Serious Organised Crime and Police Bill

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Caroline Flint: Except, as the Bill says further down in that paragraph

    ''with the leave of the court''.

That is the point. We are not trying to deny a legitimate landlord their rights.

Vera Baird: This may be a small point, but the purpose of a property freezing order is to stop anyone from dealing with the property. Is it proposed that a land charge or some sort of caution should be registered? If the person who is subject to a freezing order tries to sell the property under the table of the freezing order, we need to be able to tell the prospective purchaser that there is a freezing order on it. The way in which that could be done would be to register a land charge or something of that kind. I do not know whether there is provision to do that.

Caroline Flint: My hon. and learned Friend makes an interesting proposal. I will look into that matter and inform the Committee.

Mr. Grieve: This has been a most useful and interesting short debate, and I am grateful to the Minister for her comments. I am certainly reassured by the fact that the leave of the court can be obtained.

A freezing order and a receiving order are not one and the same. The Government are creating freezing
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orders because they are cheaper. That is the truth. Receiving orders are expensive. As I understand it, by way of background, it has been discovered in the course of the implementation of the Proceeds of Crime Act that a lot of the seizing of assets that is taking place is not so complicated that a receiver is required to be appointed. The need to appoint receivers is costing an arm and a leg, and all the assets are dissipated in the receivership. It has always been well known that receivers do better even than lawyers in terms of professional remuneration.

In such circumstances, a freezing order is a good idea. Of course, the freezing order does just that—it freezes. A receiver at least has certain duties to manage what has been placed into receivership in ways that are compatible with the rules of law, and one can go to court to have that argued. My anxiety was that the freezing order might be a rather draconian way of dealing with the matter on a long-term basis without the rights of the landlord being properly taken into account. I appreciate entirely the point that the Minister made. If we were simply to allow landlords to have peaceful re-entry in such circumstances, there could be abuse. On that basis, and as the leave of the court can be obtained, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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

Mr. Heath: I have two brief questions. First, I presume that the freezing order will cause a delay in granting probate in the event of someone having predeceased the completion of the order. Secondly—I display my ignorance, but it may assist the Committee—does the Scottish legal term ''sist'', to be found in proposed new section 255C at page 56, line 14, mean the equivalent of ''stay'' in English or Welsh law?

Caroline Flint: The answer is yes to the latter question. On the first question, it is suggested that there might be some delay, but I shall seek a more detailed answer.

Question put and agreed to.

Clause 90 ordered to stand part of the Bill.

Schedule 6

Minor and consequential amendments

relating to section 90

Amendment made: No. 57, in schedule 6, page 163, leave out lines 19 to 29.—[Caroline Flint.]

Schedule 6, as amended, agreed to.

Clauses 91 and 92 ordered to stand part of the Bill.

Clause 93

Appeal in proceedings for forfeiture of cash

Mr. Grieve: I beg to move amendment No. 245, in clause 93, page 59, at end insert—

    '(2A) The appeal is to be by way of a re-hearing.'.

I tried to work out what was being changed here, and I realised that we seemed to be changing the need
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to have an appeal by way of rehearing. I thought that we would put it back in, so as to find out from the Minister why it was taken out.

Caroline Flint: The reason is simply that a rehearing is not required in every case. For instance, the appeal may be on a matter of law, and we see no need for cases to be heard afresh in such situations. Also, if the Appeal Court thought it appropriate for an appeal to be by way of a rehearing, it could do so. The provision does not prevent it. It will a matter for the courts on a case-by-case basis. I accept that the Proceeds of Crime Act requires all appeals to be made by way of a rehearing, but on reflection we decided that it was unnecessary here.

The reason for the rehearing in the Proceeds of Crime Act is partly to do with the cash recovery scheme, which was closely modelled on that in the Drug Trafficking Act 1994. The chief difference in the proposed new section 299 is that it also gives the right of appeal to the prosecution. We think that that is appropriate. As with some of the other measures that we have discussed today, it is about hindsight. We are considering how things are implemented, and coming forward with a safeguarded but reasonable and practical approach to tackling such matters.

Mr. Grieve: Taking the latter point first, I appreciate that it allows the prosecution to appeal. I have no objection to that. I have to say that when I read the original section, I did not notice that the prosecution did not have a right of appeal. However, perhaps unintentionally the drafting does not seem to provide for that. It shows that even the 36 sittings in Committee and in the House of Lords scrutinising that Bill may not have done the job intended.

The Crown court is capable of dealing with points of law, and not appeals by way of rehearing. However, the Minister will be aware that appeals in the Crown court generally take place by way of rehearing of the facts as well as submissions of law. As long as there is the possibility for an entire rehearing, I am content. What concerned me was the possibility that the process would exclude that. On the basis of the Minister's reassurance that that is not the case, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 93 ordered to stand part of the Bill.

Clause 94

Money laundering: defence where overseas conduct is legal under local law

Mr. Grieve: I beg to move amendment No. 246, in clause 94, page 59, line 27, after 'territory', insert 'at the time it occurred'.

The Chairman: With this it will be convenient to take the following: amendment No. 247, in clause 94, page 59, line 40, after 'territory', insert 'at the time it occurred'.

No. 236, in clause 94, page 59, line 40, leave out from 'territory' to end of line 42.

No. 248, in clause 94, page 60, line 10, after 'territory', insert 'at the time it occurred'.
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No. 237, in clause 94, page 60, line 10, leave out from 'territory' to end of line 12.

No. 249, in clause 94, page 60, line 23, after 'territory', insert 'at the time it occurred'.

No. 238, in clause 94, page 60, line 23, leave out from 'territory' to end of line 25.

No. 239, in clause 94, page 60, line 34, leave out from 'territory' to end of line 36.

No. 250, clause 94, page 60, line 45, after 'territory', insert 'at the time it occurred'.

No. 240, in clause 94, page 60, line 45, leave out from 'territory' to end of line 2 in page 61.

4.15 pm

Mr. Grieve: There are two issues. I have already satisfied myself that my amendment on one of them is a bad point, for which I apologise in advance, but at least I will get an answer from the Minister and her advisers rather than my own research on the matter.

I preface my remarks by saying that I am delighted that the Government have addressed what might have been a real howler in the Proceeds of Crime Act 2002. It was explained to me a little time ago when I attended a seminar on the subject conducted by a colleague at the chancery Bar, who sent me some very useful information on the subject. A potential consequence of the way in which the Act had been drafted was that if one carried out in a foreign country an act that was perfectly legal there but that was illegal in England and Wales and from which one made a profit, one would fall within the relevant definition and could be accused of laundering money.

For example, someone importing into Scotland and making a profit from bourbon whisky that had not been made in compliance with the various pieces of whisky legislation in Scotland, would, as I understand the Proceeds of Crime Act, fall into the category of being a money launderer and making a profit that could be seized. Clearly, that was not what Parliament intended.

I therefore welcome clause 94, which, as I understand it, is there to make it crystal clear that someone who carries out an activity that may be relevant criminal conduct in the United Kingdom but is not relevant conduct in the country in which it was carried out cannot fall into the category of money laundering. However, I was concerned that after the words

    ''is not unlawful under the criminal law of that country or territory'',

the clause did not contain the words in my amendment,

    ''at the time it occurred''.

That is because the time at which the matter is being considered in the UK may well be different from the time at which the property was acquired in the foreign country or the profit made.

I am reassured by the fact that there appear to be dicta in the Pinochet case that one should consider the act at the time at which it occurred. Perhaps the
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Minister will confirm that. I might therefore be worrying about nothing, but I did wonder whether, despite the Pinochet case, my amendment might not clarify what could otherwise lead to a misunderstanding. It must surely be right that if the conduct was lawful at the time at which it occurred, even if it has subsequently been made unlawful in the foreign country, it should not place the person in the category of criminal conduct in the UK. That is the point that I am trying to make in a series of amendments. I do not need to run through them as I have gone through the entire clause and amended it in one place after another. The lead amendment defines the remaining ones.

The second amendment probes the fact that it appears that provision will still be made under the clause for certain offences or activities prescribed by an order made by the Secretary of State to remain criminal conduct. Assets can therefore still be seized in the UK even if the conduct took place abroad at a time when it was not a criminal offence there. There may be good reasons for the subsection. One can think of some of them quite quickly. One example, I suppose, is slavery. There may be no countries in the world where slavery is legal, although, unfortunately, slavery certainly exists in a number of countries and appears to be semi-legal and approved of by the Government there. However, if we were discussing the laundering or acquisition of money derived from slavery, it even if it were lawful in the country where it took place, there would be good grounds for the Secretary of State to prescribe that the profits and assets derived from it should be seized in this country.

However, it would be useful to hear from the Minister whether she has a list and how she envisages such matters being dealt with. Clearly, we do not want to close one door only for the Home Secretary to publish an enormous list putting all the offences back in again, although I am sure that he would not do that. I would be very grateful if the Minister dealt with that point, too. That, in fact, ends my remarks on all the amendments, which relate to the two specific points that go through the entire clause.

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