Proceeds of Crime Bill

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Mr. Alistair Carmichael (Orkney and Shetland): May I helpfully remind the hon. Gentleman that the Scottish nationalists did not make any requests to be members of the Committee?

Mr. Davidson: Goodness me, I had forgotten that. I am grateful to the hon. Gentleman. I think that it was the hon. Member for Orkney who drew that matter to my attention yesterday, and it is the hon. Member for Shetland who is telling me about it today. It is a particularly helpful and constructive point.

Mr. Carmichael: To follow up the hon. Gentleman's earlier point about the meaning of language, will he

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make it clear that when he says ''yesterday'', he means last Thursday?

Mr. Davidson: It was the previous day in Committee, so I assumed that as we live a virtual universe here, that was the appropriate term to use. I am glad that somebody from Orkney and Shetland has been able to contribute constructively to our debates, and I look forward to his career on the Liberal Democrat Back Benches.

We have heard wonderful words from the hon. Member for Cities of London and Westminster, but the fact is that the Conservative proposals would water down the provision. There are no ifs or buts: they are concerned not with strengthening the provision or with finding other ways of catching people, but with watering it down. That is a disgrace. If the Conservatives had tabled amendments that attempted to toughen up the provision, we would have listened to them. The hon. Gentleman says that he represents, among others, some of the most corrupt people in the country—[Interruption.] I hope that I am not being too subtle for the Liberal Democrats; perhaps I should explain my point later on. In any event, we should mark their cards accordingly, and I look forward to reporting the matter as widely as possible.

Mr. Grieve: During the intervention by the hon. Member for Orkney and Shetland, I was struck by the thought that the hon. Member for Glasgow, Pollok—who is, after all, a politician well versed in his skills—had forgotten that during an earlier intervention the hon. Member for Orkney and Shetland had told him that the SNP had not asked to serve on this Committee. Yet it is such forgetfulness that we plan, through the Bill, to criminalise. The hon. Member for Glasgow, Pollok might like to reflect on that point, and on whether making references to the SNP a criminal matter within the Labour party—sometimes one feels that they already are—might not be too onerous and draconian a step.

Mr. Davidson: That is a helpful point. The amendment would delete the phrase

    ''has reasonable grounds for knowing or suspecting''.

Have we reasonable grounds for knowing or suspecting that the SNP did not ask for a place on this Committee? [Hon. Members: ''Yes.''] Perhaps we have, and that undoubtedly should be an offence. I do not want to labour the point, but it is worth drawing it to people's attention.

The Chairman: Order. So far nobody has accused the SNP, the Liberal Democrats or any other party of laundering money.

John Robertson (Glasgow, Anniesland): There is still time.

Mr. Davidson: As my hon. Friend says, there is still time, which is why we are in favour of openness in political accounting. Is it not true that Sean Connery's supplying huge amounts of money from abroad did not perhaps come across as clearly as it might have done? The general point is a useful one, and we will probably want to pursue it on another occasion.

Mr. Carmichael rose—

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Mr. Davidson: Perhaps the hon. Member for Orkney and Shetland wants to make a point.

Mr. Carmichael: We merely wished to suggest that the fact that the SNP did not ask to be included on this Committee, but has made such a fuss about its proceedings, is in itself criminal.

Mr. Davidson: That is a very useful point, although the hon. Gentleman's reference to himself as ''we'' perhaps displays delusions of adequacy.

Mr. Carmichael: No one could accuse you of that.

The Chairman: Order.

Mr. Carmichael: I meant him, Mr. McWilliam.

The Chairman: Sedentary interventions are to be deplored at any time, but I should also point out that the Chairman never displays delusions of adequacy; he always knows where the enemy is.

Mr. Davidson: Yes, that was an outrageous attack on you, Mr. McWilliam, for which you properly rebuked the hon. Gentleman.

    ''Ignorance is no defence'',

said a long-standing friend of Sir Michael Richardson. The friend continued:

    ''He is very, very upset by it all. I think if he'd been called Mr. Tiddlywinks, you would not have heard about this. He is not self-seeking but Michael has always gone out of his way to have a high profile and I suppose this is the result . . . It is not the substance of what he has achieved in his career.''

The article then returns to the question of culture:

    ''Yet friends and contemporaries admit that, at times, Richardson has demonstrated a remarkable naivety about his clients.''

How many other people in the City display a remarkable naivety about their clients?

    ''He introduced Robert Maxwell to Smith New Court, even though both Cazenove and Rothschilds, his former employers, had flatly refused to do business with the fat fraudster.''

That reflects to the credit of Cazenove and Rothschilds, and shows that not everyone in the City is a rascal—even those who are not dead.

5.15 pm

The article goes on:

    ''Richardson had helped float Pergamon Press in the 1960s'',

and refers to a number of other issues in the past, but I do not want to touch on those. One of Mr. Richardson's friends said:

    ''I think Michael is an immensely generous and very imaginative man, who gives so much of himself to friends. But, ultimately, I think you can call into question his judgment.''

How many other senior figures in the City are there whose judgment could be called into question when they were considering whether they had reasonable grounds for knowing or suspecting? He went on:

    ''He is a very talented man, but he needs to be more shepherded. It needs somebody else to dot all the 'i's and cross the 't's. His judgment of a transaction was without doubt. When it came to people, it was sometimes suspect. He probably works best with somebody who keeps him in check.''

How many other senior figures in the City need somebody working with them to keep them in check?

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We must therefore not only retain the paragraph that Conservative Members wish to delete but be conscious that the culture that they are defending is the same culture that protects the gangsters and drug dealers who ruin the lives of many in my constituency and in the constituencies of many of my hon. Friends.

Mr. Hawkins: I thank the hon. Gentleman. He always makes speeches that are both entertaining and partly serious, and his last point was a serious one. I am sure that all those, particularly at a senior level, in NatWest, Smith New Court and Cazenove will be especially grateful for his ringing endorsement of their high compliance standards.

The hon. Gentleman's serious point, for which he has used a particular case about which he has quoted extensively from the report in the Daily Telegraph, begs one question. It is the same question as those from the Law Society of England and Wales who advise my hon. Friend the Member for Beaconsfield and myself put to us when they discussed the matter with us during the lunch break: will the Minister in due course be able to give us any examples of what he and the Government think will, under their interpretation of the clause, be a reasonable excuse? I put that point seriously to the Minister.

I hope that when the Minister addresses the serious parts of the speech made by the hon. Member for Glasgow, Pollok, he will also say what the Government's view is on whether the kind of case that the hon. Gentleman describes would have been caught by the Bill as Conservative Members wish to amend it. We do not have the details; we only have the press report, but my view is that a person behaving in the way that the hon. Gentleman describes would probably be caught by the clause as it would be amended.

However, I want to hear from the Minister what the Government think would be a reasonable excuse, because we are concerned that what may in practice result from this part of the Bill, if it is not amended, is a huge amount of empire building within NCIS. We have made the criticisms of the current system that those at the sharp end believe are valid. We think that it will be 10 times worse under the new system unless our amendments succeed.

We believe that the Minister will also have to deal with the revised compliance cost assessment. We had a debate this morning, in which the Minister accepted some interventions from me, about the difference between us about the facts of how many reports there are and how, in the view of those at the sharp end, the number has grown exponentially since 1993. The Minister refers to it as a steady rise. We are advised that it was a dramatic rise.

May I add one further piece of information for the Minister? When we adjourned at lunchtime I was advised by our expert from the Law Society's anti-money-laundering committee that the details that he had came from a lecture given recently by a senior person from NCIS. I hope that when the Minister's officials check further, they will specifically check what senior people in NCIS are saying in public lectures to the experts in the City who are trying to combat

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money laundering. If what is being said in public lectures is different from the advice being given to the Minister, some further thought needs to go into that.

This afternoon, Mr. McWilliam, you have rightly and regularly exhorted us from the Chair to concentrate on the specific amendment that my hon. Friend the Member for Beaconsfield so ably moved. I remind the Minister and the Committee that we put forward two alternatives. We did not want to hang our hat on just one piece of drafting, although my hon. Friend rightly said that we preferred one version. We wanted to give the Government a choice, but we genuinely feel that there is a danger of injustice unless some redrafting is done.

I urge the Minister, even if he does not listen with any great enthusiasm to what my hon. Friend and I say, to listen to the eminent counsel on his own side. The hon. Member for Wellingborough also thinks that there is something wrong with the drafting, although, in fairness, he does not go all the way with my hon. Friend and me. He accepts, I think, part of the spirit of what we are trying to do, agreeing that the clause as it stands is infelicitously drafted and could be improved.

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Prepared 22 January 2002