Financial investigation powers handed to raft of UK authorities

The UK government is handing authorities, including data protection authority the Information Commissioner's Office (ICO), new powers that will give them the power to conduct their own financial investigations.

Accredited financial investigators at the ICO, along with the Department for Transport, the London Fire Commissioner and the Department for the Economy of Northern Ireland, will now be able to conduct investigations, apply for restraint orders and carry out search and seizure exercises in circumstances where they believe cash has been obtained through or intended for use in criminal activities.

The legislation allows financial investigators to discharge powers which are normally granted to law enforcement officials such as police officers, Pinsent Masons said in a briefing note on 18 June.

The amendments were made through the Proceeds of Crime Act 2002 (References to Financial Investigators) Order 2021, which will come into force on 28 June 2021.

Data protection law expert Laura Gillespie of Pinsent Masons, said: "The introduction of this legislation is a huge milestone for the ICO in its approach to criminal conduct.

"Until now, the ICO has had to work in partnership with other agencies to conduct financial investigations. Given the potential financial gain obtained through criminal activity involving personal data, it is clear that having the direct power to undertake financial investigations and apply to court for restraint of any assets will be very significant. This is especially so, given the rise in prevalence of ransomware attacks," Gillespie said.

Gillespie pointed to the recent seizure by the US Department of Justice of $2.3m in cryptocurrency as an example of the type of activities which the ICO may now be able to undertake. The sum had been paid to ransomware extortionists which allegedly represented the proceeds of a payment made to individuals in a group known as Darkside, which had targeted oil company Colonial Pipeline.

"The ability for the ICO to directly follow the trail of criminal proceeds will be crucial in the fight against cybercrime," Gillespie said.

The ICO applied for direct powers under POCA in November 2019, opening a consultation into the proposal. It said at the time it had previously relied on help from partner agencies to exercise powers under POCA, but this help was no longer available.