Unpacking Account Freezing and Forfeiture Orders.

The Quiet Game-Changer in UK Financial Crime Enforcement 

By Lennie Harris. C.A. – Forensic Chartered Accountant 

While the flashy headlines may have gone to Unexplained Wealth Orders (UWOs) — with their tales of luxury shopping sprees and multimillion-pound mansions — a quieter but arguably more potent legal tool has been taking root in the UK: Account Freezing Orders (AFrOs) and Account Forfeiture Orders (AFOs). 

These powers, introduced through the Criminal Finances Act 2017, have become an essential part of the UK’s modern asset recovery toolkit. With minimal publicity, they’ve been used to freeze and ultimately seize hundreds of millions of pounds linked to suspicious or unlawful conduct — all without the need for a criminal conviction. 

Why Were AFrOs and AFOs Introduced? 

The National Crime Agency (NCA) estimates that over £190 billion of illicit funds are held in UK-linked bank accounts. Historically, recovering those funds required either a criminal conviction or costly, complex civil litigation. AFrOs and AFOs provide a simpler and more efficient route to disrupt and confiscate criminal money. 

The Government’s aim, via the Criminal Finances Act, was clear: 

“To significantly improve our ability to tackle money laundering, corruption, tax evasion and terrorist financing [and to] make the UK a hostile environment for those seeking to move, hide and use the proceeds of crime and corruption.” 

What Are AFrOs and AFOs? 

·        AFrOs: Freeze funds held in bank or building society accounts where there are reasonable grounds to suspect the money is linked to unlawful conduct. 

·        AFOs: Permanently forfeit those funds to the state after further legal steps. 

They’re governed by civil procedures but don’t require a criminal charge or conviction. The bar is set low — “reasonable suspicion” is enough to trigger action. 

How Are They Being Used? 

AFrOs have become a standard feature of financial crime investigations. Their use is growing fast. In 2018 there were 166 such orders rapidly rising to over 700 valued at over £110 million. Now there is well over £210 million frozen. Examples include the son of a foreign politician; Asian based fraud and overseas students suspected of money laundering. 

Why Are These Orders So Effective? 

1.        Speed and Simplicity: AFrOs can be issued before a formal investigation has even started. 

2.        Low Threshold: Unlike restraint or freezing orders in criminal or High Court proceedings, the standard is just “reasonable suspicion.” 

3.        No Involvement Required: The account holder doesn’t even need to be suspected of wrongdoing. 

4.        Non-Conviction Based: No need to prove guilt, only that the funds are likely to have been derived from criminal conduct. 

Legal Process and Safeguards 

·        Applications are usually made to a Magistrates’ Court, typically by officers from the NCA, HMRC, or Serious Fraud Office. 

·        Orders can last up to two years and may be granted without notice to the account holder in urgent cases. 

·        The courts must consider proportionality, such as the length of time funds are frozen and the complexity of investigations. 

·        Those affected can apply to have funds released for living expenses, business costs, or legal fees — though this requires evidence and sometimes a fight. 

Can You Challenge an AFrO or AFO? 

Yes — but the options and strategy depend on the case: 

·        Apply to discharge or vary the order: If there are no reasonable grounds or the funds are demonstrably lawful. 

·        Challenge forfeiture: You can wait and challenge the AFO application, where the enforcement agency must prove the money is criminal. 

·        Reach a civil settlement: In some cases, carving out “clean” funds may be a pragmatic solution. 

·        Judicial review: The only route to challenge an AFrO since there's no statutory right of appeal. 

However, if you let an AFrO run its course and the money isn’t forfeited, compensation is only available in exceptional cases. As with all such cases speed is of the essence and the use of a professional and knowledgeable Forensic Accountant is a useful and essential addition to the legal team. 

Key Considerations for Legal Advisers 

A retained Forensic Accountant will: 

·        Request full disclosure behind the freezing order, especially in without notice cases. 

·        Ensure clients provide full details of assets to secure releases for expenses. 

·        Evaluate whether to fight or wait — sometimes silence is strategic. 

·        Consider the impact on reputation and operations, especially for companies. 

What’s Next? 

Authorities are now using these powers in COVID-19 fraud cases and Encrochat investigations, and they’re expected to be a mainstay in financial crime enforcement. 

International cooperation is growing, too. UK law now allows domestic agencies to act on requests from foreign enforcement bodies — even if no proceedings are underway abroad. 

The line between criminal and civil asset recovery is blurring. AFrOs and AFOs are reshaping the landscape, and those caught in their net need to understand the risks, rights, and routes to respond. 

Conclusion 

AFrOs and AFOs might lack the headline-grabbing allure of their UWO cousin, but they are arguably far more impactful in practice. With low thresholds and sweeping powers, they offer a streamlined route to seize suspicious wealth. Whether defending or deploying these tools, understanding their reach and limitations is now a must for anyone working in financial crime and compliance. Importantly it is imperative to involve a professional with full knowledge and understanding of the rules surrounding these orders.  Forensic accountants are well placed to advise on these complicated issues and can be briefed individually or as an extension to a client’s legal team.  The earlier you act the better.