Proceeds of Crime Bill

[back to previous text]

Mr. Ainsworth: That is what it says.

Mr. Grieve: But then the draftsman has included provisions such as subsection (3), which, given the nature of the evidence available and the reverse burden of proof, must make it extremely likely that exactly that will happen. The Minister, and one or two other hon. Members, say that solicitors and accountants will be involved, but with the reverse burden of proof, proving or showing where an asset that may have been given to him or legitimately acquired 20 years ago, came from, will be astonishingly difficult for the person on whom that burden has been placed-[Interruption.] If the hon. Member for Birmingham, Hall Green has something to say, I shall give way to him.

Mr. McCabe: I was simply making the point that if the article in question is of value, why should it be so difficult to prove where it came from? Does everybody have a succession of hidden aunties, who disappear off the face of the globe after distributing their largesse? That is extremely unlikely. Someone who has an article of real value should be able to give a reasonable plausible explanation of how they acquired it. Why is that an outrageous assumption?

Mr. Grieve: Let us take two examples. The first is a chattel-a valuable item such as a painting or silver, which I accept are much used for money laundering. If somebody asked me for the proof of how and where I acquired a valuable item 15 years ago, I might be able to say where I got it from, but I would have great difficulty providing documentary evidence of the transaction to support what I said. The receipt is likely to have gone into the bin some time ago. The other problem that would arise is that the person from whom I purchased it, who would be the next point of reference, would also be unlikely to have supporting documentary evidence. My loft is already overburdened with stashes of tax papers from every year that I practised as a barrister, and I cannot describe the moment of happiness when, the seven years having expired, I take a year's papers outside and put them in the bin. Each one is labelled year by year, because otherwise, the loft would be full of mounds of paper that were used as the basis for my tax return in any given year. People do get rid of their papers legitimately.

Mr. David Wilshire (Spelthorne): It might not be only my hon. Friend's loft that was full after for seven, eight or nine years: the contents of my loft would fall through to the ground floor if I did not clear it out.

Mr. Grieve: Indeed. People do not keep documents indefinitely. Yet, the provision places a burden on someone to show that assets were inherited or given to them 25 or 30 years earlier.

Mr. McCabe: Unless I have misread the Bill, there is no requirement to produce a receipt, merely to provide a plausible explanation of when the goods were received. Let us suppose that the hon. Gentleman brought a painting 20 years ago. Even if he could not produce the relevant receipt because he had chucked it out, it would be possible to contact the reputable dealer who had sold the painting to him.

Mr. Grieve: That is not necessarily so. I have been involved in family law cases and tried to find out from where various assets came. I know from such experiences how difficult it is to obtain the material to prove the origin of certain assets. That is a fact of human life. If the assets were obtained six months ago, there would be no problem, but if they were obtained eight, nine or 10 years ago people would be at a disadvantage. The records of such transactions are not always easily obtainable.

Mr. Hawkins: I shall cite an example that may assist my hon. Friend, and might even convince the hon. Member for Birmingham, Hall Green of our argument. Members of Parliament are often asked by their constituents to take a matter up on their behalf. We ask them whether they have the paperwork to support their case, and even if it goes back only six months or a year, the constituents often reply, ``I'm terribly sorry, but I don't keep anything like that.'' I am referring to matters that are important enough to be brought to the attention of a Member of Parliament.

Mr. Grieve: Let us suppose that a person has £20,000 in a bank account-a nest egg built up as a result of income from employment. He has received his P45s, and the salary has been going into his account, but the last time a payment was made was 12 or 15 years ago. From my knowledge of banks, that person is likely to have considerable difficulty obtaining the bank statements from 15 years ago to show that the money was legitimately paid into his bank by his employer. Unless he had kept the statements, he would have great difficulty in proving his case.

Mr. McCabe: I am sorry to keep arguing the point, but the hon. Gentleman is being absurd. No one expects the individual to produce a receipt. It would be possible to contact the employer, who could say that the money was paid legitimately. Why is so difficult for the hon. Gentleman to accept that what is required is a reasonable level of proof?

Mr. Grieve: The employer would not have the slightest idea whether that money was the money he had paid to the employee.

Mr. Tom Harris (Glasgow, Cathcart): I accept that the hon. Gentleman is outlining his genuine concerns, and I know that Opposition Members do not support such criminals or want to protect them. However, many drug barons-Mr. Bigs-have benefited from the proceeds of crime for 20 or 30 years and have built up a stockpile of wealth. Does the hon. Gentleman want to do something about that accumulated wealth? If he is against the clause, can he suggest an alternative?

Mr. Grieve: The hon. Gentleman makes a good point. I hope that he will forgive me for saying that this is exactly the type of dialogue that members of the Committee should have. I accept the Minister's point that the demerit of the amendment might be that it could shift the goalposts too far in the other direction, so that the clause might not allow the seizure of long-standing assets, and someone who had conducted 20 or 30 years of criminal activity would escape.

9.30 am

Is there a further option? The Minister said that there was a provision in subsection (6) that the court need not make assumptions if there were a serious risk of injustice. I shall put myself in a judicial capacity, and say that it will be difficult for a court to seize any assets that can be shown to predate a seven-year acquisition period, because if a person says, ``These were legitimately acquired, but I haven't got the records'', any court will have difficulty unless-to pick up what the hon. Member for Glasgow, Cathcart (Mr. Harris) said-the assets are disproportionate to the person's lifestyle compared with his career history. That is what we are trying to flag up.

The Minister may be ingenious and identify a third way-to use the Labour party's usual mantra-that may help us, but we tabled the amendment to highlight potential difficulty and injustice. That is why I wish that the Minister would engage in constructive dialogue, rather than telling us that we are weakening the powers that can be used against criminals.

Mr. Mark Field (Cities of London and Westminster): I have taken on board the suggestions of the hon. Members for Glasgow, Cathcart and for Birmingham, Hall Green. I fully appreciate what my hon. Friend the Member for Beaconsfield said about wanting a structure that will ensure that criminals have their money swept up. Subsection (3) is a sweeping-up provision for use when we know that people have done wrong but we cannot get hold of all the assets. There is suspicion that assets have been salted away, even over the previous six years, so there is a draconian sweeping-up provision. Many libertarians are worried about whether it is right to go down that road. If the Bill is enacted in its current form, such provisions will be regarded as normal practice. There will be a reverse burden of proof, and it will be implied that all individuals should be entirely happy to make clear all their transactions to the state. If people do not do that, there will be immediate reverse suspicion, as it were. Conservative Members-and, I hope, Labour Members-have deep concerns about the law moving in such a direction.

Mr. Grieve: I agree with my hon. Friend. We are not examining the confiscation mechanism in isolation because later-I am not sure when-we will consider civil recovery. That is a sensible way for the state to recover a person's ill-gotten gains that stretch back over years. We will want to examine the civil recovery proposals in greater detail, but I find them interesting.

The confiscation provisions are onerous for the defendant, and can be triggered by several events-by a series of offences stretching over a period, or by a single offence. It would be difficult to administer the system fairly when examining assets that the evidence suggested first appeared a long time ago. That is a problem.

Mr. Paul Stinchcombe (Wellingborough): The hon. Gentleman makes an interesting case, and is trying to persuade the Minister to look for a third way. Why does he think that the way outlined in the Bill is wrong? The evidential burden is placed on the criminal for two good reasons: first, because he is a criminal, and secondly, because if it is hard for the criminal to prove the origin of his goods, it is inevitably harder for the state to do so-after all, it is the criminal who receives, imports, or inherits the goods.

We have a backstop in the discretion vested in the court by subsection (6), which allows courts not to make the assumption if

    ``(a) the assumption is shown to be incorrect, or

    (b) there would be a serious risk of injustice''.

What is wrong with that structure?

Mr. Grieve: I accept that there is a welcome safeguard in subsection (6), and I am glad of it. Nevertheless, it is pointless for Parliament to set up a structure that is always in danger of falling into the ``serious risk of injustice'' category because of the way in which it is defined. We are not intended to set up such structures; nor is the Minister.

There are difficulties with a reverse burden of proof. It requires a defendant to prove the legitimate acquisition of assets that were gained before the period in which he is under a legal obligation to keep records about those assets. I am not saying that the amendment provides the solution. Perhaps, as a result of our discussion, we shall think again and return to the subject on Report. I welcome this discussion, and it would be helpful if the Minister were either to persuade me that there is no problem, or to acknowledge that there is, and say that he will think about it.

Previous Contents Continue

House of Commons home page Parliament home page House of Lords home page search page enquiries ordering index

©Parliamentary copyright 2001
Prepared 22 November 2001