The High Court declared unconstitutional a statutory power used to freeze two Vehicle Tech Limited bank accounts during a Garda money-laundering investigation, finding that the procedure breached the company’s rights to fair procedures and property. It also declared the direction to the bank invalid because the Garda Bureau of Fraud Investigation lacked statutory authority to make it.
The judgment by Miss Justice Laffoy concerned a direction issued on 10 July 2008 under section 31(8) of the Criminal Justice Act 1994. The Bureau told Allied Irish Banks not to deal with either account without specific consent. The accounts held credits of €21,292.50 and €130,990.83. The bank complied, and the company could not access the funds while the investigation continued.
The investigation followed a mutual assistance request from Belgian authorities concerning trucks suspected of being stolen in Belgium, brought to Ireland and sold, with the proceeds allegedly laundered here. Gardaí searched the company’s premises and directors’ homes on the morning the direction was issued. The Bureau’s evidence was that it believed the account funds included proceeds from sales of stolen trucks. The investigation was ongoing at the time of the hearing; the judgment did not determine criminal liability.
The company argued that the account-freezing power lacked safeguards, including notice and an opportunity to challenge the claim about the money, independent judicial oversight, a time limit and compensation for loss. The State parties argued that the direction was a tool used during a criminal investigation and that the restrictions were proportionate. The court found that the direction left the accounts effectively frozen for an indefinite period without an opportunity to challenge the restriction before an independent adjudicator.
Justice Laffoy concluded that section 31(8) infringed the company’s constitutional rights to fair procedures under Article 40.3 and property under Articles 40.3 and 43. She rejected the view that the court could supply the missing procedural framework through interpretation, saying that would require the court to legislate. The section had since been repealed, but the court said the constitutional issue remained relevant.
The court did not decide whether the company was entitled to damages. The State parties argued that the funds were proceeds of crime and that the company therefore had no recoverable loss. Because the investigation was still ongoing and the evidence on the funds’ provenance had not been fully tested, the court said that issue could not fairly be decided at that stage. It indicated that the damages question might be adjourned until the investigation and any resulting criminal proceedings were finished. The declarations were to be made in the meantime.