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Norman Baker: To ask the Chancellor of the Exchequer how many written parliamentary questions regarding private finance initiatives have been tabled since 1 January 2000; and in answer to how many of these information has not been provided on the ground of commercial confidentiality. 
Mr. Andrew Smith: Treasury Ministers have answered 27 parliamentary questions relating to private finance initiative in the period concerned. In no case was information withheld on the ground of commercial confidentiality.
Mr. Djanogly: To ask the Chancellor of the Exchequer, pursuant to paragraph 21 of the judgment of the Court of Appeal (Criminal Division) Regina v. Patel Villiers, Sewell, Hutchinson and Ford, Cases 2000 02566, 2000 02589, 2000 02591, 2001 02259 and 2001 03772, for what reason Customs and Excise did not take action earlier to protect public revenue. 
Mr. Boateng: A key approach of the Customs National Investigation Service (NIS) to tackling diversion frauds between 1995 and 1998 was to allow fraudsters to move goods from excise warehouses while under observation. When enough evidence was obtained the perpetrators would be arrested. However, an unavoidable consequence of this investigative method was that unrecoverable arrears of duty could build up during the course of the investigation.
In their report on "Losses to the Revenue from Frauds on Alcohol Duty", published on 19 July 2001, NAO noted that
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In some cases the NIS conducted retrospective investigations ie after the fraud had been stopped. The Villiers case was a retrospective investigation
Mr. Djanogly: To ask the Chancellor of the Exchequer, pursuant to the Judgment of the Court of Appeal (Criminal Division) in Regina v. Patel, Villiers, Sewell, Hutchinson and Ford, if it is the intention of HM Customs and Excise prosecutors to seek a retrial of the appellants; what the policy of HM Customs and Excise is on the disclosure of evidence; what procedures are in place to discipline those officers who failed to disclose evidence; what the total cost to public funds to date of the criminal proceedings is; and if he will make a statement. 
Mr. Boateng: It is the intention of HM Customs and Excise to seek a retrial of the appellants in the case of Villiers and others. The Villiers judgment spoke of a failure on the part of the Crown to disclose material (para 54 of the Judgment of the Court of Appeal in Regina v. Patel, Villiers, Sewell, Hutchinson and Ford) as opposed to any failings on the part of individual officers. There is no suggestion in the judgment that individual officers wrongly withheld material from prosecution lawyers or prosecution Counsel.
The total cost incurred by the Solicitor's Office of HM Customs and Excise (including the costs of the prosecution lawyers involved, prosecution Counsel and general office costs) is estimated to be £450,000. It is not known what costs have been incurred by the defence teams or the courts.
Mr. Djanogly: To ask the Chancellor of the Exchequer what procedures he has in place to ensure that HM Customs and Excise register and handle informants in accordance with Government guidelines. 
Mr. Boateng: Informants are dealt with by specifically trained officers and HM Customs and Excise are subject to the same legislation and guidelines as police forces in their handling informants.
In addition, reviews of the way the Department carries out these activities are closely monitored by the Office of Surveillance Commissioners, National Audit Office and the Department's own internal audit division.
Mr. Djanogly: To ask the Chancellor of the Exchequer, pursuant to paragraph 6, part (2) of the judgment of the Court of Appeal (Criminal Division) in Regina 24 v. Patel, Villiers, Sewell, Hutchinson and Ford, what measures he took to monitor the activities of HM Customs and Excise officers and prosecutors in relation to London City Bond; on what date he was first informed that Customs and Excise had been involved in the losses incurred by London City Bond; and how much public funds were lost. 
Mr. Boateng: In line with standing arrangements between the solicitor's office of HM Customs and Excise and the Attorney-General, a monthly schedule of 'sensitive' cases was generated within the solicitor's office and sent to the Attorney General's office on 14 March 2001. A number of cases which involved London City Bond were included as entries in this schedule. The Attorney-General wrote to the solicitor's office on 5 April 2001 asking for fuller details of these cases. A comprehensive note was prepared and sent to
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the Attorney-General on 27 April 2001. Since then, the Solicitor's Office has continued to keep the Attorney- General abreast of current developments in these cases by way of updates to the aforementioned monthly schedule.
The Chancellor was first informed of the issues resulting from excise diversion fraud in June 2000. The Paymaster General announced an independent inquiry later that month and the full details of the losses were then published in July 2001 in the Roques report.
HM Customs and Excise Trust Statement for 19992000, published in February 2001, was certified by the Comptroller and Auditor-General and provided details of the estimated revenue losses due to excise diversion fraud of £668 million with further losses of £216 million involving goods diverted onto overseas markets where duty would have been due. Notes 9 and 10 to the Trust Statement, which was published with Customs annual report 19992000 (CM 5064), gave further details.
Mr. Djanogly: To ask the Chancellor of the Exchequer how many National Investigation Service investigations into fraudulent consignments of goods have been carried out in the last 10 years; how many such investigations are in progress; and what estimate has been made of the amount of excise duty lost to HM Customs and Excise as a result of decisions not to prosecute informers during investigations in each case. 
Mr. Boateng: Figures for the last 10 years are not available. Outward diversion fraud resulted from Single Market changes, which were only introduced from 1 January 1993. Customs investigated around 130 cases of outward diversion fraud between 1994 and 1998. After 1998 as a result of enhanced controls and the subsequent introduction of a strategic approach to countering fraud, patterns of fraud changed. It would not be in the public interest to reveal how many investigations into this type of fraud are in progress as this would assist fraudsters in evaluating the risk of perpetrating such frauds.
It is not the policy of Customs to either confirm or deny the involvement of an informant in any case.
Mr. Djanogly: To ask the Chancellor of the Exchequer what his policy is on the (a) awarding and (b) level of financial inducements to potential informants to Customs and Excise. 
Mr. Boateng: Section 165 of the Customs and Excise Management Act 1979, provides that the Commissioners of Customs and Excise may, at their discretion, pay rewards in respect of any service which appears to merit it. It is not Customs' policy to disclose information about the amounts paid to informants on the grounds that this could undermine the effectiveness of law enforcement.
Mr. Djanogly: To ask the Chancellor of the Exchequer, pursuant to paragraph 6, part (2) of the judgment of the Court of Appeal (Criminal Division) in Regina v. Patel, Villiers, Sewell, Hutchinson and Ford, what the policy is of HM Customs and Excise with regard to permitting warehouse owners to allow goods to leave without the payment of duty; and if he will define the reference by HM Customs and Excise in the judgment to bigger fry. 
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Mr. Boateng: A key approach of the Customs National Investigation Service (NIS) to tackling diversion frauds between 1995 and 1998 was to allow fraudsters to move goods from excise warehouses while under observation. When enough evidence was obtained the perpetrators would be arrested. The co-operation of warehousekeepers with Customs' investigators was an essential part in this approach. As they could have become liable for duty on these consignments, some of these warehousekeepers were given either explicit or implicit indemnities against liability for the duty evaded. In some cases the NIS conducted retrospective investigations, ie after the fraud had been stopped. The Villiers case was a retrospective investigation.
This investigative approach was examined by John Roques in his report on the Collection of Excise Duties in HM Customs and Excise. Mr. Roques concluded that there are circumstances where it is constructive and useful to observe the fraudulent movement of goods but made a three part recommendation on the subject of indemnities (Recommendation 30). This was accepted by Customs. Clearly defined authority levels for risking revenue were introduced in November 2000. A copy of the Roques report which includes the Government's response has been laid in the parliamentary Library.
Hauliers played a key role in a number of diversion frauds. In some cases the hauliers were the principals behind the fraud, in others they played a lesser though still essential role. Where the haulier was not the principal, Customs would attempt to identify the principals in order to put as complete a case as possible before the courts. It is ultimately for the courts to determine, on the evidence presented, the respective roles of the defendants.
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