New powers and a government investigation agency are among proposals to attack criminals' profits from crime.

The new legislation is part of a new police strategy to target the country's top 150 criminals who currently cannot be directly linked to illegal activities. They live highly lavish lifestyles with no visible means of income, do not fill in tax returns and in some cases even claim benefits.

The most high-profile case is Curtis Warren who is currently serving a 12-year-jail term in Holland for drug trafficking. Police claim Warren, who was jailed in 1997 for an attempt to smuggle £125 million of drugs into Britain, is the wealthiest of Britain's criminals estimating that he has gained £80 million from his activities.

Under the new legislation criminals would have to prove to a court that their possessions had been obtained legitimately.

A Criminal Assets Recovery Agency will be set up to investigate offenders' wealth accumulated through criminal activity, such as cash, cars and houses and confiscate it by court order. It will also have a centre of excellence for training financial investigators.

The Proceeds of Crime Bill will amalgamate existing criminal confiscation powers, which are currently under-used, and add powers of civil recovery. It also widens investigatory legislation. Assets will be frozen at the beginning of an investigation to prevent them being sold.

A spokesman for the Criminal Intelligence Service said: "Major organised criminals work in the same way as banks and are highly sophisticated. Criminals are motivated by money and profit and the new legislation tackles this directly."

The home secretary said the Bill would end the perception of people being above the law. "The fact that in many cases they appear to be 'untouchable', damages public confidence in the criminal justice system. We will target those individuals that benefit from crime, crippling their criminal enterprises and stripping them of the means to commit further offences.

"By removing the assets offenders have accumulated through criminality, we will deter others from following suit and send out a clear message to the public that nobody is beyond the reach of the law," he said.