Crypto, Crime, and Civil Recovery: A New Era for UK Law Enforcement

Background

The Director of Public Prosecutions (DPP) brought civil recovery proceedings under the Proceeds of Crime Act 2002 (“POCA”) against Joseph O’Connor, Keir Holme, and Kyle Lomax. The case concerned over £4 million in cryptocurrency held in accounts registered to Holme and Lomax but ultimately controlled by O’Connor. US courts had already convicted O’Connor for computer intrusion, fraud and money laundering, ordering him to forfeit criminal proceeds and pay restitution to victims. With O’Connor already serving a prison sentence in the US, UK authorities relied on the domestic connection of the Defendants’ British citizenship to seek seizure of the assets believed to be the proceeds of crime.

Judgment summary: “recoverable property” and unlawful conduct

In November 2025, the High Court made a civil recovery order under section 266 of POCA, vesting O’Connor’s cryptocurrency holdings in a trustee to be liquidated for the public benefit. The Court applied the civil standard of proof (“balance of probabilities”) and concluded that the assets were “recoverable property” obtained through unlawful conduct pursuant to Part 5 of POCA. Several key factors led to the Court’s conclusion:

• Concealment via proxies: O’Connor enlisted Holme and Lomax to open crypto accounts in their own names, masking his control. Using these “proxies” helped O’Connor hide his involvement and the true origin of the funds.

• Use of mixers and anonymised exchanges: Investigators traced the Bitcoin through a complex web of transactions involving “crypto-mixer” services and privacy-focused exchanges. These tools obscure the source and ownership of cryptocurrency through secrecy and commingling, a technique commonly associated with money laundering.

• No credible lawful source: No evidence of any legitimate source of wealth was provided. O’Connor offered no innocent explanation for how he acquired millions in Bitcoin. With no credible alternative story, the Court inferred that the assets were the product of illegality.

• Overseas criminal conduct: O’Connor’s guilty pleas in the US for serious cyber offences and fraud were a crucial part of the picture. Those crimes, which included Bitcoin fraud and extorsion using hacked Twitter accounts, would also be crimes under English law. This satisfied POCA’s “dual criminality” requirement.

On these facts, Mrs Justice Hill found that the cryptoassets were the proceeds of crime under section 243 of POCA. The Court drew adverse inferences from the concealment and lack of explanation, following established authority that, if a defendant cannot plausibly account for substantial assets, the courts may infer criminal origin. The High Court’s robust approach, even without any UK criminal conviction against O’Connor himself, puts the onus on defendants and signals that courts will act decisively where explanations are lacking or unconvincing.

Key legal issues

Cryptocurrency as “property”

The Court reaffirmed that cryptocurrency constitutes “property” under POCA’s expansive definition, following the established authority of DPP v Briedis (2021). This position aligns with the direction of travel in recent years. Since AA v Persons Unknown (2019), where the High Court granted a proprietary injunction over Bitcoin for the first time, multiple cases (including Briedis and now O’Connor) have cemented the principle that cryptoassets attract property rights and are within the reach of asset recovery regimes.

Jurisdiction and location of property

Although O’Connor’s Bitcoin was held in accounts outside the UK, the High Court was satisfied there was a “sufficient connection” to England and Wales. All three defendants were British citizens; Holme and Lomax were in England when they set up and operated the accounts, and critical steps in the scheme occurred in the UK. The judgment confirms that courts can act against property abroad if the people or conduct involved have a strong link to the UK.

This extraterritorial reach is crucial in an era where cyber-criminals may operate transnationally, reaffirming that they cannot escape asset confiscation simply by moving funds overseas.

International restitution and asset sharing

Since O’Connor was already ordered by an American court to pay restitution to victims, the question arose: what about the US victims in the UK civil recovery?

The High Court made clear that its role was limited to determining whether the assets were recoverable under UK law and could not directly dictate that the recovered £4m be diverted to satisfy the US restitution order.

However, the judgment acknowledged the “highly unusual” circumstances and left the door open for government-to-government asset-sharing negotiation under existing treaties and international frameworks, such as the United Nations Convention against Corruption (UNCAC). The Court itself could not order this outcome, illustrating the limits of judicial power in cross-border asset recovery. Beyond making a recovery order under section 243 of POCA, the Court relies on public law enforcement authorities to consider diplomatic and executive channels to achieve cross-jurisdictional justice. If international asset-sharing agreements are reached pursuant to UNCAC, any variation or discharge of such orders would require an application under section 281 of POCA.

This point highlights a broader issue: when criminal finances span multiple countries, enforcement hinges on international cooperation. The O’Connor case had the advantage of close UK-US collaboration, but commentators have questioned how similar arrangements might work in jurisdictions where legal systems are less aligned with UK standards or diplomatic relationships are strained. Without robust mutual assistance frameworks, the risk is that enforcement could be delayed or blocked. This is prompting calls for clearer multilateral agreements (or even a global convention) to handle cryptoasset recovery across borders, as traditional tools can struggle to keep up with the borderless nature of digital crime.

Cross-border asset recovery: lessons from other cases

Whilst the judgment in O’Connor represents a positive outcome, the practical challenges of tracing and recovering digital assets are echoed in other high-profile cases:

• The Zhimin Qian (“Bitqueen”) case: as we commented upon recently, this is considered to be the UK’s largest crypto seizure, where authorities recovered over 61,000 Bitcoin (worth more than £5 billion) obtained through a large-scale Chinese Ponzi scheme. Despite the successful seizure of the assets, restitution to the 128,000 Chinese victims has proven extremely complex and is ongoing. The case required cooperation between British and Chinese authorities on asset sharing and raises difficult questions about victim redress in complex Ponzi scheme scenarios.

• The Ruja Ignatova (the similarly named “Cryptoqueen”) case: OneCoin was a $4 billion global crypto fraud which took place between 2014 and 2017, spearheaded by Ruja Ignatova who vanished in 2017. In August 2024, the High Court issued a worldwide freezing order against Ignatova and several associates, targeting assets across 17 jurisdictions. This global sweep is a victory on paper for victims as it prevents assets from being moved, but enforcing is another matter. It relies on courts and authorities in each of those countries to recognise and act on the freeze. The OneCoin case fuels the debate on whether new international solutions are needed to deal with multi-jurisdictional crypto fraud and illustrates how fragmented enforcement can be: assets are scattered worldwide, different legal systems must cooperate, and progress is slow without the defendant in custody.

These cases reiterate the lesson in O’Connor that, while UK courts can robustly determine that cryptoassets are recoverable, enforcement and victim compensation largely depend on established diplomatic channels, mutual legal assistance, and clear frameworks for managing seized digital assets internationally.

Implications for clients

• Robustness of POCA: The decision confirms that POCA can readily accommodate new asset classes like cryptocurrency. Cryptoassets are firmly within the scope for civil recovery, provided the evidence shows they are linked to unlawful conduct. For practitioners, this underlines that criminals cannot shield assets behind technological innovation and agencies are adapting in turn. For clients, it provides reassurance that the courts have tools to make enforceable orders concerning these assets, and digital currencies will not slip through the cracks of property definitions. The direction of travel in the courts is an increasingly broad and proactive approach to crypto asset recovery.

• Evidential approach and analysis: O’Connor highlights the importance of a thorough evidential framework. The reliance on detailed witness statements from financial investigators and the use of blockchain analysis to trace assets through both mixers and anonymised exchanges is notable. This demonstrates the growing capability of both law enforcement and the courts to understand complex crypto transactions. For legal teams, it’s a reminder that success often comes down to presenting clear, trace-based narratives showing how the assets flow from the crime. Data tracking and expert analysis are now central to asset recovery, so parties should be prepared to engage with these technical aspects.

• Enforcing beyond the court order: Winning a judgment is only half the battle. O’Connor shows that UK authorities can act when crimes occur overseas but also exposes the limitations of a single-jurisdiction victory. For those trying to recover assets, consideration of cross-border enforcement should be central from the outset. Instructing legal advisors who can navigate differing legal systems and understand the international dimension of asset recovery is essential. Plan globally, as engaging overseas legal teams, leveraging mutual legal assistance channels, and seeking interim measures abroad maximise the chances that a court victory translates into recovered funds.

Conclusion

O’Connor marks another significant milestone in the evolution of cryptoasset recovery. It showcases the English Courts’ willingness to apply established legal tools to modern challenges, and to do so assertively. The decision also illustrates how civil recovery can complement criminal proceedings overseas through the principle of dual criminality. Once seen as an unregulated “wild west”, cryptocurrency now sits squarely subject to the rule of law: it is property that can be frozen and taken away if criminal origins are proved.

However, the case is a reminder that a court order is just the beginning. Converting a judgment into recovery, especially with cryptoassets, requires concerted post-judgment action. Success hinges on a swift and coordinated follow-up to secure assets early, the deployment of experts to trace and manage them, and collaboration with international authorities to close jurisdictional gaps.

The trend is clear: courts and law enforcement are sharpening their tools to deal with cryptocurrencies, and they are increasingly effective. To navigate the maze of cross-border enforcement, agencies and their legal teams must remain agile and cooperative globally to ensure that even the most sophisticated crypto laundering networks can be dismantled.

If you have any questions in relation to the issues raised above, please contact the Burges Salmon Dispute Resolution team. This article was written by Will Cadbury, Eleanor Parsons, and Rhiannon Price.