Asset Recovery – The Court Orders that can be made

Asset recovery is a complex process which requires specialist legal and investigative expertise to succeed.

When recovering assets, the court plays a vital part in the process and obtaining a judgment swiftly can be fundamental to prevent the dissipation of assets. The faster an order against a target can be obtained, the more likely the assets can be preserved. There are many tools available to the Courts which assist claimants to trace and recover assets. This article highlights some of the most noteworthy orders available and their effects. 

A Domestic Freezing Order 

A Domestic Freezing Order prevents the target from dealing or dissipating assets until a final judgment is obtained. It affects bank accounts, and any assets held such as property and cars. There is a full and frank disclosure process, and the receiver of the Order has to disclose their direct and indirect assets regardless of whether they are the beneficial owner of the asset. It is common practice for assets to be hidden within companies or transferred to connected persons – such Orders are designed to “pierce the corporate veil”. 

Such orders will only be applicable to a target’s assets in England and Wales. The applicant must prove there is a serious risk of dissipation for the order to be granted.  

Worldwide Freezing Order (WFO)  

The Worldwide Freezing Order is the one of the most powerful tools at the Court’s disposal. If a Court grants a WFO against a specific target, the effect of which is similar to a Domestic Freezing order but can be enforced anywhere in the world. Again, the burden is on the Claimant to prove a risk of dissipation. 

Passport Freezing Order 

A Passport Freezing Order may be granted in conjunction with other court orders if there is reason to believe the Defendant is a flight risk – it forces the receiver of the order to deliver up their passport to the Court. If a Defendant is allowed to leave the country, prior to their assets being frozen and prior to judgment, there is a serious risk of the assets never being recovered and the Defendant never being seen again. It is therefore essential this order is obtained swiftly and diligently. 

Norwich Pharmacal Order (NPO)

The NPO imposes a duty on the respondent to disclose specific documents to the applicant. A common aim of the NPO is to identify the true perpetrator and to obtain sufficient information to continue the investigation. Generally, the party receiving the Order will not be a defendant in the proceedings but will have been caught up in the actions of a Defendant. NPO’s are commonly used against banks in fraud claims where the claimant is seeking to trace stolen assets. 

Bankers Trust Order

The Bankers Trust Order, if granted by the court, requires a bank to disclose a specific target’s banking correspondence and statements, enabling the claimant to trace and identify the target’s location which subsequently increases the likelihood of preserving assets. Obtaining a Bankers Trust Order is not always straightforward as speed is a necessity to preserving assets, but they have now been approved for use in the tracing of cryptocurrency.

Mark Forman recently presented a Podcast with Prevail Partners and Intelligence Sanctuary which looked in detail at asset recovery and the investigative tools and expertise available. For more details see Asset Recovery.