Asset tracing –a beginner’s guide - Fraud Women's Network Ballamy - FWN... · the rules of...
Transcript of Asset tracing –a beginner’s guide - Fraud Women's Network Ballamy - FWN... · the rules of...
It is the process of identifying assets which
represent those which were initially
misappropriated as a result of fraud.
What is asset tracing?
the rules of common law (which recognises
legal title)
the rules of equity (which recognises
beneficial interests)
English law contains two sets of rules:
• it was the victim’s money to start with, and
• the defendant received the same money.
Tracing money in equity I
the mixed fund rule
the rule in Re Hallett’s Estate
the rule in Re Oatway
the lowest intermediate balance rule
the overdraft rule
the rule in Clayton’s case
Tracing money in equity II
£100
£50
Day 1
Day 3
Re Hallett’s
Day 2 £70 – Living
Expenses
£80 – Asset
Victim’s bank account Fraudster’s bank account
£100
£50
Day 1
Day 3
Re Oatway
Day 2
£70 – Living
Expenses
£80 – Asset
Victim’s bank account Fraudster’s bank account
£100
Day 1
The lowest intermediate balance rule
Day 2 £70 – Living
Expenses
£50
£50
Victim’s bank account Fraudster’s bank account
Day 4£110 – Asset
£30
£30
£100
£50
Fraudster’s own money
Day 3£50
£100
£30
Day 1
The Overdraft Rule
Fraudster’s bank account
£50
Overdrawn
Day 3
Victim’s bank account
£100
Fraudster’s own money
Day 2
£30
£80 – Asset
Victim 1
Victim 1 -
£100
£100
£50
Rule in Clayton’s case I
£20
£40
Victim 2
Victim 3
Victim 4
Victim 2 -
£50
Victim 3 -
£20
Victim 4 -
£40
Day 1
Day 2
Day 3
Day 4
Day 5
Day 6
Day 7
£70 – Living
Expenses
£100 – Asset
£40 – Living
Expenses
Fraudster’s bank account
Total
Victims’ bank accounts
£210
Victim 1 = £30
Victim 2 = £50
Victim 3 = £20
Victim 4 = £0
Total = £100
Victim 1
Victim 1 -
£100
£100
£50
Rule in Clayton’s case II
£20
£40
Victim 2
Victim 3
Victim 4
Victim 2 -
£50
Victim 3 -
£20
Victim 4 -
£40
Day 1
Day 2
Day 3
Day 4
Day 5
Day 6
Day 7
£70 – Living
Expenses
£100 – Asset
£40 – Living
Expenses
Fraudster’s bank account
Total
Victim 1 = £0
Victim 2 = £40
Victim 3 = £20
Victim 4 = £40
Total = £100
Victims’ bank accounts
£210
• The sequence of transactions
• Pre-existing credit balances
• Clearance of overdrawn balances
• Amalgamation of balances
• Certificates of deposit
• Continuing evolution
• Clarity is crucial
• Hawala
Some further considerations