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ARE HIGH NET WORTH INDIVIDUALS PROTECTED FROM EXTRADITION?: A LOOK AT THE CURRENT EXTRADITION LANDSCAPE

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‘ARE HIGH NET WORTH INDIVIDUALS PROTECTED FROM EXTRADITION?: A LOOK AT THE CURRENT EXTRADITION LANDSCAPE’

By Nick Vamos, Partner at Peters & Peters Solicitors LLP

International law enforcement activity against financial crime, bribery and corruption has never been more energetic. New regulatory provisions, criminal offences and law enforcement tools hove into view with increasing frequency. In the UK in the last few months alone we have seen the introduction of Unexplained Wealth Orders, a new offence of failing to prevent the facilitation of tax evasion, the creation of the National Economic Crime Centre, the appointment of an Anti-Corruption Champion and beefed up anti-money laundering powers for the NCA. Worldwide, the picture is similar; whether driven by countries with a strong adherence to the rule of law looking to protect businesses and the integrity of financial systems, or regimes emerging from periods of instability wanting to improve their geo-political standing and encourage foreign direct investment by upping their criminal enforcement game – or at least appearing to.

Nick Vamos

Nick Vamos

At the same time, adherence to human rights and the rule of law is on the wane – at least in some jurisdictions. International business people and HNWIs might find themselves on the wrong end of a politically motivated fraud, bribery or corruption investigation, initiated by a country with a dubious track record for fair trials, independent judges and human rights-compliant detention facilities. These two themes–rising enforcement but falling standards of justice – come together most starkly in the world of extradition. The UK, thanks to its world-renowned legal system, vigorous defence extradition bar and unimpeachable judiciary, is a popular place to resist extradition from. As a result, the UK courts have had to pass judgment on the criminal justice systems in many other jurisdictions and, increasingly, have found them wanting.

Prison conditions

One by-product of the worldwide recession has been the chronic underfunding of prisons – never much of a vote winner even in times of plenty. The UK High Court has barred extradition in many cases because the conditions in the prison where the suspect would be held amounted to “inhuman and degrading treatment” and therefore in breach of Article 3 of the European Convention of Human Rights. The severity of the offence is irrelevant: the court will protect the human rights of alleged murderers, rapists and white collar criminals alike. The blacklisted countries include many in the European Union as well as Asia, Africa and South America. The courts focus not just on the state of the prison system as a whole, but on overcrowding, the allocation of personal space, hygiene, violence from other prisoners and guards and the availability of adequate healthcare, which is particularly important for suspects with medical needs.

Vincent Mallya, ex-head of United Spirits, Kingfisher Airlines and the Force India Formula One team, is currently fighting extradition from the UK to India.  His lawyers are relying on two earlier precedents in which the court found that conditions in Indian prisons were so appalling that it would breach the human rights of the suspect to be extradited. The Indian authorities have countered this argument with an assurance that, whatever the conditions facing the general prison population, they can promiseMrMallyathat he will get his own special, human-rights-compliant, cell. The South African authorities gave a similar assurance to businessman Shrien Dewani so that he could be extradited to face trial for conspiracy to murder his wife, for which he was eventually acquitted. Such assurances have become prevalent in extradition cases, especially where the political and financial stakes are high. One senior judge has described the use of assurances to get around human rights arguments as “not merely normal, but indispensable in the operation of English extradition law”.

In fact, assurances have become so common-place that the new extradition battleground is about whether such assurances can be relied upon. How does a court monitor and enforce an assurance about how much personal space and time out of his cell a suspect will have after he is sent back? There is no mechanism to demand that a suspect is returned to the UK if he is mistreated following extradition, so what can the court do if the assurance is broken? Defence lawyers are arguing that some assurances – and some countries – simply should not be trusted.  Russian prisons are notoriously overcrowded, violent and lacking in basic facilities. The Russian authorities routinely provide assurances that extradited suspects will only be detained in specific prisons that have been inspected and approved by independent experts, and that British consular staff will be able to monitor compliance. In one recent case the suspect, a Russian citizen, argued that the nearest Consulate was 1,500 miles from the prison that had been earmarked for him, and that there was evidence that the Russian authorities had hoodwinked the expert into reporting it was not over-crowded by transferring out half of the inmates the week before the inspection. Nevertheless, the High Court decided that there was insufficient evidence to displace the assumption that Russia would honour its diplomatic promises, and ordered extradition.

Fair trials

Extradition can be refused on the basis that the suspect will not receive a fair trial. This requires cogent evidence, not just that requesting State has a malfunctioning judicial system, but that the suspect, in particular, will be subject to a “flagrant denial of justice”. Such challenges are often brought against extradition from countries with weak or fragile democratic institutions, a track-record of political interference in the criminal process or recent regime change leading to the settling of scores. Sometimes the best evidence comes from the mouths of the political leaders themselves, who cannot resist pronouncing publicly on the obvious guilt and future punishment of the suspect. However, the threshold for a successful challenge is very high. The only two recent examples involve Russia, whose request to extradite businessman Georgy Shuppeon fraud charges was refused on the basis that President Putin was overtly and implacably hostile to his late father in law Boris Berezovksy, and Rwanda, who the court ruled would not be able to give a fair trial to five suspects accused of involvement in the 1994 genocide.

INTERPOL

The precursor to a full-blown extradition request can often be a ‘Red Notice’ issued by INTERPOL. Contrary to popular myth, INTERPOL is not a cadre of super-cops with cross-border powers, but more like a large database with a small brain for the exchange of information between national police forces. Neither does it have a ‘most wanted’ list, but merely a register of people wanted for an assortment of crimes ranging from serious to trivial. A Red Notice is simply a notification, from one country to all the others, that a suspect has been accused or convicted of an offence and he is outside the jurisdiction. The threshold for issuing is low: the requesting State need do little more than assert that the suspect is under investigation. But the existence of a Red Notice does not mean that a suspect necessarily will be arrested, let alone extradited. Many countries, including the UK and US, will insist on a formal extradition request. If there is no Treaty that permits extradition, then it cannot take place irrespective of the Red Notice. However, there are still enough countries that will arrest on a Red Notice to make it a serious curb on a suspect’s ability to travel and conduct business. If the Red Notice is made public, then it may significantly limit access to banking and other financial services.

Some countries have been accused of abusing INTERPOL membership for political ends – issuing Red Notices merely to harass and disrupt those with whom they are displeased, rather than as a genuine law enforcement tool. Fortunately, INTERPOL is starting to wake up to this problem and many Red Notices have been challenged and removed on the basis that they are politically motivated or amount to a breach of the suspect’s human rights. Bill Browder, the founder of Hermitage Capital, has defeated five Russian requests to put him on the wanted list, most recently in October 2017. ZsoltHernadi, Chairman and CEO of the MOL Group, one of the largest companies in Central Europe, successfully argued in 2016 that a Red Notice issued by Croatia should be deleted.

Ultimately, all extradition cases require a court to balance the human rights of the suspect with the public interest in international co-operation to combat, deter and punish wrong-doing. Thankfully, for those jurisdictions who make criminal accusations for improper purposes, whose legal systems are opaque and vulnerable to political interference, and who detain people in abysmal conditions, the courts will still offer protection.

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Reuters Events Launch Global Investment Summit Online Edition Uniting Institutional Investors, Asset Owners & Financial Institutions

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Reuters Events – today announced the agenda for their Global Investment Summit (Dec 3rd -4th). The 2-day strategic summit has been reimagined in the era of social distancing and will be broadcast free of charge to the public.

This Summit, with a diverse range of international voices and anchored by Reuters News-led sessions, is the only place for institutional investors, asset owners and financial institutions to come to terms with the events of 2020.

Click for more information and for complimentary registration to the online edition

The Energy Transition team report an industry leading speaker faculty for 2020, including:

  • Eileen Murray, Chair, Finra
  • Philip Lane, Chief Economist, European Central Bank
  • Gregory Davis, Chief Investment Officer, Vanguard
  • Hanneke Smits, CEO, BNY Mellon Investment Management
  • Pascal Blanque, Chief Investment Officer, Amundi
  • Desiree Fixler, Group Chief Sustainability Officer, DWS
  • Joe Lubin, CEO, Consensys
  • Bahren Shaari, CEO, Bank of Singapore
  • Mark Machin, CEO, Canada Pension Plan Investment Board

The agenda released by Reuters Events Investment is both ambitious and comprehensive, and will cover four key themes: Market Outlook, Asset Management Strategies, Industry Deep-Dives and the Future of Investment.

View the full agenda here

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Halliburton & Baker Hughes CEO’s join Reuters Events: Energy Transition 2020

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Reuters Events – today announced that CEO’s of two of the world’s leading energy service companies, Halliburton and Baker Hughes, will join the speaker faculties for their flagship Energy Transition Summit.

The event will explore the creation of the future energy ecosystem and offer companies, from across the asset spectrum, a definitive guide to their net-zero strategies. The alignment of the two biggest O&G global service companies, Halliburton and Baker Hughes, represents a significant step in the transition to low-carbon energy

More information on the Europe and North America editions can be found below. Registration for the LIVE stream is free.

Alongside their CEO speaker representation, Halliburton join as Platinum sponsors of the North American edition. Baker Hughes join as gold sponsors for the European edition of the flagship energy transition program.

The Energy Transition team report an industry leading speaker faculty for 2020, including:

  • Lorenzo Simonelli, Chairman & CEO, Baker Hughes
  • Jeff Miller, CEO & President, Jeff Miller
  • Tristan Grimbert, CEO, EDF Renewables
  • John Pettigrew, Chief Executive, National Grid
  • Pratima Rangarajan, CEO, OGCI Climate Investments
  • Alex Schneiter, CEO & President, Lundin Energy
  • Gretchen Watkins, President, Shell Oil Company
  • Calvin Butler Jr., CEO, Exelon Utilities
  • Francis Fannon, Assistant Secretary ERB, S. Department of State
  • David Lawler, Chairman & President, bp America
  • Andreas Schierenbeck, CEO, Uniper

More information on the Europe and North America editions can be found below. Registration for the LIVE stream is free.

Governance & Cooperation – Does the energy transition face a ‘governance deficit’? To understand how the energy transition will develop over the next decade, it is crucial to understand the driving governing forces behind it. Will the Green Deal provide the first domino, how can we ensure progress in the shadow of Aberdeen and ensure that we translate targets into action?

Financing Energy Transition – We must address the elephant in the room; who is going to pay for it all? An understanding of where the funds are likely to come from is key to staking claim to the infrastructural projects that will redefine the modern world in the 21st century.

New Energy Infrastructure – Low-carbon energy supply and consumption will need a radical overhaul of infrastructure. As well as revamping the old, we’ll need entirely new assets and new systems of energy delivery. It’s an unprecedented opportunity with estimated spending at $70 trillion over the next decade. Knowing which technologies are ready to be scaled first is the key to understanding opportunity

Business Model Innovation – Who will provide leadership through the age of transition and how do we want our future energy system to look? Speed and timing will be crucial if you are to stay on the right side of the transition. Join us in setting business led, evidence based, targets as industry drives towards net-zero

More information on the Europe and North America editions can be found below. Registration for the LIVE stream is free.

At Reuters Events, we’re committed to tackling the Energy Transition head on; to shed light on the defining issue of our time and help energy companies meet a uniquely difficult challenge. That is, to be both an energy company of today, and the energy companies of tomorrow. In a period that will be defined by uncertainty we can, together, lighten the way forward.” – Owen Rolt, Head of Energy Transition, Reuters Events

Contact

Owen Rolt

Head of Energy Transition

Reuters Events

UK: +44 (0) 207 375 7596

E: [email protected]

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COVID-19 is changing people’s preferences when it comes to BTL investments

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COVID-19 is changing people’s preferences when it comes to BTL investments 1

By Jamie Johnson, CEO of FJP Investment

Throughout 2020, investors have had to navigate increasingly treacherous and volatile market conditions as a consequence of the COVID-19 pandemic. No country has been immune to the coronavirus outbreak, particularly here in the UK.

Yet even as the country enters another phased lockdown of sorts, demand for UK property has remained strong. After a brief period of suppressed demand after initial lockdown measures were introduced in late March, the UK’s implementation of the stamp duty land tax (SDLT) holiday triggered a rush in demand for bricks and mortar. As a result, both house prices and transactional activity is rising.

With this new surge in demand resulting in an 18-year-high of UK house price growth, according to the Royal Institute of Charted Surveyors, buy-to-let (BTL) investments have also substantially increased in popularity.

It’s easy to understand why. BTL investments offer landlords both long-term capital growth and regular returns in the form of rental payments. And now, as the SDLT holiday deadline beckons closer, investors keen on taking advantage of the comparative discounts on offer must act quickly.

My advice to those considering a BTL investment in the UK is to understand and appreciate the longstanding market changes that have been brought about by COVID-19. Traditional BTL hotspots are being challenged by a rise in tenant demand for real estate in up-and-coming cities and regions.

For example, the COVID-19 pandemic has resulted in the majority of the workforce working remotely from home. Recent data from property listing site Rightmove makes clear the shift in demand away from central London and towards less densely populated regions; with areas like Cambridge and Oxford seeing 76% and 64% more rental searches respectively and searches in areas like Earl’s Court dropping by 40%.

This is the clear result of previously London-based professionals realising the benefits of working from home. As businesses identify the financial drawbacks and COVID contagion risks of having all their staff physically present five days a week, employers will seek out smaller commercial workspaces.

At the same time, we are also seeing workers looking to rent larger, cheaper properties that might be further away from their office. This is due to the fact that they are unlikely to need to commute every working day to their office, even once the COVID-19 outbreak has been contained.

But, where exactly are the best larger, cheaper properties to be found? Where are the UK’s emerging BTL hotspots that need to be on the radar of prospective investors? I explore these pertinent questions below.

Liverpool life

Those who have been closely following the UK’s housing market will know just how primed Liverpool is for BTL investment. As a key recipient of the UK Government’s Northern Powerhouse funding, and with massive developments like Liverpool Waters and Wirral Waters soon to be completed, the city’s housing supply is ready to meet the demands of those taking part in the aforementioned London professional exodus.

With Liverpool constantly ranking No.1 in rankings of UK cities for BTL investment, it’s evident why investors would be keen on completing purchases of Liverpool property before the end of the SDLT holiday. Though even after the SDLT holiday ends, there’re still plenty of reasons to be optimistic about Liverpudlian BTL investment. Prime Minister Boris Johnson’s government is firmly committed to ‘levelling up’ the North of England through regional regeneration, and planned high speed rail connections between Liverpool and other northern cities will only add to the investment potential of the city.

Leeds living

Although Liverpool boasts the highest rental yields for BTL landlords in real terms, Leeds was recently named the most profitable city to become a landlord in the whole of the UK by CIA landlord. By evaluating numerous metrics; including mortgage costs, average rent, average monthly landlord costs and average property prices, they determined that Leeds was the best city for potential buyers to make their first foray into BTL investment.

And, looking at recent trends, it’s easy to see why. Leeds may benefit more from the London exodus than other cities due to its unique position of being a brain gain city’, i.e. one where more students remain after graduation than move away. As a result, it boasts the largest financial services sector in the nation after London, making it an ideal locale for employers in the financial services sector who are seeking cheaper commercial rent outside of London; likely bringing investment and employees with them.

With its strong urban economy likely to be bolstered by its designation as a ‘Northern Powerhouse’ leading business hub, Leeds is ideally positioned for BTL investment over the long-term.

Cardiff’s regeneration

And finally, the capital of Wales brings much to the table when deciding between different BTL investment destinations. With a metropolitan area population of over 1.1 million residents, forecasted to grow by 20% by 2035, demand for property in the city is set to rapidly increase over the next decade. Those able to capitalise on this population growth will be able to access considerable long-term investment opportunities – as recent reports suggest.

Thankfully, it’s unlikely that there’ll be any shortage of housing supply in Cardiff for BTL investors to invest in. Cardiff Bay has emerged as Europe’s largest waterfront development, and the upcoming Central Quay and £500m coastal developments will assist in attracting further investment into the city.

BTL remains a sound investment opportunity

COVID-19 has made evident just how resilient British real estate is as an investment asset. By offering the best of both worlds, namely long-term capital growth and regular rental returns, BTL has successfully remained an attractive and popular investment choice. And, with demand for housing still outstripping supply, the market need for rental accommodation looks set to only grow.

COVID-19 has permanently changed the UK’s housing market and, as explained above, new BTL hotspots are surely due to emerge over the next year. With renters seeking out larger homes in cheaper areas, flexible working patterns will forever change the landscape of the UK’s residential real estate market, and those able to capitalise on it may benefit hugely as a result.

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