.... Being knowingly in receipt of money fraudulently obtained from its customers also means that BT must ensure that its customers' money does not go to criminals. That's a principle of English law called "constructive trust". If BT passes money on to bad guys, when there are reasonable grounds to suspect that the money is the proceeds of crime, it is potentially guilty of a crime. As I see it, BT could be open to the charge of being involved in money-laundering if at any stage it knows or suspects customers are victims of a premium-rate scam. Money-laundering can be defined as the acquisition, possession or use of the proceeds of another's criminal conduct.
The regulations in the UK apply to assets derived from criminal conduct regardless of value. Receiving, handling or transferring £120.96 that is the result of criminal conduct - or is reasonably suspected to be the result of criminal conduct - is the same as receiving, handling or transferring £120m in drug money. I believe that BT has come close to violating the Proceeds of Crime Act (POCA) 2002, specifically sections327 (Concealing etc), 328 (Arrangements) and 329 (Acquisition, Use and Possession) of criminal property, including money. By passing suspect funds along to Redstone, it has probably "arranged" and "transferred" the proceeds of crime. The same goes for Redstone, which passed money along to Malera and Ilex. Here, too, the "constructive trust" principle comes into play. In turn, Malera and Ilex could be subject to UK money-laundering statutes, which do not limit offences to those only taking place in theUK.
If BT or Redstone had reported suspicions or knowledge of money-laundering to the National Criminal Intelligence Service (NCIS), that might be a partial defence. But a source inside NCIS says they didn't, at least not during the relevant period. If any of them have since filed reports to NCIS, that's called "defensive reporting" and anyone who understands the money-laundering regulations also understands that defensive reporting is tantamount to an admission of guilt. Even if they had reported their suspicions, BT and Redstone would not be entitled to continue handling these monies.
Yet, knowing that certain dialler fraudsters have been banned by Icstis because they were in direct violation of the codes, and in the face of so many complaints of fraud, BT continues to insist on its right to collect unpaid fees derived from highly suspect premium-rate activities. In some instances, it has threatened to shut off people's phones for nonpayment. ...
Complicating matters for BT and Redstone is the fact that UK money-laundering laws dictate behaviour for solicitors, accountants and bankers who know or suspect that laundering is taking place. Given the publicity surrounding dialler scams throughout 2004, solicitors, accountants and bankers acting for BT, Redstone or any other company involved with this might already be exposed. To demonstrate how seriously the government takes money-laundering these days, penalties set out in POCA for violation of sections 327, 328 or 329 can amount to imprisonment for up to 14 years, a fine, or both. Additionally, solicitors,accountants and bankers have further responsibilities, as set down in statutes and codes of practice by the Financial Services Authority (FSA) and their own professional bodies. Besides that, there's a potential for intervention by the new Assets Recovery Agency (ARA). Under UK law, the ARA brings civil suits against offenders to reclaim the proceeds of crime.
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