Serious Organised Crime and Police Bill


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The Parliamentary Under-Secretary of State for the Home Department (Caroline Flint): One reason why we do not support the amendment, which would mean that financial reporting orders could not be applied at magistrates court level, is that some offenders, convicted by a magistrates court of one of the specified offences, will pose a higher risk of reoffending. For those people, an order would be appropriate. As we discussed, some of the specified offences, such as offences under the Theft Act 1978 and intellectual property offences, can be tried either way. There is no reason why a magistrates court should not have the power to impose those sentences.

I agree with my hon. and learned Friend the Member for Redcar that we do not want to create the ridiculous situation in which either the Crown court is clogged up with cases or people are choosing to be tried in a magistrates court and therefore finding another loophole in the proceedings. An offender convicted by a magistrates court of obtaining services by deception under section 1 of the Theft Act could pose a sufficient risk of reoffending for the court to believe that imposing a financial reporting order on him was justified.

It is a basic principle of sentencing that the sentence must be proportionate. I have listened to hon. Members, but magistrates courts and the Crown court are capable of exercising this responsibility. Magistrates courts, magistrates and those who work alongside them are considering different ways of deterring future offending, which in some cases involves containing people who are considered a risk to the community. That might involve securing drug treatment for people. There are many different creative, and hopefully effective, ways in which magistrates can think beyond simply imposing fines or custodial sentences when they deal with individual cases. We are confident that magistrates will not use the powers in cases in which they are inappropriate. In any case, the prosecutor will be the one who requests the financial reporting orders.

However, there are issues to be addressed, to which the hon. Member for Beaconsfield (Mr. Grieve) referred. We are trying to determine whether financial reporting orders can work on several different fronts. One would hope that they will act as a deterrent against future offending behaviour, although it is undeniable that people may on occasion be tempted back into offending and that mistakes will be made. However, these financial reports contain information that could be important.

As we discussed earlier, the reports may keep people from using legitimate financial institutions to organise their criminal activity. If they act as a deterrent, provide intelligence, disrupt criminal activity or keep criminal activity away from legal enterprises, they are no bad thing.

Mr. Djanogly: Having heard the Minister's answer, I am not entirely convinced that leaving things as they are will lead to the clause being either proportionate or administratively realistic. I know that doubts were expressed as to whether magistrates would commit on
 
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the basis that they might not know about the availability of the orders, but I assume that the prosecution would have reminded the court at the time, so I cannot imagine them being forgotten about.

We do not, however, intend to take the matter further at the moment, and I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 69 ordered to stand part of the Bill.

Clause 70

Financial reporting orders: making in Scotland

Question proposed, That the clause stand part of the Bill.

Mr. Heath: I am not familiar with Scots lawóthe Minister probably is not eitheróbut the list of offences under subsection (3) looks uncommonly short. Does it encompass the same areas in law as that which applies in England and Wales?

Caroline Flint: I shall ensure that the hon. Gentleman receives the precise answer to that question. The Scottish offences with which the clause is concerned are the equivalent of those in England and Walesóit says here.

Question put and agreed to.

Clause 70 ordered to stand part of the Bill.

Clause 71

Financial reporting orders: effect

Question proposed, That the clause stand part of the Bill.

Mr. Djanogly: I wish to raise an information point. The clause does not specify that financial reporting orders are to start at the end of the custodial sentence, even though that was the position set out in the White Paper. I raise the point noting that Liberty questions whether offenders in prison would be able to comply with the requirements of an order.

I shall be interested to hear the Minister's views. I think that, given that the Bill deals with serious organised crime, the provision is right and that it should be possible to place an FRO on a Mr. Big in prison, on the grounds that he could be running a drugs empire from prison. However, compliance might not be possible for the small criminal in prison who does not have an accountant. Considering the Minister's reluctance, under previous amendments, to address the question of limiting FROs to serious cases, the point perhaps becomes more relevant.

Could the Minister also look again at subsection (10)? Is the threat of an extra maximum of 51 weeks in prison enough of an incentive to ensure compliance with an FRO by a big criminal who has earned millions of pounds from illegal activity?

Caroline Flint: Our view, after some discussion, is that people in prison do manage to continue to oversee their financial activities in a number of ways. They may not have an accountant, but they have visits from family members and others. Considering the range of people who may be affected by a financial reporting
 
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order, it is important to recognise that someone outside prison could squirrel away a huge amount of money, or transfer assets or put them in someone else's name, in order to continue the business in another form. We did not want to lose an opportunity to deal with that. I am glad to hear that in principle the hon. Gentleman sees merit in that argument.

On subsection (10), we have taken advice on a number of provisions in the Bill covering such offences such as, for instance, people not complying with disclosure orders or giving incorrect information. Subsection (10) was drafted after consultation with a number of different people, so I shall write to the hon. Gentleman to explain why we felt that it was appropriate.

Mr. Heath: Presumably, under subsection (10) the offence and the sentence can be applied each time a report is required. Therefore, a person in prison who continually fails to make their financial records available will simply stay in prison for a long time.

Caroline Flint: That sounds entirely logical. If people in prison do not comply with such a requirement for action, that would have to be looked into in terms of their prison sentence. As I said, I shall clarify the issue. However, if someone receives a prison sentence and is then given a financial reporting order with which they do not comply, that is a different offence. We have to be clear. I do not want to confuse matters, but I am happy to clarify that in a letter.

Mr. Grieve: I think that I understand what the Minister means. For a moment, it seemed she was suggesting that a person who did not comply with a reporting order would stay in prison for longer but on the existing sentence. I do not think that can be right. I want to clear it up, because I do not think that that is what the hon. Lady intended to say.

Caroline Flint: No, that is not what I meant. Obviously, the courts would impose a prison sentence and a financial reporting order, but the penalty for not complying with the reporting order is an add-on. I will write to both hon. Gentlemen to clarify that point a little further.

Vera Baird: It is a small point, but the hon. Member for Huntingdon is conjuring with the notion of someone who does not have the resources to make a return. One defence to the charge of not making a return is reasonable excuse. That may offer some reassurance.

Caroline Flint: I am indebted to my hon. and learned Friend's expertise.

Mr. Djanogly: I was not suggesting a defence of being unable to comply. I was simply questioning whether it is fair that a small criminal, who does not have the resources of big criminals, should have to make such a report. Can they physically do it? The Minister said that they have researched the point and that the answer is yes. I am happy to accept that, but it is a slightly different issue.

Question put and agreed to.

Clause 71 ordered to stand part of the Bill.
 
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Clause 72

Financial reporting orders: variation and revocation

Mr. Grieve: I beg to move amendment No. 205, in clause 72, page 42, line 15, leave out 'convicted' and insert 'sentenced'.

This is a probing amendment. I am a little puzzled by subsection (3), which states:

    ''if the order was made on appeal, the application must be made to the court which originally convicted the person in respect of whom the order was made.''

Surely the application needs to be made to the court that originally sentenced the person: the convicting court and the sentencing court will not necessarily be one and the same. It would be most undesirable if a person convicted in the magistrates court and committed to the Crown court for sentence ended up back in the magistrates court. It seems desirable, if possible, that the judge who originally imposed the sentence should hear the case. I would be glad to hear whether the Minister thinks that there is any substance in my proposal.

Caroline Flint: I have some sympathy with the hon. Gentleman's proposal. He is right to point out that offenders are not always sentenced by the same court that convicted them. We are considering tabling some amendments dealing with the use of financial reporting orders in Northern Ireland, and I will consider whether the present area could be better informed as well. On that basis, I ask him to withdraw the amendment.

 
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