sums of money to various investment schemes by promises of high returns and security. These promises were disseminated in person, through seminars and the like, "missionaries" and promotional literature. The whole was cloaked in a quasi-religious or mystic garb. The mechanism which the alleged fraudsters used was the "corporation sole", which it was claimed had particular powers enjoyed by an elite, the details of which had to be kept secret as they were proprietary interests. The individual investors became corporations sole, receiving from Washington State certificates of incorporation signed by its Secretary of State. The investment funds and registration fees were paid by the individuals into accounts maintained by the Appellants with corporate addresses in the Bahamas. The investors thought that their funds would be invested in the Turks and Caicos Islands. But the documents were fictitious and the monies were laundered via wire-transfers to US and off-shore accounts in various countries around the world, and into the hands of unknown conspirators. The early investments received the promised high rates of return. These were paid from the monies sent by the later investors so as to create the illusion that the promised returns were real and the investments safe, in order to induce others to send in their money. Excuses relating to changes in banking practice induced by terrorist attacks and an unjustified federal investigation were used to explain the later non-payment of the promised returns.

6

It is alleged that the Appellants left their property in Virginia Beach, Virginia not long before it was searched by investigators in August 2002, and thereafter concealed their whereabouts. They came to the UK. In August 2004, a Federal Grand Jury in the US District Court for the Eastern District of Virginia, returned a 63 count indictment against the Appellants. Warrants for their arrest were signed that same day. In November 2004 both Appellants were arrested in England upon provisional warrants of arrest issued by Bow Street Magistrates' Court pursuant to s73 of the 2003 Act. They have been remanded in custody ever since.

7

The 63 counts included one count of conspiracy to commit mail and wire fraud, eighteen counts of wire fraud, seven counts of using a fictitious name, twenty-three counts of mail fraud, and fourteen conspiracy and substantive counts, variously described, relating to money laundering the proceeds of the other offences.

8

The indictment, consistently with US practice, identified the features of the offences which it would be alleged justified enhancements or increases in the sentence which would otherwise follow from the application of the Federal Sentencing Guidelines. These included the scale of actual and intended loss, the large number of victims who also included vulnerable persons, the misrepresentation that religious or charitable organisations were involved in the scheme, the relocation of the fraudulent scheme to another jurisdiction to impede law enforcement, the Appellants' leadership role in the enterprise, the use of sophisticated money laundering techniques, and their attempts to impede the administration of justice. The last two factors were of some controversy in the application of the specialty rule.

9

The conduct underlying the counts was translated into eighty eight charges under English law for the extradition proceedings.

10

The US Government did not seek the extradition of the Appellants for the money laundering offences because they related to the laundering of the proceeds of what were alleged to be their own crimes. The Criminal Justice Act 1988, which was the applicable English statute, applied only to the laundering of the proceeds of the crimes of others. This was altered by the Proceeds of Crime Act 2002, but it was not in force at the relevant time.

11

The District Judge discharged half the charges as not disclosing an offence known to English law because of R v Preddy [1996] AC 815, HL. They concerned the alleged obtaining of money by deception, as opposed to procuring dishonestly the execution of a valuable security.

FORM AND PROCEDURE

12

The Appellants raised six issues as to form or procedure which I shall deal with first. None of them are complex or sound. Mr Summers for the Appellants supported his submissions by reference to what Lord Hope of Craighead said in R (Guisto) v Governor of Brixton Prison [2004] 1 AC 101 at paragraph 41, that extradition procedures are to be strictly observed, and to what Sedley LJ said in Bentley v The Government of the USA [2005] EWHC 1078 Admin at paragraph 17, that the need for rigour was far more than merely technical, with the new streamlined extradition procedures.

13

I do not find difficulty in accepting those general propositions, but their application as support for the arguments addressed by Mr Summers is less clearly justified. The former case was concerned not with a mere formality but with whether or not the Court had jurisdiction to treat the extradition request before it for an accused person, as a request for a convicted person. The latter was concerned with the fact that the US had set out to show by reference to its statutes that MDMA was a prohibited drug; those which it submitted did not show that. It was for evidence to prove that US law did prohibit MDMA, counter-intuitive though it was recognised to be to contemplate that it did not. The context for those comments is not therefore one of support for technical and formal points as impediments to extradition, but one of recognition of the requirements of jurisdiction and for the proof of that which needs to be proved and cannot simply be assumed.

14

Mr Summers first contended that the procedure adopted did not comply with s78 (2)(d) of the 2003 Act because what purported to be arrest warrants were not arrest warrants at all. They had not been signed by a Clerk to the Court, nor by a Deputy Clerk empowered to sign on behalf of the Clerk. There was no evidence as to the status of the individual whose signature appeared on the warrants, save that she was not the Clerk. For an arrest warrant to be valid under the Federal Rules of Criminal Procedure, it had to be "signed by the Clerk". Mr Summers accepted, as the US Government's evidence made clear, that a Deputy Clerk could sign a valid warrant.

15

I do not accept this first contention. The task of the District Judge under s78 is to decide whether he has been sent warrants for the arrest of the Appellants. Although Mr Summers takes two other points about the content of the warrants, the documents in question are plainly warrants in all respects except for the signature issue. As to that, they bear the typed name of the Clerk and below that the signature and name of the signatory. No position is given for the signatory.

16

I regard it as clear from the position of the signature on the warrants that the signatory is signing on behalf of the Clerk. I would be prepared to infer that she is a Deputy Clerk in the absence of evidence to the contrary and I would not regard such an inference as conflicting with the approach in either of the cases cited...

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