Terrorist asset-freezing: an intrusion too far – Dr Cian Murphy
21 December 2011
One could be forgiven, amidst the furore over the European Court of Human Rights’ Al-Khawaja judgment last Thursday, for missing the first report of the Independent Reviewer of Terrorism Legislation on the operation of the Terrorist Asset-Freezing etc Act 2010. The Report runs to over 100 pages and is the most comprehensive account of UK terrorist asset freezing in print.
It is the third report of the current Independent Reviewer, David Anderson Q.C., since he took up the post in February. Asset freezing is something of a speciality of his, as he has appeared in litigation in both EU and UK courts on the matter. It is therefore unsurprising that the Report exhibits the same attention to detail that made the Anderson’s previous two efforts essential reading.
Although press coverage of the Report has concentrated on some of the catchier phrases (‘financial house arrest’) there is much in the Report that merits closer consideration. It teases out the listing and delisting processes to consider the operation of the law with remarkable precision. Indeed, the Report’s greatest success is lifting the shroud of secrecy on the system’s operation. This is achieved in two ways.
First, the Report clearly sets out the legal regimes involved (for there are several) and indicates how they interact. Second, it puts a human face on those targeted by making available the details of individual cases. Thus, we learn that most of those targeted are already incarcerated or are overseas – with only five individuals at liberty but subject to UK asset-freezing (one of whom has now been delisted). Many of those targeted have few, if any, assets in this jurisdiction. The system is a sledgehammer to crack a nut – and there is cause to doubt both the necessity and the effectiveness of that approach.
Although many of those targeted are either incarcerated or overseas there remains a significant societal impact. The fact that all those targeted are male conjures a misleading image of footsoldiers on the wrong side of a ‘war on terror’. Several of those targeted have never been convicted of any crime. Many have families whose daily lives are seriously disrupted by the sanctions. These effects have been ameliorated by a successful challenge to HM Treasury’s interpretation of the law and subsequent amendments to the legal framework.
Anderson’s Report contains details on the cruel intrusions into the daily lives of often-vulnerable families. A seemingly unrelated but nonetheless notable feature of the Report is its examination of the system’s cost to business. It is not just human rights lawyers that are dismayed at its operation as it also causes severe compliance headaches for financial institutions. The onerous regulatory burden placed on such institutions may lead them to simply decline custom from designated persons – even after their designation has ended. The impact on business thus compounds the problems for targeted individuals and their families.
The Report affirms Anderson’s emerging philosophy on counter-terrorism reform: that the courts and Parliament complement rather than challenge each other in holding the executive to account. This has been the case in recent years with court judgments prompting legislative reform and with the House of Lords in particular amending draft legislation to improve rule of law compliance. Anderson does not, in this Report, recommend amendments to the asset freezing legislation.
Nonetheless the reform process continues. The European Court of Justice today reaffirmed its strong stance on the rule of law in EU asset freezing. Next year will see judgments from both the European Court of Human Rights and the European Court of Justice on UN asset freezing. If the courts continue their defence of the rule of law there may be further legislation in response.
Overall, Anderson’s Report paints a picture of a system that is highly intrusive but not extensively used – an ‘ancillary’ part of UK counter-terrorism. However, it consumes an inordinate amount of time for those involved in the administration of justice, in Government, in the courts, the academy and the legal profession. An optimistic view is that recent reforms are steps in the right direction. The pessimistic outlook is that the tools of oppression are merely being refined.
What remains unclear is whether the system in general or any individual designations do anything at all to make us safer. That question should be at the heart of the debate on the system’s future. The Independent Reviewer’s Report at least ensures that the debate is that much more enlightened than it was before.
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