Examination of Witnesses (Question 420-439)
MR KEVIN
FRANKLIN, MR
MARK FUCHTER,
MR DAVID
GREEN QC, MR
DAVID RICHARDSON
AND MS
HELEN WOLKIND
25 MAY 2006
Q420 Chairman: That is part of your
department?
Mr Fuchter: Yes. We are made aware
of end-users of concern and our profiling system, of those 60
profiles of screening export consignments I mentioned earlier,
they include profiles on suspect end-users—
Q421 Chairman: Is that information
from intelligence sources?
Mr Fuchter: I think, ultimately,
it will have originally derived from intelligence sources, yes.
Q422 Chairman: So they flag up potentially
dodgy end-users?
Mr Fuchter: Yes, and there is
clear line of sight between intelligence and the front line regulatory
check that takes place. However, in terms of are we testing at
the time of export—to go back to the more regulatory environment—that
the stated end use, if it does not hit one of our profiles, are
we testing whether or not the goods, ultimately, are going there,
we are not doing that. So I think whoever in the system is doing
that bit of it, we are not.
Q423 Chairman: I purchase a television
licence to use a television and the powers of the state are used
to deploy vehicles up and down my street and throughout the length
and breadth of the land to check that there is not somebody there
actually doing something illegal in relation to watching TV without
a licence. The decision on granting a licence is a key decision
in the export control business, but do you appreciate the concern
that some may have that there has got to be very, very serious
follow-up and policing, regulation—whatever the term is
being used?
Mr Fuchter: We certainly do appreciate
that concern. I am aware of cases where we have been challenged
over our role in terms of end-users, where export consignments
have ended up being transhipped from the declared end-user to
another state, where they have been used in conflicts, but if
everything is in order and lawful—if all the processes in
place are legal—then we can take no enforcement action but
what we can do, of course, is feed back in the intelligence, although
I think in the cases of which I am aware intelligence agencies
would be perfectly well aware.
Q424 Sir John Stanley: Just one last
request for a written note: in relation to what you have told
the Committee about the ongoing investigation approaching a possible
prosecution, in relation to a weapon or components of a weapon
of mass destruction in relation to something happening extra-territorially,
could you give us a note as to under what section or sections
of which Acts that investigation is being carried out, please?
Mr Richardson: It is Section 47
of the Anti-Terrorism, Crime and Security Act 2001.
Sir John Stanley: Thank you very much.
Q425 Chairman: Can I ask about warning
letters? In his evidence to the Committee Mark Thomas said that
Global Armour, a South African company, offered electro shock
weapons in their company brochure at the last DSEI exhibition
in London, and that Imperial Armour, another South African company,
offered to provide stun weapons and set about negotiating a deal
from the fair. It is understood that the evidence of those alleged
breaches in the law were passed to Revenue and Customs Prosecution
Office and that warning letters were issued to the companies.
I understand, Mr Green, under the duty of confidentiality, Section
14 and so on and so forth, the constraints that operate on what
you can say. Would I be right in saying you cannot comment on
those individual cases?
Mr Green: I cannot, I am afraid,
on any case currently being considered—
Q426 Chairman: If the Attorney General
were to ask you, of course, you would answer to him. Fine. What
are the circumstances under which warning letters would be issued?
Would a situation such as this: somebody comes to an arms fair
in Docklands and starts advertising instruments of torture in
their brochures, which is clearly not what we want—would
that be the kind of thing that you might send a warning letter
for?
Mr Green: It is really a matter
for HMRC.
Mr Fuchter: In essence, yes. If
a case is not going to go to prosecution or any other sort of
enforcement action, in fairness warning letters can be part of
(they are obviously at the lower end) enforcement action. It is
a form of closure, if you like; it means that they get to understand
that we have finished looking at something, but the benefit for
us is that we have made it very clear to them that we think—and
we have to express it in careful terms—that their behaviour
may have breached relevant legislation, etc, etc (we make that
very, very clear) and that by doing so they may have rendered
themselves liable to prosecution, but that reviewing the whole
circumstances we have decided to take no further action. In the
sort of cases to which you refer, where there were brochures,
if there were brochures at an exhibition, it would be our policy,
in every one of those cases, for there to be at least that form
of closure. If a company was showing brochures or video clips
or interactive boards, or whatever, at an arms exhibition involving
sensitive goods, then the matter would not be left high and dry.
Q427 Chairman: How many such letters
were issued within the last 12 months?
Mr Fuchter: We are issuing about
50 a year, for not just the internet-type or brochure-type scenario
but, generally, where we wish to conclude an inquiry by means
of a warning letter. It is round about one a week.
Q428 Chairman: Has any company allegedly
re-offended after they have had a warning letter?
Mr Fuchter: We are not aware of
any in the last three years.
Q429 Chairman: When it has happened
in the past, has a prosecution taken place?
Mr Fuchter: Our principle would
be yes, because that provides you with guilty knowledge. We would
look for Section 68(2) because the primary point is they are in
a difficult position to say they did not understand the regulations.
Q430 Chairman: You are familiar with
the information we have received about arms fairs; we have read
about it in the newspapers and it has been on television, and
we have had evidence from Mark Thomas and other journalists, always
ringing me about dodgy things going on. What does HM Revenue and
Customs do to try to detect this kind of activity on our doorstep
and to take appropriate action?
Mr Fuchter: First of all, we put
a lot of effort into the prior planning, working with DTI colleagues
and others and, principally, with the organisers—in the
case of DSEi, but also with Farnborough the year before (certainly
I think those are the two major ones that have taken place since
the new controls have been place)—to make sure the organisers
have the right material and dispatched it to the exhibitors that
made abundantly clear what the obligations were on those exhibitors.
That took place before DSEi and, obviously, it is very disappointing
to then read the allegations which have emerged. The next stage
of our activity is to put a lot of control effort in by means
of our local control staff, but I have to say our priorities were,
firstly, those real weapons themselves—the genuine firearms
under the Firearms Act that were on display. That was our top
priority—making sure the temporary importation of those
was controlled in accordance with the exhibitors' obligations
(we put a lot of effort in on that) and, secondly, any exhibitor
dealing with missile components. I have to say I think we have
learned a lesson from this that the brochures and the other interactive-type
materials and screens were not amongst those top two priorities,
and I think we have accepted we need to sit down ourselves, also
with the DTI, in the event of any future exhibition and see what
lessons we have learned and see if we can take a different approach.
Q431 Chairman: Did your department
spot any brochures that were advertising arms that should not
have been included in those brochures? For example, weapons of
torture.
Mr Fuchter: No, is the answer.
Q432 Chairman: So your staff went
looking around and could not find any?
Mr Fuchter: We did do some work,
as you say, incognito, in terms of just walking round and examining,
but it was very selective. I think it was Mr Thomas who picked
up those things before we did.
Q433 Chairman: From the TV programme
I saw Mr Thomas was certainly not incognito; it was perfectly
clear who he was and there must have been TV cameras and things.
How was it that he was able to find things that your staff were
not able to find?
Mr Fuchter: As I say, I do not
have the detailed sort of incident report but I do know that our
main priority was the real firearms themselves, and ask the Committee
to bear in mind that when there are the sort of weapons that appeared
there they are, perhaps, a more clear and immediate threat should
any of those be diverted—
Q434 Chairman: A final question on
this, you will pleased to hear: I understand the efforts that
you say are made to advise arms dealers who are advertising at
arms fairs that they should operate within the law, and this requires
certain things. Do they submit brochures for inspection by the
organisers of the arms fair?
Mr Fuchter: I do not know the
answer to that but that is an excellent point that we could take
away. I suspect we did look at some material—I do not know
the detail. I know a lot of effort went into marshalling materials
that was dispatched, as I say, to make sure they understood their
obligations. Was the sort of reverse side of that done? I do not
know the answer but I think it is something well worth pursuing.
Q435 Chairman: It does seem a bit
obvious, does it not? In terms of labour time it is a lot quicker
than having to go walking round all the stalls and spot the dodgy
brochures; you simply require people—and they can afford
it; these companies are not badly off—to submit to the organisers
of the fair the brochures, and then somebody quickly flips through
to see if they are advertising anything that should not be advertised
in the UK.
Mr Fuchter: It may have been done.
I do not know that it was done. If it was not we would pursue
it.
Q436 Chairman: Would you be able
to write to the Committee and inform us whether that was, in fact,
done? Certainly, if it was not done, if you would consider—the
Committee has yet to produce a report—as you say, it would
not be a bad idea, would it?
Mr Fuchter: Very much so.
Chairman: I think my colleagues might
even find that a unanimous view of the Committee. Thank you for
that.
Q437 Mike Gapes: In your memorandum
to us, paragraphs 63/64, you talk about the training of your staff
and you talk about a programme of seminars. How much training
do your staff get in terms of detection and the understanding
of things like dual use and weapons of mass destruction—specific
training on issues of that kind? How much do you give?
Mr Fuchter: They get more training
in this area than they do on some of our other prohibition and
restriction regimes, I have to say, and it is by virtue of these
seminars. The programme runs at around about four a year, and
the intention is to cover the UK every two years or so, and we
do that by—
Q438 Mike Gapes: I am sorry. Four
seminars? How many people are on each seminar?
Mr Fuchter: I do not have those
numbers but we do ask officers, if we hold a seminar in Manchester
for example, to travel so that we are covering in terms of spread.
Q439 Mike Gapes: Can you tell us,
perhaps in writing, how many people actually attend and take part
in the seminars each year, so that we have a sense of the amount
of training that is going on in terms of keeping people up-to-date
with legislation, technology and other issues?
Mr Fuchter: Yes, we can.
Mike Gapes: Thank you.
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