Nominet plans to hand over control to police?

A proposal from Nominet the agency that handles the UK domain name structure bears some close attention. On the surface it seems reasonable - if someone is using their website for criminal activity Nominet can remove the domain from them.

Where it starts to get stinky is the grounds for removal

reasonable grounds to believe they are being used to commit a crime (e.g. a request from an identified UK Law Enforcement Agency).

That's not that they've been convicted of a crime, not that a member of the judicial service has requested or approved it; nope it's the enforcement agency itself that can do the requesting or even just if Nominet themselves decide to. This is even worse than the Proceeds of Crime Act wherein a person can be charged and found not guilty of an offence yet still have their possessions removed as being proceeds from a crime they have either be proven innocent of or not even charged with.

One point that did occur to me is that everyone is on thin ground in terms of slander and libel in both cases. If you have your domain removed by Nominet on the basis of a request by a law enforcement agency they are stating you are a criminal. If you've had no charges made or have been cleared of them how can either agency be able to justify these actions?