Clause 98
Money laundering: miscellaneous amendments
Question proposed, That the clause stand part of the Bill.
The Chairman: With this it will be convenient to consider new clause 24—Tipping off—
'(1) In the Proceeds of Crime Act 2002, section 333 is amended as follows.
(2) In subsection (1)(a) after ''has been made'', insert ''or knows that such a disclosure is going to be made''.'.
Mr. Grieve: Clause 98 provides for an offence of tipping off, but does not provide for circumstances in which tipping off takes place immediately prior to the disclosure being made. The intention of the new clause is to beef up the provisions and to make it an offence to tip off, not only where a disclosure has been made, but where the person knows that such a disclosure is going to be made. I would have been quite comfortable to reinforce the structure of the Proceeds of Crime Act 2002. Otherwise, the offence is a slightly different one from tipping off. Tipping off is either knowing or believing that a disclosure is going to be made. Here, one commits the offence only if one knew that a disclosure was about to happen. I should be interested to hear the Minister's response on that point and the comments that I thought she was about to make about clause 98.
Caroline Flint: At present, the tipping off offence is in respect of disclosures about money laundering that have already been made to NCIS. We have not had sufficient time to consider the new clause fully. I should like to get the views of NCIS and law enforcement on this matter. I would also want to ensure that the amendment would not tighten the tipping off offence in a way that was unacceptable. For example, a solicitor acting for a wife in divorce proceedings might feel professionally obliged to warn her that, as a result of what she told him about her husband's finances, he would need to make a disclosure and seek consent from NCIS under section 328 of the Proceeds of Crime Act 2002 if he continued to act for her. Such a warning might constitute tipping off under the new clause if, as a result of him telling the client, a subsequent criminal investigation is likely to be prejudiced. We need to consider the implications, and I would like to report back later, but the hon. Gentleman has raised issues that give us pause for thought.
Clause 98 is a tidying-up clause that addresses an anomaly identified by the legal and accountancy professions. Under the Proceeds of Crime Act 2002, a professional legal adviser advising a client is not obliged to disclose to NCIS information that they obtain from the client in privileged circumstances. The
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definition of privileged circumstances does not cover the case in which a professional adviser passes to his nominated officer information that he has received in privileged circumstances. Passing the information would constitute disclosure and trigger the nominated officer's duty to tell NCIS. That would put a professional adviser in a dilemma of whether not to disclose to NCIS and risk a breach of the reporting requirements, or to disclose and risk a breach of professional privilege or other confidence intended to be protected. Clause 98 amends the Act so that the nominated officer is not obliged to disclose to NCIS when the professional legal adviser seeks advise for him on whether the facts known to him give rise to the need for a disclosure.
With that explanation and with what I have said about the hon. Gentleman's new clause, I hope that he will not press it and that the Committee will approve the clause.
Mr. Grieve: On the latter point, I am grateful to the Minister for clarifying what the clause is intended to achieve. It is undoubtedly necessary and important, and I am grateful to the Government for considering the matter and accepting representations on it from various professions.
My new clause was probably taken with this clause stand part debate because it is the only place that it can be taken, but they do not marry together particularly well. I understand the Minister's point perfectly. It was not my intention to criminalise the solicitor in the circumstances that she described. I was concerned about a situation in which it is known in an office that an employee has decided to make a disclosure the following day about a client, but prior to the disclosure taking place, another person in the office tips off the client. That was the circumstance that interested me and that we could try to catch with my new clause if we so wanted. However, as always, there is a law of unintended consequences with the drafting of all legislation, and it may be that what I proposed is unworkable.
Question put and agreed to.
Clause 98 ordered to stand part of the Bill.
Clause 99
Money laundering offences
5 pm
Amendment made: No. 34, in clause 99, page 66, line 27, at end insert—
'( ) In section 398 (meaning of customer information: Scotland) in subsection (5)—
(a) after paragraph (a) insert—
''(aa) constitutes an offence specified in section 415(1A) of this Act,'';
(b) in paragraph (b) after ''paragraph (a)'' insert''or (aa)''.'.—[Caroline Flint.]
Clause 99, as amended, ordered to stand part of the Bill.
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Clause 100
International co-operation
Amendment made: No. 35, in clause 100, page 66, line 39, leave out
'In section 447(3) of the Proceeds of Crime Act 2002'
and insert—
'( ) Part 11 of the Proceeds of Crime Act 2002 (c. 29) (co-operation) is amended as follows.
( ) In section 444 (external requests and orders), for subsection (3)(a) (Order under the section may include provision about the functions of the Secretary of State, the Lord Advocate, the Scottish Ministers and the Director of the Assets Recovery Agency) substitute—
''(a) provision about the functions of any of the listed persons in relation to external requests and orders;''.
( ) In that section, after subsection (3) insert—
''(4) For the purposes of subsection (3)(a) ''the listed persons'' are—
(a) the Secretary of State;
(c) the Scottish Ministers;
(e) the Director of Public Prosecutions;
(f) the Director of Public Prosecutions for Northern Ireland;
(g) the Director of the Serious Fraud Office; and
(h) the Director of Revenue and Customs Prosecutions.''
( ) In section 447(3)'.—[Caroline Flint.]
Question proposed, That the clause, as amended, stand part of the Bill.
Paul Farrelly (Newcastle-under-Lyme) (Lab): Just before we leave part 2 and the Government amendment, I wanted to mention that one capability is omitted from part 2 that has played a vital role in dismantling organised crime syndicates around the world, not least the Mafia in the United States. It is the power to use wire-tap evidence in court. I do not want to detain the Committee, but I do not know whether legislation is needed for wire-tap evidence to be admissible in court. Could the Minister pay some serious attention to that and perhaps write to me?
Mr. Mitchell: If the hon. Gentleman looks carefully, he will find new clause 12. It is a permissive clause that seeks to do precisely what he suggests, but we have not yet reached that point in the Bill. If he can contain himself until Tuesday morning, he may have the opportunity to enter into a most interesting debate.
Paul Farrelly: I am grateful to the hon. Gentleman. I shall contain myself and will not ask the Minister to write to me on that matter at the moment.
Question put and agreed to.
Clause 100, as amended, ordered to stand part of the Bill.
Further consideration adjourned.—[Mr. Heppell.]
Adjourned accordingly at one minute past Five o'clock till Tuesday 18 January at ten minutes past Nine o'clock.
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