A divorc?e should be stripped of a ?40,000 settlement because her ex-husband was a convicted heroin dealer, the Court of Appeal ruled yesterday.

Lindsay Richards knew her family's assets were built on trafficking and so had no right to benefit from them, Lords Justice Thorpe and Moses and Mr Justice Hedley ruled.

Mrs Richards had been awarded ?39,250 out of the family's assets of ?431,000 by a Liverpool family court last November.

The Crown Prosecution Service, which had brought the appeal, had argued that "public policy required that drug dealers were deprived of the fruits of crime and that those fruits should not be distributed to others, least of all those with guilty knowledge of the origin of those assets".

Anthony Richards is serving a 10-years in a Dutch jail after he was convicted in connection with a consignment of heroin valued at ?8.8 million.

There are outstanding confiscation proceedings against him in Holland. The High Court has made an order on the assets, covering three properties and two bank accounts.

The couple began their relationship in 1994 when they were in their 20s and divorced 10 years later after Richards's Dutch conviction. His ex-wife had originally sought a ?150,000 settlement.
 

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