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Lady Olga Maitland (Sutton and Cheam): He is not dead yet.
Mr. Robathan: One may leave one's memorials long before one passes on, and I know that my right hon. Friend will be back after the next election, as will we all, God willing, but this Bill may be one of the small memorials that he leaves the House and it might improve the lot of many people who might otherwise have become victims or dupes of bogus promoters of the dubious financial schemes that he has mentioned.
It is said that a fool and his money are easily parted, but this issue is much more complicated than that. There are many sad cases. I suspect that most Members have, as I have, met sad constituents who have explained how they have lost money in one scam or another and who have wondered what could be done about it. The sadness is that we discover that, often, little can be done.
What we might describe as an innocent abroad, perhaps a man in his 40s or 50s who has recently been made redundant and who is unable to get a job in the declining industry in which he was working before, may be enticed by advertisements into putting his redundancy money into a scam. Often, those people have no experience or knowledge of the world into which they are venturing--or think they are venturing--be it insurance, financial investment or selling of some sort and they see an opportunity. We should beware of criticising those people because they are being enterprising and trying to raise themselves from an unfortunate position.
Mr. Piers Merchant (Beckenham):
I agree with my hon. Friend. Does he agree that, when some people suggest that the Bill's purpose is to protect gullible people, although that may be true, it goes much further than that and many of the people who are caught by the sort of schemes that the Bill attempts to extinguish are not gullible? They have been seduced by deceptive literature, advertising and schemes.
Mr. Robathan:
My hon. Friend makes an extremely good point. Before coming to this place, I was in the Army for many years and having left the Army, I was surprised, as I looked through the opportunities in the newspapers--the House of Commons was not there; I had to find that one for myself--that there were many enticing advertisements explaining how I could make money with my enormous skills, which, of course, were flattered by those seductive advertisements. When I replied to one, however, I discovered that it looked rather fishy.
That is the nub of the matter. Everything is about getting rich quick and, of course, getting rich quick is rare, apart from the lottery or tomorrow's Grand National. Incidentally, as we discuss the Grand National tomorrow and the Bill, I would appropriately recommend to the House Young Hustler, which at 7-1 must be a favourite.
Madam Deputy Speaker (Dame Janet Fookes):
Order. The hon. Gentleman may want to offer such advice, but not here and not now.
Mr. Robathan:
I am not offering advice. I am just commenting that Young Hustler at 7-1 is running tomorrow. I take no responsibility for anyone who backs it.
Madam Deputy Speaker:
Order. The hon. Gentleman must, however, take responsibility for the relevance of his remarks to the Bill.
Mr. Robathan:
We are talking about get-rich-quick scams, but I shall move on from the Grand National and the lottery.
There are few ways in which one can get rich quick, or, indeed, get rich, apart from by working hard. Getting rich quick usually involves crime. I was going to comment on those of us who are backing a horse at Aintree tomorrow, but never mind. Those of us who are buying a lottery ticket tomorrow know in our hearts that we are unlikely to be able to spend Easter in the Bahamas as a result. Sadly, some people who are conned by pyramid selling and similar trading schemes, which my right hon. Friend the Member for Chelsea has mentioned, have lost so much that not only the Bahamas but even the most excellent resort of Blackpool is an unlikely destination.
When I was a child, I was occasionally privy at school to receiving what were known as chain letters. They were rather fun and said that one must not break the chain or one would get bad luck. I personally never returned one such letter, so I suppose I broke the chain. The letters usually originated in Minnesota or Uruguay, from some holy man or sadhu in the Himalayas, or perhaps some child in Sweden. Maths was never my strongest point at school, but I could understand quite easily that to keep such chain letters going, an enormous number of people needed to be involved.
More recently, and more seriously, about ten years ago, when I was working in London, the same sort of letters began to appear, but they demanded money. It was not a great deal of money--£10 or so. They also warned that the chain must not be broken, but they were curiously mystical. Examples were given of people who had received £20,000 and of some who had had bad luck and lost a great deal of money. Such letters also all began in the deepest south of America or the mountains of Asia, but rather than coming from a holy man they were usually from a very clever mathematician.
I recall that in the space of about two months I received about three or four such letters, which always included lists of names. One had to send £10 to the top name, strike it out, and send on the letter to six more people.
Mr. Flynn:
On a point of order, Madam Deputy Speaker. Will the hon. Gentleman refer to the clause that would stop letters coming from Ukraine and south America?
Madam Deputy Speaker:
That is not a point of order for the Chair. I thought that the hon. Member wanted to intervene.
Mr. Robathan:
It might have been an intervention, but I thought that the hon. Gentleman wanted to get on to his
By examining the lists of names on those chain letters that required £10, I saw that there was at least one general and several people who may since have become generals--I was in the Army at the time--who were not dupes or fools but quite sensible, responsible and educated. When I received three letters, I began to smell a rat. I worked out that by sending six letters, I could receive 46,656 letters by the sixth stage, which, at£10 a head, would have amassed almost £500,000. If I was not at the beginning but already at the sixth stage, more than 2 billion people would have needed to have been involved in the chain for me to have received the same amount of money. If I was at only the fifth stage, the whole population of the United Kingdom--every man, woman and child--would have to have sent letters for me to be have received the same amount of money. I have lost money in some ventures, but I have never been quite as foolish as to engage in that.
Although that was not a particularly important scam, the issue that it raises is nevertheless serious and directly relates to the Bill, notwithstanding what the hon. Member for Newport, West (Mr. Flynn), who has just left, said.I was often told that such a practice was illegal, and perhaps my right hon. Friend the Member for Chelsea or my hon. Friend the Minister can confirm that. It should be illegal. Although the generation of such money is perhaps trivial, it is nevertheless worrying.
The same principle was applied by such companies as Global Pioneers Ltd. and Alchemy UK plc, as I understand it. Such companies were getting rich quick by putting money up front in order to get other people to give them money. Of course that is all too easy, and involves amounts much more than £10. Some people's losses have been great. Perhaps the promises of selling, financial work and insurance were given, and always the income was guaranteed--except that it never came. The parallel is clear.
My right hon. Friend the Member for Chelsea has been in touch with the Direct Selling Association, as he mentioned, and I am delighted that it supports the Bill. As my right hon. Friend and my hon. Friend the Member for Mid-Kent (Rowe) have mentioned, our retail habits and unemployment in the retail sector have changed over recent years. If we look to America, we see that it is likely to change even further. Many busy people choose to buy items from catalogues or from agents of direct selling companies. There is nothing wrong with that and I am delighted that the Bill will not harm it. It is important that bureaucratic regulation does not build up and stifle perfectly proper enterprise. The franchise sector has been mentioned and there are technical issues in it that need to be considered by the DTI in years to come--not necessarily by special investigation. Since the Bill concentrates on providing a framework and does not deal with detailed regulations, it is a great asset in that area.
My right hon. Friend the Member for Chelsea will know that I wanted to debate an amendment on Report, which, despite being accepted when I tabled it was declared defective. I am not sure why. It was not in any sense a wrecking amendment. It was to investigate the
difference that was raised by consultees between directly inviting or asking people to participate, as opposed to informing or giving information designed to lead people into such participation. The consultees raised that as a matter of importance and my amendment would have altered the Bill so that section 119(1) of the Fair Trading Act 1973 would read:
"Regulations made by the Secretary of State by statutory instrument may make provision with respect to the issue, circulation or distribution of any form of advertisements, prospectuses, circulars or notices, which
(a) contain any invitation to persons to become participants in a trading scheme to which this part of the Act applies, or
(b) contain any information calculated to lead directly or indirectly to persons becoming participants in such a trading scheme".
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