Criminal Assets Bureau v John McCormack

• Jurisdiction: Ireland
• Court: Court of Appeal (Ireland)
• Judge: Mr. Justice Murray
• Judgment Date: 18 June 2021
• Neutral Citation: [2021] IECA 184
• Docket Number: Court of Appeal Record No. 2020/165

Between

Criminal Assets Bureau

Applicant/Respondent

and

John McCormack

Respondent/Appellant

[2021] IECA 184

Noonan J.

Murray J.

McGrath J.

Court of Appeal Record No. 2020/165

High Court Record No. 2018 32 CAB

COURT OF APPEAL

JUDGMENT of Mr. Justice Murray dated the 18 ^th day of June 2021

Background

1 . Section 1(1) of the Proceeds of Crime Act 1996, as amended, (‘the Act’) defines ‘ the proceeds of crime’ broadly. It means any property obtained or received at any time by or as a result of or in connection with criminal conduct. The provisions of the Act apply not merely to such property, but also to property that was acquired in whole or in part with or in connection with property that directly or indirectly constitutes the proceeds of crime. Under s. 3 of the Act, application may be made to the High Court by inter alia the Criminal Assets Bureau (‘CAB’) for orders prohibiting a named respondent from disposing of or dealing with such property. To that end CAB may rely upon evidence of the belief of certain members of the Gardaí that the property in question falls within this description.

2 . On 20 July 2020 the High Court made an order pursuant to s. 3 of the Act in respect of three properties located at 26 Purcell Park, Shannon, Cloontra West Co. Clare and Claughan Fort, Garryowen, Limerick (‘Purcell Park’, ‘Cloontra’ and ‘Claughan Fort’ or collectively ‘the properties’). Each of the properties was owned by the respondent to the proceedings, and appellant in this appeal. I will refer to him throughout as the appellant. The reasons for the Order were set forth in a detailed judgment delivered on the same date which, in turn, followed a three day hearing the previous month ( [2020] IEHC 361).

3 . In summary, the trial Judge concluded that the evidence adduced on behalf of CAB established on a prima facie basis that the appellant had for many years been involved in serious criminal activity, that the nature of that activity was such that it was likely that he gained financially from it, and that the income so generated was likely to have been the source of the funds with which each of the properties was acquired. The evidence on which the Judge based this conclusion included affidavits from two Chief Superintendents of an Garda Síochána (Detective Chief Superintendent Patrick Clavin and Detective Chief Superintendent Michael Gubbins) attesting to their belief that the properties in question had been acquired with the proceeds of crime. The court found much of the evidence adduced by the appellant (who was cross-examined in the course of the hearing) to be lacking in credibility, and held that it did not displace the inference thus arising from that presented by CAB.

The evidence

4 . It will be necessary to return later to the detail of some of the evidence adduced at the hearing. For present purposes it suffices to say that while neither Chief Superintendent Clavin nor Chief Superintendent Gubbins were cross-examined at the hearing of the matter, each relied upon inter alia the affidavit evidence of Detective Mark Davis and Detective Sergeant Kevin O'Hagan as the basis for their belief. Detective Garda Mark Davis outlined 28 previous convictions of the appellant (who was born in 1972). 14 of these were for Road Traffic matters. The others included convictions for malicious damage and larceny in 1987, demanding money with menace, burglary, aggravated burglary and malicious damage in 1988, assault in 1989, handling stolen property and possession of housebreaking implements in 1991 and possession of housebreaking implements in 1994.

5 . Detective Sergeant O'Hagan (who was cross-examined in the course of the hearing) had been in charge of the Detective Branch in Shannon since 2010. He said that from sources which, for operational reasons, he did not wish to disclose he knew the appellant to be one of the biggest suppliers of illegal drugs based in the mid/west of Ireland and that, with others, the appellant had been responsible for the importation into Ireland of ‘ vast quantities of drugs … since the late 1990s’. He said that having started to sell drugs in the Shannon area in the 1990s, the appellant fell foul of a subversive organisation active in the area resulting in him leaving Ireland. He said that the appellant had involved himself in a criminal organisation operating in Limerick in 2001 and soon became the leader of that group, which then became involved in the large scale importation and distribution of drugs into the State. He referred to the following:

• (i) On June 15 1999, 37 kilogrammes of cannabis was seized by Gardaí at Rolagh, Ballina, County Tipperary resulting in the arrest and conviction of certain persons. Detective Sergeant O'Hagan said that the appellant had direct involvement with the sourcing and movement of these drugs up and until their seizure

• (ii) On March 11 2002, the appellant's wife was found in possession of £9,500 counterfeit sterling near her home in Shannon. Detective Sergeant O'Hagan expressed the view that this currency was to be used by the appellant as part of his criminal enterprise.

• (iii) The crime group led by the appellant planned and intended to execute a ‘Cash in Transit’ robbery in Clare on 24 June 2005. That operation was interrupted by the Gardaí and a number of persons were arrested and convicted in relation to it. The investigation determined that the appellant had been involved in the planning of this crime and had sourced the van used by those arrested as they travelled to the location of the proposed robbery.

• (iv) An investigation carried out by the Garda National Drugs Unit in 2005 established that 1.5 kilos of cannabis and 500 kilos of cocaine were to be purchased on mainland Europe for importation into Ireland and that the appellant and another male brought €270,000 to Spain for the purchase of those drugs.

• (v) On 21 February 2008 Gardaí recovered €8,500 of stolen Canterbury Rugby clothing from a vehicle stopped leaving the appellant's property at Cloontra. That clothing had been stolen from Dublin Port six months previously. A search was then conducted of a lock-up owned by the appellant on the same lands and more of the same clothing was recovered. CCTV on the site was viewed and it showed the appellant orchestrating the transportation of the stolen clothing utilising two of his gang members, including a George Carmody. Arising from this operation, the appellant was charged with the offence of handing stolen property but was acquitted at the direction of the trial Judge.

• (vi) While Gardaí were searching the Cloontra property on this occasion 2.5 kilos of cannabis valued at €30,000 was found hidden on the premises. CCTV showed an employee of the appellant hiding the cannabis seized. Detective Sergeant O'Hagan said that Gardaí believed that these drugs were originally brought into the jurisdiction by a Polish employee of the appellant on his orders. He said that the appellant hired two Polish men to bring this person back from Poland (where he had fled following the seizure of the drugs) in an attempt to avoid prosecution in connection with the seizure.

• (vii) Detective Sergeant O'Hagan gave evidence that a George Carmody was one of the appellant's right hand men. Mr. Carmody thereafter took his own life, following which Gardaí conducted a search of lands near Mr. Carmody's home in Newmarket on Fergus Co. Clare, recovering €168,000 of cocaine. Detective Sergeant O'Hagan said that he believed that this was to be distributed by the appellant.

6 . The properties were acquired between 1995 and 2011 and were, at the time of the institution of the proceedings, unencumbered. It was CAB's case that during that period the appellant did not have any lawful source of income that would have accounted for his expenditure on these, and other, assets. At the time of the application to the High Court Cloontra was, according to CAB, valued at €150,000 (although the Judge did not accept fully this valuation having regard to the absence of development consent for some of the structures on it). Claughan Fort was valued at €55,000. The appellant's evidence was that Purcell Park had a value of €80,000 as of 2015. In the period from October 2008 to January 2013, the appellant and his wife also purchased four properties in Fuerteventura at a combined cost of €403,178 with a mortgage of €139,459 drawn down against same. These properties were not the subject of these proceedings, although the fact that the appellant had purchased them was clearly relevant to the issues that arose as to the income and assets available to him during this time. The Judge specifically observed (at para. 19) that the evidence relating to business activities and sources of income contained little which could suggest an explanation for how the appellant and his wife could purchase the four properties in Fuerteventura, later noting (at para. 58) that the source and method of funding for some of the mortgage repayments for these properties was ‘ unclear’. The evidence also disclosed that at the time he acquired the property in Purcell Park, the applicant was also the owner of another house at Glasgow Park, Limerick.

Sections 3, 4 and 8

7 . Both sections 3 and 8 of the Act refer to applications by, and the evidence of, ‘ a member’ or an ‘ authorised officer’. These are respectively defined as a member of the Garda Síochána not below the rank of Chief Superintendent, and an officer of the Revenue Commissioners authorised in writing by the Revenue Commissioners to perform the functions conferred by this Act on authorised officers. Section 3 then provides for the making of what it terms an ‘ interlocutory’ order, as follows:

‘3.—(1) where, on application to it in that behalf by a member, an authorised officer or the Criminal Assets Bureau, it appears to the Court on evidence tendered by the applicant, which may...