UWO in the UK: The Mechanism Resumes Practice
Key takeaways
- UWOs, introduced into POCA in 2017, target assets over £50,000 whose provenance cannot be lawfully explained by PEPs (outside the EEA) or those suspected of serious crime.
- Non-compliance with a UWO creates a rebuttable presumption in civil recovery proceedings that the assets were unlawfully obtained.
- Early hype gave way to setbacks; the NCA’s 2020 Baker defeat (resulting in approximately £80m in assets) led to £1.5m in adverse costs and a decline in usage.
- 2022 reforms strengthened the regime against complex ownership and capped adverse costs, reducing operational risk.
- Enforcement has broadened: the NCA secured the first Northern Ireland UWO (May 2024), and the SFO realised £1.1m from its first UWO (September 2025).
- Case outcomes show traction: Hajiyeva’s 2024 settlement could yield around £13.6m; Hussain’s settlement delivered approximately £9.8m; the SFO sale added £1.1m.
- Total UWO‑linked proceeds are on course to approach £25m, far exceeding the Home Office’s decade‑long recovery projection.
- Initial cost assumptions (20 orders a year at £5k–£10k) were unrealistic; nonetheless, value for money has improved as recoveries rise.
- Strategically, UWOs act as investigative levers that catalyze out-of-court settlements and assist in recovery even post-conviction.
- Outlook: cautious optimism; continuing judicial oversight on proportionality and rights will shape future deployment and resilience.
Introduction
In September 2025, the Serious Fraud Office (the SFO) realised £1.1 million from the sale of a property owned by the former spouse of convicted fraudster Timothy Schools. This marked the SFO’s first deployment of an unexplained wealth order (UWO) and served as an important indicator: after a difficult debut, UWOs are beginning to bed in as a credible tool for recovering criminal proceeds.
What UWOs are and why they were created (POCA 2017)
UWOs were added to the Proceeds of Crime Act 2002 (POCA) in 2017 to counter the laundering of illicit funds through UK markets. Ministers said offenders would feel the “full force of government”. However, after only a few uses, the mechanism suffered a major setback in 2020 in National Crime Agency v Baker & Ors: the High Court set aside the National Crime Agency’s (the NCA) attempt to pursue about £80 million in property allegedly linked to a former Kazakh minister and ordered the agency to pay approximately £1.5 million in costs. This setback influenced how the regime was initially perceived.
Early scepticism and parliamentary criticism
By that stage, UWOs had barely been tested. Of the five empowered bodies, four had scarcely used them. As a result, criticism mounted, culminating in a House of Commons Foreign Affairs Committee report branding the regime “spectacularly unsuccessful”.
Signs of a turnaround over the last year
Over the last year, the picture has shifted. The Schools matter indicates that the mechanism is not only functioning again but doing so effectively. This article traces the brief history of UWOs in the UK and how, after a bumpy start, they are now playing a more dynamic role in tackling illicit financial flows.
The statutory test: Who can be targeted and when
Under POCA, enforcement authorities can request a UWO from the court, requiring an individual to explain the origin of certain assets. The court may grant an order if there are reasonable grounds to suspect:
- The person is a politically exposed person (PEP) from outside the European Economic Area (EEA) or is suspected of having committed a serious crime.
- The person lacks sufficient lawful income to justify assets worth more than £50,000.
Failure to comply creates a rebuttable presumption in subsequent civil recovery proceedings that the assets were unlawfully obtained. In essence, the UWO is an investigative lever to support civil asset recovery.
Early expectations: “McMafia orders” and Home Office forecasts
Supporters championed UWOs for targeting wealth that doesn’t add up, even when hard evidence of crime is lacking. The media promptly nicknamed them “McMafia orders,” fueling public imagination with visions of hundreds of suspicious properties being unmasked across London. Did these bold predictions come true? The Home Office forecasted around 20 UWOs per year, each costing between £5,000 and £10,000.
2018–2019 casework: Hajiyeva and Hussain
Early momentum looked promising. In 2018, the NCA secured a high-profile UWO against Zamira Hajiyeva, the spouse of a former Azerbaijani state banker convicted in 2016, requiring her to explain funding for a multimillion-pound home (upheld on appeal in 2020). In July 2019, the NCA obtained another order against Mansoor Mahmood Hussain, suspected of laundering money for organised crime and building a major property portfolio. Since the alleged seed money dated back two decades, prosecution would have been challenging. The UWO required disclosure of acquisition routes.
2020 Baker decision: Legal and financial blowback
The NCA initially obtained an order over assets thought to be funded by Rakhat Aliyev, a deceased Kazakh PEP. Baker (the effective controller), together with Aliyev’s former wife and son (purported beneficial owners), responded with material said to show legitimate funding and sought to discharge the order. The NCA refused, alleging non-compliance.
The High Court disagreed. It discharged the UWO and found the threshold for granting it had not been met. The court criticised the NCA for “unreliable” assumptions and an “inadequate investigation into some obvious lines of inquiry.” Permission to appeal was refused. The agency was left with a £1.5 million costs order. The Times described the outcome as “embarrassing for the Home Office.” The earlier £10,000 per-case estimate appeared unrealistic. Baker alone consumed more than a third of the NCA International Cooperation Unit’s £4.3 million annual budget. Confidence wavered, especially given complex ownership structures.
Post-Baker resilience and reforms
Despite the blow, the NCA stood by the tool. Months later, Hussain settled out of court, delivering the first sizeable UWO-linked recovery: 45 properties across London, Cheshire and Leeds, four land parcels, £600,000 in cash and other assets totalling about £9.8 million — evidence that UWOs can yield tangible outcomes.
Parliament then intervened. In early 2022, amendments aimed to “strengthen and reinforce” the regime, improving usability where assets sit behind intricate corporate webs (as in Baker) and capping adverse costs to reduce operational risk. These changes set the stage for renewed application.
2024–2025 outcomes: wider use and rising recoveries
There are signs the reforms are working. For example, in May 2024, the NCA obtained its first Northern Irish UWO concerning a £275,000 property suspected of being funded by cigarette smuggling. More recently, the SFO secured an order over a £1.1 million property linked to the ex-wife of Timothy Schools — notably, the first use by an agency other than the NCA, signalling potential uptake by the three other empowered bodies.
Recoveries have also climbed, reinforcing the effect of recent reforms. In August 2024, the NCA settled with Hajiyeva, under which she agreed to surrender 70% of two properties now marketed at a combined £19.5 million, potentially yielding approximately £13.6 million. Together with the SFO’s recent £1.1 million and the Hussain settlement, UWO-related proceeds are on course to approach £25 million.
Reassessing costs, value, and strategic use
While the 2017 impact assessment plainly underestimated enforcement costs, this was a key concern following the Baker report. At the same time, it also undervalued likely recoveries. The ten-year projection of £6.1 million has already been quadrupled. Recoveries are not the sole metric of success. They do, however, reinforce the case that UWOs materially assist efforts to target criminal wealth.
Practice is also showing flexibility not fully anticipated in 2017. The Hussain and Hajiyeva outcomes illustrate that UWOs can catalyse out-of-court settlements where respondents struggle to justify assets. The Schools Matter shows they can assist even post-conviction, where the proceeds remain difficult to trace.
Outlook: Cautious optimism with judicial oversight
UWOs remain relatively young and untested across the full range of scenarios. As case law develops, courts will continue to police proportionality, responsible use, and compatibility with fundamental rights. While a future adverse ruling could slow momentum again, the track record over the past 12 months suggests UWOs appear to be maturing into a potent instrument for recovering criminal assets and disrupting illicit financial flows in the UK.
