Home / ECCTA: Amendments to the Proceeds of Crime Act 2002
9th July 2025
Helen Mather, Corporate Law Partner
In aiming to tackle economic crime and enhance the transparency of UK companies, and effective from 26 April 2024, the Economic Crime and Corporate Transparency Act 2023 (“ECCTA”) amends the Proceeds of Crime Act 2002 (“POCA”) and provides law enforcement agencies with the extra power to seize, freeze and recover crypto assets and ‘related items’ believed to be used for criminal purposes.
ECCTA itself describes Crypto assets as “A cryptographically secured digital representation of value or contractual rights that uses a form of distributed ledger technology and can be transferred, stored, or traded electronically” – not exactly an easy-to-understand definition, but well-known examples include NFTs and Cryptocurrencies such as Bitcoin and Ethereum.
These can be used to bypass many of the regulations associated when moving money traditionally such as anti-money-laundering and know-your-customer procedures, and allows individuals and groups to store and manage funds where a bank may otherwise decline to do so on the basis of their beliefs or the goals of the owners, making seizing and even tracking assets almost impossible.
‘Related Items’ include any item which gives or contains information likely to assist in the seizure of Crypto assets. This can include devices storing passwords, meaning provided there are reasonable grounds to do so, devices such as phones can be seized and searched where the enforcement agency believes they are linked to or intended for unlawful conduct, without an arrest being made.
One of the largest changes is extending the reach of powers given to the court by POCA to better realise assets falling under the act’s definition of proceeds of crime, updating a large amount of the act to include reference to Cryptoassets when describing enforcement agencies’ powers to seize and detain such assets.
Enforcement officers will now be able to freeze any Crypto assets held in a UK-connected Crypto asset Service Provider (effectively the cryptocurrency equivalent of banks and exchanges) on application to the Magistrates’ Court where they have reasonable grounds to suspect the Crypto assets are to be used in or recoverable from criminal activity.
Additional powers will allow these agencies, where further assurances have been given to the courts, to return the property to a previous owner or destroy it where it is ruled that returning such an asset to circulation ‘is not conducive to the public good’.
Finally, where assets are set to be returned, ECCTA gives the court the power to exchange said assets for cash – avoiding potential fluctuation in the value of the asset as a result of market volatility.
This legislation is a clear statement by the government that they will no longer turn a blind eye to criminal activities where cryptocurrency and crypto assets are involved, and although it does not target companies or their officers directly, these new powers will no doubt strengthen the governments current anti-money laundering and counter criminal / terror financing regimes in a world-leading move.