National Crime Agency v Azam & Ors [2014] EWHC 2722 (QB)

Case No TLQ/12/1039

[2014] EWHC 2722 (QB)

IN THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

Venue Royal Courts of Justice, Strand, London, WC2A 2LL

Date 31/07/2014

Before

MRS JUSTICE ANDREWS DBE

Between

NATIONAL CRIME AGENCYClaimant

AMIR AZAM & OTHERSRespondents

Andrew Sutcliffe QC and Jonathan Hall QC (instructed by National Crime Agency) for Claimant

Philip Coppel QC and Oliver Powell (instructed by Litigaid Law) for First Respondent

Hearing Hearing dates: 8-11, 14-18, 21 and 23 July 2014

Judgment

[1]This is a claim for a civil recovery order brought by the National Crime Agency (“the NCA”) formerly known as the Serious Organised Crime Agency (“SOCA”) under Part 5 of the Proceeds of Crime Act 2002 (“POCA”). The NCA may bring a claim for such an order under s.243(1) of POCA against any person whom it believes to hold recoverable property. “Recoverable property” is defined in s.304(1) as “property obtained through unlawful conduct” and includes property that represents the original property (s.305) and profits accruing in respect of the recoverable property (s.307). Property outside the jurisdiction may be recovered, provided there is a connection between the case and the relevant part of the United Kingdom (s.282A). There is no difficulty in establishing that connection in the present case.

[2]Section 241(1) of POCA provides that “conduct occurring in any part of the United Kingdom is unlawful conduct if it is unlawful under the criminal law of that part.” If conduct occurring outside the UK is relied upon, there is a “double criminality” requirement, in that it must be established that the conduct was a crime under the law of that other country and that it would have been a crime under domestic law if it had occurred within the jurisdiction (s.241(2)). Section 266(1) of POCA obliges the High Court to make a recovery order in circumstances where it is satisfied that the property is recoverable property, subject only to the proviso in s.266(3), to which I shall return in due course.

[3]The right to recover property does not depend on the commission of unlawful conduct by the current holder. All that is required is that the property itself be tainted because it, or other property which it represents, was obtained by unlawful conduct. Since property might be recoverable from someone who is entirely innocent of wrongdoing, the NCA is required to establish clearly that the property in question was obtained by unlawful conduct. It is unnecessary for the NCA to prove the commission of any specified criminal offence, in the sense of proving that a particular person committed a particular offence on a particular occasion. However it is necessary for it to prove that specific property was obtained by or in return for a criminal offence of an identifiable kind or in return for one or other of a number of offences of an identifiable kind: Director of the Assets Recovery Agency v Szepietowski

[2007] EWCA (Civ) 766

, [2008] Lloyd’s Rep FC 10, per Moore-Bick LJ at [106]–[107].

[4]If the NCA alleges that the unlawful conduct from which the property is derived is money laundering, it must establish that the respondent concerned was handling money derived from criminal activity. There are two ways of doing this: i) by establishing that the money was derived from unlawful conduct of a specific kind or kinds, or ii) by establishing that the circumstances in which the money was handled are such as to give rise to the irresistible inference that it could only have been derived from crime. See R v Anwoir and others

[2008] EWCA Crim 1354

at [21] as applied by Griffith Williams J in SOCA v Gale [2010] Lloyd’s Rep FC 39 at [17] (a judgment deservedly commended by both the Court of Appeal and the Supreme Court in that case as “meticulous and comprehensive”). Thus where money-laundering is relied upon there is no requirement to specify the predicate offence, only to satisfy the court that the evidence establishes that the property was obtained through laundering the proceeds of criminal activity.

[5]The burden of proof lies on the NCA and the standard of proof to be applied is the civil standard of the balance of probabilities: s.241(3) POCA, and see the decision of the Supreme Court in SOCA v Gale

[2011] 1 WLR 2760

. In that case it was held that an acquittal in criminal proceedings does not preclude the Court from considering evidence that formed the basis of the charges against a respondent to proceedings for civil recovery. A court may find in such proceedings that, on the balance of probabilities, the respondent committed the same act of which he was acquitted on application of the criminal standard of proof. However, it is not open to the court to undermine the effect of an acquittal by saying or deciding anything that casts doubt upon it. As Kenneth Parker J. observed in SOCA v Hymans and others

[2011] EWHC 3332

at [18]:

“This will not happen if the court’s language and reasoning go no further than is necessary for the purpose of determining the issue before that court and without making imputations of criminal liability. The fact that the findings may implicitly cast doubt on the acquittal is not sufficient to bring Article 6(2) into play. It is clear that a finding to the civil standard that unlawful conduct has been committed by a respondent who was acquitted of the very same conduct in criminal proceedings, will not undermine the effect of that acquittal.”

[6]The property sought to be recovered in this case comprises(1) eight properties, including real estate in Spain (“the Spanish Property”);

(2) the proceeds of rental income from six of the seven English properties; and

(3) the balance of the sums originally standing to the credit of three English bank accounts and two bank accounts in Luxembourg. The money in one of the Luxembourg accounts was brought within the jurisdiction pursuant to an earlier court order, and what remains of it after making permitted payments is in a client account held by a firm of solicitors, Saunders Law Ltd (“Saunders”), to the order of the court. Two further properties in England, 40 Grange Road and 4 Ellison Gardens, were the subject of successful summary judgment proceedings before Supperstone J as long ago as 2 November 2011. The reasons why it has taken so long for the balance of the claim to be determined will soon become apparent.

[7]The only person taking an active part in defending the claim is the First Respondent, Amir Azam (“Mr Azam”), also known as “Methu” or “Matt”, who was born in 1971. The Second Respondent is his former wife, Kalsoom Amir (“Kalsoom”). She has submitted Points of Defence raising discrete issues (essentially in the nature of ancillary relief) which are to be heard separately at a later date. As with Kalsoom, in the course of this judgment, for convenience and brevity, and without intending to show any disrespect, I shall be referring to Mr Azam’s family members by one of their given names.

[8]Prior to his arranged marriage to Kalsoom in Pakistan in April 2001, Mr Azam was in a long-term relationship with Hardeep Grewal (“Hardeep”), who is the mother of his three older children, Sohail, Aisha and Deen. They met when Hardeep was 17 and still at school. Mr Azam was not much older. She converted to Islam and they were married in a Muslim ceremony in 1992. The relationship ended in 2000; although neither Mr Azam nor Hardeep has given any clear indication of when they parted, other evidence points to the relationship having broken down in around March, though there may have been an unsuccessful attempt at reconciliation a little later on. Mr Azam has custody of the children. The marriage to Kalsoom was arranged because Mr Azam’s father considered that Mr Azam should not have to bring up the children alone. Mr Azam and Kalsoom have one child together, a daughter named Zahra, who is now 11 years old. She was born in Dubai in January 2003.

[9]The remaining Respondents are all members of Mr Azam’s family, including his mother, Zarina Begum (“Zarina”), and father, Mohammed Azam (“Mohammed”). Some, but not all, of them have appeared as witnesses. The claim was originally brought against seven Respondents, but the Sixth Respondent (Mr Azam’s sister Asma) acknowledged service stating that she has no interest in any of the properties, and therefore was deleted from the claim.

[10]Although the NCA’s claim relates to eight real properties in total, only three of them are in the name of Mr Azam, namely, 1 Offley Place, purchased on 19 July 2002; 2a Wheatash Road, which was purchased on 17 August 2003 as a plot of land with planning permission, registered in the joint names of Mr Azam and Kalsoom, and on which they later built a property; and the Spanish Property, purchased on 21 May 2004, as evidenced by documents obtained from the Spanish Land Registry. None of these properties was purchased with the assistance of a mortgage.

[11]It is common ground that the bulk of the money used to purchase 1 Offley Place came from the proceeds of sale of an earlier property, 2 Watery Lane, Northolt; the NCA’s case is that this property was purchased in January 1996 with money derived from Mr Azam’s criminal activities, and that its purchase was an act of money laundering. Therefore it is necessary to consider that property as well. Watery Lane was purchased in the name of Mr Azam’s sister Shazia Ali, née Azam, (“Shazia”) in whose name a mortgage was also obtained from the Woolwich Building Society; just over two years later, in March 1998, it was transferred into Zarina’s name. Two days after that transfer she transferred it into the name of Mr Azam for no consideration.

[12]Watery Lane is the only property that was purchased outside the primary limitation period. The effect of s.62(2)(b) of the Policing and Crime Act 2002 is that claims for which time was still running under the original 12 year limitation period as at 25 January 2010 were given an extended limitation period of 20 years. That means that any claim for recovery that arose on or after 26 January 1998 could be brought by the NCA within 20 years of the date on which the cause of action arose.

[13]The NCA has submitted that although the purchase of Watery Lane (and thus any unlawful conduct which preceded it) occurred before that date, there are two reasons why limitation does not provide a defence to a claim based upon it. First, as the Court of Appeal held in Szepietowski (above), s.32(1) of the Limitation Act applies in principle to actions under Part 5 of POCA, and all the offending conduct in this case was deliberately concealed. Secondly, each new act of money-laundering represents a new act of criminal conduct, and thus if the court is satisfied that the purchase of Watery Lane was an act of money laundering, the use of the proceeds of sale of that property to buy Offley Place was a fresh act of money-laundering within the limitation period. The issue of limitation only arises if the factual premise is made out, and therefore I shall defer consideration of those arguments.

[14]Mr Azam accepts that a fourth property, 291 Great West Road, was purchased in the name of his mother on 12 May 2000 for £120,000 with funds sent by him from Dubai through a foreign currency exchange, World Link Exchange, on or around 17 April 2000. He claims it was a gift to her. Even if that were true, it would not prevent a civil recovery order from being made if the NCA can satisfy the court that the funds used to buy it were the proceeds of crime. Mr Azam claims that they were derived from legitimate business activities.

[15]Great West Road was transferred into the name of another sister, Shabana, for no consideration in November 2005, and she received the rental income from it for a while, though Shabana does not claim any interest in the property. On 3 November 2005 Zarina and Shabana executed a deed of trust under which Zarina declared that she held the property on trust for Shabana, though in a witness statement dated 23 April 2010 Zarina asserted that Shabana held the property on trust for her. The exact nature of the arrangements between them is only of relevance to credibility.

[16]A further property, 5 Thurza Court, was purchased in the name of Mr Azam’s father Mohammed on 17 September 2001 and transferred into Kalsoom’s name on 1 May 2002, it is said as a wedding gift. Mr Azam does not claim an interest in that property; his evidence was that the funds for its acquisition came from his father, though Mohammed does not claim to be the owner of that property.

[17]The remaining three properties (to which I shall refer collectively as “the ABC properties” because those are the initials of the streets in which they are located) are said by Mr Azam to have been purchased using funds provided by his brother-in-law, Shahid Tanveer (“Tanveer”), Shabana’s husband, whose attitude towards them can be described, at best, as ambivalent.

[18]It is a significant feature of this case that the family at the heart of it is Asian, of Pakistani origin, because in their culture, regardless of the legal niceties, property (particularly land) is regarded as belonging collectively to the family rather than to individual family members. Thus it is quite normal for one family member to use his or her own money to purchase a house in the name of another family member, in which the latter, or possibly even a third family member, then lives. Transfers of real property into the name of another family member, for no consideration, are not unusual. Thus the fact that such a transfer has occurred is not necessarily an indication of a wish to lay a false trail as to its ownership. However it is more usual for the properties to go to the male family members. Zarina’s second witness statement confirms that “usually in Pakistani culture the properties go to the son”. Mr Azam himself confirmed that when his parents pass away all their property would come to him under Sharia law, and his sisters would get a small percentage. He added that as he was the only son of the family the assets stay with him:

“when the daughters go they go from the house but when the son stays … everything goes to the son.”

[19]If a property is rented, the family may decide that the rental income should be paid to a particular family member who has need of the money, but otherwise has no connection with the property. A property may be transferred ostensibly as a “gift” to an adult child by a parent, and the donee may become the registered owner, but the property may still be regarded by all concerned as still belonging to the parent, and transferrable back to the parent or to a third family member on request. The trust or nominee relationship is not always documented either at the time of the original transfer or at all. As one of the witnesses, Mr Neeraj Makol, put it in his witness statement: “Every family has its own way of working, but in my experience the common theme is that within the family, ownership of the property depends on more than just what is written on the registry”.

[20]The eldest or only son, as Mr Azam is, will often be entrusted with the responsibility of carrying out transactions on behalf of his parents or siblings (or on behalf of the family collectively). Thus the person who is giving instructions in relation to a property or receiving income from it is not necessarily its beneficial owner, and one cannot safely reach that conclusion from those facts alone, but must look at the evidence as a whole. Female members and younger members of the family are brought up to respect and obey without question their elders and male members of the family, and thus it is not uncommon for a wife, daughter or sister to sign documents pertaining to a legal transaction without knowing the detail of that transaction.

[21]Moreover, a younger family member may be denoted as the “purchaser” of a property that an older family member wishes to acquire, and a mortgage may be sought and obtained in the name of that person, even though in reality that person has insufficient income and someone else in the family may be funding the mortgage repayments. Mr Makol explained that “the family will be able to get better mortgage rates if younger members are responsible for paying it off so it makes good sense.” The fact that an arrangement of this kind might involve the commission of a mortgage fraud would not necessarily occur to those concerned.

[22]A further feature of this case is the use of money exchanges to transfer money into and outside the jurisdiction, or between other jurisdictions, or to exchange currency. Although money exchanges can be used for money laundering, they may be used for entirely innocent transactions, in order to obtain a better rate of exchange. They may also be used to circumvent exchange control restrictions on the amount of money that can be taken out of or brought into a foreign jurisdiction at any given time; but that does not mean that the money concerned is being laundered or has any connection with criminal activity. However, Mr Azam’s evidence is that he only ever used one money exchange to effect money transfers, the one that I have already mentioned, World Link, which was based in Dubai. He said he only used currency exchanges in the UK to change small sums for holiday money. The truthfulness of that evidence is of considerable importance.

[23]Mr Jangra, the former owner of World Link, which has been dissolved, wrote a letter dated 1 September 2013 which is exhibited to Mr Azam’s 7th Witness Statement. In that letter he says that he remembered Mr Azam coming to their branch to do business transactions. He thought Mr Azam conducted 3-4 cash transactions per month, the majority of which were to purchase cars in Japan and the Far East. It appears that Mr Jangra may be referring to the period after Mr Azam had moved to Dubai, as the letter begins with an express reference to the year 2004.

[24]When considering the acquisition of each of the properties in question, and what then became of them, it is important for me to bear all these matters in mind, though I must equally take care not to give them undue weight. As counsel for the NCA submitted in their written closing, it would be inappropriate to determine the issue of whether any particular property was purchased from the proceeds of sale of land in Pakistan on the basis of cultural generalisation. The evidence must be subjected to exactly the same scrutiny and assessment as in any other case.

[25]It is equally important to take into account the length of time that has elapsed since many of the transactions concerned took place. The passage of time has not only taken its toll on witnesses’ memories, as one would expect, but it has meant that some documents, in particular, bank statements, could not be found or easily obtained from third parties. Other documents are unavailable for reasons that I shall explain in due course, and for which in my judgment neither party is to be blamed. Although Mr Azam has nothing to prove, he complains that the absence of documents has hampered his ability to defend himself by providing corroboration of his account, or assisting him to recollect.

[26]Although there is some force in that complaint, the lack of documentation also operates to the disadvantage of the NCA. Much of the evidence upon which the NCA relies is contained in or exhibited to witness statements of Ms Ruth Davison, a financial investigator and member of its staff. The absence of bank statements, accounts and other records has meant that there has been no raw material upon which a forensic accountant could have worked and formed an opinion. This was frankly admitted by Ms Davison in the course of her evidence, and understandably seized upon by Mr Coppel QC as undermining the NCA’s case (he submitted, fatally). However, a forensic accountant is not essential. Circumstantial evidence and hearsay evidence is still evidence. The weight to be attributed to it, and the inferences that can be properly drawn from it, are a matter for the court. The court must form its own view of the quality and reliability of the totality of the evidence, whilst remaining mindful of the distinction between evidence, speculation, and submission, and staying vigilant to avoid it becoming blurred.

An overview of the case

[27]Between the ages of 17 and 22 Mr Azam was convicted of a variety of offences ranging from wounding and violent disorder (for which he was sentenced to 12 months’ detention) to handling and attempting to obtain property by deception. All those convictions are now spent. He has had no criminal convictions in this jurisdiction since 4 February 1992, when he was fined £50 for being in possession of a controlled drug. His sole conviction since then, and the only one relating to drug trafficking and money laundering, in the United Arab Emirates (“UAE”) in 2007, was eventually quashed on appeal after he had spent seven years in prison there, in circumstances of considerable hardship.

[28]Despite this, the NCA’s case is that Mr Azam is a career criminal and that all the property it seeks to recover was either obtained through his criminal activities (chiefly, drug dealing and/or money-laundering) or falls within the extended definition of “recoverable property” under s.305 or s.307 of POCA.

[29]Mr Azam vehemently denies this. His case is that after the period of youthful offending (which he attributes to his association with an older peer group who were a bad influence), he resolved to turn his life around and, with a good deal of hard work, became a successful businessman trading in cars and investing in residential property in this country and abroad, chiefly in the UAE. He was the subject of police surveillance operations in this jurisdiction, but they never collated sufficient evidence to arrest him, let alone charge him, with any criminal offence of the kind now alleged.

[30]Although Mr Azam accepts that he moved in the same social circles as convicted criminals, including drug dealers, it would be wrong to conclude that he is a criminal merely by reason of such association. He says that any encounter he may have had with members of the criminal fraternity has been innocent and purely coincidental – for example, selling someone a car. In short, since his youthful escapades, which he greatly regrets, he has led an entirely blameless life.

[31]Mr Azam went to live in Dubai in July 2002 and became engaged in various business activities involving trading in cars, as well as making highly profitable investments in land. However his business dealings in Dubai came to an abrupt end. On the evening of 9 February 2006, Mr Azam was arrested at his home on suspicion of drug trafficking and money laundering offences alleged to have been committed whilst he was in Dubai. His bank accounts in Dubai were frozen by the UAE authorities and remain frozen. He was taken to Sharjah Narcotics branch, hooded and handcuffed, seriously mistreated, and forced to sign a confession written in Arabic, a language which he did not understand. On 21 March 2007, before the Abu Dhabi court of first instance, Mr Azam was convicted of a drugs trafficking offence and sentenced to life imprisonment with a minimum term of 25 years. He was also convicted of money laundering and sentenced to 5 years’ imprisonment to run concurrently with the life sentence. The NCA was not in a position to dispute Mr Azam’s account of his treatment in Dubai and therefore did not challenge his evidence that his confession was extracted by torture and that he was subjected to the most appalling degradations whilst in custody in the UAE. In consequence of this, the NCA did not seek to rely on any evidence that could even arguably have been the product of such treatment and it was excised from any of the material before this court.

[32]After a lengthy legal process, including several hearings before various appellate courts, Mr Azam’s conviction for drug trafficking was finally quashed by the Federal Court of Appeal on 31 May 2012 and he was declared innocent. The UAE prosecutor unsuccessfully appealed that decision. Mr Azam remained in custody throughout, and for a short time after the final decision on the prosecution’s appeal, whilst the necessary formalities were undertaken to dispose of the money-laundering conviction (which was apparently dependent upon the other conviction). He was released on 16 March 2013 and deported to the UK. The hearing of the NCA’s application was adjourned on Mr Azam’s application from July 2013 to July 2014.

[33]Since his return, Mr Azam has been receiving psycho-therapeutic treatment for what has been diagnosed as post-traumatic stress disorder, which has led to an improvement in his condition. He is not currently on any medication. In the course of that treatment, he has complained to the doctors of significant impairment to his memory. As yet, there appears to be no diagnosis of the cause. Mr Azam’s experiences in prison in the UAE and the effect they have had upon him are matters that I must and do take into account in evaluating his credibility and the reliability of his evidence.

[34]These are by no means the only misfortunes suffered by the Respondents. Mr Azam’s father suffered severe head injuries in 1997 after being run down by a car driven by a young joyrider which had mounted the pavement. He spent 9 months in the specialist brain care unit at Charing Cross hospital. Although he has made a remarkable recovery, and was well enough to give oral evidence, the accident has taken its toll on his health, and especially upon his memory.

[35]Mr Azam’s mother, who separated from his father in 2000 (they have since divorced), is only 63 years old but looks much older; she has diabetes and is on regular medication. I was told that she suffers from kidney problems and has been in and out of hospital in the past month including a recent trip to the Accident & Emergency department, though a letter produced from a locum at her GP’s surgery suggesting that she would be too physically infirm to attend court omitted to mention this. Although the NCA took steps to facilitate her attendance, and she did come to court, in the end she did not give evidence in person, in circumstances that I shall describe in due course.

[36]Finally, Mr Azam’s sister Shazia, who did give oral evidence, has not only experienced domestic violence at the hands of a husband from whom she is now divorced, but had a nervous breakdown in April 2012. She testified that her memory has been impaired. These are all matters which I have had to bear in mind when evaluating their evidence, over and above the difficulties that any witness would experience in trying to recollect matters that go back over 20 years.

Procedural History

[37]This claim was initiated at a time when Mr Azam was still incarcerated in the UAE. On 14 August 2009 SOCA (as it then was) applied to and obtained from Walker J a disclosure order under s.357 of POCA against banks and other third parties, designed to ascertain whether all or any of the property held by Mr Azam was recoverable property or associated property. This was followed by a property freezing order (“PFO”) against the first six Respondents which required them to serve SOCA with a full statement of their assets within 21 days of service. Tanveer was joined to the proceedings as the seventh Respondent at a later date.

[38]Mr Azam found out about the PFO in the course of one of his monthly telephone calls from prison to Kalsoom, who by then had returned to the UK. Service of the PFO was effected on him via Saunders, who were then representing him, on 18 August 2010. There were considerable difficulties in communicating with Mr Azam in prison in the UAE, and there were also difficulties in funding his legal representation. SOCA had to agree to several exclusions from the PFO; a further exclusion was contested but sanctioned by the Court of Appeal. Mr Azam’s fourth, fifth and sixth witness statements, which were prepared and signed after his release from prison in Dubai, relate to his applications for those exclusions, and are of relevance only to the extent that they contain detailed descriptions of the conditions in which he was incarcerated in Dubai and the difficulties which this posed for his defence to these proceedings. I accept all the evidence about Mr Azam’s experiences whilst he was serving his sentence in the UAE and about those difficulties, without reservation, but that does not mean that I accept that they afford an explanation for all the inconsistencies in his witness statements.

[39]It was not until February 2012 that a solicitor from Saunders was able to travel to the UAE, visit Mr Azam in prison and take instructions from him for the purpose of preparing a statement of assets. His first witness statement responding to the PFO and ostensibly setting out all his assets is dated 13 April 2012. I say ostensibly, because it omitted to mention one of the Luxembourg bank accounts. I will consider in due course whether this was accidental or deliberate. A further visit from the solicitor took place in May 2012. Access to Mr Azam was limited to 2-2½ hours in the mornings.

[40]Mr Azam had no little or no access to documents because of the restrictions imposed on what his legal team could bring into the prison. He was not allowed to keep any copies. The UAE authorities had seized all his business papers and records when he was arrested, and they have not returned them to him since, despite his acquittal. Mr Azam, through his counsel, has sought to criticise the NCA for failing to request the UAE authorities to provide them with copies of all the records of his businesses and accounts that were seized at the time of his arrest, since they would have gone some way to assisting Mr Azam in his defence and there is a duty on the NCA to be even-handed.

[41]However, as Ms Davison has explained, the NCA received legal advice that because the UAE authorities do not recognize the legitimacy of civil recovery proceedings where a respondent has not been convicted of a criminal offence, such a request was likely to be turned down. Whilst it could be said that there would have been no harm in testing the advice by asking them anyway, the NCA cannot be criticised for acting on it. In any event, if the UAE authorities would not release the documents to Mr Azam or his legal representatives, despite the fact that they are his property, it seems unlikely that they would have parted with them to the NCA voluntarily.

[42]Mr Azam’s 2nd witness statement is dated 31 May 2012 and his 3rd is dated 3 July 2012, but in order to ensure that they were lodged with the Court in time, he had to sign pieces of paper in blank in advance, and trust the solicitors to compile the statements on the basis of the information he had given them. That is how he explains any inconsistencies between his earlier statements and his 7th witness statement, which was prepared after his release with the benefit of seeing and giving instructions on the material upon which the NCA relies.

[43]In the meantime, these proceedings had been initiated by a Claim Form issued under CPR Part 8 (as mandated by paragraph 4.1 of the relevant Practice Direction-Civil Recovery Proceedings) on 19 January 2011. Although proceedings for a CRO must be started under Part 8, I was told by counsel that it is possible to transfer the matter to the Part 7 procedure, and that has happened in other cases. It did not happen in the present case, even though case management directions were made by Eder J on 3 February this year which included a timetable for the service of further evidence by Mr Azam and the witnesses upon whom he intended to rely, and for the service of evidence by the NCA in response. Mr Azam’s 7th Witness Statement, dated 27 March 2014, which contains his substantive response to the NCA’s claim, was served in compliance with those directions.

[44]In consequence of the fact that the Part 8 procedure has governed the matter, there has been no disclosure stage, as there would have been under Part 7. Although Points of Claim have been served, which have been through several amendments, the NCA’s case remains as set out in and exhibited to its witness statements, chiefly those of Ms Davison. I have to treat that evidence with some care, since much of it is hearsay, of variable reliability, and (understandably, because procedurally the witness statements are the vehicle through which the NCA must set out its case) there is a great deal of submission as to what inferences or conclusions are to be drawn from the underlying material.

[45]The latest amendment to the Points of Claim was the subject of an application made by Mr Sutcliffe QC at a very late stage, mid-way through Mr Azam’s cross-examination, at the end of day 7 of the hearing. Mr Sutcliffe sought permission to amend in two respects; first, to raise an allegation that there had been a mortgage fraud committed in respect of the acquisition of 2 Watery Lane in the name of Shazia, and secondly to add the theft of motor vehicles to the list of criminal activities whose proceeds were allegedly being laundered. I allowed the second amendment but not the first.

[46]The theft allegation was nothing new; it had been raised fairly and squarely in Ms Davison’s evidence and exhibits, and although Mr Coppel protested that it caused his client severe prejudice, and that if it had been pleaded he would have sought the records from the Japanese authorities to show that none of the vehicles in question was stolen, I was not persuaded by that argument. For a start, Mr Azam had no surviving records identifying those vehicles or otherwise relating to the businesses through which they were imported into the UK or elsewhere.

[47]Secondly, two of the people who bought, or say they bought the vehicles at auction in Japan are already witnesses in this case for Mr Azam, though neither of them was willing to subject himself to cross-examination. The initial importer of the vehicles from Japan into the UAE with whom Mr Azam dealt was Mr Nadeem Choudry, (“Mr Choudry”) from whom a witness statement had already been obtained which addressed this very issue in paragraph 3. Mr Choudry has exhibited none of the paperwork that he would have obtained from Japan relating to his acquisition of those vehicles. The same comments can be made of another supplier, Mr Saleem Akhtar Ahmed (“Mr Ahmed”) who addresses the issue in paragraphs 5 and 6 of his witness statement but exhibits no supporting documentation, having explained that he did not retain business records for more than 10 years. In the light of the absence of any records relating to the vehicles in question, I do not understand how Mr Azam’s legal team could have begun to make those inquiries in Japan even if the matter had been in the Points of Claim from the outset.

[48]Thirdly, this is a Part 8 claim and the Points of Claim, though a useful guide to the matters in issue, are not a formal statement of case. There was sufficient notice of the point in advance of the hearing to have enabled Mr Azam’s legal team to make any additional inquiries they saw fit to make, though I have my doubts as to whether they would have made such inquiries in the light of the financial constraints imposed on them, and even if they had, I doubt whether they would have got anywhere.

[49]Finally, Mr Coppel had raised no objection when the theft allegation was put to his client in cross-examination fairly and squarely by Mr Sutcliffe, or indeed at the time when he raised an objection about certain other lines of questioning on the morning of Day 7. Without intending this to be a criticism, the objection to this amendment did have more than a little flavour of opportunism about it.

[50]The mortgage fraud allegation was an entirely different matter. Although the suggestion had been raised in the NCA’s written opening, and Mr Coppel had not protested about it then, he did object after questions had been put to Mr Azam in cross-examination suggesting that Shazia’s purported signature on two documents relating to Watery Lane was forged and that there had been a mortgage fraud on the lender, the Woolwich Building Society. That allegation was nowhere in Ms Davison’s evidence, and could not have been foreshadowed before the written opening was served. The failure by the NCA to make that allegation was inexplicable, especially in the light of the fact that the NCA had alleged (and proved) mortgage fraud by Zarina in respect of two other properties transferred into the name of another daughter, Asma, and had obtained summary judgment in respect of those properties in 2011.

[51]Mr Sutcliffe submitted that the evidential foundation for his line of questioning and for the allegation of mortgage fraud was there to be seen in the land registry documents and in Shazia’s own witness statement, in which she said that when she wrote a letter to SOCA on 13 September 2010 in response to questions about the way in which Watery Lane was purchased, “at the time I did not know any of the details of the mortgage and I was not involved with the paperwork for the purchase from the Police auction” and “once the property was taken back by mum I wasn’t involved in the transfers or sales so I didn’t know the details”. The letter to SOCA to which she was referring stated that the property was purchased by her parents and she was not aware of the purchase price or as to how the property was funded. She also said in the letter that at the material time she did not have an income from paid employment and was reliant on her parents for financial assistance. Shazia was coming to give evidence in person. Thus, Mr Sutcliffe submitted, there was no possible prejudice to the Respondents in allowing the amendment, since it was plain that Shazia, who on her own account was not the true purchaser, though the Woolwich was told that she was, did not have the means to service the mortgage and it was never intended that she would be paying the instalments.

[52]One of the signatures whose authenticity Mr Sutcliffe was querying appears on the TR1 form lodged with the Land Registry dated 1 January 1996 transferring Watery Lane to Shazia, which looks to the untutored eye very different from her signature on the mortgage nine days later. The other is Shazia’s purported signature on the document transferring the land to her mother Zarina, dated 4 March 1998. In the light of the contents of her witness statement, that line of questioning had a proper evidential foundation and was permissible, at least for the purposes of challenging her credibility. However, those questions had no bearing on the issue of a mortgage fraud, since it was accepted by the NCA that Shazia’s signature on the mortgage, witnessed by her father, was genuine.

[53]Although I saw the force of Mr Sutcliffe’s argument about what was said in Shazia’s witness statement, the mortgage application form was not before the court and one could not speculate about what the mortgage lender was told about the family arrangements at the time. Moreover, prejudice to the respondent, or lack of it, is not the only factor that the court must take into consideration when a party makes a late application to amend its case so as to raise an entirely new point. These provisions of POCA give Draconian powers to the NCA, and fairness dictates that respondents to claims for civil recovery orders know the case they have to meet well in advance of the final hearing. The real target of the NCA’s application was and is Mr Azam, but it seems that any mortgage fraud in respect of Watery Lane would have been perpetrated by others, as it was in the case of the properties transferred to Asma. Thus there was a danger of opening up a satellite enquiry that would serve only to distract from the matters at the heart of this claim.

[54]It is also important to send out the message to the NCA that it is simply not good enough to seek to rely on counsel to make good perceived deficiencies in the claim at the last minute. Bearing in mind the overriding objective, I do not consider that it would have been a proper exercise of my discretion to accede to Mr Sutcliffe’s application in the absence of any satisfactory explanation as to why the matter was being raised so late in the day.

[55]Before turning to the detail of the NCA’s case and examining whether it has discharged the burden of proof in respect of each of the properties or accounts claimed, it is convenient to set out a chronological history of what Mr Azam was doing (or says he was doing) at the relevant times, so as to put their acquisition into context. The history falls conveniently into two main periods; pre-July 2002, when Mr Azam was based in England, and post-July 2002, when he went to live in Dubai. Only two of the properties, Wheatash Road and the Spanish Property, were acquired in the post-July 2002 period, and so understandably the NCA’s case largely focuses on the pre-July 2002 period.

Period 1 – pre July 2002

[56]Mr Azam’s evidence was that he had an unsatisfactory education at a local state school. After his release from detention, he undertook a course of training as a car mechanic. At that time he was helping out in the family business (importing textiles and ready-made garments from Pakistan). The business was described by Mohammed Azam in his second witness statement. It was called “Shazia Fashions Ltd” and had been trading from leased premises in Southall since 1987. A second shop in Southall is run through another family company called “Family Fashions Ltd.”

[57]According to Mohammed Azam, the supplies were purchased from wholesalers in the UK and from companies in Pakistan that his brothers were running, having taken the companies over from him. He explained that the shop made only a small profit because the bulk of the profit was made by the branch of his family running the Pakistani companies (on the supplies to his company). All the family helped out in the shop, but no-one was paid a salary, though money would be handed out as and when required. In her statement in response to the PFO dated 23 April 2010 Zarina stated that she earned £500 to £600 per month from the family business.

[58]During the period from 1993 to 1996, when he was working in the shop, Mr Azam would buy up cars which he would repair himself, and then after the work was completed, sell each one on to finance the purchase of another car to work on. Thus by his own account, he would have had little money to spare. Mr Azam’s first known business venture of any substance started some time in 1997. By then he not only had a wife but two small children to support. Sohail was born in 1994 and Aisha in 1996. Apart from looking after the children, Hardeep was working in the family business too. From 1996 onwards they were living at 2 Watery Lane. Hardeep is recorded on the electoral roll as living there from 1996 until 2000. Mr Azam is recorded on the electoral roll as living there from 1998 (when the property was transferred into his name, and when their third child, Deen, was born) until 2002. However his evidence was that he only lived separately from Hardeep when they had had an argument.

[59]The business venture in question consisted of importing second-hand Japanese cars from the UAE for sale in the UK. The initial source of the cars in the UAE was the aforementioned Mr Choudry, who said in his witness statement that he had purchased them at auction in Japan for his company Diachii Motors, based in Sharjah. Mr Azam met Mr Choudry some time in 1997 by chance, when he accompanied a friend of his father named Abid Malik to Dubai on a business trip. Mr Malik, who told the court that at that time he ran a profitable catering business, with an annual turnover of £1.2 million, (as well as a furniture shop, two sandwich bars and two minicab offices) was a regular traveller to Dubai, though he professed not to remember the reasons why he was going there so often. Mr Malik’s unimpressive explanation for declaring none of his income to tax during this period was that the business was his wife’s and she paid the tax.

[60]Mr Malik acted as a mentor to Mr Azam by introducing the budding entrepreneur to the world of business and giving him a helping hand by teaching him what he knew, though he also said in his oral evidence that he had no idea what Mr Azam was doing to make a living before he “guided” him to Dubai in 2002 (his expression). That is wholly implausible. Mr Malik knew what Mr Azam was doing, but he did not want to say. My impression of Mr Malik was that he was a less than ideal role model for a young man eager to turn over a new leaf. When it was put to him by Mr Hall that he was a criminal associate of Mr Azam involved in drug dealing, his response was:

“prove it. Don’t talk if you don’t know.”

[61]On this particular trip to Dubai, Mr Malik and Mr Azam came across Mr Choudry’s showroom, one of the few that dealt in right hand drive vehicles. Mr Choudry was keen to give them a good deal on initial sales. Mr Malik’s evidence was that he paid Mr Choudry around £22,500 for a Land Cruiser for his own use, and that was his only transaction involving importing a car. Mr Azam purchased two cars from Mr Choudry on the same occasion, a Lexus and a Land Cruiser, and imported them into the UK. There was no evidence as to what he paid for them, or where the money came from, though it would be reasonable to infer that the price of the Land Cruiser must have been much the same as Mr Malik paid for his. Mr Azam said he sold the Land Cruiser almost immediately, and kept the Lexus a little longer, but he made a profit on both the sales. It was his evidence that it was this money that he used to purchase a caravan with a plot in Whitecliff Bay Holiday Park in the Isle of Wight, for use as a holiday home, in around 1999 or 2000, for around half the sum (a little over £21,000) for which he sold it in 2002.

[62]After their initial contact, Mr Azam introduced Mr Choudry to an acquaintance named Kevin Seaton who was already in the business of buying and selling cars. Mr Seaton had previously bought imported Japanese cars from another source, but was disappointed in their quality; Mr Choudry’s were much better, and the prices he was asking were reasonable. The upshot of the introduction was that Mr Azam and Mr Seaton entered into a business arrangement to import second-hand Japanese vehicles sourced from Mr Choudry into the UK and sell them at a mark-up. They were large vehicles such as Land Cruisers, Shoguns (Pajeiro), Nissan (Skyline) and Colorado (Perado), each selling in the price range of £20,000 to £40,000. The arrangement between Mr Azam and Mr Seaton lasted from 1997 until, at the latest, early 2000.

[63]All the negotiations with Mr Choudry appear to have been left to Mr Azam, who was from the same cultural background and could converse with him in Urdu. Initially, Mr Choudry demanded payment for the vehicles up front, but after a time he allowed them to be taken on credit, so that Mr Seaton would remit the balance of the price to Mr Choudry after the vehicles were sold in the UK, net of the expenses and what Mr Seaton described as his “commission” on the sales. It was agreed that because he had effected the introduction, Mr Azam would earn a commission from Mr Choudry on the sales of these imported cars. The amount of the commission appears to have been agreed on an ad hoc basis depending on the nature and number of the cars, and was paid by Mr Choudry in dirhams in the UAE. Mr Azam opened an account in the National Bank of Dubai into which he said he paid “most of” the money, though he thought he might have converted some into sterling to bring back with him. His evidence was that he would get the equivalent of around £1,600-£2,000 per car. His only English bank account was at Barclays.

[64]It was Mr Azam who made the necessary arrangements for the shipment of the cars to the UK through Thames Port, using a shipping agent in the UAE called Mr Fiyaz (introduced by Mr Choudry) and a clearing agent in the UK named Elie Abi-Akl who traded under the name “Safina International”. In January 1999 a container carrying a consignment of tiles, which had passed through Safina’s hands for onward shipment to Holland, was stopped and searched at Dover and found to contain 2 tonnes of cannabis. However, no charges were brought against Mr Abi-Akl arising out of this incident.

[65]Of course the import duty and other taxes had to be paid before the cars were released by the clearing agents. Mr Azam reimbursed these agents and paid their fees; he claimed that the money was provided by Mr Seaton, but Mr Seaton’s evidence, which I prefer, was that he left everything to do with the shipments, including financing their payment, to Mr Azam. The cars would be imported in the name of individuals who were not necessarily the persons who were going to buy them, two cars per person (a factor of some significance, as I shall explain).

[66]After the cars arrived they would be repaired and fitted out to ensure that they passed the single vehicle approval (SVA) and MOT tests. Mr Azam arranged for the necessary work to be carried out, usually by his childhood friend Samir Jarche, who worked in a garage in Southall named First Choice Engines. Mr Seaton’s evidence was that the work generally took about a week to complete. On at least one occasion Mr Jarche could not fix the gearbox and the car was taken to a specialist called Arun Rudki. He was a partner in a nearby garage called VA Transmissions which was next door to a garage called AJ Autos in Merrick Road, Southall. Mr Azam would sometimes have to import the spare parts for the gearboxes from Japan and drop them off at Mr Rudki’s garage, as they were not easy to get hold of in the UK. Although neither Mr Jarche nor Mr Rudki was willing to attend court, I see no reason to disbelieve their evidence about these matters. Mr Rudki places his first dealings with Mr Azam in around 2000, (thus towards the end of the business relationship with Mr Seaton).

[67]After they had passed the SVA and MOT tests, the cars were registered with the DVLA in the names of the individuals in whose name they had been imported. The cars, which had UAE trade plates on them, were stored either in a yard which Mr Seaton had rented in Finchampstead, or on the driveway of 2 Watery Lane. Mr Azam said he could fit up to 10 cars on his drive at any given time. On Mr Azam’s own estimate, the sales value of ten such cars that were seen parked on his drive in Watery Lane by police officers at various times during that period was £250,000 (roughly half the retail value if they had been brand-new). If the individual in whose name the car had been imported and registered with the DVLA was not buying it, Mr Seaton would advertise it for sale in “Auto Trader” or sell it from the rented yard, or else it would be sold by Mr Azam from off his drive.

[68]Over the period that this business arrangement was in place, Mr Azam arranged for around 60 cars in total to be imported from Dubai (Mr Seaton and Mr Choudry both agreed with that figure). Mr Azam’s evidence was that he was importing up to six cars a month, using the regulations that permitted the importation of two cars as personal imports per year to import the cars in the names of other people. He said he also purchased a few cars from Mr Choudry for his own friends and family, outside of his arrangement with Mr Seaton, though he did not earn commission on those transactions.

[69]In his witness statements Mr Azam said he also arranged for a few cars to go to Holland (using a clearing agent called Intermodule) and to Pakistan, where Mr Choudry had contacts to help with the importation arrangements. In cross-examination, however, he said he never shipped any cars to Holland under this arrangement, and that he only shipped a couple of cars to Pakistan for his brother-in-law Tanveer. Even if one took the most generous figure from Mr Azam’s estimated commissions of £2,000 per car and assumed that he paid none of the expenses or overheads, the most he would have earned over the entire period of his business association with Mr Seaton would have been around £120,000. It is that money that Mr Azam claims he used to pay for the acquisition of 291 Great West Road, and the evidence of money being transferred from Dubai at that time is consistent with that evidence, which I accept. He has not explained where he sourced the £10,000 he says he expended on renovating the kitchen of that property after its acquisition.

[70]Mr Seaton’s oral evidence was that in his witness statement he had over-estimated the amount he made out of each transaction (£2000 to £3000) and that it was more like £1,000 to £1,500 per car. The yard cost him £1,000 per month to rent and he also paid for the advertising and the repairs. He did not make enough money to declare the net income to tax and he certainly did not make enough to pay commission to Mr Azam. That was consistent with his witness statement. Of course, if Mr Seaton regarded himself as a commission agent too, rather than as a principal in the sale and purchase chain, he would have no reason to pay Mr Azam commission.

[71]In contrast, Mr Azam said for the first time in the course of his cross-examination that he was being paid commission by Mr Seaton as well as by Mr Choudry, which he described as “double bubble.” He stuck with that story even after Mr Sutcliffe put its inconsistency with Mr Seaton’s witness statement to him. This new evidence emerged at a time when there was some uncertainty about whether Mr Seaton was going to come to court. Indeed a witness summons had been issued for his attendance, at Mr Coppel’s behest. However, Mr Seaton did come, and he looked astonished at the suggestion that he might have had the money spare to pay commission to Mr Azam.

[72]I prefer the evidence of Mr Seaton, who was, as Mr Sutcliffe put it, “disarmingly frank”. I find that Mr Azam was belatedly seeking to exaggerate the amount of money he was making from their business venture, for reasons which will become apparent. However he initially appeared not to have thought through the implications of asserting that he was earning commission in the UK as well as in Dubai (which further commission, like the commission paid in Dubai, he had not declared to HMRC). When those implications did sink in, he suggested that Mr Seaton paid him the money in Dubai. That was patently untrue.

[73]Mr Seaton also worked in a business called WR Hammant, which had a car showroom in Winkfield, although the extent to which his employment there overlapped with his business dealings with Mr Azam is unclear. Ms Davison’s evidence is that he was recorded by HMRC as being employed by Hammant in 1999/2000 and 2000/2001, and paid tax on his income from that employment. That fits in with Mr Seaton’s evidence in cross-examination that it was because he did not make enough money out of his business with Mr Azam that he went to work for Hammant. None of the cars imported under the arrangement with Mr Choudry was ever taken to the showroom for sale.

[74]After Mr Seaton’s business arrangement with Mr Azam came to an end, Mr Seaton appears to have ceased all dealings with Mr Choudry. When he was out in Dubai looking for a new supplier he met a man named Mr Wahli who told him that he was buying the cars from Japan in the same way as Mr Choudry. Unfortunately for Mr Seaton, his ensuing business with Mr Wahli led to his being arrested and interviewed by the police in November 2000 in connection with an investigation into Mr Wahli importing stolen vehicles from Japan. However, Mr Seaton was never charged with any complicity in Mr Wahli’s wrongdoing.

[75]It was the NCA’s contention that the cars which Mr Seaton and Mr Azam were importing from Mr Choudry were stolen, but the evidence on which they sought to rely is far too thin for me to be satisfied on the balance of probabilities that this was the case. That does not mean that the business was a legitimate one. There has been no satisfactory explanation of where the cash came from to purchase the cars in the first place – at least, before Mr Choudry trusted the pair sufficiently to allow them to import the cars on credit. Leaving aside the two cars that Mr Azam bought for himself on the first trip to Dubai, for which he must have paid Mr Choudry at least £40,000 in total, there were at least six cars purchased up front from Mr Choudry for the first consignment, not to mention the cars that Mr Azam was buying later on for friends and family, including Hardeep. Even using the lowest price in the given range, that meant they had to find at least £120,000 for the first six cars.

[76]Mr Azam’s evidence was that Mr Seaton was the one who bought the cars. He referred in cross-examination to Mr Seaton having “investors” and “other people financing him” but they were never identified, and Mr Seaton did not mention anyone other than a business partner in the salesroom at Winkfield who appears to have had nothing to do with this sideline. Moreover, on the evidence before me, there was no-one in Mr Azam’s immediate family, at least, that was earning the sort of money to be able to afford to pay over £20,000 for a car in the late 1990s; and he was plainly not earning enough to buy the cars himself and give them to his family as presents. High value cars, like property, can easily be used to launder the cash proceeds of criminal activity. This is something to which I shall return.

[77]Even on Mr Azam’s and Mr Seaton’s own account, it was a necessary part of their business model to pretend to the authorities, including the DVLA, that the vehicles were being imported personally, by and for named individuals, when in truth they were being imported as part of a business and only some were being imported for the named customers. This was deliberate and calculated deception, from which they stood to gain financially, and plainly unlawful conduct. Mr Azam admitted in his first witness statement that:

“Because [the cars] were imported mainly in the name of third parties, they were mostly not registered to me. That was to get round the regulations governing the quotas on imported cars into the UK, not in an effort to conceal the identity of the true owner so that they could be used for a nefarious purpose.”

[78]At the very least this amounted to a VAT fraud. Ms Davison’s evidence is that in 1997 the threshold for taxable supplies above which a business was obliged to register for VAT was £47,000 (s. 3(2) of Schedule 1 to the VAT Act 1994). The Azam/Seaton business plainly exceeded that figure by a considerable margin. Mr Azam was not registered for VAT, and VAT was not charged to the end customers. If VAT had been charged it is probable that there would have been insufficient profit in it to make the venture worthwhile, but in any event it was the lower prices at which they were advertised for sale that made the vehicles attractive to potential customers.

[79]The fraudulent evasion of VAT is an offence under s.72 of the VAT Act, and it would be unlawful conduct to conspire to commit that offence, or to be an accessory to its commission by another, so it is no answer for Mr Azam to seek to pin the blame on Mr Seaton because he was the one who was doing most of the selling. After initially seeking to suggest that it was a “grey area,” Mr Seaton was constrained to accept that the cars were not being brought in for personal individuals, but as part of his business with Mr Azam, and that what they were doing was illegal. Mr Azam said in cross-examination:

“I didn’t know it was unlawful. I just thought it was a way round the quota system. I didn’t think it was unlawful. Like the tax people, the way people do their tax, get offshore companies. I thought it was just a way round the tax.”

In my judgment, Mr Azam knew perfectly well that what they were doing was unlawful.

[80]Whilst Mr Azam was engaged in this business with Mr Seaton, in February 1998 two companies named Fabio Holdings Ltd (“Fabio”) and Empire Worldwide Ltd (“Empire”) which had been incorporated in the British Virgin Islands in April and July 1997 respectively, were purchased “off the shelf” on Mr Azam’s instructions, using a firm of solicitors called St Johns, for the purpose of acquiring properties. St Johns were involved in a number of property transactions for Mr Azam and other family members from at least February 1998 to late 2001. There were two persons in particular with whom he dealt, a Mr Bamrah, who had sold the goodwill of his practice in 1995 to the Hounslow branch of St Johns and was thereafter employed by them as a consultant, and a Mr Virdi, a partner in the firm, who appears to have been based in the firm’s other office in Southall. The documentary evidence reveals that it was Mr Bamrah who dealt with the trust company in Jersey which sold the shelf companies for £1,750 each and also opened sterling and Deutschmark accounts for each of them with AIB Bank in Jersey. The reason for opening a Deutschmark account was never explored in evidence, but it was obviously done on specific instructions.

[81]Mr Azam accepts that he gave the instructions for the incorporation of the two BVI companies and that the offshore structure was being used to minimise exposure to tax – he said, capital gains tax. He was later billed for the associated expenses. These two companies were used in the acquisition of two of the three ABC properties said by Mr Azam to have been purchased by his brother-in-law Tanveer as an investment, 16 Allenby Close (on 23 February 1998) for £65,000 and 30a Brackley Road (on 1 July 1998) for £60,000. In each case the named purchaser was Empire, using money said to have been loaned to it by Fabio. The vendor of Brackley Road was none other than Mr Azam’s mentor, Mr Abid Malik; the vendor of Allenby Close was a friend of Mr Azam named Javed Rana who worked in a restaurant. In each transaction St Johns acted for both parties; Mr Virdi for the vendor, Mr Bamrah for Empire.

[82]In the month preceding the acquisition of Brackley Road, the shares in Fabio and Empire were transferred into the name of Hardeep, “care of” St Johns (the share register inaccurately records her as “Mr” Hardeep Grewal). Since Hardeep was a British national there was no tax advantage to be gained from putting the shares in her name. On 1 April 2000, by which time Hardeep had moved out of Watery Lane and was living in a women’s refuge, minutes of both BVI companies record Empire as having accepted “an offer from Shahid Tanveer to purchase Empire’s shares for the sum of £145,000.” There is no evidence of that sum, or any other sum, having been transferred by Tanveer to Hardeep (nor indeed to anyone else) at that time or at all. However there is a later handwritten note from Mr Stanley Michaels, who was engaged by Mr Azam as his accountant at a later date, headed “AMIR AZAM/Matt” and dated 1 August 2002 which states, among other matters, “not the owner of any property but acts [for] Empire Worldwide” and “purchased the coys [presumably shorthand for companies] from Miss Hardeep Grewal – British national – at beginning of 2001. Beneficial owner is brother in law.” There is nothing on that file note to record that Hardeep was Mr Azam’s ex-wife.

[83]The third of the “ABC properties”, 149 Collingwood Road, was purchased on 2 December 1999 in the name of Tanveer for £100,000, without a mortgage, from the same Javed Rana who had sold Allenby Close. Mr Rana had only owned the property for a short period of time, having purchased it for £112,500 in September 1998. There has been no plausible explanation as to why Mr Rana was selling the property so soon, and at a loss. Once again, St Johns were involved in the transaction. Initially they were acting for Mr Rana, and another firm named Mark Betteridge & Co was instructed by Mr Azam on behalf of the purchaser. It is clear from handwritten annotations on a fax copy of a letter from St Johns to Betteridge dated 18 November 1999 in connection with this transaction, requesting the transfer of £100,000 to them, that Betteridge complied by making a bank transfer on the same date. They described the transfer as “return of client funds” and made it clear that it was not at that stage being transferred to make payment for the property. It can be inferred from that exchange that Betteridge had been placed in funds of £100,000 some time prior to 18 November, though there is no evidence of how they came to receive the money.

[84]At around the same time there are documents written by St Johns to St Johns stating that they are acting for the buyer. It does appear from subsequent documents that St Johns took over the handling of the transaction from Betteridge before completion. A document within the St Johns conveyancing file relating to Collingwood Road has “Mat, nickname”, written in the top corner. Although the evidence that Mr Azam was known as “Matt” was compelling, and consisted of documents from various different sources, he sought to deny it in cross-examination, at one point even suggesting that “Matt” was someone working for Mr Betteridge. This did not reflect well on his credibility.

[85]This is perhaps an appropriate juncture at which to mention that in March 2002, before Mr Azam went to live in Dubai, the Law Society intervened in the practice of St Johns, and that practice was shut down and the files transferred to the Solicitors Regulatory Authority. Both Mr Bamrah and Mr Virdi faced disciplinary action before the Solicitors Disciplinary Tribunal. In August 2005 Mr Bamrah was found to have handled business transactions indicative of “criminal impropriety”, whether banking fraud or money laundering, and struck off the Roll of Solicitors. In October 2008 Mr Virdi was suspended from practice for three years after being found to have permitted and facilitated the participation of Mr Bamrah in dishonest transactions which had the characteristics of money laundering and/or financial instrument fraud. None of the transactions which formed the basis of the charges against Mr Bamrah involved Mr Azam or any member of his family. However it is at the very least a most unfortunate coincidence that from 1998-2001 Mr Azam and his family happened to be instructing a dishonest solicitor who facilitated money-laundering for other clients and a partner in the firm who allowed him to get away with it.

[86]Mr Azam said that in 1998 and 1999 he also worked as a commission agent in Belgium and the Netherlands for Mr Ahmed of Heartwave Ltd, who was exporting second-hand motor vehicles from Japan into those countries. This is the business which was generating the most money for him, and therefore what Mr Azam was getting up to in Europe requires careful scrutiny.

[87]Mr Azam’s present solicitor, Mr Thornton, served a witness statement on 20 July 2014, the last day on which I heard evidence, deposing to his efforts to obtain evidence from various witnesses on behalf of Mr Azam. In that witness statement Mr Thornton explained that he only had postal and email addresses for the witnesses who were overseas, and that when he took their witness statements, Mr Azam was the person who would contact them by phone using Skype and effect the introductions. Mr Azam would remain present whilst they were questioned by Mr Thornton, who did not think to make a note of their telephone contact details. Some of them were reluctant to speak to him without first speaking to Mr Azam and without Mr Azam remaining present.

[88]Mr Ahmed, who lives in Japan, had initially confirmed his willingness to attend trial if he was able to sort out a visa in time. Mr Thornton also subsequently investigated the possibility of his evidence being given by video link. However a recent letter written to Mr Ahmed at the address in Tokyo that Mr Thornton had been given for him was returned unopened after an unsuccessful attempt at delivery, and Mr Thornton could find no details of Mr Ahmed or Heartwave through searches on the internet. He has been unable to obtain any other contact details for Mr Ahmed since then.

[89]Mr Ahmed alleges in his witness statement, which was served under a Civil Evidence Act notice, that he sold around 100-150 cars per month to Mr Choudry’s company Diachii, which was one of his best customers, and that is how he got to know Mr Azam. Mr Azam’s evidence is consistent with this. Mr Choudry paints a very different picture. He says in his witness statement that Mr Ahmed was someone he had met at car auctions in Japan, and that he understands that Mr Ahmed supplied cars to Mr Azam at the same time as Mr Choudry was working with him, in the run up to 2000. Mr Choudry was apparently unwilling to be cross-examined even by video link to Dubai. This was ostensibly because of his need to have the flexibility to make business trips abroad, but as a result of Mr Thornton’s evidence it has become apparent that this was what was reported to Mr Thornton by Mr Azam.

[90]One or other of Mr Choudry and Mr Ahmed is not telling the truth, or the whole truth, about the nature and extent of their acquaintance with each other, but neither was available to be cross-examined. All there is to substantiate Mr Ahmed’s evidence that he was running a wholesale car trading business called Heartwave Ltd, besides Mr Azam’s evidence, in which I place little credence, is a handful of invoices produced by Mr Azam, and a few documents exhibited to Mr Ahmed’s witness statement in Japanese (untranslated) said to be the incorporation documents of Heartwave, which prove nothing about its business. Mr Ahmed’s explanation that he did not keep business records for more than 10 years is a fair one, but it does mean that he has produced no documentary evidence relating to his company’s trade in Europe at the relevant time.

[91]Mr Choudry would hardly have forgotten his major supplier. I can see no good reason for Mr Choudry to wish to distance himself from Mr Ahmed if he was truly supplying so many cars to his company and Mr Ahmed’s business was above board. Mr Seaton did not know where Mr Choudry obtained his cars from, and Mr Azam was a thoroughly unreliable witness. Mr Choudry’s evidence was that he was purchasing his cars by going to the auctions in Japan himself, or from local exporters in Japan who would carry out the necessary checks to ensure that the paperwork was in order. If that is true, and Mr Ahmed was just someone he bumped into at car auctions in Japan, Mr Ahmed’s wish to portray himself as a major supplier of cars to Mr Choudry is explicable as an attempt to bolster his, and Mr Azam’s, claim that he was exporting sufficient numbers of vehicles to Europe to attract the levels of “commission” that Mr Azam was banking.

[92]According to both Mr Ahmed and Mr Azam, Mr Ahmed’s previous agent had not been doing a very good job, and he was looking for a suitable replacement to help him with his trade in Holland and Belgium, where he allegedly imported on average 50-60 cars per month into Rotterdam, Amsterdam or Antwerp; Mr Azam fitted the bill. Mr Ahmed’s evidence is that his customers in Europe paid him in cash, which Mr Azam would collect and pass on to him via courier once he had deducted his commission. When Mr Azam was asked in cross-examination about how he was paid his commissions he said that he was paid in cash in return for a bill of lading. When asked how he carried the cash, he said he could not remember. When asked if he declared it to any of the authorities in whichever port he was collecting it, Mr Azam then suggested that some of the money was wired directly by Intermodal and the customers (though he did not identify an account or a bank to which it was wired). When asked about what he did to safeguard himself against being robbed of the cash he collected, he said he kept the cash with his cousins.

[93]Mr Azam said in his 7th witness statement that he did not earn much in the way of commission on sales to Mr Ahmed’s existing customers, but he introduced other customers to Mr Ahmed, including people in France and Germany, and was paid a larger commission for these deals. When he was asked in cross-examination about these customers, he was unable to recall anything about the German customer or customers save that they cleared the goods through Intermodal, who at one point he suggested were the ones who paid him the cash against the bills of lading for the German imports. In his 2nd witness statement, Mr Azam had said that he was selling cars to one German dealer in particular, whose name he could no longer recall. They were left- hand drive German high performance vehicles, which had been exported to Japan where there is a limited market for such vehicles, and then re-exported to be sold in the used car market. Mr Ahmed says nothing about German vehicles in his witness statement. Mr Azam does not explain why the German dealer was paying cash.

[94]The customers in France all came through an Algerian man named Mustapha Benali, who Mr Azam says was in the restaurant business, and who was living in Reims at the time, though he had spent time in the UK and his sister was friendly with Hardeep. The only customer that Mr Azam dealt with in Europe that he was able to name was Mr Benali. Mr Azam said in his 7th witness statement:

“I did not meet the customers that Mustapha was introducing, I only ever dealt with Mustapha, I assumed because he was adding his own margin on before selling them to the customers. Mustapha would bring me cash and I would hand him the bill of lading.”

[95]Mr Benali was not a witness in this case. This is understandable. According to his record on the police national computer, Mr Benali has three convictions in France between 1982 and 1990 for 5 drug offences including drug supply, and for other offences of fraud and handling stolen goods, for all of which he received custodial sentences. The drugs offences were the most recent. Ms Davison also deposes to Mr Benali being the subject of an outstanding UK criminal matter dating from 1997 for possession of heroin, but she does not reveal the source of that information and it is not on the record that she exhibits. I therefore discount that particular piece of evidence. However, even on his own account, Mr Azam was importing high value cars and exchanging the bills of lading for those cars for what must have been very significant amounts of cash in hand from Mr Benali. The overwhelming probability is that the cash was the proceeds of unlawful conduct. Whether or not drugs were involved, the trade with Mr Benali was obviously money-laundering. That factor casts considerable doubt over the legitimacy of the rest of the business that was going on.

[96]In September 1999 Mr Azam opened the first of his two bank accounts in Luxembourg at the suggestion of his cousin Shaikh Ilyas who lives in Belgium, and with whom Mr Azam stayed when he was travelling in Europe. He says he did so because it was a tax haven (even though he was not declaring his earnings to any tax authorities in any event). They drove together across Belgium to Luxembourg and he opened the account at the first bank they came across. Mr Ilyas is someone who could have given important corroborative evidence for Mr Azam about the nature of his business dealings for Mr Ahmed in Belgium and Holland. He said in his witness statement that he knew that Mr Ahmed was buying and selling cars which were coming into Rotterdam and Antwerp ports, as he drove him to Antwerp once or twice a month. Mr Ilyas had recommended the clearing agent in Antwerp to Mr Azam because he had used him for his own leather import business.

[97]Despite being a member of the family with whom Mr Azam stayed on his regular trips to Belgium, Mr Ilyas was not prepared to subject that evidence to cross-examination. Mr Thornton says that he was told that this was because Mr Ilyas was in the early stages of a new business venture and could not be certain which country he would be in during the court case. It is unclear from Mr Thornton’s witness statement whether Mr Ilyas told him this directly or whether the excuse came via Mr Azam. That is an interesting explanation, given that Mr Ilyas has stated in his witness statement that he has been on welfare and classed as handicapped since fracturing his left hand and injuring his back in an accident in 2007. Mr Ilyas also has a string of convictions, spanning a period between 2002 and 2012, for haulage offences in Belgium, as well as one conviction for selling counterfeit computer goods for which he received a three month prison sentence. In these circumstances I am not prepared to attach any weight to Mr Ilyas’ evidence.

[98]The first Luxembourg account was opened at the Banque de Luxembourg (“BDL”) in the name “Manhattan Star” – possibly the name of a ship. Between September 1999 and April 2000, a total of U$500,000 was paid into that account by Mr Azam in cash deposits in different currencies which the bank then turned into Euro 5 year bonds. Mr Azam was therefore able to afford to leave that sizeable amount of money untouched. Mr Azam claims that the source of that cash was commissions from his arrangement with Mr Ahmed/Heartwave Ltd. He exhibited to his 7th Witness Statement eight so-called “invoices” on paper headed “Heartwave Co Ltd” under which appears an address and telephone number in Tokyo, addressed to him at 90 Wesley Avenue, Hounslow, Middlesex, and ranging in date from 9 September 1999 to 26 May 2000. These refer to various “units of cars sold” ranging in number from 1 to 36 units, (135 cars in total) and to “cash received by client” in Deutschmarks, Belgian Francs and French Francs. The sums on the invoices totalled approximately £370,000 at the rates of exchange in May 2014. Each invoice bears the rubric “Ref: Commision [sic] Fees Agent”. The same spelling mistake appears on each document; that is explicable if the same template was used to generate all the invoices. Each document has a round stamp in red ink in the bottom right hand corner with characters that look Japanese. There is no signature.

[99]Mr Azam’s evidence was that whenever he made a deposit, the invoice to which it related was left in a safety deposit box provided by BDL as an extra service that came with the bank account. One of the invoices related to a commission that he had not deposited; his evidence was that he kept some of the commissions in cash, though he cannot now recall how many. There is no evidence of what became of that other cash (apart from the money deposited in the second Luxembourg account) and certainly Mr Azam gave no evidence that he brought it back into the UK, whether through a currency exchange or otherwise. He said in cross-examination that he kept it for spending money.

[100]Mr Azam was unable to provide any coherent explanation as to how the Heartwave invoices were generated and how he got them. He denied creating them. In his cross-examination he said that he thought that the Japanese company, Heartwave, gave him commission receipts. It makes no sense for Heartwave to be sending Mr Azam an invoice (or a receipt) for his commission, although it would make sense for it to send him an invoice for the whole of the sale proceeds, less his commission, or to ask him to send Heartwave a receipt, to evidence that he had taken payment of his commission at source. I could also understand his creating and then sending an invoice to Heartwave for it to keep in its records, accounting for his share of the commission, though a receipt for what he had received, or an invoice marked by him as “paid” would make more sense: but such a document would surely also state the balance of the sales money he was remitting to Heartwave in cash via the courier. On that scenario, given that Mr Azam had already received payment of the invoiced sum, there would be no need for Heartwave to stamp the document; all Mr Azam would need to do is keep a duplicate for his records.

[101]If Mr Azam was putting these documents in the safety deposit box at the same time as depositing the cash to which they relate, then (unless they were created prior to the sale of the cars and receipt of the cash and the stamp was then affixed by Heartwave), he would have had to wait for Mr Ahmed to send the stamped invoice from Japan (or Dubai) before he could deposit the commission; but what would he do with the cash in the meantime? If Mr Ahmed was issuing the invoices, why did they not set out the sale prices of the cars, and the full amount on which the commission was charged, but only the amount of the commission, and why was a commission agent being described as the “client”? In any event, each invoice bears an English address for Mr Azam – so were they sent to him in England or in Belgium, or handed to him in Dubai?

[102]These are not the only oddities about those invoices. It was Mr Azam’s evidence that when he and Hardeep split up, he and the children moved from 2 Watery Lane into the property at 291 Great West Road, which he purchased in May 2000 in the name of his mother. Mr Azam said he recollected that Hardeep came back to live with them at Great West Road for around a month, but things did not work out between them and she then moved out permanently. She took the children to live with her in a bedsit, but he persuaded her to let them come back and live with him, as she had refused to go back to live with the children at Watery Lane, which was later sold (in January 2001). Therefore the address for Mr Azam on the Heartwave invoices, whoever created them, should have been the Watery Lane address.

[103]90 Wesley Avenue, the address on all the Heartwave invoices, was the address of Mr Azam’s parents. It was a “right to buy” council property that Mohammed had acquired for £16,000 with a full mortgage and subsequently transferred into the joint names of himself and Zarina in 1986. It appears that Zarina still resides there, and has done so ever since her divorce. Mohammed now lives in a rented property in Hounslow. It was his evidence that he re-mortgaged Wesley Avenue several times and gave the money to his wife or children. There was no evidence that Mr Azam moved into Wesley Avenue when his relationship with Hardeep was breaking down. His own evidence was to the contrary.

[104]I cannot conceive of a reason why Mr Azam would have given Mr Ahmed his parents’ address for correspondence or put it on the invoices in 1999 or 2000. However, the documents relating to the BDL account reveal that it was the address that he gave to that bank in a letter of authority seeking to transfer money out of the account in March 2013, after his release from prison in Dubai. The account opening forms disclosed by BDL to the NCA only state an address for him in Dubai, not in the UK, though he had not yet moved there permanently when the account was opened. Thus there is considerable doubt as to whether those invoices were ever in that safety deposit box or were created on the dates they bear. Whenever they were created, I am satisfied that they were created by Mr Azam.

[105]Even if the Heartwave invoices were placed in the safety deposit box when the money was deposited, as Mr Azam says they were, it is more likely than not that they were created in order to provide a paper trail for BDL to satisfy it (or any authority making inquiries of it) as to the legitimacy of the source of the cash deposits. It would have been easy enough for Heartwave to have supplied Mr Azam with pre-stamped headed proformas or notepaper from which to create them, or with a Japanese stamp to apply to them. The extra “invoice” is explicable either on the basis that Mr Azam changed his mind about banking that particular cash deposit and just put the invoice in the safe with the others, or that it related to a deposit made in the other Luxembourg account. These documents are not reliable evidence as to the source of the funds or as to the legality of the trade that was going on. Whenever they were created, they were designed to create a smokescreen to disguise the fact that the cash was the product of unlawful conduct, either drug dealing, money laundering, or both.

[106]Mr Azam did not disclose the BDL account initially in response to the PFO. On consideration of Mr Azam’s various explanations for it at different times, and making full allowance for his ill-treatment in prison, and for the difficulties in taking evidence from him, I am satisfied that this non-disclosure was deliberate and that Mr Azam’s motive was to keep his ill-gotten gains out of the hands of the NCA. He would not have forgotten about the account in which the bulk of his money from the European trade had been deposited. However the NCA did eventually find out about the existence of the BDL account and informed Mr Azam’s then solicitors, Saunders, in November 2012.

[107]When Mr Azam became aware that the Supreme Court had ruled (in Perry v SOCA

[2012] UKSC 35

[2013] 1 AC 182

) that assets abroad could not be frozen under a PFO, he sought to transfer all the funds out of the BDL account; €10,000 to an account at a Spanish bank and the rest into accounts in Hong Kong in the names of three companies: €50,000 to Cool Lead Ltd in December 2012, €35,000 to Best World Trading Ltd on 13 March 2013 and two separate transfers of $267.710.92 to Sunon Develop Ltd and to Enrich Summit Ltd. Both those final attempts to transfer the money were made on 23 April 2013. Had they been successful they would have transferred the entire balance left in the account. However all the attempts to transfer the money out of the account were thwarted when it was frozen, first by the Luxembourg authorities, and then by the NCA following the enactment of the legislation which reversed the decision of the Supreme Court in Perry v SOCA.

[108]Mr Azam’s evidence in cross-examination was that the Hong Kong companies belonged to a friend, Ali Al Sajwarni, his sponsor in Dubai, or else to someone called Shabaz who worked for Mr Sajwarni in the latter’s money exchange. Mr Azam’s explanation of his attempts to empty the BDL account was that he wanted to pay the service charges on the Spanish Property and take some money for his family. Eventually, he drove over to Luxembourg with his elder son Sohail, and withdrew €30,000 in cash. He said the bank manager told him to close the account and he could have taken it all, but he did not do so. He forwarded €20,000 of the money to his cousin to pay the Spanish service charges and used the balance to treat his children. I am prepared to believe that Mr Azam was seeking to pay the Spanish service charges, as the attempted transfers to the Spanish bank are consistent with that, but the attempted transfers from the BDL account to Hong Kong were plainly attempts to spirit away and conceal the money before the NCA could get its hands on it.

[109]In April 2000 Mr Azam opened the second Luxembourg account, this time at Kredietbank Luxembourg (“KBL”) under the pseudonym “A X Kikuchi”. His reason for opening that account was that BDL had insisted the deposits were converted to bonds, and he wanted to keep some of the commissions in cash. Mr Azam deposited €255,645.93 in that account. His evidence was that the pseudonym was chosen at random by the bank, but he was unable to explain why the bank happened to pick a Japanese name. He said he did not know what a pseudonym was, and if he had been asked to pick one, he would probably have used the name of one of his children. The documents relating to that account show that the bank made a fairly substantial charge for the use of the pseudonym. This was something about which Mr Azam stated he was unaware until it was pointed out to him whilst he was giving his evidence. That is possibly one of the few aspects of his evidence that was truthful.

[110]Quite apart from the inherent unlikelihood of the bank choosing the pseudonym for the customer, there is a link between Mr Azam and the name Kikuchi. In the course of a search of Mr Azam’s property in 2000, an address book was found with a fax number attributed to “Yasaka Ltd” at the address of an estate agency named Astons in Isleworth, for which Mr Azam had been working as a commission agent, as I shall explain below. The number was the Astons fax number. Its predecessor, Interlet, was the trading name for a company registered under the name Yasaka Corp Ltd. which was acquired by Mr Makol and his business partner, but later dissolved and replaced by Astons Hounslow Ltd and Astons Isleworth Ltd. The fax number was carried over to Astons. However, there was also a registered company named Yasaka Ltd, nothing to do with Astons or Interlet, which was incorporated in 1997 and ran a licensed restaurant in London. The surname of one director and of the company secretary is Kikuchi, and another director is a Tomoko Sato. Mr Seaton’s witness statement makes reference to his hearing about a Mr Sato who was sending large numbers of cars to Rotterdam or Amsterdam. Mr Azam could not explain what the name Yasaka Ltd was doing in his address book, coupled with the fax number of Astons. This may all be pure coincidence, but I do not believe that the bank chose the pseudonym or that, given the choice, Mr Azam would have chosen a pseudonym that would be far easier to trace to him.

[111]Mr Coppel pointed out that Mr Azam used his genuine signature on the account forms and provided the bank with copies of his passport. It would have been easy enough to ascertain that he was the man behind the Kikuchi account. Moreover the small print on the forms made it clear to the customer that if the bank received an order to freeze his accounts it would also freeze any pseudonymous accounts ascribed to him. However, Mr Azam did not read the small print; and anyone seeking to freeze his accounts would have to know that he was using the name “Kikuchi” in order to ascertain that he banked with KBL in the first place. That was the whole point of using the pseudonym.

[112]Mr Coppel also submitted that there is nothing inherently unlawful about opening a bank account, pseudonymous or not, in a recognized tax haven. Nor was it unlawful for Mr Azam to seek to take the money out of the account at a time when the account was not frozen. That is, of course, true. In order for the contents of the two Luxembourg accounts to be recoverable property, the NCA still has to satisfy the court on the balance of probabilities that the money deposited by Mr Azam was acquired through unlawful conduct. However the circumstances in which the accounts came to be opened, their nature, and the fact that Mr Azam was driving long distances from Belgium to deposit sizeable amounts of cash in various currencies into them, with or without lodging highly dubious paperwork in the safety deposit box at the same time, gives rise to a very strong inference that he was trying to hide the money from anyone who might be interested to ask questions about the circumstances in which he had acquired it.

[113]The other obvious point is that these were huge amounts for an agent to have made just for dealing with the necessary clearance formalities, seeing to it that the bill of lading was delivered to the customer or the customer’s agent, and collecting the price of the cars against the bill of lading – hence the need to convince the court that the commission was being earned on the importation of large quantities of cars (because Mr Ahmed was a wholesaler) and that Mr Azam was earning enhanced amounts by bringing in new customers for Mr Ahmed through his contacts in France, Belgium and elsewhere in Europe. If these truly were commissions, which inevitably are a small percentage of the price, the amount of cash passing through Mr Azam’s hands back to Mr Ahmed would have been in millions. Mr Ahmed referred to a sales turnover of US$5-10 million in the period between mid 1999 and 2000. Nobody carrying on a legitimate business would entrust sums of that size to a courier, especially in cash. They would have to be remitted to Japan (or Dubai) via a bank or, possibly, a currency exchange – but that would subject them to scrutiny by the authorities.

[114]If Mr Ahmed was truly a wholesaler, he would be selling in bulk to identified trade customers, and if they were legitimate traders they would be sending him payment via a bank, (probably by letters of credit, if not by interbank transfer) not cash in hand via couriers, with a sizeable cut to the man who received the bill of lading and delivered it to them. That is why Mr Azam decided to introduce the possibility of wire transfers when he was cross-examined. However, if the payments were made through a bank, there would be no cash from which to take the commission. The inexorable inference is that criminal conduct must have been involved in this trade. Whether or not some or all of the cars were stolen, it is absolutely plain that this was a money-laundering operation with the cars being exchanged for the “dirty” cash. The involvement of Mr Benali confirms it. Indeed it is far from clear that the dealings with France and Germany had anything to do with the importation of cars. I do not accept that the German money paid into the BDL account had anything to do with the importation of German cars from Japan.

[115]The trade for Mr Ahmed into Europe stopped in mid to late 2000. Mr Azam attributed this to the Yen rate worsening against the Euro or other European currencies, making the business far less profitable for Mr Ahmed.

[116]From 1January 2000 until 15 March 2001 (according to the HMRC records) Mr Azam worked for his friend, Neeraj Makol, at Astons, which was then the latter’s business. Astons was started by Mr Makol and one of his cousins in March 1999 after Mr Makol had ceased working in his family’s fast food business. Mr Azam worked on a commission basis, introducing both landlords and tenants for properties to be managed by Astons. The amount of commission he earned was determined on an ad hoc basis and paid to him via PAYE. Mr Makol’s evidence, which I accept, was that by early 2001, Mr Azam’s work for Astons was slowing down. However after he ceased working for Astons, Mr Azam still retained them to manage the properties that were held in the names of members of his family, the ABC properties, and Offley Place after its acquisition.

[117]Mr Azam’s income from his work for Astons was the only income that he declared for income tax in that period (or indeed at all, prior to going to Dubai). The evidence from the Inland Revenue records exhibited to Ms Davison’s 9th and 23rd witness statements establishes that in the year 1999/2000 Mr Azam declared income of £4,800 gross (£3,995 net) and in the following year, 2000/2001, he declared income of £18,269.79 gross (£15,303 net), Astons being the only source of the declared income in both years.

[118]Ms Davison’s evidence was that enquiries with HMRC revealed that for the tax years 1990/1991 to 1994/1995 Mr Azam was in receipt of unemployment benefit. This was confirmed by a statement from HMRC exhibited to Ms Davison’s 23rd witness statement. Mr Azam said he did not believe that he claimed unemployment benefit for five years in a row, though he could not really remember. He did not otherwise challenge the HMRC records when they were put to him in cross-examination. For the tax years 1995/1996 to 1998/1999 he declared no income to tax from any source. Mr Azam’s explanation for this was that he believed that the commissions paid to him in respect of his business venture with Mr Seaton were not taxable in the UK as they were earned and paid to him in the UAE, where there is no charge to income tax.

[119]So far as the commissions on imports into Europe were concerned, Mr Azam admitted that he paid no tax, but said that he did not know whether he had to or not, adding:

“I thought because the cars were getting imported and you paid a duty on them, there is no other taxes.”

He then said, when pressed by Mr Sutcliffe, that he had asked the lawyer, Mr Bamrah, and the (unidentified) accountant he was then using and he felt that he may have been misguided, looking back on it now. As in many other instances, Mr Azam was not being truthful, in an attempt to exculpate himself from responsibility for his behaviour. Even a dishonest solicitor or the most incompetent accountant is unlikely to have advised a British national then domiciled in the UK that there was no income tax to be paid on significant amounts of money he was earning in Europe and stashing away in a tax haven.

[120]In her 4th witness statement, Kalsoom said that when she first met Mr Azam she was given to believe that he was a successful businessman predominantly engaged in property development. After they were married she also found out that he dealt in cars but she described that as “occasional”. However she did not really concern herself in his business affairs. What Kalsoom believed at the time certainly fits with the evidence that by late 2000 Mr Azam’s involvement with both Mr Seaton and Mr Ahmed in the importation of cars had ceased and his main source of (known) income was his work for Astons. However in early 2001 he was winding down his work for Astons and concentrating on his own affairs. There is no evidence of what those business affairs were or of he was doing to earn a living at that time or after he ceased working for Astons.

[121]On 14 May 2001, a matter of days after Kalsoom arrived within the jurisdiction, Mr Azam was remanded in custody on charges of a wholly unrelated nature. He was released on 10 December 2001. This 8 month incarceration (which Mr Azam did not mention in his witness statements) is of relevance in two respects. First, Mr Azam was unable to obtain an income from employment during that period; no income was declared by him or Kalsoom to HMRC from any source for the tax year 2001/2002. Secondly, it was during that period that another of the properties that the NCA is seeking to recover, 5 Thurza Court, was purchased for £71,000 from Neeraj Makol in the name of Mohammed Azam. The property was rented out through Astons and transferred into Kalsoom’s name on 1 May 2002, shortly before Mr Azam went to live in Dubai.

[122]In the same way as for the period between March and May 2001, there is no evidence as to what Mr Azam was doing to earn a living in the period between his release from custody in December 2001 and his move to Dubai. His evidence, in his 7th Witness Statement, was that he was “busy with the car sales” and was travelling around with Abid Malik more. Since the car imports (both domestic and European) about which there is evidence had stopped by this point, and Mr Azam said that Mr Malik never paid him anything, there is something of a blank canvas in the immediate run up to his decision to move abroad. I agree with Mr Sutcliffe’s submission that the evidence of Mr Malik was damning. Far from being a respectable elder businessman and mentor, he was tellingly unwilling to tell the Court how Mr Azam made his money, though he must have known.

[123]In my judgment, Mr Azam was trying to make out that he was earning more from the Seaton business venture than he actually was, because he realised that there was no evidence of his earning sufficient money over and above the Choudry/Seaton commissions (most if not all of which remained in Dubai and were used to purchase Great West Road in 2000) to meet his and his growing family’s everyday living expenses, plus his regular expenditure on trips to Europe (at least twice a month) and to Dubai, let alone any other business outgoings. When he and Hardeep were still together, the small amounts she may have been paid for working in the family shop would not have funded that. His work for Astons yielded no more than approximately £20,000 net over 15 months. The money which he earned in Europe was, on his account, largely going into the two Luxembourg accounts. Apart from Offley Place, whose acquisition was largely funded by the proceeds of sale of Watery Lane in January 2001, he simply did not have enough money from legitimate earnings to purchase properties (especially without a mortgage). Yet those sale proceeds remained untouched in his Barclays account earning interest for over a year.

Period 2 – July 2002 onwards

[124]In July 2002 Mr Azam moved to the UAE, intending that Kalsoom and the three children would join him there once he was settled (which in due course they did). During the period of just under four years he spent in the UAE, Mr Azam and his family had a comfortable lifestyle and the older children were privately educated. Initially he rented a property, because at that time expatriates were not allowed to buy land. He estimated that the rent was around 60,000-80,000 dirhams (approximately £10,000- £11,500).

[125]At around the time of the move, Mr Azam purchased 1 Offley Place in his own name on 19 July 2002 for £300,000. St Johns again acted in the purchase. The bulk of the funds, as I have said, came from the proceeds of sale of 2 Watery Lane, and interest that had accrued on that sum which had remained in Mr Azam’s account with Barclays since Watery Lane was sold in January 2001. Mr Azam said that the balance came from the sale proceeds of the caravan in the Isle of Wight which he sold in April 2002 for just over £21,000. As his assertion is supported by the documentary evidence, I am satisfied that the sale proceeds of the caravan probably were the source of the balance.

[126]I am not, however, prepared to accept Mr Azam’s evidence that the caravan was purchased with the profits from the sale of the Lexus and Land Cruiser that Mr Azam initially bought from Mr Choudry in Dubai and brought into the jurisdiction lawfully. It is highly unlikely that he would have kept that money until 1999 or 2000, which is when he said he bought the caravan and associated plot in the holiday park. Even if he bought it in the early part of 2000, he was earning insufficient from Astons at that time to have afforded to pay around £10,000 for a holiday home. The money either emanated from the cash retained by Mr Azam from the business in Europe, or from some other source which he has not revealed.

[127]It was at around the time when he was settling in Dubai that Mr Azam first engaged a man named Stanley Michaels to help him and Kalsoom prepare their UK tax returns. Mr Michaels was a sole trader as an accountant and company formation agent. He was recommended by Astons, who provided him with all the documentation relating to the receipts from rentals of 1 Thurza Court and 1 Offley Place. In August 2003 Mr Michaels was also engaged to prepare a tax return for Shahid Tanveer in respect of the receipts from Allenby Close and Brackley Road, but he never met Tanveer and when he was interviewed by SOCA it was apparent that he knew very little about him. Mr Michaels did not give evidence.

[128]Mr Michaels prepared tax returns which showed that Kalsoom derived rental income from lettings of Thurza Court and Offley Place. For the tax year 2002/2003 she declared a gross income of £6,593 (net 4,330) and for 2003/2004 a gross income of £10,667 (net £6,332). 2003/2004 was the first year in which Mr Azam submitted an income tax return. He declared a gross income from UK land and property of £17,200 (9,814 net). The figures declared by the couple for the rental income for the following tax year, 2004/2005, were of a similar level.

[129]On his arrival in Dubai Mr Azam said he managed to purchase some Land Cruisers from Oman via a man called Abdul Wahab (presumably Abdul Wahab Al Balushi), which he sold for around 5,000-10,000 dirhams cheaper than the official Dubai dealers, and made a profit of around 5,000 dirhams. He was also working with Mr Choudry and continuing to make commission from him. After that, Mr Azam set up in business with a man named Neelesh Chudasama under the name “Mayback International FZD”. According to Mr Azam, Mayback was importing right hand drive vehicles from Japan and other Far Eastern countries and selling them for export to right hand drive countries in Africa and elsewhere. His evidence is that they commenced trading in October 2002 from premises in the Dubai free trade zone leased by Mr Chudasama.

[130]In his 2nd witness statement Mr Azam says he was introduced to Mr Chudasama in 2001 (before he went to Dubai). In his 7th witness statement he contradicts that account by stating that he met him after no more than a couple of weeks in Dubai, and that (like him) Mr Chudasama had only come to Dubai recently. They were both British Asians in a foreign country and felt that they would work very well together. Mr Chudasama already had a big open plan building on a plot of land that could be used as a car showroom. In his 2nd witness statement Mr Azam stated that he invested the equivalent of £8,750 to buy fixtures and fittings and office furniture and a similar sum to improve the rented premises by erecting a canopy. In his 7th witness statement he said he did not have to put any funds in, but brought in custom through his contacts in the car market. He said the business was so successful that he was drawing an average of £14,000 per month.

[131]In December 2003, Mr Chudasama bought out Mr Azam’s interest in Mayback. Mr Azam exhibited to his 7th witness statement a sale agreement recording that Mr Chudasama had paid him 900,000 dirhams for the stock of cars and 450,000 dirhams for goodwill, fixtures and fittings, a total of 1,350,000 in cash. That equated to around £222,500. In his cross-examination, Mr Azam described himself as a “silent partner”. He was unable to explain why it was that Mr Chudasama appeared to be buying out all the stock at full value if he already had a 50% stake in the business, other than by saying that the agreement was drawn up by one of the staff in their showroom and it was probably badly worded.

[132]Mr Azam then set up his own second hand car sale business, “Exotic Cars LLC” with the assistance of a local sponsor, the aforementioned Ali Sajwarni. In his 2nd witness statement Mr Azam said that this was a golden opportunity to exploit the growing local market and that is why he decided to dissolve his partnership with Mr Chudasama. However, in his 7th witness statement he said that he disliked the way in which Mr Chudasama treated the customers and therefore decided on a parting of the ways. In cross-examination he said that Mr Chudasama was tricking customers by trying to push them into buying a car when there might be something wrong with the gearbox, or something like that. Unfortunately that suggests that the business in which he and Mr Chudasama were engaged involved selling second hand cars which were not in good condition, and that Mr Azam was aware of it (otherwise he would not know that his business partner was tricking the customers). That does not fit in with the impression that some of Mr Azam’s witnesses sought to create of the nature and quality of the cars in the Mayback “showroom”.

[133]This attempt by Mr Azam to distance himself from Mr Chudasama is likely to be in consequence of the fact that before he made his 7th Witness Statement he found out that the NCA was seeking to rely on a report published on the BBC website in 2001 of an investigation by the BBC “Watchdog” programme into the trade of stolen Japanese cars being imported into the UK from Dubai. Prior to moving to the UAE Mr Chudasama had been arrested by the Metropolitan police on 20 August 1997 for conspiracy to steal approximately £1 million worth of vehicles. There is no further evidence of any action being taken against him in this regard. The BBC article suggests that Mr Chudasama had admitted to an undercover team of journalists that he was bringing stolen vehicles into the UK, bragging about providing them with false identities once they were here.

[134]The court has to be very careful about placing reliance on information of this kind. Even if Mr Chudasama had made such admissions, (and the evidence that he did is multiple hearsay, though he was apparently recorded) there are many examples of cases in which innocent people have been tricked into making admissions of unlawful behaviour, or have boasted about such behaviour in order to make themselves seem important or to impress the person they are dealing with. Clandestine recordings are generally inadmissible in evidence. What the BBC said goes nowhere near proving that Mr Chudasama was ever engaged in criminal activity of the alleged or any other kind.

[135]Whenever it was that they met, there is no evidence of any business association between Mr Azam and Mr Chudasama prior to their business relationship in Dubai in 2002, and the business in which they were engaged post-dated Mr Chudasama’s arrest and the BBC programme. Even if Mr Chudasama had been engaged in unlawful behaviour of the kind alleged when he was in the UK, it would not follow from that that there was anything unlawful about the business of Mayback. However, Mr Azam does not appear to have been very discriminating about his choice of business partner.

[136]What is perhaps more telling is the further damage that his explanations for his association (and subsequently disassociation) with Mr Chudasama caused to Mr Azam’s credibility. In cross-examination he initially stated that the first he knew of Mr Chudasama’s arrest was when Mr Sutcliffe showed him the custody record. He said that he had a “vague knowledge” about the BBC programme. On further probing he clearly did know a lot more than he was letting on about the allegations. At an earlier stage, when Ms Davison was giving her evidence, Mr Azam had passed a note to his counsel to say that Mr Chudasama was suing the BBC for libel, which Mr Coppel read out. In cross-examination Mr Azam’s evidence was that he took no notice of the allegations because Mr Chudasama had said to him back in 2001 that he was suing the BBC with support from the Dubai government, and that was what the note had referred to. It was plain that Mr Azam was unconcerned about the prospect of going into business with Mr Chudasama despite this question-mark over his past, and the libel story was a fiction. I reject his account of growing to distrust him because of the manner in which he was dealing with the customers.

[137]There is an astonishing lack of supporting evidence about Mayback and the trade it was carrying on during its short existence. Unlike many of Mr Azam’s other business associates, Mr Chudasama was not even a paper witness. Mr Ahmed said in his witness statement that Mr Azam bought 10-15 cars per month from him “for his showroom” (and thus, presumably, not for export), but Mr Abdul Wahab Al Balushi, (“Abdul Wahab”) who supplied cars to Exotic Cars, describes Mayback as importing and exporting right hand drive cars, mainly imported from Japan. This is consistent with Mr Azam’s own evidence in his 2nd and 7th Witness Statements, though in the latter he said they would also stock some left hand drive cars for the local market.

[138]Mr Choudry stated in his witness statement that he bought a few left hand drive cars from Mr Azam at Mayback to export to Africa, but he does not say that he sold him any. However Mr Azam said in his 7th witness statement that he sourced some of his cars from Daiichi and some from Mr Ahmed. A witness statement from a Mr Arif Mapara (who by his own account is a long-standing acquaintance of Mr Chudasama) states in his second witness statement that his business, Sabre Trading, which specialised in high value French vehicles, would purchase 1-2 cars per month from Mayback and sell them 4-6 cars per month. Surprisingly, Mr Mapara made no mention of this business relationship in his first witness statement, which merely dealt with Kalsoom coming to his (Mr Mapara’s) showroom and selling two cars to him in April 2006. Mr Mansoor Al Balushi, unlike his cousin Abdul Wahab, described Mayback as selling “luxury” new and used cars. He said it was a good and profitable business, although he was in no position to give that evidence from his own knowledge, since he only ever introduced customers to Mr Azam at Exotic Cars.

[139]There is another interesting feature of the Mayback business that emerged in the course of the oral evidence, when in the course of his supplementary evidence in chief Mr Azam referred to his acquaintance with a man named Mubarak Shah, also known as “Lee” (“Mr Mubarak”). He knew Mr Mubarak’s father, who ran a garage, and he had known Mr Mubarak himself for around 15-20 years before he (Mr Azam) went to live in Dubai. Mr Mubarak was a good cook who had been in the restaurant business. Around six months after he had moved to Dubai, Mr Azam discovered that Mr Mubarak and his fiancée were also living there, and he introduced him to Mr Chudasama. Mr Chudasama took a liking to Mr Mubarak and they gave him a job in Mayback. When asked about the job, Mr Azam was extremely vague. He said “he was doing everything, cooking and helping around with the cars”. When Mr Azam parted company with Mr Chudasama, Mr Mubarak left the job and Mr Azam said he left the UAE as well. Although Mr Azam claimed they then lost touch for a while, he now lives just around the corner from Mr Azam’s house, and according to Mr Azam they are regular visitors to each other’s homes and he regularly cooks meals for him and his family.

[140]Mr Mubarak and his son were recently apprehended by the police in possession of 150kg of cannabis, (a mixture of resin, herbal cannabis and “skunk”) with a street value of approximately £1 million, which had been offloaded from a van and taken in boxes into Mr Mubarak’s house. On 12 June 2014 at Southwark Crown Court they both pleaded guilty to conspiracy to supply a controlled drug of class B, namely cannabis, contrary to s.1(1) of the Criminal Law Act 1977. They have not yet been sentenced.

[141]Mr Azam’s motive for seeking to distance himself from Mr Chudasama could be because he knew that the vehicles they were selling had a dubious provenance, (especially if they were coming from Mr Ahmed) but the highly suspicious nature of what was going on is still insufficient for me to be satisfied on the balance of probabilities that the cars that Mayback were selling were stolen. However the evidence that the money Mr Azam must have invested in setting up this short-lived business was either the proceeds of drug dealing or money laundering is more than sufficient for me to so find, which I do.

[142]Meanwhile, in August 2003, Mr Azam and Kalsoom purchased a plot of land at Wheatash Road on which they later built a property. Mr Azam’s evidence was that the land was purchased entirely or mainly for £50,000 from the rent received from Offley Place and Thurza Court, though the proceeds of his car trading activity may have contributed towards it. The first time he said this was in his 3rd witness statement. The HMRC evidence in relation to the rental income was that Mr Azam declared £11,200 for 2002/2003 and £17,200 for 2003/2004 (£28,400 gross) and Kalsoom declared £6,893 and £10,667 for those years. The total sum declared (£45,960) falls short of £50,000 and of course part of the rentals would have been earned after August 2003.

[143]When she was interviewed by SOCA on 27 July 2010, Kalsoom said she did not know how they afforded to build a property on the land. Mr Azam’s evidence was that his father paid for the cost of the building work (£50,000-60,000) out of the proceeds of compensation he had received for his accident. His father denied this. The building work was completed in late 2004. In cross-examination Mr Azam estimated that by August 2003 he was making around £500,000 to £1 million from his car trading business. He had no plausible answer to the point put to him by Mr Sutcliffe that if that was so, he had no need to borrow his father’s compensation money to pay for the building work because he could simply have repatriated the funds via his sponsor’s currency exchange or via World Link.

[144]Exotic Cars rented a showroom in what various witnesses have described as an excellent location on the Sheikh Zayed Road in Dubai. As the name suggests, it specialised in prestige models. The evidence in relation to where these cars came from was in the witness statements of Mr Abdul Wahab. He says he is a dealer in high value cars such as Mercedes, BMW, Ferrari, Porsche and Lamborghini. He claimed to have sold him 14-16 such cars per month. Most of his deals were done in cash or cheques to cash. He said that was the normal way in which business is done in the UAE. Abdul Wahab was due to give oral evidence by video link from Oman, but failed to show up at the appointed time and place; yet another of Mr Azam’s intended witnesses who appeared reluctant to subject their evidence to cross-examination. On 15 April 2014 an order was made by Hamblen J by consent that Abdul Wahab, his cousin Mr Mansoor Al Balushi, Mr Zahid Yahya, Mr Saleem Akhtar Ahmed and Mr Abid Malik be cross-examined either in person or by video link. The only person on that list who ended up being cross-examined was Mr Malik. In the light of Mr Thornton’s evidence as to how their statements came to be made, this is perhaps unsurprising.

[145]At around the same time as he set up Exotic Cars, Mr Azam also turned his attention to the residential property market in Dubai. Mr Azam’s evidence was that in the rapidly rising market he made a lot of money from ad hoc property deals. He would sell off-plan properties at a profit before completion, or else he would buy properties and either sell them at a profit (a process known as “flipping”) or rent them out through an agency called Milford Real Estate.

[146]Nicole Edlund, who worked for that agency and whose evidence was unchallenged, was involved in letting out the properties he had purchased and advising him on future purchases and investments. She testified to the substantial profits that Mr Azam made from buying and selling properties in the Emirates Hills and Greens after holding on to them for short periods of time. I have no doubt that this is correct: but Mr Azam would not have been in the position to buy those properties in the first place if he had not been engaged in unlawful conduct and made enough money from his drug dealing to start those investments. Even if the business of Mayback was legitimate, it was short-lived. I do not believe that it generated Mr Azam much in the way of profit, certainly not enough to keep him and his family in the comfortable lifestyle they were enjoying. The business was a front, in the same way as the businesses involving cars that he conducted in the UK and Belgium were a front. It is no coincidence that the man he and Chudasama decided to employ at Mayback to do nothing in particular, was someone who was convicted many years later of being concerned in the supply of a large quantity of cannabis after being caught red-handed by the police.

[147]In early 2005, according to Mr Azam, the Kuwaiti owner of the showroom where Exotic Cars traded decided to sell the premises, and the new owner planned to increase the rent six-fold. Until then it was only around £24,000 a year. Although he said he received legal advice that the new owner could not enforce the rent increase he was concerned that they would make his life difficult if he refused. Mr Azam says that he sold his interest in Exotic Cars to a Mr Zahid Yahya on 15 June 2005. He said in his second witness statement that he was becoming disillusioned with the lifestyle in the UAE, the weather was too hot in the summer, and he was thinking of returning to the UK. Mr Yahya paid him around £180,000 for the goodwill and separately for the stock – the total purchase price was around £435,000. However in his 7th witness statement Mr Azam did not maintain all those reasons for selling but painted the picture that it was a combination of the threatened rent increase plus Mr Yahya effectively making him an offer he could not refuse. As Mr Sutcliffe pointed out, a price of £435,000 for a business generating as much profit for Mr Azam as Mr Azam said it was, made no sense at all. Either the business was not as lucrative as Mr Azam suggests, or he was very anxious to get rid of it for other reasons.

[148]Mr Yahya says in his first witness statement that he first made an offer for the business in April 2005 and that Mr Azam accepted it the same month. In both his witness statements he says that he saw no accounts before he bought Exotic Cars. He was able to judge for himself that the business was well run. He knew from his own business dealings with Mr Azam that he was selling 20-30 cars a month; Mr Yahya alone was selling him 6-7 cars per month. His evidence is that he paid Mr Azam in instalments in cash (having previously given him cheques as security).

[149]Mr Yahya is yet another of Mr Azam’s intended witnesses who got cold feet about giving evidence in person. Mr Thornton’s evidence is that he was uncomfortable or unhappy about speaking to Mr Thornton without first speaking to Mr Azam. Initially Mr Yahya said he was available only between the 7th and 10th July, but when Mr Thornton next spoke to him, on 24 June, he said he was leaving in July and there were problems with Ramadan. He refused to expand on this until he was able to speak with Mr Azam. Whilst I am prepared to accept that Mr Yahya purchased Exotic Cars from Mr Azam, as evidenced by the documents, I place little weight on the rest of his evidence and in particular I reject his and Mr Azam’s story about the increase in the rent. It is possible that things were getting too hot for Mr Azam in Dubai (not necessarily the weather) or alternatively he had decided to move away from cars and into something different (not necessarily lawful), involving his new company AA Trading, and his useful new contact Mr Jonathan Nuttall, both of whom are discussed below.

[150]Various witnesses, including Nicole Edlund, Mansoor Al Balushi and Arif Mapara, referred in their witness statements to the showroom being full of prestige cars and appearing to have a high turnover. It appears to have gone from strength to strength since Mr Yahya took it over, and two more showrooms have been opened. The alleged problems over the increased rentals appear to have melted away.

[151]Mr Azam initially said in his 7th witness statement that Abdul Wahab was the main supplier of cars to Exotic Cars, and that he would actually invest and buy the car himself before leaving it in the showroom in return for a 50/50 split of the profits when Exotic Cars sold the car. Mr Azam stated unambiguously that he kept separate accounts relating just to the cars supplied by Abdul Wahab, and did not include all the business he did through Exotic Cars. He assumed that those accounts were the source of the claim by the UAE authorities that Exotic Cars made 733,000 dirhams (or £126,000) profit in 2004 and he said that because the Abdul Wahab business only accounted for part of the profit, the true profit figure was around £525,000.

[152]In cross-examination Mr Azam initially said he never kept profit and loss accounts for the whole business because there was no reason for him to do so; there were no taxes to pay and nobody really kept accounts in the UAE. That fitted with the evidence given by at least one other witness about the way in which business is done in Dubai. The following day, however, Mr Azam claimed to have remembered that he did keep full accounts of all the business done by Exotic Cars, and they had all been seized by the UAE authorities. Yet the evidence relied on by the UAE authorities at his trial only mentioned the accounts Mr Azam ascribed to the Abdul Wahab sales. If the UAE authorities were so determined to frame him for money laundering, as he contends they were, it would make no sense for them to hold back on using any documents they had found recording the amount of money passing through the business of Exotic Cars. I consider that Mr Azam’s change of evidence was the result of overnight reflection that he had given evidence that he perceived to have been unhelpful to his case, rather than of his impaired memory being jolted.

[153]Mr Azam claims that he invested some of the money from the sale of Exotic Cars in the Spanish Property, though that cannot be correct because the property was purchased a year earlier. When that was pointed out to him in cross-examination, he said the money must have come from the business or from his property transactions.

[154]Kalsoom, in her 4th witness statement, made on 10 August 2011, recalls the sale of Exotic Cars somewhat differently from the accounts given by the parties to it in their witness statements. She says that Mr Azam sold a majority shareholding in Exotic Cars but retained a minority shareholding in it, which caused him to continue to receive an income from the business. Shortly after his arrest in the UAE she remembered the majority shareholder (Mr Yahya) coming to court and insisting that her husband sign over his shareholding to him since he no longer wished to be associated with him. When faced with this in cross-examination, Mr Azam said that this was because Mr Yahya was afraid he might lose the trade licence if Mr Azam’s name was no longer on it, so he asked him to retain a 5% share. When Mr Yahya came to court in the UAE, Mr Azam got Kalsoom to organise the transfer of the 5% share to him. He denied continuing to receive any income from Exotic Cars.

[155]Mr Azam also set up a company in the Dubai free zone called “AA Trading FZC”, which he said in his 7th witness statement was intended to run a car accessory import business, although it never took off. However, according to his statement of assets there was the equivalent of £775,000 in various accounts in the name of AA Trading in Dubai which were frozen when Mr Azam was arrested. In cross-examination Mr Azam tried, unconvincingly, to suggest that there had been some double counting by the bank and the balance was smaller. His initial evidence was that this company only did one trade, with a man called Jonathan Nuttall, to whom he sold £30,000 worth of audio car equipment. Mr Azam claims that he met Mr Nuttall in the middle of 2005 in Dubai, at a trade exhibition. However it was Ms Davison’s evidence that a few weeks after that transfer of £30,000 by Anglo Legal Ltd, one of Mr Nuttall’s companies, there was another transfer of £40,000 to AA Trading from another company of Mr Nuttall’s. These transfers were in November 2005 and January 2006 respectively. The second transfer happened two days after the arrival of the cannabis in Belgium which was the subject of the drug trafficking charges against Mr Azam in Dubai. Faced with evidence of the second payment, Mr Azam then said it was for audio equipment as well. AA Trading was put on the US Treasury blacklist after Mr Azam’s initial conviction in the UAE and it has not been removed, despite his acquittal.

[156]Mr Nuttall’s company, Anglo Legal Ltd, was involved in the transfer of the properties at Allenby Road and Brackley Road (previously held in the name of Empire Worldwide Ltd) into the name of Tanveer on 26 October 2005 for no consideration. Two days later, on 28 October 2005, Anglo Legal made a payment of £36,000 from its client account to a bank account in the name of Tanveer. Neither Mr Azam nor Tanveer has given any explanation of what that payment was for. Mr Nuttall was also involved in the proposed dissolution of Empire and Fabio. When Anglo Legal was served with a Disclosure Notice, and provided documentation in connection with Empire and Fabio, Mr Nuttall claimed that he “did not know of an Amir Azam”.

[157]Mr Nuttall has convictions for VAT evasion and benefit fraud, and in May 2007 he was found to be unfit to act as a company director and was disqualified from acting until May 2011. Anglo Legal Ltd also had an association with a man called Diljan (“John”) Saggar, who was introduced by Mr Azam to Astons as a client during his time working for them in 2000-2001. At that time he had been involved in the provision of temporary accommodation for asylum seekers. Mr Makol referred in his evidence to Mr Saggar going on to be very successful and owning his own management company. However in January 2011 Mr Saggar pleaded guilty to MTIC fraud (relating to offences committed in 2005) and received a 27 month custodial sentence. He was arrested again in March 2014 on suspicion of further offences of VAT fraud and money laundering. One of Mr Saggar’s companies made payments totalling £50,000 to Anglo Legal in the weeks prior to the payment to Tanveer and the first payment to AA Trading. The evidence strongly points towards Mr Nuttall being a money launderer.

The NCA’s case

[158]Mr Azam first attracted the attention of the police in the early part of 1997 in the course of their investigations into the murder of a man who worked for a Bureau de Change in Edgware, to whom I shall refer as “X”. As those investigations are still ongoing, I shall say as little as possible about that matter in this judgment. I heard evidence about it from DI Karen Mumby, who is a member of the team of officers working on the case. Although DI Mumby had no first-hand knowledge of the information entered on the police databases, she was able to attest to what had been logged on by other officers within the investigating team. She also confirmed the contents of a letter of request written by the UK to the UAE authorities in August 2007 seeking their assistance in interviewing Mr Azam in connection with their investigation into X’s death. I found her to be a careful and reliable witness and had no reason to doubt that the contents of the letter of request accurately represented what the police had discovered thus far in the course of that investigation.

[159]The police found evidence that X had been using his employment at the exchange to launder money for local criminals. Over the weekend prior to his death, X had lost over £100,000 gambling. On 13 January 1997, whilst at home, he told his wife that he had lost money which belonged to “creditors”. He also told her that he had the contact telephone number of one of his creditors. At 7pm he phoned his wife from a public telephone in the lobby of a London hotel, saying that he was going to meet his creditors. Later that evening he rang his wife and instructed her to take £40,000 from a safe and deliver it to a man at Baker Street, which she did. The following day X’s body was found.

[160]In the course of the evening of 13 January 1997, from the same phone box at the hotel, X made several telephone calls other than to his wife or to the Bureau de Change where he worked. He called the number of a particular mobile telephone three times in 60 minutes. That phone was registered to Hardeep Grewal. Other telephone records demonstrated that X had telephoned the same number from his home telephone on 15, 17 and 18 December 1996, and that there was an attempted call from the mobile registered to Hardeep to X’s place of work on 4 January 1997. The underlying phone records were put to Mr Azam in cross-examination.

[161]Mr Azam could offer no explanation for why X would have been ringing Hardeep. He denied all knowledge of and all dealings with X, but as with much of his evidence that denial was untruthful. The calls were plainly made to, and in the case of one call, by him using that mobile phone. I am satisfied on the balance of probabilities that Mr Azam was a customer of X and that he was using the money exchange at which X worked. Given the timing of the calls, it is more likely than not that Mr Azam was one of the creditors that X was seeking to speak to on that evening.

[162]For operational reasons, the police decided not to interview Mr Azam at the time, but placed him under surveillance. The NCA’s case is largely founded on material relating to a surveillance operation code-named Operation Kismet although I also saw and heard evidence relating to Operation Oboe and Operation Mile. The NCA relied upon the National Crime Squad (“NCS”) “Minerva” intelligence reports, the records entered on to the NCS database by members of the surveillance teams, as well as evidence from police officers or former officers involved in those operations or in collating the information from the Minerva reports.

[163]In assessing the weight to be placed on the surveillance material I have taken into consideration the nature of the information, how soon after the initial surveillance it was recorded, whether it is a record of something witnessed by an officer or of something said by someone else, (and if the latter, whether the source is identified) and whether the information has been graded within the system by the officer making the log to denote the level of the accuracy of the intelligence and its reliability. I have also considered whether the behaviour observed or recorded is capable of an innocent explanation and the explanations given by Mr Azam in his statements and in his oral evidence.

[164]As one might expect, much of the surveillance material was of a mundane character and showed activities that were innocuous or as capable of an innocent explanation as of a sinister one. Mr Azam complained that the NCA was cherry-picking and using selective reports to fit their thesis that he was engaged in unlawful activity without having regard to the material that pointed in the other direction; he also made the fair point that with the passage of time it was extremely difficult for him to remember what he was doing on a particular day when he was under observation.

[165]Having taken all those matters into account, I am nevertheless satisfied on the balance of probabilities that the explanation for Mr Azam’s conduct is that he was playing an active role in drug dealing or money laundering or both. Mr Horsley, who was a Detective Chief Inspector when he retired from the National Crime Squad, and who I regarded as a very impressive witness, was the case officer for both Operation Kismet and Operation Oboe. He gave evidence that although he did not observe Mr Azam with drugs in his hand, he saw him conducting activity which led him to believe that Mr Azam was in a conspiracy with other people in relation to drug dealing (a conspiracy of which, I should add, the others were convicted).

[166]A significant feature which crops up time and again was the use by Mr Azam (and others whom he met) of public telephone kiosks to make phone calls. Mr Wild, who served for 30 years in the Metropolitan Police, ending his career as a Detective Inspector, told the court that the use of telephone kiosks is preferred by the criminal fraternity because it is less easy for police authorities to hear what is going on.

[167]On 7 October 1998, Mr Azam was seen meeting with a man called Neil Wadley, who was the target of Operation Mile. Wadley is a known drug dealer who was convicted of conspiracy to supply drugs and sentenced to 54 months’ imprisonment in 1995. Wadley had made a call from a telephone kiosk and then met Mr Azam in a car park off the A4, where Wadley handed Mr Azam a plastic carrier bag. The contents of that bag are unknown. Mr Azam said he had employed Mr Wadley as a plasterer. That does not explain why it was that immediately after this encounter Mr Azam made two calls from a public telephone kiosk to one Leslie Miles and to a number in Holland. Leslie Miles was one of the subjects of Operation Kismet who was later convicted for conspiracy to supply drugs. The police attempted to follow Mr Azam but he was recorded in the Minerva report as having performed anti-surveillance measures.

[168]Mr Horsley explained what was meant by that expression; although quite understandably he could not recall what precise measures were taken on that date, and they were not expressly specified, the expression would include such behaviour as driving round the block several times before parking up, and parking in a way so that the occupant(s) of the car had good visibility of what was around them and of anyone observing them. The assessment that Mr Azam was performing anti-surveillance measures was made by surveillance officers who would be able to differentiate between someone going on a test drive of a vehicle (Mr Azam’s suggested explanation) and someone trying to avoid surveillance.

[169]Perhaps the strongest evidence in the Minerva reports relates to what was observed in early March 1999. On 2 March Mr Azam left his home address in his blue Vauxhall van with another man and drove to a petrol station, where he made a call from a telephone kiosk. The other man drove off in Mr Azam’s van and met with a man driving a white Vauxhall van then registered to a Michael Wilby, and previously registered to Leslie Miles. Two large cardboard boxes were handed over. 12 minutes later the driver of the blue van used a telephone kiosk. He then returned the van to Mr Azam’s address. The man identified as Wilby travelled in the white van to the premises of Jones and Tyson at Feltham Trading Estate where he dropped off the boxes. The next day, Mr Azam went to a bureau de change. He used two different telephone kiosks to make calls in the afternoon, the second one twice. On the last occasion he was seen using a small blue notebook.

[170]On 4 March 1999 Mr Azam left home and used a telephone kiosk. He then travelled to Ajay Motors, where he met the occupants of a UAE plated vehicle. The vehicles drove to First Choice Engines where boxes were transferred from Mr Azam’s vehicle to the other vehicle. The vehicles then returned to Ajay Motors, but there is nothing in the surveillance reports about the boxes being offloaded there or at the engine transmission workshop next door. Mr Azam then made visits to a plumbers’ merchant and to Brackley Road where he met a builder. Later on, Mr Azam made another call from a telephone kiosk, and 30 minutes after that call he went to an address where a white bag was passed between him and a male.

[171]Although there was evidence that Mr Azam did occasionally drop off gearbox parts at Mr Rudki’s workshop next door to Ajay Motors, Mr Rudki’s evidence was that his dealings with Mr Azam did not commence until 2000. Even if he was mistaken about the year, the surveillance evidence is more consistent with criminal activity than with dropping off spare parts; if Mr Azam was dropping off parts that had been delivered to the first garage, he would have gone there first, driven to the second garage with the boxes and off-loaded the boxes there, or else he would have handed over the boxes at the first garage and left the other vehicle’s occupants to drop them off at the second. It made no sense for him to drive back with them, or to hand the boxes over if he was going back there to drop them off.

[172]Later surveillance reports from 1999 record Mr Azam visiting Jones and Tyson’s premises, on one occasion spending 10 minutes there and dropping off a carrier bag; but such visits were rare. Those premises were found to be a storage and distribution centre for drugs. In November 1999 a third of a tonne of cannabis and £150,000 in cash were seized from the premises and Wilby, Leslie Miles, his brother Paul, and Jason Saunders were among those who were arrested and ultimately charged with and convicted of conspiracy to supply. Mr Azam admitted being a friend or acquaintance of the Miles brothers and Saunders, with whom he went to school, but claimed that his association with them was innocent, that his only dealings were in cars, and that he only found out that they were convicted for conspiracy to supply drugs when the NCA served its case. I do not believe him.

[173]On 14 May 1999 Mr Azam used a public telephone box outside a Tesco store to call a number of people; the last call was to a number noted in his personal organiser under “Yaah (Anis)”. Yaah Exchange was a currency exchange in the Whitechapel Road run by one Mohamed Anis Ismail who was the subject of a customs investigation into money laundering. Mr Ismail later pleaded guilty to money laundering approximately £46 million between 9 April 1997 and 20 November 1998. On his arrest a list of customers was found. Mr Azam’s name was on it. So were the names of Jason Saunders and Paul Miles.

[174]An earlier intelligence report in October 1998 had recorded that Ismail was seen meeting Mr Azam, who was using a laptop computer. Mr Azam said he did not have a laptop computer but even if true, that does not rule out his borrowing one from someone else. In his 2nd Witness statement Mr Azam said that he conducted substantial foreign transactions in connection with his car import business, particularly with the UAE, and needed to undertake money transfers to sustain that. He stated that it was possible that he may have had dealings with Mr Ismail in that connection, though it was too long ago for him to remember. In his 7th Witness statement and in his oral evidence he retracted that evidence.

[175]Of course in 1998 and 1999, Mr Azam was not buying cars from the UAE or from anywhere else. On his account, he was just a commission agent. He did not need to use a currency exchange to send money overseas and his commissions were all paid to him in Dubai or Europe so he did not need to use one to receive money either. His business relationship with Mr Seaton did not involve such transfers, nor (on his account) did his relationship with Mr Ahmed. There was no legitimate reason for him to be using a currency exchange, and his evidence was that he only ever used one such exchange, in Dubai. It seems very likely that Mr Ismail was a replacement for the late Mr X and being used to launder the proceeds of Mr Azam’s drug dealings.

[176]The evidence in respect of Operation Oboe is far less compelling. The target of that operation was a man named Stephen Potter, another drugs dealer, who was eventually arrested and convicted with others of a conspiracy to import cocaine. Mr Azam claims that his only involvement with Potter was that he sold him a car, a people carrier, and that the surveillance report of recording his handing Potter a piece of A4 sized paper on the afternoon of 13 October 2000 was likely to have related to the occasion on which he gave him the log book. Potter was first recorded in the Minerva reports as driving the people carrier on the night of 3 October 2000. On the morning of the 13 October he was seen loading a number of white boxes into the rear of it, but there are no other records of his having had any dealings with Mr Azam. I consider that Mr Azam’s account of his dealings with Mr Potter is likely to be true, save that Mr Azam is mistaken in his recollection that the sale of the car took place at around the time of his split from Hardeep. It occurred somewhat later in 2000 than that.

[177]However, in the Minerva reports for Operation Oboe there is a report of a conversation that took place between Mr Azam and an unidentified male on 12 July 2000. The topic of their conversation was general although Mr Azam stated that he was able to “arrange plenty of things” at present. This was believed by the officer logging the report to be a reference to drugs, as the rest of the conversation included references to known drug dealers.

[178]Mr Azam gave varying explanations for his use of public telephones from the possibility that his mobile phone battery had gone flat, or the lack of a signal, to an alleged affair with a girl called “Susannah” who he said was Mr Makol’s secretary at Astons, to the fact that he only had a pager and may have gone to make calls in response to a message received on the pager (a point he raised for the first time in cross-examination). However, the evidence of Ms Davison, supported by the data in the surveillance reports, was that the numbers called by Mr Azam from the phone booths did not match anyone called “Susannah” and, despite naming lots of other people who worked for Astons, Mr Makol did not testify to having a secretary, let alone one named Susannah. In any event, the police surveillance evidence relating to Mr Azam’s prolific use of phone boxes pre-dates his going to work for Mr Makol, and thus the alleged affair, by some considerable time.

[179]Hardeep Grewal did make reference in her brief witness statement to her husband having an affair shortly before they split up, and to his leaving the house to make phone calls to his girlfriend, but that statement is unsatisfactory for many reasons and the evidence was never tested. Hardeep made it clear to Mr Thornton that she was not prepared to come to court and no witness summons was served on her. It is possible that Hardeep believed that the reason her husband was always going out to make telephone calls (instead of using the mobile registered in her name) was that he was having an affair, but in my judgment the true explanation is that he was involved in drug trafficking, and the use of public phone boxes was intended to evade interception of his calls and to make it as difficult as possible for the police to create clear records that would attribute those calls to him.

[180]Mr Coppel submitted that the reason why Mr Azam was never charged, prosecuted or convicted as a result of the surveillance material was that he was not engaged in unlawful activity. The thesis that he was able to continue to engage in widespread criminal activity despite being subject to extensive and prolonged surveillance was founded on the assumptions that he was not only aware of the surveillance, but extraordinarily lucky. He pointed out that there was reference in only two of the surveillance logs to Mr Azam appearing “surveillance conscious”.

[181]I had the advantage of observing Mr Azam giving evidence for over two days and my impression of him is that he is no fool. An alternative explanation to sheer luck is that he was careful to put himself in a position where he was unlikely to be caught doing anything he could not explain away, especially because the car trade was a useful cover, as was the building work that was carried out from time to time on the family properties. Wherever possible he was using others to act as couriers rather than being directly involved in handling the drugs or cash himself. The evidence of what happened on 2 May 2014, which I address separately, confirms that view.

[182]It must also be remembered that for much of the period in question, certainly the latter part of it, Mr Azam was making regular trips abroad. The first of his bank accounts in Luxembourg was opened in September 1999, two months before the drugs were seized at Jones & Tyson’s premises.

[183]If Mr Azam was engaged in the drug trade and in using cash exchanges to launder money in the period from at least some time in 1996 to late 1999, as I find he was, it may be inferred from the evidence about his connection with X that he was doing it during an earlier period as well, but there is no evidence as to when he started. The NCA point to two earlier transactions for which no explanation has been given. The first involved Zarina exchanging 70,000 Austrian schillings for approximately £4,000 sterling at Thomas Cook in 1993. No Austrian connections have been identified, and that is too great a sum to be holiday money for this family. The second involved the payment of £15,000 in cash into an account at United Bank Ltd in November 1995, the name on which is difficult to decipher (though it could be that of Mr Azam’s sister Shazia). Whilst the first transaction is undoubtedly odd, the second is consistent with Mohammed’s evidence that he used the proceeds of sale of property in Pakistan to make payments to his wife, son and daughters from time to time or to inject funds into the family business. There is evidence that he, and his wife, sold land in Pakistan in 1995 – this is of relevance when I come to consider 2 Watery Lane. A transfer of that sort of amount is not inconsistent with making preparations for Shazia’s forthcoming marriage.

[184]It is also safe to infer from the sums of money going into the accounts in Luxembourg in the period up to May 2000 that the unlawful conduct continued even after the raid on Jones & Tyson’s premises and the arrests of Mr Azam’s regular partners in crime in England, and (subject to the long period he spent in detention in 2001) that he was still engaged in unlawful activity during the period before he went to live in Dubai. This is the period for which there is no explanation as to what he was living on, and what exactly he was getting up to with Mr Malik. The evidence from the Minerva reports establishes that Mr Benali was staying with Mr Azam at or shortly after the time of the split from Hardeep in April or May 2000. The payments into the Luxembourg accounts ceased at around that time, as did the trade with Mr Ahmed. Mr Azam had ceased to work for Astons by then.

[185]It is probable that the seedcorn money used to start up his business dealings in Dubai was the proceeds of Mr Azam’s unlawful activity – the money in the Luxembourg accounts had been untouched, the proceeds of the Seaton business in the Dubai bank account had been used to purchase Great West Road, and Kalsoom and the children had had to manage on their own for eight months in 2001, which would easily account for the modest earnings he had made from Astons, even if it had not been spent before Kalsoom came over to the UK from Pakistan. In any event there is no evidence of any transfer by Mr Azam of money from England to Dubai to start up the businesses there. The fact that the proceeds of unlawful conduct must have been used to buy the initial batch of cars from Abdul Wahab and then to start up Mayback is what, in my judgment, led Mr Azam to seek to play down the amount of his initial financial outlay.

[186]The evidence of unlawful conduct in the period after 2002 is largely confined to the events that gave rise to Mr Azam’s arrest and incarceration in 2006. These events post-date the acquisition of all the properties and thus this evidence is only relevant to the NCA’s case that Mr Azam is a career drug dealer and money launderer. I approach that evidence with extreme caution. The NCA do not seek to rely upon the UAE conviction, a point that Mr Sutcliffe reiterated and emphasized in his closing speech. The evidence from the UAE proceedings themselves includes an analysis of the financial records for Exotic Cars seized by the UAE authorities, but those records are not available before this court. Moreover, the person who gave that evidence was identified by Mr Azam as the man who gave directions for his ill-treatment. That is not, in and of itself, a reason to refuse to admit the evidence (since it is not evidence that was obtained through torture) but it is a reason to treat it with a great deal of care.

[187]In any event, in my judgment, that evidence is of little weight. The main points that were made were that Mr Azam bought fixed assets for approximately 23 million dirhams whereas the unaudited final accounts of Exotic Cars for 2004 recorded a net profit of approximately 730,000 dirhams, and that he delivered and received large quantities of money from individuals without recording their names. All of this, as Mr Coppel submitted, was consistent with Exotic Cars being a very successful company and with the “flipping” of properties in Dubai at a time when it was possible to make huge profits on the turn.

[188]The evidence that is independent of what was stated to the court in the UAE is something on which the Court can place some reliance. On 1 February 2006, in Antwerp, a container CRXU 9900634 being carried by articulated lorry was seized and found to contain 2,384kg of cannabis, with a cover load of cotton. It had been picked up at the container terminal on 31 January 2006 and had come from Karachi (via Sri Lanka) on 4 January 2006. The lorry was heading for an address in The Hague. The shipping agent was a man called Luc Van Looveren. Between 1 December 2005 and 16 February 2006, Van Looveren made numerous calls to the UAE. In particular, on 31 January and 1 February 2006 he made several calls to Tom Michielsen, a Belgian national with numerous previous convictions.

[189]On 2 February 2006 the Dutch authorities sent a letter of request for judicial co-operation to their counterparts in the UAE. After naming four specific individuals about whom they sought information, they told the authorities in that letter that “in accordance with our private investigation through hearing systems over telephone calls, we found out that Tom Michielsen and Amir Azam who are both residing in the United Arab Emirates are also involved in the attempt for smuggling [sic] a quantity of 2500kgs of Hashish and entering it to Holland.” They asked for as much information as the authorities could provide about them and their criminal organization and “about the consignment weighing 2500kgs of Hashish which arrived at Antwerpen on 25th January 2006.”

[190]There is no inconsistency between the earlier date attributed to the vessel’s arrival, and the clearance of the container from the port on 31 January. In the intervening period, on 27 January, as mentioned previously, there was the unexplained transfer of £40,000 into AA Trading through Mr Nuttall’s company Anglo Legal Ltd.

[191]Mr Azam accepts he knew Michielsen, whom he met some time in 2005. His evidence was that Michielsen had alerted him to a consignment of tiles that were in the port which could not be cleared because the owner of the containers could not afford to pay the tax to take them out. Mr Azam had found a local contact who was willing to pay for the tiles and to pay Mr Azam around 250,000 dirhams commission for introducing the business. He was in possession of the cheque for the commission when he was arrested. All this may be true; but it does not mean that Mr Azam was not also involved with Michielsen in conspiring to import the cannabis into Belgium, or that the Dutch authorities were making up a story when they sent that Letter of Request.

[192]Mr Coppel submitted that the Letter of Request is not evidence of the underlying offence, but just evidence that the Dutch Authorities requested assistance. In my judgment, however, it is evidence, albeit hearsay evidence, of why they were requesting that assistance and why they were interested in Mr Azam as well as Mr Michielsen. A better point for Mr Azam is the fact that on analysis of the telephone calls passing between Mr Van Looveren and the UAE in the period in question, only three were said to have been made to the number of a mobile attributed to Mr Azam. He denied using that phone, which was registered in the name of someone apparently from the Philippines, whom he claimed he did not know, and he said he did not know Mr Van Looveren either. However in his oral evidence he did seem to know quite a lot about how difficult it was for an expatriate to get the necessary permission for registering a mobile phone in the UAE. There is no indication of when in that period those three calls were made or how long they lasted or what was said but if the phone was being used by Mr Azam, he has put forward no explanation for contact with Mr Van Looveren.

[193]In my judgment, there is no reliable evidence of a connection with Mr Van Looveren; but the telephone contact with Michielsen and the timing of the unexplained £40,000 payment via Anglo Legal, do establish a connection with the drugs that were imported into Belgium and add weight to the NCA’s case that Mr Azam was a drug dealer.

[194]Finally there is the evidence about the events of 2 May 2014. It is relevant to Mr Azam’s credibility, but even without it I have an ample basis upon which to conclude, as I do, that he was a thoroughly mendacious witness. It is also of relevance to rebut his claim to be an accomplished businessman who is able to generate significant profits from legitimate trading, but again, there is more than enough material without it for me to reject his evidence about that, as I do. As the criminal proceedings which ensued have not yet reached a conclusion but there is shortly to be a plea and case management hearing, it would be unfair to Mr Azam to make my findings in the body of this judgment. I have included them in an appendix which I shall direct is to remain confidential (and not for publication) until after the trial in those proceedings has come to an end or the matter reaches an earlier resolution.

Are the properties “Recoverable Property”?

[195]I shall deal with each property in the order of its acquisition, save for the “ABC properties” which I shall consider collectively.

[196]This is the property that has caused me the most difficulty. It was purchased at auction from the Metropolitan police for £84,000 in January 1996. Mr Azam’s evidence was that he attended the auction with his father, having attended several property auctions with his parents on previous occasions when all bids were unsuccessful. The purchase price is said to have been made up of the proceeds of sale of some land in Pakistan belonging to Zarina which was sold in April 1995 for 4 million rupees, and the aforementioned mortgage from the Woolwich. Although it is likely that solicitors acted in the transaction in 1996, it was not St Johns. Mr Azam said in his 7th witness statement, and in his oral evidence that he recollected accompanying his father to the office of the solicitors for the Metropolitan police and handing over a cheque or a banker’s draft.

[197]At the time when those Respondents other than Mr Azam who live in the UK provided statements in response to the PFO in 2010 it appeared that none of them had much in the way of money or other assets. Mohammed Azam was living in rented accommodation off state benefits and his only asset of substance was a car. The family textile business made very little in the way of profit in the UK for the reasons I have already mentioned. Zarina declared rental income from the two properties that were the subject of the summary judgment, and from Great West Road, plus the small amount of income from “Family Fashions” to which reference was made earlier in this judgment.

[198]However, in his 7th Witness Statement Mr Azam said that his parents were not poor and came from a relatively wealthy area of Pakistan called Sialkot. He stated that within their family there were a lot of different property holdings which sold for good money. His parents were unable to recall what all of it was used for, but he and his parents had concluded that some of it his parents invested in property in the UK, other money was used to help to support the family, and more “may have been used to build up the UK businesses.” He exhibited a number of documents that he said related to the sales in 1995 and 1999 of plots of land in Pakistan belonging to his parents. Thus Mr Azam’s written evidence was to the effect that he and his parents were speculating, or taking an educated guess, as to where the money for the purchase of Watery Lane had come from.

[199]A second witness statement purporting to be from Zarina written in English and signed by her on 27th March 2014, stated as follows: “I have found a sales document dated 1 April 1995 for the sale of a property in Pakistan for 4 million Rupees which according to the attached historic exchange rate would have been worth around £75,000.... I believe I used this money to buy the property at 2 Watery Lane in January 1996. I recall signing over a cheque for £40,000 and paying it into my daughter Shazia’s bank account in April 1995. The woman at the counter asked me where the money came from and I explained property sale in Pakistan. This property was bought for £84,000 and I cannot recall whether the rest of this was part of the mortgage from Woolwich or whether I added more money myself. If I added more money, I believe it would have come from the sale of property in Pakistan”.

[200]The witness statement went on to say that the house was transferred to Shazia as a gift to help her and her husband to get started. However, the gift was of the use of the property, not the property itself. Shazia had to have a property or she could not have brought her husband over here from Pakistan. There is then an explanation as to why Zarina took the property back in 1998, essentially that Shazia’s husband turned out to be feckless and violent and Zarina did not want him to get his hands on it. The statement goes on to say that in 1998 Zarina wanted to give the property to Amir and Hardeep to help them and their children. It was her lawyer (presumably Mr Bamrah, because he acted in the transfer) who told her that the property had to go back into her name before it went into her son’s. She said she paid off the balance of the mortgage, around £30,000, from money earned from her business. “I was doing wholesale of textile at the time which had a very good cash flow and I could spare this money”.

[201]It is not for Mr Azam to prove that the source of the funds for Watery Lane was legitimate or that it derived from the proceeds of sale of land in Pakistan. It is for the NCA to prove that it was purchased with the proceeds of his unlawful conduct. However on the evidence before me there are no legitimate sources from which Watery Lane could have been bought other than the Pakistani land sold by Zarina. Mohammed, who also owned and sold land in Pakistan in 1995 (and in 1999), did not claim that any part of his money had been used in the purchase of 2 Watery Lane; he said he believed that it had been used to finance the purchase of Thurza Court. If, therefore, the NCA satisfies the court on the balance of probabilities that Watery Lane was not purchased with the proceeds of sale of the Pakistani land, the irresistible inference is that it must have been purchased with the proceeds of unlawful conduct.

[202]The starting point must be the documentary evidence. There are documents in Urdu and English which on their face indicate that Zareena Azam, wife of Muhammad Azam, has sold a plot of land in Sialkot for 4 Million Rupees to one Ashraf Ali on 1 April 1995. The amount is set out in the document as Rs 40,00,000 (i.e. 40 lacs). Although on the originals it appears that the witnesses have signed the English translation in different ink from the Urdu version, that was satisfactorily explained by Mohammed on the basis that the documents were sent off to be translated and then everyone reconvened to sign the translated version at a later date.

[203]The documents were notarised on 18 October 2013. Mr Sutcliffe submitted that it was Mohammed’s evidence that they were actually created on 18 October 2013, since it was his evidence that the originals had been given to the purchaser. Although his answers to Mr Sutcliffe’s questions could be given that interpretation, I did not understand him to be agreeing to anything more than that the documents were authenticated on that date. It is possible that something got lost in translation. In any event, I am satisfied that the property was sold on 1 April 1995, as evidenced by those documents. The problem is that there is no reliable evidence as to what became of the proceeds – not even where they were banked. There was no evidence from either of Mr Azam’s parents about having bank accounts in Pakistan.

[204]There is a cheque for £40,000 in evidence, drawn on Allied Bank of Pakistan Ltd and made payable to “FDD” which is said to stand for “foreign demand draft”. However it pre-dates the sale of the Pakistani land by some 10 weeks (it is dated 19 January 1995) and on the evidence that money is more likely than not to have been used by Zarina to pay for textiles supplied by the family companies in Pakistan. I am satisfied that it has nothing to do with the purchase of Watery Lane a year later.

[205]The next document is more problematic. It is a photocopy of a stub from a book of paying in slips relating to a bank account that Shazia had at the time, and it is said by the Respondents to evidence the payment of £40,000 from the Pakistani sale money into her account at NatWest Bank on 28 April 1995. Shazia corroborated her mother’s written evidence about paying a cheque for £40,000 into her bank account and about the lady cashier asking about the source of the funds and Zarina explaining that it came from the sale of land in Pakistan. The figure that appears on the stub is actually 4000000, (i.e. 4 million) but the last three zeros have been crossed out in both places where it appears on the stub, and someone has written £4,000 underneath. That only adds to the confusion about the sum that is said to have been paid in, suggesting it was £4,000 not £40,000. It is entirely credible that Shazia’s mother or father would transfer £4,000 into her account to help pay for her forthcoming wedding, but that does not explain why the figure that originally appeared was 4 million. Shazia’s oral evidence was that the original figure was in her handwriting and the correction and writing underneath is in her mother’s hand.

[206]The stub does not have a bank stamp on it; moreover the original paying in book has not been produced. There are no bank statements relating to this payment, and Shazia accepted that she made no attempts to obtain them from the bank (though with the passage of time it seems unlikely that the bank would have kept the records). Shazia’s evidence was that before she was married, her original paying in book was handed over to her mother, but the document that was found in a bag of papers belonging to her mother was a photocopy of this entry in her book, not the book itself.

[207]I regret to say that I have concluded that this document was concocted. If the cashier was conscientious enough to ask about the source of the funds she is unlikely to have overlooked stamping the stub. Moreover, the absence of the original document is telling. Nobody would keep a photocopy of one entry in a paying in book, and discard the original book. There would be no reason to keep a photocopied record of the payment of part of the deposit, but no similar record of the payment of the £14,000 balance into the same account. In my judgment it is no coincidence that the figure on the stub was originally written in a way that matched the Rupee amount of the sale proceeds. It seems plain that the intention was to create a record that Shazia had received the whole of the 4 million rupees, or 40 lacs, not that she had received £40,000 sterling.

[208]In his 7th Witness Statement Mr Azam said that in preparing for the case he had learned from his sister Shazia that “my parents put the money in her account with her [sic] and that she was there when my mother told the bank that the money had come from Pakistan” (my emphasis). That seems to suggest that the entire deposit was put into Shazia’s bank account on one occasion. It was obviously his initial intention to claim that the whole of the sale proceeds from Pakistan went into Shazia’s account and were used to pay the deposit for Watery Lane, which would fit with the handing over of a single cheque or draft to the vendor’s solicitors. However, that would also mean that the mortgage was very modest, which did not tally with his mother’s statement that she paid £30,000 to redeem it in 1998. I am alive to the possibility that the document was created to support an otherwise truthful account of where the money came from, but it is also possible that it was created to give credence to a false one.

[209]I next turn to the inherent probabilities. The only previous occasion when either of Mr Azam’s parents had put their own money into property in England they had put in a very small amount - £16,000 was paid for Wesley Avenue with a full mortgage, and £9,000 was the deposit for Grove Road in 1990, with a sizeable mortgage of £60,000. That pattern was broken with this property, although the Pakistani land had not been sold before the earlier purchases.

[210]Secondly, if the property was purchased at auction, it seems inherently unlikely that a large sum of money would be transferred into Shazia’s bank account by one of her parents months before a suitable property had been found, for even though the deposit would need to be paid reasonably quickly, it does not take all that long to effect a transfer from abroad. Moreover, if Mr Azam’s account of going to the lawyers with a cheque or a banker’s draft for the deposit is true, Shazia would have had to have been involved in signing that document to withdraw the money from her account, but there is no evidence of that happening. She said she did not remember. Indeed, as I have said, there is no evidence of the remaining £14,000 being transferred into her account, or certainly not that account. Although it is possible, as I have already stated, that £15,000 was transferred into a different account belonging to Shazia in November 1995, it would make no sense to transfer the money intended for the property into different bank accounts.

[211]Next, the “wedding gift” explanation is not convincing. In Asian families, if a daughter is getting married, her family will traditionally give her gold as a wedding present, not real estate. She would normally go to live with her husband’s family, or else he would provide the home for his wife. Zarina’s witness statement suggests that Shazia had to have a property or she could not have brought her husband over from Pakistan. Later, it states that usually in Pakistani culture the properties go to the son but “it was different here because of the immigration rules”. That does have a ring of truth about it. I do find it credible that the property and the mortgage were put in Shazia’s name in order to convince the immigration authorities that she had sufficient means to sponsor her husband coming over from Pakistan. Shazia herself had no income at the time apart from ad hoc payments for her work in the family business, and that business was not generating sufficient profit to buy her the property.

[212]It is implicit in the explanation given in Zarina’s statement, that if it had not been for the need to provide evidence to the immigration authorities, the property would have been put in Mr Azam’s name to begin with. Although the statement is unreliable for reasons I shall explain, that part of it does accord with the objective probabilities. It also fits perfectly with the fact that Mr Azam was the person in immediate need of a home of his own, with one small child and another on the way, and with the fact that it was he and Hardeep who went to live at Watery Lane in 1996, not Shazia. There is the further factor that both Mr Azam and his father had criminal records – Mr Mohammed Azam has a single conviction for possession of a dangerous drug and supply of cannabis resin dating back to 1973, for which he was imprisoned for three years. That plainly would have inhibited the ability of the male family members to get mortgages in their own names.

[213]Whilst Shazia was the person registered for council tax for the year 1997/1998 that is consistent with her being the registered owner. It does not necessarily mean that she was living there, and she was never on the electoral register there. Even if there was a time when she was sharing the premises with her sister-in-law Hardeep, as she claimed to recollect (for example when her brother was on one of his regular trips abroad) that sheds no light on who financed the purchase.

[214]The need to provide evidence to the immigration authorities also fits in with the transfer of the property back in 1998, by which time Shazia’s husband had arrived in the country, and the need to maintain the fiction that she was the owner had gone. Instead of Shazia transferring the property directly to her brother at her mother’s direction, matters were then arranged so that the mortgage was paid off, and the property was transferred into Zarina’s name and then transferred to Mr Azam. This was all done through Mr Bamrah of St Johns. The “Trust Deed” which bears the date of 10th January 1996 was plainly created at the same time as the transfer to Zarina; the same person witnessed Shazia’s signature on both those documents whereas someone different witnessed her signature on the original TR1 and her father witnessed her signature on the mortgage document that was registered at the Land Registry in 1996. Mr Sutcliffe submitted that if Zarina owned the property and Shazia was holding it as her nominee or trustee all along, there was no reason for the property to be put in Zarina’s name before it was transferred to Mr Azam; Shazia could simply have transferred the property to him directly at her mother’s direction. That is true, but if she was already experiencing difficulties in her marriage, a transfer of the property for no consideration to her brother would not necessarily have had the desired effect of putting it beyond her husband’s reach if and when she divorced him.

[215]There is no satisfactory explanation of where the money came from to pay off the mortgage or who effected that payment. It is highly unlikely that it came from the family business, which even in 2010 was paying Zarina no more than £600 a month. I do not overlook Mohammed’s evidence that he remortgaged the family home on more than one occasion and gave the proceeds to his wife and daughters but he gave no indication as to when this happened. Nor did he say that he had anything to do with paying off the mortgage on Watery Lane. It is unlikely that he did, because he would still have been recovering from his terrible head injury at the time.

[216]Finally I turn to the evidence of the witnesses themselves. In his 7th Witness statement Mr Azam said that he did not know how his parents were going to pay for Watery Lane, because he did not know about the Pakistani properties at the time. However in cross-examination he claimed that he had seen his mother’s properties on earlier visits to Pakistan (and thus was aware of their existence all along). He tried to explain away the inconsistency by saying that he was aware of the existence of the properties and what he meant in his statement was that did not know when they were sold. That was a most unconvincing explanation, and I do not accept it.

[217]In his earlier (2nd) witness statement Mr Azam claimed that £54,000 was provided by Zarina from “money that she had from her share of land in Pakistan” (my emphasis). He also said that Zarina had had funds in an account with the United Bank of Pakistan for at least four years before she bought Watery Lane, and that she had finally decided to purchase the property under pressure from him and his father, and partly because Shazia had just got married (though in fact Shazia got married afterwards). He also suggested that in 1998 Hardeep was expecting their first child and he prevailed upon his mother to let her have 2 Watery Lane, to which she agreed. At the same time his mother redeemed the mortgage.

[218]There are numerous inexplicable inaccuracies in this account, even after making allowances for the difficult circumstances under which the statement was produced. For example, it is odd that Mr Azam has forgotten that his first child was born in 1994, and that he and Hardeep were living at 2 Watery Lane as soon as the property was acquired.

[219]Since Mohammed Azam (who I find to have been a generally credible witness) did not claim to have used any of his own money in acquiring Watery Lane, a position he maintained when he gave his oral evidence, the two key witnesses were Shazia and Zarina. In terms of Zarina’s credibility, the starting point is that Supperstone J had held that she had committed two mortgage frauds and, moreover, had perjured herself by pretending to the county court in proceedings for ancillary relief that she had no interest in the properties transferred into her daughter Asma’s name, so as to prevent her ex-husband from gaining any interest in them when they divorced. Her second witness statement in this case admits that the transfer of Great West Road into Shabana’s name was similarly intended to “make sure it was mine after I left my husband.”

[220]Zarina had attended court in 2011 when Supperstone J heard the summary judgment application. She was representing herself, and addressed the court through an interpreter on that occasion after the judge realised how limited her understanding of English was. An interpreter was also arranged for this hearing. At the start of the hearing there was uncertainty as to whether Zarina would be able to give evidence. On 4 July the NCA were told by Mr Thornton that she was in hospital, as that was his understanding at the time. It then transpired that she had visited the Accident & Emergency Department recently, and would be going to see her GP to ascertain if she would be well enough to give evidence. There was then the statement from the locum GP to which I have already referred, which provided no reason to suppose that the assistance of the wheelchair and taxi offered by the NCA would fail to meet the difficulties caused by her physical frailty.

[221]When Zarina did attend, she sat quietly in the front row of the court next to the interpreter for over an hour whilst her son finished giving his evidence (the questions and his answers were being interpreted to her). However, when the time came for her to take the oath, she launched into what I can only describe as an angry tirade in Urdu, and it rapidly became obvious that she had no intention of giving evidence. Although I gave her the opportunity to calm down over the short adjournment, Mr Coppel informed me when the hearing resumed that he and his junior had formed the view that she was still in no fit state to give evidence, and thus she did not do so. Mr Coppel asked me to treat her statement as her evidence, notwithstanding that she had not formally adopted it, and I did so, though I probably would not have acceded to his request had I known at the time what I now know about how it came to be produced.

[222]In his witness statement, Mr Thornton explained how Zarina’s 2nd witness statement came to be taken. Mr Thornton said he drafted the statement by asking questions in English which were translated into Urdu and the answers translated back into English for him to note down. He said that this was a very lengthy process and involved “dealing with lots of tangents and complaints about this process”, however, he was eventually able to record those instructions which were sufficiently clear for Zarina to sign and confirm as her evidence. He said that Zarina, assisted by her family, was also able to produce the documentation exhibited to her witness statement.

[223]However, despite making no secret of Mr Azam’s involvement in the taking of witness statements from the witnesses who were abroad, Mr Thornton omitted to mention that it was Mr Azam who was doing all the translation for his mother during this long drawn out question and answer process, and when her final statement was translated to her. That crucial piece of information only came to light by chance when I asked who did the translation, expecting to be told that it was one of her daughters. That puts a wholly new complexion on the statement. The fact that the person who stands to gain most from this evidence was, in effect, solely responsible for telling the solicitors what the witness was saying would be a reason for attaching little or no weight to it, regardless of any view that the court may have formed as to Mr Azam’s credibility as a witness. It also sheds a whole new light on her refusal to confirm its contents on oath, since she probably had no idea what she was confirming. I cannot be confident that Zarina would have confirmed that the money for Watery Lane came from the sale of her land in Pakistan. Even if she gave such confirmation, there would be little reason to believe that she was telling the truth, given her previous track record of deception and the strong motive for trying to keep all the property that the NCA is seeking to recover in the family, plus the fact that she plainly had a hand in the concoction of the paying-in stub.

[224]That leaves Shazia, who did give evidence, though it much of it was very vague, unreliable and often unconvincing both as to its content and by reason of the manner in which it was given. For example, in her witness statement she had suggested that some 2 years elapsed between the purchase of 2 Watery Lane and her marriage, but it was pointed out to her in cross-examination that it could not have been more than a few months. She was very unclear as to when she did get married and Mr Sutcliffe asked me to accept what she had stated in her original evidence, but that seemed to me to be less objectively plausible.

[225]Shazia was a patently nervous witness. She was understandably concerned about her mother (including being concerned about her mental health) and her evidence about her mother’s strong personality was plainly truthful. Shazia has also had a very difficult time in her private life, and it has taken its toll on her own mental health. I have made allowances for all these factors. Yet if her memory has been so badly impaired, she cannot possibly have an independent recollection of paying in the £40,000 as she claims she has.

[226]My overall impression of Shazia was that she was not deliberately trying to deceive the court and was doing her best to tell the truth, but when she was put on the spot she resorted to vague and evasive answers in order to avoid doing so and thereby getting her family into trouble. For example, she professed to have had little or no idea what her brother was doing to make a living at the time the house was purchased, saying that she was too preoccupied with her forthcoming marriage; yet until the purchase of Watery Lane, he was living in the same house. It appears that her evidence was coloured by a misplaced sense of loyalty towards him. She maintained that the challenged signatures were genuinely hers, and I am sure that she believed that to be true. It is unnecessary for me to make any finding on that issue, though I cannot really conceive of any motive for forging them, given that Shazia was plainly aware that the property was being purchased in her name, and would have had no reason to refuse to sign the transfer back to her mother when asked to do so.

[227]I also got the impression that Shazia was highly suggestible. It is possible that in seeking to reconstruct events from a long time ago, she has convinced herself, or allowed others to convince her, that something happened when it did not. In her statement in response to the PFO, prepared before her brother was released from prison in the UAE, Shazia said that she did not know how the property was funded, and that the property was purchased by her parents. There was nothing in that statement about being present when her mother paid £40,000 into her bank account, something that one would hardly expect her to forget, or to suddenly remember three years later. Whether or not she had a hand in concocting the paying in slip, I cannot regard her as a reliable witness, but I have no reason to suppose that the unprompted answers she gave in that original statement were deliberately untrue. They may have been mistaken.

[228]That leaves the Court in a very difficult position. Although in April 1995 there were more than sufficient funds to pay the deposit on Watery Lane, there is no reliable evidence that any of that money left Pakistan, let alone reliable evidence that it was used for the deposit in January 1996 instead of, for example, being used to purchase stock for the family business or re-invested in Pakistan. If the burden of proof had been on Mr Azam to establish that the funds for its purchase came from the property in Pakistan he would have failed to discharge it by some margin; but as I have well in mind, the burden of proof is on the NCA to prove that the funds did not come from that source.

[229]The house was plainly being purchased for Mr Azam and his family to live in, not for Shazia. If it had not been put in Shazia’s name in order to facilitate her husband’s entry into the jurisdiction, it would have been put in Mr Azam’s name from the onset. If that property was always intended for him, as I find it was, then if his parents had the money to buy him a house I would have expected them to do so earlier, and not wait until Hardeep was expecting a second child. Although that is consistent with their failing to make successful bids at auctions, the only evidence about attending the earlier auctions came from Mr Azam, and it was introduced by him for the first time in his 7th witness statement. Neither of his parents addressed the point at any stage in their evidence.

[230]On the other hand, there was a credible reason for putting the house in Shazia’s name which had nothing to do with hiding the true source of the funds. Shazia did not know where the money came from. She said in 2010 that it came from her parents, but that must have been an assumption, because as I have found, she was not present when any money was paid into her account. Indeed I am not satisfied that the money went anywhere near her account. I cannot accept any part of her mother’s evidence as to how the property was paid for. Mr Azam was involved in the purchase, and by his own account he was present when the deposit was handed over. His father was involved to the extent of witnessing Shazia’s signature on the mortgage.

[231]Finally, there was the false story about the £40,000 and the concocted paying in stub. Even though that was a deliberate attempt to mislead the court, I would have been hesitant about concluding that the motivation was to conceal the true source of the funds used to purchase Watery Lane, had Zarina’s evidence been taken or given in a conventional manner. Even Zarina’s previous dishonesty in the matter of the divorce proceedings and the mortgage applications and her refusal to give evidence can be explained in a way that does not fatally undermine the assertion that the source of the funds was the proceeds from her land in Pakistan. The matter which has caused me the most concern is the fact that the entire content of Zarina’s witness statement is attributable to Mr Azam, which casts it in a wholly different light.

[232]But for that, I would probably have concluded that the NCA had failed to discharge the burden of proof. However, the evidence seeking to link the sale of the Pakistani land with the purchase of 2 Watery Lane was all orchestrated by Mr Azam, and he was obviously the person who came up with the idea of creating the false paying in stub. By far the most likely explanation for the attempts by Mr Azam to mislead the court in this way was that 2 Watery Lane was not purchased by Zarina, but by him, and that once it had served its initial purpose of appearing to be evidence of Shazia’s means to bring her husband over from Pakistan, he made sure that Mr Bamrah arranged matters so as to create the false impression of a trust, ownership by Zarina, and a gift of the property to him. I therefore conclude that Watery Lane was purchased with the proceeds of unlawful conduct, since it was not purchased with the proceeds of the sale of the Pakistani land. As for the redemption of the mortgage, Zarina plainly did not have £30,000 with which to redeem it in 1998 and Mr Azam, who I find was the person who redeemed it, had no lawful means to pay that sum, given my findings above.

[233]I have already found that as a fact that the caravan was not purchased with the proceeds of sale of the first two cars imported into the country lawfully by Mr Azam. It cannot have been purchased with the proceeds of the Seaton/Azam import business because that money all stayed in the Dubai account until it was used to purchase Great West Road. Therefore, the caravan and related plot in the holiday park must have been purchased with funds relating to Mr Azam’s unlawful conduct in the UK and Europe at the relevant time. This means that Offley Place was purchased with the proceeds of unlawful conduct (the original proceeds of Watery Lane plus the balance) and, subject only to the limitation point, it is recoverable property.

[234]In my judgment the purchase of Offley Place using the proceeds of Watery Lane which itself was acquired with the proceeds of unlawful conduct was a further act of money laundering within the limitation period and thus the claim to recover it is not time-barred.

The ABC Properties

[235]Mr Azam claims that the capital for their purchase was provided by his brother in law, Tanveer, pursuant to a joint venture under which he was to receive 50% of the rental income from the first two properties after Tanveer’s original investment was repaid. Collingwood Road was purchased by Tanveer as an outright investment after it transpired that there were no tax advantages in his using the offshore company structure.

[236]Tanveer, who lives in Pakistan, and who does not speak English, has provided two conflicting statements in English, the second of which Mr Azam contends is truthful. The first was a letter to SOCA claiming he had nothing to do with the properties and that his identity had been “hijacked”. That was obviously untrue because Tanveer must have at least lent his name to these transactions. The second statement, essentially confirming Mr Azam’s account of the joint venture and investment, and claiming that he provided the capital with which to purchase the properties, is dated 27 March 2014. He said that the initial letter was not accurate and was written for fear of what may happen to him in Pakistan as a result of this action. In that statement, Tanveer said “I get on very well with Amir Azam who is my brother in law.”

[237]The second statement was produced in the unsatisfactory circumstances explained by Mr Thornton, using Shabana as a translator. Mr Thornton provided a list of questions, Shabana provided the answers to the questions to Mr Azam and then Mr Thornton spoke to Shabana on the telephone with Mr Azam present in order to finalise the statement. Tanveer was not prepared to make himself available for cross-examination, even by video-link. The excuse that was provided (preoccupation with business matters) was palpably thin. Mr Azam claimed that there was a family feud arising from the fact that Tanveer was angry that he (Mr Azam) was responsible for losing his investment, and that Tanveer had threatened to divorce Shabana: that is inconsistent with what Tanveer has stated in the witness statement.

[238]I have no reason to doubt that Tanveer is a highly successful businessman in Pakistan and that his wealth has nothing to do with anything unlawful. If he really loaned the money to his brother in law or participated with him in a joint venture in respect of the first two properties, and the third belongs to him outright, it is inconceivable that he would not take steps to claim them, especially if he was angry about potentially losing his investment and (contrary to his witness statement) has now fallen out with Mr Azam over it. The combined value of the three properties is just short of £1 million.

[239]The first document to mention Tanveer in connection with these properties is dated 1999, in connection with the purchase of Collingwood Road; the person communicating with the solicitors and accountants and company formation agents in connection with these properties was Mr Azam. Tanveer never met Mr Michaels or Mr Nuttall despite file notes written in English suggesting that he did. His bank statements evidence withdrawals from his Habib Bank account on 19 February 1998 (£58,600), 1 June 1998 (£53,600) and 1 December 1999 (£78,200) but there is no evidence that these monies went to Fabio, let alone from Fabio to Empire Worldwide or to St Johns, and there are discrepancies between these figures and the amounts actually paid.

[240]The evidence shows that Betteridge, and then St Johns, were in funds to pay for Collingwood Road prior to 18 November 1999, a full two weeks before the £78,200 was withdrawn in cash from Tanveer’s account. Since the money plainly did not come from Tanveer, it must have come from Mr Azam who was dealing with Betteridge & Co and with St Johns. Mr Azam lied to Mr Michaels, as he lied to the court, about his only being the manager of the property for his brother in law; when he engaged Mr Michaels to deal with accounting matters he also deliberately fostered the impression that he had nothing to do with Hardeep Grewal, the person from whom he allegedly “purchased” the first two companies, by omitting to tell Mr Michaels that she was his ex-wife.

[241]In my judgment one of the key pieces of evidence is that the shares of Fabio and Empire Worldwide were originally put in the name of Hardeep and then, with the assistance of Mr Bamrah, transferred into the name of Tanveer when her relationship with Mr Azam had irretrievably broken down. There was no good reason for Tanveer to agree to his sister-in-law having control over the offshore companies (as opposed to, for example, his wife). The use of Hardeep’s name is consistent with those properties belonging to Mr Azam. I am satisfied that Tanveer, with whom Mr Azam had a good relationship, loaned his name but not his money to the transactions after Hardeep departed from the scene, in return for which he was paid a share of the rental income; Mr Azam maintained the fiction that he was simply “managing” the properties for his brother in law. Of course there was a tax advantage to the income from the properties being declared to tax in the name of Tanveer because there would have been a separate personal allowance attributable to him.

[242]Mr Azam’s ownership of the ABC properties is also consistent with Kalsoom’s understanding when she married him that he was a well to do property developer and that this was his main line of business. By then, he had ceased working for Astons. Watery Lane had been sold and the proceeds were in the bank; Offley Place had not yet been purchased, and the only other family property with which Mr Azam was dealing was Great West Road, which he was renovating.

[243]In my judgment the NCA has proved that the money used to purchase all three of the ABC properties emanated from Mr Azam during a period when he was making money from drug dealing and/or money laundering, and because there was no other legitimate source from which he could have purchased those properties they were purchased with the proceeds of his unlawful conduct. Tanveer was used merely as a cipher to disguise the true nature of Mr Azam’s interest in those properties. All three of the “ABC” properties are recoverable property.

Great West Road and Thurza Court

[244]The next two properties, 291 Great West Road and 5 Thurza Court, can be dealt with more swiftly. 291 Great West Road was purchased with the fruits of the Azam/Seaton car import business, which at the very least involved a VAT fraud; it is a recoverable property.

[245]In his written opening, Mr Coppel raised a point about proportionality and Article 1 Protocol 1 of the European Convention on Human Rights, to the effect that if the Seaton/Azam business involved a VAT fraud, the only recoverable portion of the profits from the business should be the VAT that was evaded, and to deprive him (or his mother or sister) of a property purchased with the fruits of that business would be disproportionate: see POCA, s.266(3)(b) and R v Waya

[2012] UKSC 51

[2013] 1 AC 294

. However, it is not an excessive burden on Mr Azam or anyone else to take that course on the facts of this case, because, as I have held, the unlawful conduct (the VAT fraud) was essential to the carrying out of the business, not an incidental part of a legitimate business as in the case of Ahmed v HMRC

[2013] EWHC 2241

(Admin).

[246]5 Thurza Court is slightly more problematic. The file notes relating to the instructions given by Mohammed Azam to the solicitors when Mr Azam was on remand are more consistent with Mr Azam being the purchaser, and his father taking over the instructions on his behalf, than with Mohammed being the purchaser all along. As I have already found, Mohammed was a generally credible witness and he obviously believed that the money for Thurza Court emanated from the sale of some of his land in Pakistan, but that was not in consequence of any direct recollection of what happened to those proceeds of sale. Thurza Court cannot have been transferred to Kalsoom as a wedding gift because it was transferred almost a year after the marriage took place. If it had been intended as a wedding present, it could have been put in her name when it was first acquired. It was transferred just before the intended move to the UAE, no doubt to provide an income for the family before they were able to join Mr Azam out there.

[247]Although there was a sale of such land in Pakistan in 1999 and there was sufficient money from the proceeds to purchase Thurza Court, Thurza Court was bought in September 2001. The evidence in the St Johns’ files points towards Mr Azam being the source of the funds used to buy the property, and he controlled the purchase. It was he who gave his father a written authorization to deal with St Johns, not vice versa, and the fact the property was going to be bought in his father’s name is no more indicative of who paid for it than the fact that Great West Road was bought in his mother’s name. The NCA has satisfied me on the balance of probabilities that Thurza Court was yet another property purchased by Mr Azam and thus, on the evidence, the proceeds used to purchase it must have derived from unlawful conduct. Thurza Court is recoverable property.

The Luxembourg Bank Accounts

[248]In the light of my earlier findings the money deposited in these accounts resulted from unlawful conduct and the balance is therefore recoverable property.

Wheatash Road

[249]The rental income from the other properties declared to tax by Mr Azam and Kalsoom was insufficient in and of itself to purchase Wheatash Road, but in any event that rental income, like the properties, was derived from property which in and of itself was derived from the proceeds of unlawful conduct. The building work was financed by Mr Azam, not his father; it was not remitted from the UAE by any orthodox or above board means, and thus it cannot be concluded that the money emanated from lawful trading or the proceeds of “flipping” properties.

[250]In any event, as I have already found, any money used by Mr Azam to found his business in the UAE cannot have been derived from a legitimate source. Any money that went into Wheatash Road is therefore derived from unlawful conduct. Wheatash Road is recoverable property.

The Spanish Property

[251]If the Spanish Property had been purchased with legitimate funds it is difficult to see why Mr Azam would have gone to so much trouble to prove that it was purchased with the proceeds of sale of Exotic Cars (even to the extent of getting Mr Yahya and Mr Abdul Wahab to give an explanation of accelerated cash payment that fitted in with what Mr Azam then believed to be the date of purchase). However it is not for Mr Azam to prove that the property was purchased with legitimate funds; it is for the NCA to prove that it was not.

[252]So far as the Spanish property is concerned, I am not convinced that it has, despite Mr Sutcliffe’s points about Mr Azam firmly nailing his colours to the mast about the sale proceeds of Exotic Cars. There is credible evidence from Nicole Edlund about the amounts of money that could be made legitimately from “flipping” properties in Dubai at that time. There is no clear evidence of any drug dealing when that property was purchased. In my judgment the Spanish Property is not recoverable property.

[253]That just leaves the money in the other bank accounts which, since it did not emanate from the UAE, has no lawful source and must also be recoverable property.