Proceeds of Crime Bill

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The Chairman: Order. This debate is deteriorating rapidly into one that goes wider than the amendment allows. The amendment is extremely narrow. The hon. Member for Beaconsfield made the intention behind it clear, and hon. Members are trying to widen the debate to areas that it does not cover.

Mr. Wilshire rose—

The Chairman: I have not finished. Furthermore, an intervention is meant to be just that. The previous intervention was a bit long.

Mr. Wilshire: I am grateful for your guidance, Mr. McWilliam.

My hon. Friend raised a fair example. Having made the point that it is possible to hold such property that is not tainted, I shall not go further down that route.

However, I wholly support my hon. Friend's amendment. The wording may not be to the Minister's liking, but he cannot dismiss an amendment by saying, ''Look, the property is tainted, and there is nothing we can do to say that it isn't.'' The best way that the Minister can describe my example of something that is acquired after the crime rather than in the process of the crime is as property that was previously obtained using funds that were obtained unlawfully. The property itself was not obtained unlawfully by the person who has the money. If the Minister cannot accept my hon. Friend's wording, will he consider an alternative wording, whereby it is not the property that is tainted, but the money that was originally used to acquire it?

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The Chairman: Order. The hon. Gentleman has gone miles wide of the clause and the amendment, which are related not to money but to property.

Mr. Wilshire: I understand that, Mr. McWilliam, which is why I sat down just before you stood up, as I had finished speaking.

Mr. Field: We have had a long debate on the amendment, and I endorse entirely the points made by my hon. Friends the Members for Spelthorne and for Beaconsfield. As far as the Minister is concerned, the property is tainted, and there is a clear, strong argument that it is tainted for ever. However, we have a real concern that a bona fide purchaser for value without notice is also likely to be tainted by attachment to property that has been obtained through unlawful conduct, and the individual's good name will inevitably be affected, however innocent he is. I wonder whether there is a form of words that could resolve that.

Mr. Ainsworth: What can we do, other than name the individual as a bona fide purchaser for value? Surely that makes the situation as clear as possible: he was a bona fide purchaser for value without knowledge, and was totally and utterly innocent—and the property would no longer be recoverable. However, the fact that he is described in that way does not change the history of the property. I do not know how we can do that. We could try all kinds of contorted phrases—the hon. Member for Spelthorne tried one—but if we had to have wording such as ''obtained by funds that were obtained by funds that were obtained by funds that were originally the proceeds of crime'', that will be nonsense.

Mr. Field: That may well be nonsense, and it may not be the ideal way of drafting amendments to such clauses. None the less, I hope that the Minister will reflect further on how to remove the taint that would otherwise be transferred to a bona fide purchaser for value without notice.

Mr. Grieve: I listened carefully to the Minister, and I am mindful of the points that he made. However, concepts are being misunderstood.

The Minister alluded to the fact that that which is unlawfully obtained remains, in history, unlawfully obtained. I can see the force of that if property is originally stolen property. At the beginning there was a victim—an individual who was deprived of it. One thinks of Earl Warenne—not the Earl Warren involved in the inquiry into President Kennedy's assassination but a 12th-century Earl Warenne—and the Act of quo warranto, whereby the King sent round justices to inquire how people held their land. Earl Warenne became a bit shirty, opened an old cupboard, and said, ''By this rusty sword!'' Clearly, there had been a victim of the original land depredation, at the time of the conquest. I have no doubt that hosts of properties held in this country were acquired by such unlawful acts.

The interesting point about the Bill, which we have discussed previously, is that it is not necessarily about property of which a person has originally been unlawfully deprived. Those individuals have remedies at law that are independent of this legislation, which

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provides a complete statutory definition of a new thing called property obtained through unlawful conduct. There does not necessarily need to be a victim. It so happens that the origin of the money was through activities outside the law—that is the best definition that I can provide.

Analogies to the Crown jewels have little force, because we are discussing a statutory definition. Therefore, adding the phrase

    ''or property obtained through unlawful conduct.''

does not cause the chaos that the Minister envisages. When property is in the hands of a person who has paid good money for it and is innocent of any knowledge of its origins, the property obtained through unlawful conduct has the value of the money that was paid by the innocent person to the other person.

Although I regret taking up the Committee's time, an issue of principle is involved and I wish to press the matter to a Division. I dare say that it will not surface again in the passage of this legislation, unless it arises in another place, but I would not be doing justice to the issue if I did not ask the Committee to vote on it.

Question put, That the amendment be made:—

The Committee divided: Ayes 5, Noes 13.

Division No. 24]

Field, Mr. Mark Grieve, Mr. Dominic Hawkins, Mr. Nick
Johnson, Mr. Boris Wilshire, Mr. David

Ainsworth, Mr. Bob Baker, Norman Brooke, Annette Clark, Mrs. Helen Davidson, Mr. Ian Lazarowicz, Mr. Mark Lucas, Ian
McCabe, Mr. Stephen McGuire, Mrs. Anne Robertson, John Stinchcombe, Mr. Paul Stoate, Dr. Howard Watson, Mr. Tom

Question accordingly negatived.

Mr. Grieve: I beg to move amendment No. 472, in page 176, line 36, leave out subsection (10).

If I recollect correctly, this is a simple matter. Clause 306 deals with exceptions. Each exception is explained and it says at the end of most of the subsections that the property ''ceases to be recoverable.'' However, subsection (10) is not an exception but a definition. My query is exactly the same as that in respect of clause 304 (3). Why is subsection (10) necessary? Does it fulfil any useful purpose? The Minister will probably give exactly the same explanation as he gave for clause 304 (3).

Mr. Ainsworth: I will not, because this is not as clear as that.

Subsection (10) provides for how the provisions of clause 306(1) and (2) apply in cases where clause 303 is engaged—that is, where a person has entered into a transaction whereby he disposes of the original recoverable property and obtains other property in its place—in other words, where there is representative property.

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Subsection (10) makes it clear that any representative property obtained in place of the recoverable property will still be recoverable. The amendment would remove that provision. Removing subsection (10) would not necessarily mean that the representative property would not be recoverable, but the position would be less clear than it is at the moment.

Clause 306 sets limitations on the enforcement authority's ability to follow and trace property, by setting out certain exceptions to civil recovery and cash forfeiture. Subsection (10) ensures that those exceptions cannot result in the avoidance of civil recovery or cash forfeiture proceedings.

An example of that might be helpful. Under clause 302, if someone is given a car in return for a contract killing and he subsequently sells the car, the enforcement authority may follow the car into the hands of the purchaser and recover it from him. Under clause 303, the money received in return for the car comes to represent the car, and is also recoverable property.

Clause 306(1) provides that property is not recoverable where it is obtained by a bona fide purchaser. If the purchaser pays full value for the car, and is unaware that it is the proceeds of unlawful conduct, the enforcement authority is not entitled to recover the car from him, or from anyone who may subsequently acquire it. The purpose of that is to defend an innocent purchaser who obtains property that would otherwise be a potential target for civil recovery.

However, the exception will apply only to the car; it will not apply to the proceeds of the sale. Subsection (10) makes it clear that the proceeds of the sale of the car, which themselves represent property obtained through unlawful conduct, will remain recoverable.

I accept that it is possible to argue that subsection (10) is not essential to achieve that result; it could be said that there is nothing in subsections (1) or (2) that suggests that representative property could become immune from prosecution in the circumstances that have been set out. However, as the provisions on recoverable property—including those on tracing property—are not straightforward, we think that it is preferable to retain subsection (10), to avoid any possible confusion.

The hon. Member for Beaconsfield was right after all: at heart, my argument is the same as the previous one. However, as it is also more complicated than that one, I wished to address it in greater detail. For the reasons that I have given, I ask the hon. Gentleman to withdraw his amendment.

Mr. Grieve: The Minister has persuaded me. I take his point on board, and beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 306 ordered to stand part of the Bill.

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Clause 307

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