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must apply here. It must be right for life- style criminals who continue to offend and damage Britain are hit, and hit hard. I welcome the new clause, as it is doing something extremely important to protect us all.

Lady Olga Maitland (Sutton and Cheam): First, may I give a warm welcome to the introduction of the Bill as a whole? I was delighted that my hon. Friend the Member for Exeter (Sir J. Hannam) decided to choose the Proceeds of Crime Bill as his private Member's Bill. This is the first opportunity that I have had to make remarks on the Bill. This country is crying out for something to be done about criminals who are living off the fat of their proceeds--

Madam Deputy Speaker: Order. I am sorry to interrupt the hon. Lady, but her remarks may be anticipating the Third Reading of the Bill. We are looking at one simple new clause.

Lady Olga Maitland: I thank you, Madam Deputy Speaker, for your remarks, but I felt that it was essential to point out the broad picture before moving on to specific points--

Madam Deputy Speaker: Order. I have specifically told the hon. Lady that that is not acceptable.

Lady Olga Maitland: I stand corrected. The new clause is welcome and important. All of us are proud of the British film industry, and also of the music industry which has produced excellent classical and popular work and we will not stand to see those valuable industries undermined by crime.

I have had some personal experience of the availability of counterfeit videos. Before Christmas, my 13-year-old son decided to go to Camden market to trawl for Christmas presents. On a stall at the market he found an array of videos, including--for £5--"Four Weddings and a Funeral". He brought it home, and was pleased as punch--so pleased that he decided to go back the next day to get some more copies. The stallholder had bunked off with the profits, but other stallholders were around. He bought more copies, wrapped them up and gave them as Christmas presents.

We watched one of the videos. I suspected that it had been suspiciously cheap, but how was a young child or any purchaser to know of the source of the video? When the picture came up on the screen, it was clear that it was not a first-class, first-print video. The opening shots were rather awkwardly presented, and there were black margins on the screen before the film finally got into full cry. It was clear that we had been cheated and conned. There is no way in which a customer can get compensation after being diddled in that way.

I was lucky that my son was not distracted by another kind of video that he could have bought. The availability of pornography is terrifying, and it corrupts everybody--not necessarily the young. We do not need it in our society, and I wish that there was some way in which we could stop it. We did manage to put a stop to pornography coming over the television airwaves through the control of the Red Dutch television programme--

Mr. Duncan: Red Hot Dutch.

Lady Olga Maitland: Red Hot Dutch. None the less, it is not just pornography that I am concerned about.I am also concerned about the spread of counterfeit


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videos which promote violence. These cheap and violent videos are extremely damaging to our society. They have a particularly damaging effect on emotionally vulnerable people who may be easily disturbed. In the end, society pays a heavy price as such a person could lose control.

I congratulate my hon. Friend the Member for Ryedale (Mr. Greenway) on giving a graphic description of how counterfeit videos are produced. I had been aware of the method following discussions with police, but his remarks were a salutary lesson in the ease with which counterfeits can be produced and the amount of profit involved. To think that one producer alone can make £3 million out of one lock-up garage is terrifying. It is impossible to estimate the full scale of the industry in the United Kingdom --it is beyond belief.

Another important point that my hon. Friend made was that behind those innocent-looking videos--some are less than

innocent-looking--there are serious racketeers at work. As my hon. Friend pointed out, IRA-Sinn Fein in Northern Ireland has funded its terrorism with such racketeering. I have had several conversations with the Royal Ulster Constabulary in Belfast on just that point. If we could find a way of clamping down on such crime, we would be saving people's lives in the long run. We should not work on the basis that as we now have a ceasefire in Northern Ireland the urgency is not so great. The urgency is always there. When we see how the money goes into weapons and arms, we must realise just how serious and important the new clause is.

Counterfeiting has funded killing machines not only in Britain but throughout the world. I was worried to read in the Home Affairs Select Committee report on organised crime just how international counterfeiting has become and how it has invaded Britain. An interesting submission was made to the Select Committee on just that point by the Association of Chief Police Officers, the Police Superintendents Association and the Police Federation.

The Committee examined some of the principal threats that have come from organisations such as the Chinese triads, who operate in Britain. The Committee was told that it was extremely difficult to assess the real extent of their activities, but that it was known that the triads had a high degree of responsibility for counterfeiting. The problems that have to be countered in trying to beat the Chinese triads include the insular nature of the Chinese community, the wall of silence that exists, the distrust of anyone who is not Chinese which makes the organisation impenetrable, the background of fear over many generations about the triads so that no one dares talk about them and the vicious and public nature of the attacks or retribution which promulgate the fear of triad societies. But the triads are just one organisation promoting counterfeit crime which the police are trying to crack.

The Select Committee also looked into the Caribbean criminals, who have caused great concern. In other


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countries such as Japan, criminal gangs are rich with illicit funds. Such gangs have invaded our country. The Italian Mafia--

Madam Deputy Speaker: Order. I am sorry to interrupt the hon. Lady for a third time, but I must return her to the substance of the new clause under consideration.

Lady Olga Maitland: With the greatest respect, I am trying to illustrate how important the new clause is. I am also trying to show that counterfeit crime is not only endemic in Britain but is being introduced from overseas and is operated here from just such sources. If you will just give--

Madam Deputy Speaker: Order. Passing reference is one thing, but a general and thorough review of these matters is not germane to the new clause.

Lady Olga Maitland: Obviously, I bow to your judgment, Madam Deputy Speaker.

We should take the international aspects of counterfeit crime seriously because they have a bearing on counterfeit crime in Britain. The point was made earlier that counterfeit crime is not merely a harmless little boyo activity in Sunday markets. That boyo working at a Sunday market is often part of a nationwide organised criminal gang. For that reason, we have to take it very seriously. On the more general point, counterfeiting is not just about films and recordings. My hon. Friend the Member for Beckenham (Mr. Merchant) talked about other forms of counterfeiting. He was right. Whether we are talking about cheap reproductions of clothing--designer clothes, for instance--perfumes, watches and a whole host of different things, we have to recognise that it is a major crime which should have been included in the Bill in the first place. Now is the time to make sure that it is given the due consideration that it deserves.

The Minister of State, Home Office (Mr. David Maclean): I have considerable sympathy with the new clause. I, too, am well aware of the concern that trade organisations and others have expressed about counterfeiting and copyright infringement. While a tremendous amount of the debate has concentrated on videos and the record industry--the music industry, I suppose we should call it now that there are CDs, tapes and so on--I am glad that my hon. Friends have mentioned other counterfeit products such as watches and designer clothing and shoes.

Many colleagues have also mentioned that counterfeiting is not--I shall have to use the expression so as not to be the only one not to use it in the debate--just a Del Boy type of crime. It is not just people who make a few copies for their friends and run off another few to sell to someone else. I suspect that many people think like that because most people start in that way, before it becomes heavy and organised, making just a few copies or a copy for their own use. 10.45 am

What Member of the House or what child these days does not buy a CD or album, as we used to call it, of greatest hits and inevitably find that they like only half, if they are lucky, or even just a third of it? So if one wants to listen to some music in the car, one ends up making a


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compilation tape. I suspect that every youngster has started on the first step of what could be a counterfeiting career by doing something perfectly legitimate--namely, copying music for personal pleasure. I cannot imagine anyone in the House who has not made a compilation tape. Well, I imagine that my hon. Friend the Comptroller of Her Majesty's Household does not sit with the headphones on listening to a compilation tape of Wet Wet Wet.

It is probably because counterfeiting has such innocent beginnings that people tend to think that it cannot be a real crime. In every home in this country it is possible to reproduce music on to a tape. Those whom we are trying to get at today are those who massively reproduce material to sell it on and pass it off as something else. I was interested to read in one of my woodworking magazines last year about the man who invented the wonderful Black and Decker workmate. With its corporate muscle, Black and Decker has spent about £10 million worldwide trying to protect the copyright of that simple but brilliant machine from counterfeiters throughout the world. When children cry out for the latest designer clothing or those designer shoes or trainers which cost £70 or £80 and still last no more than a month, it is no wonder that many parents are tempted, with screaming children in hand, to go to the market and pick up a £10 pair of apparently designer trainers. We can all have great sympathy with parents in those circumstances. If I read today's press correctly, I suspect that there will be a big market in Manchester United counterfeit strips as it has changed its strip for the seventh time in three years and charges £70 a time. That is good for Manchester United, but not so good for the parents who will feel obliged or pressured to buy a new one each time.

There is a large industry out there. We are also aware that America is concerned that some countries in the far east have massive state-run factories which mass-produce counterfeit equipment. The message that must go out is that this is a crime. I liked the way in which my hon. Friend the Member for Ryedale (Mr. Greenway) described it: it is theft--theft from the consumer, from the people who invented the original product and from the businesses involved. There can be no doubt that such activities represent a significant threat to legitimate businesses and, as we have heard disturbingly today, that they are a source of income to professional criminals. It is because I am concerned about the links with pornography and organised crime that I have initiated an on-going interdepartmental consultation exercise.

As my hon. Friend the Member for Ryedale will understand, the Home Office is not primarily responsible for the legislation that has a bearing on this problem. Clearly, it is sensible to ascertain an estimate of the number of cases that would arise from this proposal and whether the additional court costs and other costs can be met. I agree with my hon. Friend that the best way forward is probably not by means of an amendment to the Bill, which could create an unwelcome precedent. I am grateful also to my hon. Friend the Member for Exeter (Sir J. Hannam) for making the matter clear in the Standing Committee on Wednesday when I was not able to be present. The use of an order made by the Secretary of State, which is already anticipated in part II of the Criminal Justice Act 1988, is probably the best way forward.


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My hon. Friend the Member for Ryedale asked some questions about the powers of the Crown court and magistrates courts. The Crown court has the power to make a confiscation order in respect of any offence listed in schedule 4 to the 1988 Act or, if it is not listed, in respect of any indictable offence--that is covered by section 71(9) of that Act. Magistrates courts can make a confiscation order only in respect of schedule 4 offences. They cannot make an order for any summary, or triable-either-way offence unless it is included in schedule 4. If we make an order and include summary or

triable-either-way offences, which we could do, it would mean that the Crown court could still make a confiscation order if a triable-either-way offence is heard in the Crown court.

The interdepartmental consultation exercise is under way, considerable progress is being made, and I should be in a position to make known the outcome of our deliberations shortly. I certainly expect to be able to do so before the Bill completes its parliamentary passage. I know that my hon. Friend the Member for Ryedale will consider that an important safeguard from his point of view and a measure of my good faith. I assure him that the Government will consider very sympathetically the addition of these offences to schedule 4 by means of an order.

I am afraid that, for the reasons that I explained, it would be better to use existing order-making powers. Since I have assured my hon. Friend that I am looking sympathetically at the matter and since I should be able to inform the House before the Bill has completed its parliamentary stages-- with that important safeguard built in--I ask him not to press the new clause to the vote, but to leave the matter to the order making powers.

Sir John Hannam: This debate has touched chords in the House and will do so throughout the country. The scale and extent of the offences that my hon. Friend the Member for Ryedale (Mr. Greenway) identified are known to pretty well every family in the country because of the measures that he pointed out and the examples that my hon. Friends have given in the debate.

I recall the pornographic videos that were displayed to Members of Parliament representing the Devon and Cornwall constabulary area, including my hon. Friend the Member for Plymouth, Sutton (Mr. Streeter), before we introduced legislation to deal with that type of obscenity. As has been described today, people are using the old pornographic videos, which no longer have any value, as cheap material for recording children's videos. That is a very disturbing example and the sort of thing that we really must deal with. The thread running through the debate is that we are dealing with big crime and that is the sort of crime with which the Bill seeks to deal. Criminals are able to get away with it. They might have to pay a small fine or serve a short prison sentence, but until my Bill is enacted, any confiscation orders that might exist can be expunged. This is an important debate and my hon. Friend the Member for Ryedale introduced it in the manner to which we are accustomed from him. He covered all the important areas. I listened to the remarks of all my hon. Friends and of the Opposition spokeswoman, the hon. Member for Hornsey and Wood Green (Mrs. Roche), with considerable interest because I have been involved in copyright matters. I am very sympathetic to the view that we must take action to close that gap.


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The motives that underlie the new clause certainly have my support. Like my hon. Friend the Minister, however, I have reached the conclusion that the Bill is not the best forum for dealing with the matter. It is a question, not of whether the offences should be included in confiscation orders--there is no doubt about that--but of how best that can be achieved. As hon. Members will know, specified offences can be brought within the reach of confiscation powers under the Criminal Justice Act 1988 by adding them to schedule 4, as my hon. Friend pointed out. The 1988 Act lays down a procedure for amending schedule 4 by statutory instrument, which is a quicker and more straightforward way to amend it than an amendment by primary legislation, which the new clause is.

In 1990, schedule 4 was amended by statutory instrument to deal with the problem of acid house parties, from which large illicit profits were being made. Given that precedent, and the simplicity of established procedures for amending schedule 4 by statutory instrument, I am inclined to think that that is the right way to deal with this type of counterfeiting and copyright infringement offence.

Mr. John Greenway: This is the Bill of my hon. Friend the Member for Exeter, but it is clear from what we have heard this morning--and from the support that I have received from my hon. Friends--that there is support throughout the House, but particularly on the Conservative Benches, for ensuring that the provisions of his Bill cover the types of crime that we have been discussing. He will want the Bill to cover such offences. Is he satisfied, from the discussions that he has had with our hon. Friend the Minister, that we shall get that statutory instrument and that when we leave the House today we shall be able to tell people in the film and record industries that we have been successful and that although the legislation will not be on the face of this Bill the Government are going to act?

Sir John Hannam: I can certainly assure my hon. Friend that I have every confidence that the outcome will


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be the same for the serious offences under discussion as for other types of crime that have been brought within confiscation law through the statutory instrument procedure, such as acid house parties. Some months ago, when I was first acquainted with the problem, I brought it to the notice of my hon. Friend the Minister. He responded immediately and encouraged me by saying that he would be considering the matter and that a review would take place. I can assure my hon. Friend the Member for Ryedale (Mr. Greenway) that that would be the best route for dealing with the problem. I hope that it will not take too long.

I was pleased that my hon. Friend the Minister announced that we are to have a clear statement on this important matter before the Bill completes its passage through Parliament. While I commend my hon. Friend the Member for Ryedale for exposing this important subject, I hope that he will feel that the right way forward is to seek leave to withdraw his new clause.

Mr. John Greenway: We have had an interesting and thoughtful debate on the matter and I am most grateful for the support from my hon. Friend the Member for Exeter, other hon. Friends and the hon. Member for Hornsey and Wood Green (Mrs. Roche) for the proposal that I brought before the House. Without question, the issues must be resolved quickly.

My hon. Friends the Minister and the Member for Exeter have given an assurance that they want those matters covered in legislation. I have listened carefully to their commitment and their assurance that those matters can be dealt with satisfactorily through a statutory instrument. I urge my hon. Friend the Minister to introduce that statutory instrument as quickly as possible so that those offences are listed in part I of schedule 4 of the 1988 Act.

With the benefit of those assurances and the considerable airing that we have given the subject this morning, I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

It being Eleven o'clock, Madam Speaker-- interrupted the proceedings, pursuant to Standing Order No. 11 (Friday sittings).


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Serious Fraud

11 am

The Attorney-General (Sir Nicholas Lyell): With permission, Madam Speaker, I wish to make a statement setting out the way ahead for the investigation and prosecution of serious and complex fraud. This issue has now been the subject of two official reports: the Graham report, received in March 1994; and the report by a committee chaired by Mr. Rex Davie, formerly of the Cabinet Office, delivered to me at the beginning of February. The Graham report was published last year. I have today placed copies of the Davie report in the Library.

The key issue focused upon by the Davie Committee was whether to develop and build on the existing structures, or whether to merge them into one organisation and, if so, whether that organisation should be based upon the Serious Fraud Office or the fraud divisions of the Crown Prosecution Service. The clear advice of the Davie committee is that the existing structures should be retained and that the role of the police in SFO cases should be clarified. The Davie report makes that principal recommendation against a merger, and nine subsidiary recommendations. I accept them all.

The report emphasises the fact that fraud covers a wide spectrum, from the highly sophisticated banking and commercial frauds involved, for example, in the collapse of the Bank of Credit and Commerce International or the Guinness cases, to relatively straightforward deception. That broad range requires an effective, proportionate and flexible response. For the heaviest cases, the Davie report endorses the regime based upon Lord Roskill's report in 1986, which brings together the investigation and prosecution of fraud by a multi-disciplinary team of lawyers, accountants, both in-house and from the private sector, and the police, working at all stages under the aegis of a specialist prosecuting authority--the Serious Fraud Office. But intermediate cases can properly be handled by traditional police methods leading to prosecution by the less resource-intensive fraud divisions of the Crown Prosecution Service, and a substantial number of lesser cases should also continue to be prosecuted locally in each Crown Prosecution Service area.

I should emphasise that, despite the often misguided criticism to which the prosecuting agencies have been subject, the Serious Fraud Office and the fraud divisions of the CPS have made real advances since they were set up in the 1980s. In its seven years of existence to date, the Serious Fraud Office has brought to trial 141 major cases involving 309 defendants, of whom 191 have been convicted. More significantly, in over 75 per cent. of the cases brought to trial by the SFO, at least one person has been convicted, usually the principal defendant.

The Serious Fraud Office has a current case load of some 50 cases of which, on average, 20 have been brought to trial each year. At the intermediate level, the police in London and throughout England and Wales consult closely with the fraud divisions of the Crown Prosecution Service, London or provincial, in significant fraud cases prior to charge; and between them the two divisions have currently just under 100 cases being tried or awaiting trial in the Crown court. Each fraud division comprises a team of 15 lawyers, supported by in-house accountants, together with a very substantial input from independent


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counsel, usually brought in at an early stage of any case going forward to prosecution. This system is less resource-intensive than the Serious Fraud Office but nevertheless provides a specialised service on a multi-disciplinary basis. Each CPS area also handles a number of fraud cases locally, again working in close co- operation with the police and counsel.

At whichever level cases are handled, high levels of expertise, experience and attention to detail are essential. The primary conclusion of the Davie report was that the broad structure of each organisation should remain unaltered. Its subsidiary but nonetheless important recommendations are as follows. It provided a revised set of criteria for determining whether cases should be handled by the Serious Fraud Office or the Crown Prosecution Service. Those criteria, which the report concludes should lead to a heavier case load for, and some enlargement of, the Serious Fraud Office, should be published. The allocation of resources as between the two prosecuting authorities in relation to their case load should be kept under review and the Serious Fraud Office should continue to adopt a flexible approach when deciding precisely how their cases should be handled.

The role of the Joint Vetting Committee, established following the Graham report to consider the allocation of cases, which do not fall clearly to the Serious Fraud Office or the fraud divisions, should be strengthened to allow consideration of policy issues and the Association of Chief Police Officers should be fully represented on the Joint Vetting Committee when policy issues are discussed. The role of the police in Serious Fraud Office cases needs to be clarified, perhaps in a memorandum of understanding.

Finally, there should be closer co-ordination between the two prosecuting agencies to encourage a pooling of expertise, a common approach to policy issues, and improved arrangements for the interchange of staff to broaden their experience and provide for enhanced career development.

The Director of Public Prosecutions, the Director of the Serious Fraud Office and I all welcome the constructive measures suggested in the two reports. They bring to an end what has been a period of uncertainty for both organisations and provide a sound blueprint for future improvements. There can be no room for complacency, but it can be said with confidence that, without the present structures and organisation, many of the heaviest cases successfully brought to trial and conviction would never have been tried at all. Once the constructive recommendations of these two reports are in place, the ability of both organisations to perform their heavy tasks will be significantly enhanced. The Government are wholly committed to the effective and efficient prosecution of fraud at all levels. I commend the proposals to the House.

Mr. John Morris (Aberavon): I welcome the Davie report and the Attorney-General's conclusions. While I would not necessarily have devised the Serious Fraud Office and maintained a fraud division of the Crown Prosecution Service at the same time, a shotgun marriage now is not the best way to proceed.

There is no single measure of the effectiveness of a prosecuting authority and we are not in the business of knocking either the SFO or the CPS for knocking's sake. Does the Attorney-General accept from my experience


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that both the SFO and the fraud division of the CPS handle complex and difficult cases, and that the number of convictions is not necessarily a yardstick by which to judge their effectiveness? As regards the Attorney-General's responsibility, will he satisfy himself that both authorities make the widest use of counsel of experience, including those usually defending, and instruct them to consider the further lightening of indictments, what can be done to limit the breadth of evidence, and concentrate on prosecuting the prime wrongdoers rather than trying to catch every tiddler, thereby simplifying the difficult and onerous task of jurors?

As enormous costs are frequently at stake, will the

Attorney-General convey to the Lord Chancellor the need to ensure the strongest pool of competent judges to try those cases, and perhaps to signify their qualities properly? That perhaps is often the heart of the matter.

Will the Attorney-General reconsider his remarks about the need to clarify the role of the police in the SFO--a masterly understatement, if ever there was one? I have read the Davie report, which speaks of a much more serious position. It refers to "confusion and uncertainty" in direction of investigations, says that

"relations work in the majority of cases"

and mentions

"the need to resolve current tensions."

It is a masterly understatement to speak of clarifying. Does the Attorney- General share the anxiety of some commentators that for a time there were few, if any, references from the London police forces to the SFO? The Graham report notes:

"The recent trend of provincial forces collectively to refer more cases than the two London forces is contrary to the expectation that the more likely place of incidence of serious fraud is in London." Has that now changed? Will he personally ensure the greatest participation by the police in the SFO? Is it good use of scarce talent for the police to serve in the SFO at a very high level for a relatively short time and transfer to more mundane duties, including traffic, very soon after?

Will the Attorney-General make a further report to Parliament on what will be achieved by better co-ordination between the SFO and the fraud division in allocating cases? The report refers to "confusing overlap". Perhaps we might know, as a significant increase in the work of the SFO appears to be intended, what proportion that is likely to be. Will he also ensure that the alarming finding that there is little contact on professional questions between the CPS and the SFO becomes a matter of history?

The use of new methods of recording evidence and new technology has helped juries in their difficult task in some recent complex cases. Will the Attorney-General ensure that resources are not denied to the SFO to make the task of juries easier?

The Attorney-General: First, may I thank the right hon. and learned Gentlemen warmly for his welcome, and his recognition of the value of the Serious Fraud Office and the fraud divisions of the Crown Prosecution Service? He and I are in entire agreement about that important matter and we share the opinion that Davie has correctly identified the way ahead.


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I accept that both organisations have a complex and difficult role. No one should underestimate the strain on everyone involved--the investigating police and accountants, counsel who presents the case and, indeed, the judge--of those heavy cases.

The right hon. and learned Member for Aberavon (Mr. Morris) is right that one must seek experienced counsel to present those cases, that the indictments should not be overweighted by an excessive number of charges, that they should be well focused on the principal suspects and the principal aspects of the case, and that they should not be diverted on to minor and subsidiary matters.

I agree that the selection of the judge is of huge importance. The House should pay respect to the enormous burden on the judge in trying a long case of that nature. There are two key factors in those cases; clear, comprehensive and comprehensible presentation by the prosecution and a clear absorption by the judge, who must keep the case steady, prevent it from being unduly interrupted by unnecessary technicality and then present the case clearly and fairly to the jury in his summing-up. It is a heavy task, for which we owe a deep debt of gratitude to the judges who work so hard to carry it out. An important argument in the Davie report is that the role of the police needs to be clarified in the SFO, so that the police who work there, who have an immensely important role to play--I say that with great emphasis--have a line of accountability that they fully understand and which enables the Director of the Serious Fraud Office, with his heavy duties, to have clear control and direction of cases under his command.

For a time, there was a reduction in the number of cases coming forward in London. There has been a pick-up. The exact reasons for it are difficult to deduce, although it may be something to do with the recession.

It has been suggested that the police should spend longer periods in the Serious Fraud Office. I have taken a close interest in that matter for about 14 years, since I was first parliamentary private secretary to Sir Michael Havers, long before those offices were set up.

It is specialisation, it is the fact that one knows the game of fraud as well as or better than the fraudsters, that makes an excellent investigator and prosecutor. That applies to the police, and they must be given an opportunity to build up that long-term expertise.

In answer to the final questions of the right hon. and learned Member for Aberavon, yes, we shall maintain a close watch on the way in which those matters develop. I am sure that the subject will come up in questions, rightly, from time to time. The shift to the Serious Fraud Office must be considered case by case. We are not dealing with supermarket products here; we are dealing with decisions carefully tailored to heavy cases.

The lack of contact in the past between the SFO and the fraud divisions of the CPS is something that I wish to be changed. Before the report was produced, I had the opportunity to visit and talk personally to the great majority of the lawyers and accountants who deal with those prosecutions. They are anxious for closer contact. They seek an enhanced career structure. I am determined that we shall give it to them.


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Technology is of great importance. In a recent case, the judge praised the way in which 17,000 documents were kept on computer and might be brought instantly to the attention of the jury, greatly enhancing the management of the case.

Mr. John Greenway (Ryedale): I warmly welcome my right hon. Friend's statement. Does he agree that, with the increased prevalence of technology, especially throughout the banking and financial services world, the opportunities for fraud are greatly increased? Does not that demonstrate that the only effective way to discourage those people is to create the certainty that they will be detected and successfully prosecuted? He is right to draw attention to the importance of skills.

I make a plea that the skills in the police are not undervalued by the police themselves, and that there is a proper career structure for police officers working in the Serious Fraud Office, so that their expertise and experience is not wasted by their being returned to other duties.

The Attorney-General: I agree strongly with what my hon. Friend has said. He is a former police officer, and I know, from my several visits to the SFO and the CPS fraud divisions, the huge role that the police do and should play in those matters. They deserve clear lines of accountability and a proper career structure, so that they can play a maximum part in those heavy and important cases and thereby help to show the fraudster that crime does not pay and that it does lead to the condign punishment that it deserves.

Mr. Archy Kirkwood (Roxburgh and Berwickshire): I am willing to give a cautious welcome to the statement that has been made. I think that the decision to build on the existing structures is the right one, but does the Attorney-General accept that there remains a good deal of uncertainty and disquiet in the public's mind about the process? Can he confirm that the existing structures must be built on and developed, as he said, so that the public confidence that we need can be established? The jury is still out on the SFO. Although today's announcement will go a long way to dispelling public disquiet, work still needs to be done.

Do any of the Davie recommendations deal with the

Attorney-General's role in monitoring the process in future? That was mentioned earlier and it is an essential part of building the confidence in the system which the public are entitled to feel about it. The right hon. and learned Gentleman is right that we owe a debt of gratitude to judges who conduct such cases. Are they sufficiently trained, however, to digest and break down the evidence that is put before lay members of the jury, so that those juries can make sensible decisions? Will the right hon. and learned Gentleman have urgent discussions with the Lord Chancellor to satisfy himself that judges receive the training that is adequate for the task?

The Attorney-General: The hon. Gentleman makes a number of good points with which I agree. I am grateful for his welcome of the conclusions of the Davie report. He is right to agree that we should build on the existing structures.

The hon. Gentleman may say that the jury is out on the SFO or the fraud divisions of the CPS, but they deal with heavy cases. If any of them go wrong it generates a huge amount of publicity. I am sure that the hon. Gentleman


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would agree that to achieve a conviction in 75 per cent. of SFO cases, usually of the principal defendant, is no mean achievement. A certain number of interested people like to run down the prosecuting authorities, perhaps in the hope that they will be less effective in turning their gaze in certain directions.

As for my role, I can tell the House that I and my hon. and learned Friend the Solicitor-General, who has 30 years of prosecuting experience, including such heavy cases, take a close interest in the operation of both organisations, with the assistance of the Directors of the SFO and of Public Prosecutions and we will continue to do so. The hon. Gentleman is right to emphasise not only the burden on judges, but the importance of training. I shall keep in close touch with my noble Friend the Lord Chancellor on such matters.

Mr. Oliver Heald (Hertfordshire, North): Does my right hon. and learned Friend agree that the SFO has now acquired unique specialist skills and experience? Many cases, such BCCI, Barlow Clowes and Guinness, would not have come to trial without that knowledge and its ability to get behind the defences of some of the most sophisticated criminals in the country.

Does my right hon. and learned Friend also agree that the other area in which the SFO has scored recently is in the presentation of cases? At Oxford recently, Judge May stressed that the way in which 17,000 court documents could be presented by the SFO using computer screens was a fantastic aid to the jury and saved a lot of court time. Does my right hon. and learned Friend agree that, having achieved all those improvements and having that knowledge, it is more likely in the future that criminals will be detected and successfully prosecuted by the SFO than before? Is not that a tribute to its work?

The Attorney-General: My hon. Friend makes a number of good points. It is typical of us in Britain that we often run ourselves down when the rest of the world is praising us. The members of the SFO and the CPS are in great demand overseas, as are their directors, because the rest of the world wants to know how to organise its serious fraud prosecution and prosecution processes generally. My hon. Friend is absolutely correct that, going back to the early 1980s, fraud cases took enormously longer to prosecute. I remember one of the Lloyd's cases, known as the Gang of Four case, which took about seven years to come to trial and which did not lead to a conviction. The speed and efficiency with which that sort of matter is now investigated, in tandem with the Department of Trade and Industry, is a sea change from those days. It is a remarkable thing to be able to draw up any one of 17,000 documents, as required, with proper indexing, word recognition and so on. That is the way ahead; my hon. Friend is right to point to it.

Mr. Dennis Skinner (Bolsover): Is the Attorney-General aware that, by making a narrow statement on the Davie committee report, he has missed a great opportunity to remove from the public's mind the idea that there are two standards of justice in Britain? It seems extremely odd that he has not used this opportunity to explain why some of those millionaire crooks, like Levitt, the Maxwell brothers and others, can get legal aid while they hand around at court. Some of those cases take a month of Sundays, but the people involved manage to live off the public purse and finish up with a few hours' community service.


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Why has the right hon. and learned Gentleman not used today as a chance to explain how the prosecution of such cases will be sped up even more? He should have said that the SFO will explain how the treatment of those in the City, who are making money hand over fist at Baring Brothers and the like, and who have not been brought to justice, will compare to the justice meted out to the little old lady who takes a tin of pilchards from Marks and Spencer and gets locked up within a month?

The Attorney-General: I am not going down the road of commenting on individual cases, particularly any that may be currently before the courts. I invite the hon. Gentleman to take an unusual course and to praise what everyone else in the House has been right to see merit in. The steps that we are taking and the steps that we have taken through the SFO and the fraud divisions of the CPS have done and are doing exactly what he wants. It is ensuring that a high standard of justice will bring the spotlight, indeed the searchlight, to bear on the activities of fraudsters and will bring them to justice far more effectively than before.

Mr. Jacques Arnold (Gravesham): The public could be forgiven if they thought that all fraud cases are either handled according to a conspiracy theory, which seems to be the theory of the hon. Member for Bolsover (Mr. Skinner), or the cock-up theory, which is often presented to the public by the press. Does my right hon. and learned Friend agree that it is rather encouraging that, of the cases that the SFO brings to court, it gains convictions in three quarters of them, frequently of the principal fraudsters? That is particularly meritorious in the light of the complexities of the matter. Does my right hon. and learned Friend consider that what he has announced today will further strengthen the idea in the public mind that fraudsters will be caught up with and properly dealt with by the competent authorities?


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