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    The Evolving Regulation Of Crypto-currencies and Crypto-assets

    The news that footballer, Lionel Messi’s financial package at French soccer club Paris Saint-Germain includes crypto fan tokens has caused a stir in the business and banking world.  Although Bitcoin has been circulating in the world’s monetary system for over a decade, when it comes to regulation, governments remain in the frontier days of digital cryptocurrency.  However, news of Mr Messi’s part payment in crypto tokens demonstrates that the pressure is on for regulators to achieve oversight over cryptocurrencies.

    Large banks such as Goldman Sachs and the Bank of England want to enter into this developing and ever more important financial opportunity.  Central banks around the world are busily looking to implement their own crypto-currencies (referred to as Central Bank Digital Currency – CBDC), to create monetary and financial control and stability.  It is likely that shortly there will be a significant increase in CBDCs.  However, this will require overall market regulation so global financial market assimilation can be achieved.  Furthermore, recent developments such as ‘stablecoins’ must be understood and regulated to ensure the long-term stability of financial markets.  In this article, we examine the tasks faced by regulators in controlling cryptocurrency and how global regulation may be achieved.

    Current cryptocurrency regulation

    Cryptocurrencies have developed at the edge of the traditional monetary system; therefore, many regulatory controls that apply to the regular financial system, such as anti-money laundering regulations were not or could not be implemented.  Blockchain, by its very nature, is designed to promote data integrity and provide a permanent, unchangeable history of financial transactions.  However, the blockchain model and its global span also mean that central governments and regulatory bodies are unable to exert fundamental control over cryptocurrencies.  

    There is concern coming from the world’s central banks and treasuries that digital currencies being used to finance or engage in criminal activities.  US Treasury Secretary Janet Yellen has said that cryptocurrencies are “mainly for illicit financing, and I think we really need to examine ways in which we can curtail their use”.  The biggest threat comes from countries that do not have a stable government and regulated banking systems.  Without these, it can be almost impossible to thwart financial crime and compensate victims.

    Another key concern for central banks and governments is the wild instability of cryptocurrencies, especially given that in many cases, instances of volatility are not connected to any particular event.

    The above challenges beg the question – how can cryptocurrencies be adequately regulated? 

    Regulating cryptocurrencies

    Every country faces the challenge of being able to effectively regulate cryptocurrencies.  The Basel Committee on Banking Supervision (BCBS), which describes itself as the “primary global standard-setter for the prudential regulation of banks”, began a consultation in Autumn 2021 on the ‘Prudential treatment of crypto-asset exposures”.  The consultation paper states, “The Committee is of the view that the growth of crypto-assets and related services has the potential to raise financial stability concerns and increase risks faced by banks. Certain crypto-assets have exhibited a high degree of volatility and could present risks for banks as exposures increase, including liquidity risk; credit risk; market risk; operational risk (including fraud and cyber risks); money laundering / terrorist financing risk; and legal and reputation risks…. To that end, the Committee has taken steps to address these risks”.   The BCBS has set out principles that it believes cryptocurrency regulation should be founded on.  These include:

    • Consistency – if a crypto-asset has the same economic function and risks as a traditional asset, the same capital and liquidity requirements should apply.
    • Simplicity –regulatory models should be uncomplicated and flexible enough to evolve.
    • Minimum standards –allow countries to increase or decrease regulatory control as required, but implement by Convention that a minimum standard must be maintained. 

    Incorporating the regulation of cryptocurrencies and assets into an already highly regulated banking system will be a challenge.  Some crypto exchanges have already applied for banking licences (e.g. Xapo and Kraken), which is both hastening the demand for regulatory change and illustrating the risks cryptocurrencies impose on the existing financial system. Governments may have to push crypto exchanges into the existing banking system, for example, using them as financial clearinghouses to exert regulatory control.

    Final words

    The Bank of England recently released a discussion paper on regulatory control over cryptocurrencies and assets.  However, with so many stakeholders involved, regulations, especially those on a level that requires some form of international agreement, are unlikely to present themselves any time soon. As developments occur, I will ensure to update you.

    Tanveer Qureshi specialises in white-collar crime and regulatory investigations and prosecutions.  If you require legal representation, please contact Tanveer directly at or via his chambers, 4-5 Gray’s Inn Square. for more about Tanveer or to subscribe to his newsletters, please go to 

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      Existence of An All-assets Criminal Restraint Order Did Not Obviate the Grant of a WFO

      Court of Appeal Finds the Existence of An All-assets Criminal Restraint Order Did Not Obviate the Grant of a Worldwide Freezing Order (WFO)

      In the recent case of AA and others v BB and others [2021] EWCA Civ 1017, the Appellants appealed against the continuation of a Worldwide Freezing Order (WFO) made on 7th September 2020 on the basis that criminal restraint orders (CROs) were already in place covering all the relevant assets under the Proceeds of Crime Act 2002 (as amended) (POCA).


      The Respondents in the original case were two companies and their administrators who brought a claim against five Defendants, four of whom were alleged to have been directors or de facto directors of one or other of the claimant companies.  It was alleged that the Appellants had misappropriated ‘substantial sums’.  Such was the risk of the Appellants dissipating their assets, criminal restraint orders (CROs) were put in place on application to the Serious Fraud Office (SFO).

      On 20th August 2020, the Respondents proceeded, without notice, to apply for a worldwide freezing order (WFO), which was granted at an ex parte (without notice) hearing.  A week later, on 27th August 2020, the Respondents issued a claim form and notice of the application to continue the freezing orders to the Appellants.  In considering the application on 7th September 2020, the judge found that there remained a strong risk of the assets being dissipated regardless of the CROs and that the freezing orders should remain in place.

      The grounds for appeal

      The appeal was brought by two of the original Defendants who argued that the Judge in allowing the freezing orders to continue had erred in four ways:

      1. The CRO removed any real risk of dissipation of assets.
      2. There was no justification for the application to be heard without notice.
      3. There was a failure to comply with the statutory obligation under section 58 of POCA to give notice of the application to the SFO.
      4. Had notice been given to the Appellants and the SFO, there would have been more time to properly present and consider the claimants’ case in the presence of the Appellants.

      Lord Justice David Richard stated from the outset that he did not believe any of the grounds had substance.

      The Court of Appeal’s findings

      The Court of Appeal reiterated the point that a freezing order would only be granted if there was a real risk of dissipation of assets.  The Appellants cited the case of Stanford International Bank Ltd (In Receivership), Re [2010] EWCA Civ 137, [2011] Ch. 33, [2010] 2 WLUK 712, however, the Court of Appeal concluded that this case does not establish that a Court should prima facie refuse to issue a restraint order where another restraint order is already in place.  The cases of Faya Ltd (In Liquidation) v Butt [2010] EWHC 3461 (Ch), [2010] 11 WLUK 435 and Cancer Research UK Ltd v Morris [2008] EWHC 2678 (QB), [2008] 5 WLUK 637 were referenced by the Court as these show the inherent problems with relying on previous orders and that CROs are not a proper substitute for a WFO (criminal restraint proceedings are brought in the public interest, while civil freezing orders protect private interests).

      The Court of Appeal also addressed the concerns of procedural unfairness, including that there was no justification for an application for a freezing order without notice.  On this argument, the Judge reminded the Court that the appeal did not relate to the granting of the ex parte freezing orders but against the continuation of the order, for which proper notice had been given. There was an acknowledgement that the SFO should have been informed of the ex parte application for freezing orders, however, this would not have been for the benefit of the Appellants; therefore, the judge concluded, “The failure to give such notice is not, however, something about which the Appellants can complain”.

      The appeal was dismissed.

      In dismissing the appeal and summing up, Lord Justice David Richards added his comments on the joint management of CROs and freezing orders.  He stated,

      “The existence of two or more such orders against a single party is liable to increase substantially the burden of compliance, as regards both the provision of information and obtaining consent to any disposals. This may be to some extent unavoidable, but joint management is a way by which such burden can be kept within proportionate bounds. In Re Stanford International Bank Ltd, Hughes LJ discussed in some detail at [204]-[212] how this might be achieved. Serious consideration should be given to arranging joint management in cases such as the present, but in the present case, efforts to achieve it appear to have failed”.

      What are the implications of this case?

      Any person or business who finds themselves on the receiving end of multiple restraint and/or freezing orders will need to ensure they understand the compliance requirements that apply, especially when considering the disposal of assets.  In such cases, it may be possible to present a robust case for joint management to keep these proportionate to the situation and the scope of the assets concerned. 

      Tanveer Qureshi specialises in white-collar crime and regulatory investigations and prosecutions.  If you require legal representation, please contact Tanveer directly at or via his chambers, 4-5 Gray’s Inn Square. for more about Tanveer or to subscribe to his newsletters, please go to 

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        SFO Enters into £103m DPA With Amec Foster Wheeler Energy Ltd

        Serious Fraud Office (SFO) Enters into £103m Deferred Prosecution Agreement (DPA) With Amec Foster Wheeler Energy Ltd

        In what will likely be viewed as a landmark decision, Lord Justice Edis recently gave formal approval to a Deferred Prosecution Agreement (DPA) between the Serious Fraud Office (SFO) and Amec Foster Wheeler Energy Ltd (AFWEL).  The DPA relates to the involvement of AFWEL in corruption in its dealings in the oil and gas sector.  Foster Wheeler Energy Limited (FWEL) was acquired by AMEC in 2014, changing its name to Amec Foster Wheeler PLC (AFWL). 

        What was AFWEL charged with?

        AFWEL was charged with [PM1] unlawful conduct in relation to their use of ‘corrupt agents’, including conspiracy to make corrupt payments (contrary to under section 1(1) of the Criminal Law Act 1977 and section 1 of the Prevention of Corruption Act 1906).   Corrupt payments occurred in Nigeria, Saudi Arabia, Malaysia, and India between 1996 and 2010.

        The organisation was also found to have failed to prevent a bribery scheme [PM2] (contrary to the Bribery Act 2010) over three years in Brazil from 2011 and 2014, which led to the awarding of a contract worth approximately $190 million from Petrobras to design a gas-to-chemicals complex in Brazil called Complexo Gás-5 Químico UFN-IV (“UFN-IV”).

        What is a Deferred Prosecution Agreement (DPA)?

        DPAs[PM3]  in the UK were introduced in early 2014 under the Crime and Courts Act 2013 as a means of enabling prosecutors and organisations which could be prosecuted to reach an agreement with the oversight of a judge.  By entering into a DPA, the prosecution may be deferred or suspended for a set period of time.  The main aim of DPAs is to make the corporate body pay full reparations for their actions without incurring the damage of a formal criminal conviction. 

        What does the DPA mean for AFWEL?

        The DPA has several implications for AFWEL.  By entering into the DPA, AFWEL has accepted responsibility for their role in ten offences of corruption in its international operations.  Under the terms of the DPA, AFWEL were required to pay back profits made as a result of the corruption and a financial penalty and costs amounting to around £103 million.  In addition to the disgorgement of profits and the payment of compensation, the DPA also requires that AFWEL’s current parent company, John Wood Group PLC, must implement new checks and balances to prevent any future likelihood of corruption in its dealings with third-party intermediaries, sales agents, and national sponsors.  To facilitate this, a complete change of governance is required, including the integration of AFWEL’s management into the executive structure of the John Wood Group.

        The DPA also states that the John Wood Group must keep AFWEL in existence, operational, and within its control for the life of the DPA.  AFWEL is also prohibited within the terms of the DPA from making any public statement contradicting any of the matters outlining in detail in the Statement of Facts.

        What has been the response to the DPA approval?

        In response to the DPA approval, Lisa Osofsky, Director of the Serious Fraud Office, stated[PM4] , “Over a period of 18 years, Foster Wheeler Energy Limited brazenly and calculatedly paid bribes to officials around the world to cut corners and secure contracts, going to great lengths to conceal its corrupt conduct. In doing so, the company subverted the rule of law and harmed the integrity of the economy in the United Kingdom. We will continue to deliver justice for the taxpayer by punishing such actions and forcing companies to change for the better.  Justice also means recovering money to compensate victims wherever possible, and I am delighted that we have been able to secure compensation for the Nigerian victims in this case”.

        The co-operation of AWEL under its current management has also played a key role in allowing them to enter into a DPA and, hence, avoid criminal prosecution.  In making his ruling, Lord Justice Edis stated that the DPA and the level of compensation reflect the gravity of the conduct, but he also acknowledged the full cooperation of AFWEL and John Wood Group in assisting the SFO in their investigation and their efforts to implement an “extensive remediation and compliance programme”. 

        What does this DPA mean for other companies?

        The contents of the DPA between the SFO and AFWEL offer a useful guide to the types of policies and procedures that corporations and companies reliant on overseas agents and third-party intermediaries require to mitigate the potential for bribery and corruption in their operations.  By implementing clear and robust guidance which is easily accessible to all staff on the organisation’s policy towards avoiding bribery and corruption, directors and senior management may have a basis for a defence in the unlikely event that such acts are ever uncovered.  Such policies and procedures, and their regular review and improvement, should be at the heart of all organisations of this nature. 

        Tanveer Qureshi specialises in white-collar crime and regulatory investigations and prosecutions.  If you require legal representation, please contact Tanveer directly at or via his chambers, 4-5 Gray’s Inn Square. for more about Tanveer or to subscribe to his newsletters, please go to 

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          Mental Health Trust Fined £1.5 Million

          Mental Health Trust Fined £1.5 Million After Death Of 11 Patients

          The Essex Partnership University NHS Foundation Trust has been fined £1.5 million after the Health and Safety Executive (HSE) successfully prosecuted it for failing to prevent suicides.  The Trust pleaded guilty to offences under the Health and Safety at Work etc Act 1974 and was ordered to pay costs of £ 86222.23.

          The HSE investigation and prosecution followed the tragic suicides of 11 people between 1 October 2004 to 31 March 2015.  All patients died from hanging failed to effectively manage recognised risks from potential fixed ligature points in its inpatient wards, resulting in mental health patients being exposed to unacceptable and avoidable risk at a time when they were most vulnerable. 

          Ligature points and health and safety risk assessments

          Three quarters of mental health in-patients who kill themselves do so by hanging.  Therefore, it is vital that all Trusts have a robust risk management plan concerning ligature points. 

          A ligature point is anything that can be used by a person to attach a cord, rope, belt, sheet, or other material that can be used for the purpose of hanging or asphyxiating themselves.  Ligature points include shower rails, coat hooks, pipes and radiators, bedsteads, window and door frames, ceiling fittings, handles, hinges, and closures.

          Ligature points present an even greater danger if:

          • They are located in an area where a patient would expect privacy, such as the toilet or shower room.
          • It is between 0.7 metres and 4 metres from the ground.
          • There is a persistent lack of duty staff and/or the layout of the ward makes it difficult to supervise vulnerable patients.

          According to the Care Quality Commission (CQC), many warnings have been issued regarding the risk of fixed ligature points on mental health wards.  These include:

          • In 2000, the report of the Chief Medical Officer, An organisation with a memory, instructed mental health trusts to remove all non-collapsible bed and shower curtain rails by March 2002.  Since 2009, suicide using non-collapsible rails has been a ‘never event’ which applies to all mental health inpatient settings.
          • In 2012, the cross-Government strategy for preventing suicide in England called on mental health services to make “regular assessments of ward areas to identify and remove potential risks i.e. ligatures and ligature points”.

          How did the Essex Partnership University NHS Foundation Trust breach the Health and Safety at Work etc Act 1974?

          The Chelmsford Crown Court heard how the Trust failed to successfully oversee acknowledged risks from potential fixed ligature points in its inpatient wards.  This resulted in mental health patients being exposed to unacceptable and preventable peril at a time when they needed a high level of protection due to their vulnerable mental state.  

          The Health and Safety Executive (HSE) found that the Trust did not properly pinpoint, or address with enough urgency, the importance of the risks posed by the fixed ligature points within its inpatient wards.

          Speaking after the hearing, HSE inspector Dominic Elliss said:

          “It has long been recognised that a key control in the prevention of inpatient death or self-harm is the identification and removal of potential fixed points of ligature from the ward environment. For a period of more than 10 years, NEPUFT repeatedly failed to manage these well documented risks, including learning from tragic experience, thereby needlessly exposing vulnerable patients in its care to unacceptable risk.

          “I hope this case acts as a reminder to all mental health trusts of the need to continue to review their current arrangements and ensure their service users receive the protection they need at, what is often, their most vulnerable time.”

          What actions do mental health providers need to take to mitigate fixed ligature related health and safety risks?

          According to guidance by the CQC, in general inpatient wards, individual and ward risk assessments should include potential ligature points and any risks identified must be managed.  The same applies in psychiatric intensive care units.

          To receive a Royal College accreditation, the unit would be expected to have undertaken an assessment of the necessity of any fitting that could be a potential ligature point. Where such fittings were unavoidable, they should not be able to bear a load of more than 20 kilos.

          Medium secure services must meet NHS England standard contract for medium secure services states that services “will meet” the best practice guidance from the Royal College. This states that in medium secure wards:

          • No ligature points in bathroom and shower areas.
          • There is a system in place to formally assess the clinical environment twice a year (minimum) to ensure that ligature points are identified, and appropriate action taken.
          • There is a system in place for staff to report any ligature points identified with prompt follow up action.

          Staff should be trained on how to conduct an assessment for potential ligature points and keep a record of who has carried out the checks and when they were last done.

          Concluding comments

          Article 2 of the European Convention on Human Rights (ECHR) provides that ‘everyone’s right to life shall be protected by law’ and that ‘no one shall be deprived of his life intentionally’.  This puts a duty on all NHS health providers to ensure that their outpatient and inpatient premises are safe, and this includes ensuring that there are no fixed-ligature points in places where mental health patients may be placed.

          Tanveer Qureshi specialises in white-collar crime and regulatory investigations and prosecutions.  If you require legal representation, please contact Tanveer directly at or via his chambers, 4-5 Gray’s Inn Square. for more about Tanveer or to subscribe to his newsletters, please go to 

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            Understanding CQC Prosecutions

            In April 2021, the East Kent Hospitals University NHS Foundation Trust pleaded guilty to failing to provide safe care and treatment to a newborn baby and his mother, which resulted in the infant dying seven days after a Caesarean birth.  The Care Quality Commission (CQC) brought the prosecution following an inquest into the death of the infant.  What was unique about this case is that it marks the first time the watchdog has prosecuted a regulated provider for a clinical failure as opposed to a health and safety breakdown.

            The fact that the CQC has extended its scope for prosecution into clinical failure means those regulated by the watchdog must have a clear understanding of how it operates and its enforcement powers.

            What is the CQC?

            The CQC is an independent body that regulates a broad range of services that the general public rely on, including:

            • Hospitals.
            • Adult social care providers.
            • Mental health and community health services.
            • GP practices.
            • Health and social care in prisons and young offenders’ institutions.
            • Primary care dental services.

            The regulator’s two primary purposes are:

            • To protect people who use the above-regulated services from harm and the risk of harm, and to ensure they receive health and social care services of an appropriate standard, and
            • To hold providers and individuals to account for service failures.

            Can the CQC prosecute people?

            The CQC has the power to bring enforcement action against an individual if:

            • They breach the conditions of their registration.
            • The offence has been linked to or caused by their negligence.
            • Bringing a prosecution is in the public interest.

            What is the process the CQC will follow if they are required to investigate a regulated service or person?

            If required to make an enforcement decision, the CQC will use a four-step process:

            • Initial assessment – a Management Review Meeting (MRM) will be held to consider the case.  Most cases will then progress to a focused inspection or standard direct checks.  However, if the matter is serious enough, the process of collecting evidence for a potential prosecution will begin.
            • Legal and evidential review – the CQC will carefully examine the evidence it has gathered and check it was obtained, recorded, and logged in accordance with statutory guidance. 
            • Tests to assess appropriate enforcement action – inspectors will consider the following in order to decide what type of enforcement action to take:
              • The seriousness of the concerns.  Here, inspectors must determine whether there is evidence of systematic failings in the quality of care or management, resulting in the same issues happening again.
              • Is there evidence of multiple or regular breaches?  A positive answer is likely to result in harsher enforcement action and may also result in criminal prosecution being pursued.
            • Final decision – A further MRM is held where a final decision on the enforcement action to take will be made.  This is done with reference to the priorities set by CQC’s Board and agreed in the CQC’s business plan.

            What enforcement action can the CQC take against a regulated body or individual?

            Several enforcement action routes are available to the CQC, including:

            • Simple cautions – these are given in situations where there is enough evidence to prosecute but it is believed that improvements can be made, and the provider is prepared to take action to remedy failings.  If the breach does not greatly affect service users, a caution is likely to be given.    Although the provider does not have to accept the caution, the CQC can consider prosecution if acceptance is refused.
            • Fixed Penalty Notices – as with cautions, there is no obligation to pay a Fixed Penalty Notice; however, failure to do so may result in a prosecution being brought.  If a breach occurs across a sector, multiple providers can be issued with a Fixed Penalty Notice.
            • Prosecution – this will be considered in cases where multiple breaches have occurred, avoidable harm was caused to the service user, and/or the provider has acted deceitfully or withheld information.

            Civil enforcement powers can also be used, including:

            • Imposing, varying, or removing conditions of registration.
            • Suspending registration.
            • Cancelling registration.
            • Urgent procedures for cancelling registration, suspending registration, or imposing or varying conditions.

            The following special measures can also be imposed:

            • A direction that changes must be made within a certain timeframe to ensure inadequate care does not continue.
            • Coordination with other regulators.

            Can enforcement measures be appealed?

            If a registered body or person disagrees with a CQC enforcement measure, it or they can appeal to the First-tier Tribunal (Care Standards).

            Appeals must be lodged within 28 days of the service of a:

            • Decision notice.
            • Notice imposing, varying, or removing conditions using the urgent procedures.
            • Court Order cancelling a registration using urgent procedures.

            There is no right of appeal concerning warning notices, penalty notices, or criminal convictions.

            Final words

            A CQC prosecution can have serious consequences for a registered provider’s or person’s professional reputation and ability to deliver care in their sector.  The key to mitigating the risk of persecution and media interest is to instruct a lawyer who has expertise in regulatory investigations and prosecutions. If you are facing a CQC prosecution, please contact me urgently.

            Tanveer Qureshi specialises in white-collar crime and regulatory investigations and prosecutions. If you require legal representation, please contact Tanveer directly at or via his chambers, 4-5 Gray’s Inn Square.

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              Drayton Manor Fined £1 Million – What H&S Failures Resulted In A Child’s Death?

              In May 2017, 11-year-old Evha Jannath was killed following an accident on the Splash Canyon water ride at Drayton Manor Park.  On 18 March 2021, the theme park was fined £1 million after pleading guilty to breaching Section 3(1) of the Health and Safety at Work etc. Act 1974.

              The sentencing judge, Mr Justice Spencer concluded: “This was an utterly tragic waste of a young life.”

              The fine will not be paid because the company operating Drayton Manor has gone into administration and the theme park has been sold.

              How was the accident caused?

              On the day of the accident, Evha Jannath and four friends from Jameah Girls Academy in Leicester boarded one of the boats on the Splash Canyon river rapids.  Evha got to her feet mid-way through the ride and fell in the water.  It took 18 minutes for park staff to reach the little girl and by then it was too late to save her.

              Section 3 of the Health and Safety at Work etc. Act 1974 provides that every employer must “conduct his undertaking in such a way as to ensure, so far as is reasonably practicable, that persons not in his employment who may be affected thereby are not thereby exposed to risks to their health or safety.”

              Following its investigation, the Health and Safety Executive (HSE) found there was inadequate or poorly visible signage telling riders to remain seated.  Furthermore, there was a lack of staff training, understaffing, and failure to have an emergency plan for the ride.

              The Court heard that there had been 14 previous instances of people falling into the water whilst on the ride, including a 10-year-old boy who was rescued by members of the public as staff had not noticed the incident.

              There was also a failure by staff to tell passengers on the ride to stay seated.  Evidence showed that people standing up on the ride was a “relatively frequent” occurrence and that on “9% to 16%” of journeys, there was passenger “misbehaviour.”  On the day Evha died, 70 people had stood up in the boats.  Furthermore, the loudspeaker system designed to control passenger behaviour was never used to order those 70 people to sit down.

              No staff members saw Evha fall into the water.  Investigators discovered that CCTV only covered half the course and was static.  Also, the CCTV was not always monitored as the ride’s operator had to split their time between watching the footage and helping passengers board the boats.

              Just under a month before the fatality staff members raised concerns to park management over the lack of signage, the CCTV, and the use of sprinklers that sprayed passengers with water, thereby encouraging them to stand up.  Mr Justice Spencer commented:

              “Nothing had been done in the short time between this meeting and the fatal accident to address these matters. But there was a clear appreciation of several ongoing issues concerning safety on the Splash Canyon ride.”

              Following the hearing, HSE Principal Inspector Lyn Spooner said:

              “As a result of Drayton Manor’s failings 11-year-old Evha Jannath, died at the end of what should have been a fun day out.

              “The risks from ejection from the raft had been evident to Drayton Manor for some time, yet they still failed to take the action that could have prevented Evha’s death.

              “This tragic event should never have happened and my thoughts and the thoughts of HSE remain with Evha’s family and friends.”


              Evidence showed a litany of failures that resulted in Evha Jannath’s death.  This case highlights the importance of updating risk assessments when incidents occur.  For example, analysis showed that the Splash Canon ride was dangerous as a high percentage of riders stood up in the boats.  An undertaking of a comprehensive risk assessment, followed by procedural changes to mitigate the risks identified; for example, investing in a broader CCTV system that had a dedicated staff member to monitor it and increasing staff training, would likely have prevented Evha’s death.

              One of the best ways to ensure your business has adequate risk assessments in place and is meeting its statutory duty under section 3 of the Health and Safety at Work etc. Act 1974 is to work with an experienced health and safety lawyer.  They can audit your health and safety policies and procedures and, should the HSE launch an investigation into your business, advise and represent you to ensure your best interests are protected.Tanveer Qureshi specialises in white-collar crime and regulatory investigations and prosecutions.  If you require legal representation, please contact Tanveer directly at or via his chambers, 4-5 Gray’s Inn Square. for more about Tanveer or to subscribe to his newsletters, please go to 

              Book a Discovery Meeting

              Contact me now for a consultation.

                HMO Landlords Face Unlimited Fines Under New Fire Regulations

                Landlords and managing agents of houses in multiple occupation (HMO) could face unlimited fines under new measures to be included in the Building Safety Bill, likely to come into force in 2022.

                As part of the reforms resulting from the Grenfell Tower tragedy, the measures will amend the Fire Safety Order to:

                • improve the quality of fire risk assessments and competence of those who complete them;
                • ensure vital fire safety information is preserved over the lifespan of all regulated buildings;
                • improve cooperation and coordination amongst people responsible for fire safety and making it easier to identify who they are;
                • strengthen enforcement action, with anyone impersonating or obstructing a fire inspector facing unlimited fines;
                • strengthen guidance issued under the Fire Safety Order so that failure to follow it may be considered in court proceedings as evidence of a breach of compliance;
                • improve the engagement between Building Control Bodies and Fire Authorities in reviewing plans for building work;
                • require all new flats above 11 metres tall to install premises information boxes.

                The unlimited fines relate to the offence of obstructing or impersonating fire inspectors.

                The measures form part of the Government’s response to the Fire Safety Consultation that ran from July to October 2020.

                What Is the Fire Safety Consultation (the Consultation)?

                The British Government is determined that the fire which consumed Grenfell Tower and cost 72 people their lives never happens again.  This will be achieved by reforming building and fire safety laws.

                The Consultation paper proposed to:

                • “strengthen the Regulatory Reform (Fire Safety) Order 2005 and improve compliance
                • implement the Grenfell Tower Inquiry Phase 1 Report recommendations that require a change in law to place new requirements on building owners or managers of multi-occupied residential buildings, mostly high-rise buildings
                • strengthen the regulatory framework for how building control bodies consult with Fire and Rescue Authorities on planning for building work and the handover of fire safety information”.

                The Government’s response to the Consultation stated that in general, its proposals for improvement received a positive response, especially in relation to strengthening the Regulatory Reform (Fire Safety) Order 2005 (FSO) and improving overall regulatory compliance.  The response document also stated that a:

                “….recurring theme throughout many of the responses was the need to consider other risk factors in addition to a building’s height in order to determine the extent of fire safety measures necessary to mitigate them. This point was particularly emphasised in relation to higher risk workplaces.”

                Have there been any recent prosecutions against landlords for breaching fire safety regulations?

                There have been several recent incidents of landlords being prosecuted for fire safety offences, including:

                • In February 2021, an HMO landlord was prosecuted following a fire in a five-bedroom home.  Only one fire detector had been fitted. Taunton Crown Court handed down a nine-month custodial sentence, suspended for 18 months.
                • A landlord who had previous convictions for harassing tenants, failure to comply with improvement notices, and poor management of HMOs was ordered to pay over £7,000 in fines and costs for fire safety failures.  Sentencing, which took place in Sheffield in March 2021, also saw the landlord given a 12-month Community Order.  When inspecting the property, housing officials found evidence of inadequate fire detection and heating systems, damaged fire doors, serious damp, unsafe electrics including bypassed electricity meters, and rat infestations, which they said left occupants ‘vulnerable to serious risk of harm from fire and infection’.
                • In October 2020, a landlord was sentenced to four months imprisonment, suspended for 12 months, with a fine of £20,000 and £12,000 in costs following the death of a tenant in a house fire.  The HMO was occupied by seven people; however, there were no fire doors and although some fire detection was present it may not have worked.  Furthermore, there was no linking in the fire detection apparatus as required by law.

                Final words

                Local and central authorities are increasing their enforcement of landlord fire safety breaches.  The new measures to be included in the Fire Safety Bill will add to fire safety compliance requirements applicable to landlords and managers of HMOs. If you are being investigated for suspected fire safety compliance breaches, it is imperative that you contact a criminal defence lawyer or barrister immediately to ensure the best interests of you and/or your company are protected.Tanveer Qureshi specialises in white-collar crime and regulatory investigations and prosecutions.  If you require legal representation, please contact Tanveer directly at or via his chambers, 4-5 Gray’s Inn Square. for more about Tanveer or to subscribe to his newsletters, please go to 

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                  Non- Privileged Email Attachments Not Covered By Legal Professional Privilege

                  The Supreme Court has stated that non-privileged email attachments are not covered by legal professional privilege.  This is the case even if the email itself is protected.

                  The UK’s highest court refused permission to appeal in Frasers Group Pls (formerly Sports Direct International plc) v The Financial Reporting Council Ltd after the retailer challenged the decision of the High Court and Court of Appeal that it had to disclose 21 email attachments.

                  Permission to appeal was refused because the Supreme Court concluded Frasers Group’s application did not raise any arguable points of law.


                  The Financial Reporting Council (‘FRC’), which regulates auditors, is involved in an ongoing investigation into the conduct of Sports Direct’s former auditors, Grant Thornton UK LLP and of a person working at the firm.  The investigation concerns the audit of the financial statements of Sports Direct and its subsidiaries for the year ending 24 April 2016 and in particular, the engagement by a subsidiary of Sports Direct called Sports Direct Retail of an entity called Barlin Delivery Ltd to provide delivery services to that subsidiary’s customers.  The relationship between the owners of Barlin and Sports Direct was not disclosed in the group’s accounts, and this resulted in a regulatory investigation being launched.

                  During April and May 2017, the FRC issued notices to Sports Direct under para. 1 Schedule 2 of the Statutory Auditors and Third Country Auditors Regulations (‘SATCAR’) and rule 10(b) of the Audit Enforcement Procedure seeking certain categories of documents.  The relevant notice relating to the case was issued on 20 April 2017 (‘the Notice’).  It stated that for the purposes of the investigation, Sports Direct must provide in electronic format all emails and attachments to emails in the possession and control of Sports Direct which (i) relate to the audit; (ii) are held by one or more of five identified custodians; (iii) are dated within certain specified date ranges; and (iv) are responsive to one or more of 27 different specified search terms.

                  Sports Direct provided around 2,000 emails but withheld 40 claiming they were subject to legal professional privilege (‘LPP’) as they comprised of emails and attachments sent to or by Sports Direct’s internal and external legal advisors.

                  The FRC argued that although the emails did contain material that would normally be protected by LPP, they fell within a narrow exception recognised in case law meaning that in the particular circumstances of this request the handing over of the 40 emails would not prejudice Sports Direct’s privilege.  Alternatively, the FRC stated that any infringement would be a technical infringement only and would be authorised by the SATCAR regime.

                  The High Court decision

                  At first instance the High Court judge accepted the FRC’s arguments, ruling that even if the emails themselves attracted LPP, it did not necessarily follow that any attachments did.  This was based on dicta by Lord Hoffman in R. (on the application of Morgan Grenfell & Co Ltd) v Special Commissioners of Income Tax [2002] UKHL 21.  Sport’s Direct appealed, arguing that Lord Hoffman’s comments did not establish a principle that the production of documents to a Regulator was not always an infringement of the regulated person’s LPP.  The alternative argument was that there could be no override of even a technical breach of privilege implied into Sch.2, given the clear terms of the limitation on SATCAR’s power to call for documents.

                  The Court of Appeal decision

                  Partially overturning the High Court decision, the Court of Appeal confirmed that under English law the only exceptions to LLP is where communications between a Solicitor and client is for a criminal purpose or where legislation makes clear by express words or necessary implication that LLP is excluded if particular circumstances apply.

                  “… there is nothing in [the case law] that suggests that paragraph 1(8) of Schedule 2 to SATCAR means something different from exactly what it says. The recipient of a notice given by the FRC under paragraph 1(1) or 1(3) is not required to hand over privileged documents, whether the person entitled to the privilege is the auditor under investigation or the auditor’s clients.”

                  The Court went on to say:

                  “Moreover, if Parliament had intended to preserve some general exception applicable where documents are sought pursuant to regulatory powers, paragraph 1(8) would not have been drafted in the way it is.”

                  There was also no justification for regarding Lord Hoffmann’s comments as authority either for the existence of a “no infringement” exception to the protection conferred by LPP or for the application of some lower threshold for implying a statutory override on the ground that any infringement would be technical. 

                  However, non-privileged documents attached to an email which is protected by LPP do not acquire LPP simply by virtue of being attached to the protected email.  Therefore, they must be disclosed.


                  Companies will welcome the fact that in denying the application to appeal the Supreme Court confirmed that exceptions to LLP are extremely limited and the Courts have no immediate desire to expand them.  However, care must be taken with non-privileged documents as these can still be requested even if they were attached to an email protected by LLP.Tanveer Qureshi specialises in white-collar crime and regulatory investigations and prosecutions.  If you require legal representation, please contact Tanveer directly at or via his chambers, 4-5 Gray’s Inn Square. for more about Tanveer or to subscribe to his newsletters, please go to 

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                    The Financial Services Sector Has The Power To Help Eradicate Modern Slavery

                    Although we think of the financial sector predominantly in terms of investment and the global movement of funds, the City is in a position to immensely influence social and human rights matters such as climate change[C1] and modern slavery. With regard to the latter, the Independent Anti-Slavery Commissioner has recently published a report entitled: “Preventing Modern Slavery & Human Trafficking: An Agenda for Action across the Financial Services Sector[C2] ” (the Report). It highlights that the financial sector must do more to address modern slavery and human exploitation and sets out recommendations for how this can be achieved.

                    With over 40 million people held in modern slavery in 2016 and a further 16 million victims of labour exploitation, such abuse is a problem for every country and the UK is no exception. For example, in 2020, the Coronavirus pandemic exposed the shocking incidents of worker exploitation in Leicester textile factories[C3] .

                    Generating illegal profits of around $US150 billion per year, modern slavery is one of the top three international crimes, alongside drug trafficking and trade in counterfeit goods.

                    While the City of London may seem far from the dilapidated textile factories of Leicestershire because money laundering and fraud are intertwined with modern slavery, the financial sector must be at the heart of steps to combat it. However, the Report shows that many who work in finance have a narrow view of the sector’s impact on worker exploitation and slavery. Often only direct examples were considered, such as whether office cleaners, caterers, and construction workers were victims of such practices. However, the Report has called for the City to focus on the wider impact its business practices have on modern slavery, particularly relating to its investments, client relationships, and lending.

                    Dame Sara Thornton, the UK Independent Anti-Slavery Commissioner comments in the Report’s foreword:

                    “Financial institutions have a significant role to detect and disrupt this serious organised criminality but this report shows that through their lending and investment decisions they can do so much more. There is a growing recognition that investors and lenders do not want to invest in companies which are harming the environment. But similarly, do they want to invest in businesses that are harming people?”

                    Although the UK Modern Slavery Act 2015 requires all companies with a turnover of more than £36 million to produce an annual statement on the steps taken to tackle modern slavery and human trafficking in their organisations and supply chains, Dame Thornton states that the Report’s findings show this does not go far enough to address the “spectrum of abuses”.

                    Below are some of the recommendations made by the Report.

                    • Change begins at the top. Business leaders need to stand together against modern slavery and labour exploitation and put the issue on their Board and Senior Management agendas.
                    • Wherever possible, modern slavery should be incorporated into existing risk assessments and due diligence practices.
                    • Board members should be fully aware of the commitments they have made towards the UK Modern Slavery Act 2015 and understand the contents of the statements they sign off relating to compliance.
                    • A culture of transparency regarding the identification of modern slavery and labour exploitation in the business and its supply chains and/or client relationships should be encouraged.
                    • Procurement departments should review the recruitment processes of manpower suppliers and ensure the same is carried out across the supply lines of partner organisations.
                    • Investment companies should incorporate modern slavery and labour exploitation elements into any company-wide Human Rights Due Diligence framework, ensuring everyone across the entity is using the same risk assessment and due diligence practices.
                    • As a precondition of investment or lending terms, financial businesses should ask for proof that no modern slavery and labour exploitation exists in the borrower’s supply chain.
                    • Modern slavery red flags should be incorporated into existing money laundering control frameworks.
                    • Retail bank staff should be trained to look carefully at suspicious activity and facilitate access to bank accounts and support services for victims of modern slavery.

                    As gatekeepers to capital, financial institutions are in a unique position to positively influence clients and businesses. Dame Sara Thornton comments that although human rights due diligence is not currently required by statute “surely it is better to do the right thing rather than be forced to do so by legislation?”. Furthermore, the British Academy has confirmed that ‘the purpose of business is to solve the problems of people and planet profitably and not profit from causing problems.

                    By implementing some of the Report’s recommendations, the financial sector can significantly contribute to ending the scourge of modern slavery and the human misery it creates.

                    Tanveer Qureshi specialises in white-collar crime and regulatory investigations and prosecutions. If you require legal representation, please contact Tanveer directly at or via his chambers, 4-5 Gray’s Inn Square. for more about Tanveer or to subscribe to his newsletters, please go to

                    [C1]Climate change: a key imperative for financial services — Financier Worldwide

                    [C2]Modern Slavery and Human Trafficking in Financial Services — THEMIS (

                    [C3]Leicester: Up to 10,000 could be victims of modern slavery in textile factories | UK News | Sky News

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                      The HMRC Process For Identifying Furlough Fraud

                      The Chancellor, Rishi Sunak has announced that the Furlough Scheme, which pays a percentage of an employee’s wages if they are unable to work because of a Covid-19 lockdown, will be extended until April 2021.

                      According to The Guardian – “Against a backdrop of rising coronavirus cases and the return of tougher government restrictions that are expected to remain in place well into the New Year, the Treasury said it would continue to contribute 80% towards workers’ wages to give businesses and employees certainty.”

                      However, despite the Furlough Scheme (officially called the Coronavirus Job Retention Scheme) being extended, a parallel project is underway to claw back money that employers should not have claimed during the first lockdown (March till May 2020).  Around £3.6 billion in furlough payments have been claimed in error throughout the year and it is estimated that £2 billion of this has been stolen by criminal gangs.  In August, a 90-day amnesty period for those who had collected excess payments was announced; however, this period has now expired.

                      Several arrests have already been made in connection with furlough fraud.  The first, in July 2020 involved the fraudulent obtaining of almost £500,000.  A suspected multi-million-pound tax fraud and alleged money laundering offences were being investigated alongside the furlough fraud.  And in September 2020, an accountant and a company director were arrested following an HMRC investigation which unveiled fraud totalling £70,000.

                      HMRC are following a process when investigating suspected furlough fraud.  Below is how you can protect yourself if your business comes under scrutiny.

                      Steps HMRC are taking in identifying furlough fraud

                      If you have received payments under the Furlough Scheme, HMRC may request information from you such as:

                      • The names of employees’ who received furlough payments, the hours they worked, and how the furlough payments were calculated.
                      • Evidence of the claims and payments made.
                      • Details of any adjustments or corrections made to payments.

                      To minimise stress, make sure you have this information readily to hand.

                      If there are discrepancies or an employee informs the HMRC that furlough payments were made in error or they were asked to continue working whilst furloughed, the department may ask for further information.  Evidence may be required to show that furlough payments were necessary for the survival of the business and that your organisation complied with furlough rules.

                      If HMRC makes contact you must seek legal advice immediately.  As mentioned above, much of the furlough fraud identified was orchestrated by criminal gangs.  You may discover that your business has inadvertently been caught up in a sophisticated fraud operation.  Without expert advice from a fraud lawyer, you could find yourself subject to a stressful investigation and even prosecuted for furlough fraud.

                      How businesses have been inadvertently caught up in furlough fraud

                      The speed in which the Furlough Scheme had to be implemented and the lack of checks around claimants made it inevitable that criminal gangs would take advantage of the system.  Furlough agents accounted for around half of claims under the Jobs Retention Scheme.  Details of these agents were likely to have been stolen, allowing fraudsters to claim large amounts under the guise of legitimate organisations.  For the first few months of the scheme, many businesses may have had their details hijacked and used to make fraudulent claims.

                      A damaging fallout from this type of furlough fraud is that legitimate businesses who have unknowingly had large sums entering and exiting their company accounts may find themselves facing criminal charges.

                      How to protect yourself against furlough or bounce back loan fraud

                      To protect yourself from getting caught up in fraud committed against the government’s Coronavirus business support schemes you must invest time in conducting due diligence whenever you take on a new customer, supplier, investor, agent, distributor, or joint venture partner.  The level of due diligence required will depend on the risk posed by the party – a client you have had dealings with in the past is likely to require little more than the checking and recording of their identity.  However, an overseas prospect or investor who deals in large cash deposits will require far more scrutiny, preferably by a professional such as a lawyer or accountant.

                      It is also essential to keep a watchful eye on your business bank accounts and investments.  Any suspicious activity should be reported via a Suspicious Activity Report (SARs).  Before doing so, it is wise to seek legal advice to ensure your best interests are protected throughout the reporting process.

                      Tanveer Qureshi specialises in white-collar crime and regulatory investigations and prosecutions.  If you require legal representation, please contact Tanveer directly at or via his chambers, 4-5 Gray’s Inn Square. for more about Tanveer or to subscribe to his newsletters, please go to 

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