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UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 1174-ii

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

NORTHERN IRELAND AFFAIRS COMMITTEE

 

 

CROSS BORDER CO-OPERATION

 

 

Wednesday 19 November 2008

MRS BETH SMITH, MR JOHN WHITING,

MR ANDREW LAWRENCE and MR KIERAN COLL

Evidence heard in Public Questions 50 - 110

 

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Oral Evidence

Taken before the Northern Ireland Affairs Committee

on Wednesday 19 November 2008

Members present

Sir Patrick Cormack, in the Chair

Mr David Anderson

Christopher Fraser

Mr Stephen Hepburn

Dr Alasdair McDonnell

Mrs Iris Robinson

David Simpson

________________

Memorandum submitted by HMRC

 

Examination of Witnesses

Witnesses: Mrs Beth Smith, Deputy Director, HMRC Criminal Investigation, Mr John Whiting, Assistant Director, HMRC Criminal Investigation, Mr Andrew Lawrence, Deputy Head, HMRC Criminal & Enforcement Policy, and Mr Kieran Coll, Senior Investigation Officer, HMRC Criminal Investigation, gave evidence.

Q50 Chairman: Could I welcome you this afternoon. It is very kind of you to come and give evidence at this inquiry that we are conducting into cross-border co-operation. Who is leading the team? Are you, Mrs Smith?

Mrs Smith: I am, yes.

Q51 Chairman: We can all read, of course, but if you would like to introduce your colleagues.

Mrs Smith: I am Beth Smith. I am a Deputy Director of Criminal Investigations in HMRC. I look after the region of Wales West and Northern Ireland. On my left is Andrew Lawrence, who is Deputy Head of Criminal Enforcement Policy for HMRC. On my right is John Whiting, who is my Assistant Director in charge of CI operations in Belfast, Northern Ireland. Kieran Coll is a Senior Investigation Officer in Belfast.

Q52 Chairman: Do you prefer that I address you as Miss Smith, Mrs Smith or Ms Smith?

Mrs Smith: Mrs Smith, or whatever.

Q53 Chairman: I always like to choose the terminology that you prefer. You are very welcome. As I said, we are conducting this inquiry into cross-border co-operation and you are a crucial part of this. Is there anything that you would like to say by way of opening submission before I begin the questioning?

Mrs Smith: We have got quite a good story to tell you. There is quite a lot of cross-border co-operation in the operations that we do and I think it has moved on considerably over the last couple of years, in particular with the Revenue Commissioners in the South and the Police Service in both the North and Ireland. That is really the story that we have.

Q54 Chairman: We do find that when we travel to Dublin and, indeed, to parts of Northern Ireland, particularly the border areas, there is a great degree of willingness to co-operate among the agencies and so on, and that is all very, very good, but we want to probe a little. One thing that came up in the Northern Ireland Grand Committee's debate on organised crime yesterday was the reduction in your numbers of officers and whether this would have an effect upon your operational effectiveness. I am bound to say that on the face of it the figures look a bit worrying and we are, therefore, a little concerned. Could you put our minds at rest or are our concerns entirely justified?

Mrs Smith: I think it would be best if my colleague, Mr Lawrence, took that.

Q55 Chairman: Of course. Do farm the questions exactly as you choose.

Mr Lawrence: The position in Northern Ireland is that we have actually increased the number of Criminal Investigation staff. The Belfast team is larger, they are doing more work than they have ever done with cross-border organisations and organisations in the South, such as An Garda Siochana and the Criminal Assets Bureau. What we are doing as the whole department, of course, is reducing our headcount in line with the changes in the way we are doing our business, which is why we are reducing the number of HMRC staff overall, but that will not impact directly on the investigation of organised crime in Northern Ireland. Similarly, we are rationalising our estate. We are looking at buildings where we have very few staff and bringing staff from those buildings into other centres so that we are shedding buildings in Northern Ireland in order to save a bit of money, but that does not mean that we are reducing the number of staff there. As I said at the beginning, on the contrary, we are actually increasing our number of Criminal Investigation staff.

Q56 Chairman: Thank you very much for that. In the latest report from the Independent Monitoring Commission we have had the rather disturbing comment that Continuity IRA are targeting your staff, those who help the Police Service in Northern Ireland. Have there been any attempts?

Mrs Smith: My colleague, Mr Whiting, is probably best placed to deal with that one.

Mr Whiting: This threat was as a result of a very specific joint operation that took place with PSNI, HMRC uniformed officers in County Fermanagh and also the DVLNI. As a result of that co-operation there was a threat that was issued by Continuity IRA. There has not been an attack, I am happy to say, but we clearly work with our partner agencies in Northern Ireland and take these threats seriously and adjust our operations accordingly. I think it would be fair to say that my uniformed colleagues stood down their operations in that area for a short while but then resumed their activity thereafter and they are operating in that area now.

Q57 Chairman: This has not in any sense inhibited your ability to act?

Mr Whiting: In no way whatsoever.

Q58 Chairman: What are your main priorities when you come to identifying and combating cross-border criminal activity?

Mrs Smith: The regimes that we have overall responsibility for. HMRC has wide ranges of responsibility but obviously we take into account the localised effects in Northern Ireland, in particular the incidents of fuel fraud and excise smuggling.

Q59 Chairman: We shall certainly come back to that subject, but you would say that is very high on your list of priorities?

Mrs Smith: Certainly in respect of Northern Ireland, but we are a national organisation working to national priorities. As I said, we do take account of the localised effect in Northern Ireland when we are looking at the appropriate regimes that we deal with.

Q60 Chairman: Obviously our questions are all to do with Northern Ireland and in particular with cross-border co-operation. In this particular context, are there any differing priorities between you and your colleagues south of the border, or are the priorities agreed between you?

Mr Whiting: It is fair to say we do have different priorities north and south of the border. In terms of fuel fraud, clearly the loss of revenue, generally speaking, is to the UK Exchequer rather than the Irish Treasury. That said, it is fair to say our colleagues in the Revenue Commissioners and the Criminal Assets Bureau are very much signed up to assist us with achieving our objectives, but I would not imagine that fuel fraud would be their top priority. I know that they have significant operations in respect of cigarette smuggling, which is our joint top priority together with oils, but they also have other priorities in respect of VAT fraud which perhaps is lower on our list of priorities at present.

Q61 Chairman: This slight differing of priorities does not inhibit the co-operation between you in any way?

Mr Whiting: I would have to say I have not seen any reflection of that concern in the way we have operated on joint operations.

Q62 Chairman: Are you the lead man in this from the Northern Ireland side?

Mr Whiting: I am indeed, yes.

Q63 Chairman: The person with whom you most regularly liaise in the Republic, is he or she of the same professional level as you? How does that work?

Mr Whiting: That is right. Dave Godwin, who I think probably you have met in the past, is of equivalent rank in the Revenue Commissioners.

Q64 Chairman: And you have a good relationship?

Mr Whiting: I do indeed. I also have a good relationship with John O'Mahoney who is the Chief Superintendent with the Criminal Assets Bureau.

Q65 Dr McDonnell: Thank you very much for your answers so far. We are concerned about the changes that have taken place, the creation of a UK Border Agency and, indeed, the replacement of the Assets Recovery Agency with SOCA. Has that been helpful for you? Has it been disruptive? Is co-operation working well internally? Is the focus still there?

Mr Whiting: If I deal with them separately. In respect of the UK Border Agency, we have just concluded working out the numbers that will be involved in the de-merger, the number of staff that will move to the UK Border Agency and the number that will remain to deal with inland work. In other words, our response to fuel fraud is normally led by our road fuel teams, uniformed staff, supported by our other detection officers. These are uniformed staff that you might see at the airport, but you might also see them on the roads or visiting shops, et cetera, in respect of illicit cigarette products perhaps. We have recently agreed the numbers that will move to the UKBA and those who will remain with Revenue and Customs. There has been no decision made yet in terms of the Criminal Investigation side of the interdictions that we make. In other words, UKBA officers, nominal officers in that shadow force, are making interdictions in respect of cigarettes and drugs at our airports and ports. It is a team that is managed by myself that is currently adopting those cases for Criminal Investigation and reporting to the Public Prosecution Service. In fact, we have excellent co-operation between those two agencies. If I can move on to SOCA. SOCA is effectively in two parts in Belfast. We have the new operational part and we have what was previously the Assets Recovery Agency. I have to say that we have excellent relationships and I have personal relationships with the two leading officers on both those aspects of SOCA. We have not seen any diminution in the service that we are receiving from those teams.

Q66 Dr McDonnell: Is it always clear where the lead lies, where the responsibility lies, with one of them or with you in any particular case there is a multi-component taskforce?

Mr Whiting: With SOCA?

Q67 Dr McDonnell: Yes,

Mr Whiting: Yes, with SOCA in terms of their operational team, which is brand new, the team that has just been set up, we have a very good understanding with them. In fact, they are supporting us very strongly with operations. Even though we have had a substantial increase in numbers we are still stretched in our capability and, in fact, they are supporting us with those operations in developing our intelligence and evidence-gathering, collection. However, it is quite clear that we have tasked them to gather that evidence on behalf of HMRC and, as it stands at the moment, whenever those cases come to a conclusion in terms of arrests then the case will be investigated thereafter by HMRC. There was one instance recently when we had some BBC television coverage. In fact, the surveillance operation that supported that particular arrest operation was led by the Serious and Organised Crime Agency.

Q68 Dr McDonnell: Dare I ask you what is your assessment of co-operation and co-ordination within the various components of the team on the other side of the border? You said that the priorities may be different, and one can understand a subtle difference in priorities.

Mr Whiting: The first thing you should know is that I chair, for example, the Cross-Border Fuel Fraud Enforcement Group which has recently been set up under the auspices of the Organised Crime Taskforce. In that regard we are very clear, and we have representatives from PSNI, from SOCA, from the Criminal Assets Bureau and the Revenue Commissioners, about who has the lead in which part of the operation that we are conducting. We have adopted a joint investigation, but I am obviously reluctant to provide any detail about that because it is at the very early stages. We have regular meetings where we agree the objectives to be achieved by each agency. There is no friction in terms of what we are seeking to do, we are very much operating as a team. In terms of much wider objectives, let us say there was a particular operation that suddenly appeared on the doorstep where perhaps we were having to work with the PSNI, An Garda Siochana and perhaps wider, we would agree at the start which organisation has the lead in terms of the particular crimes that are under investigation. There have been investigations recently where we have sat down and said, "If certain events take place then it will be PSNI and An Garda Siochana will take the lead, but if those events don't take place then it will be an opportunity for HMRC and/or the Revenue Commissioners". It is based on the facts and the case as it develops.

Q69 Dr McDonnell: You are telling me the relationships are good, in other words?

Mr Whiting: Absolutely.

Q70 Dr McDonnell: One final question from me. Do you find differences in structure difficult to relate to? In other words, you may not have an equivalent in the South or an equivalent of your Deputy or whatever, they may be structured slightly differently.

Mr Whiting: In Revenue Commissioners they are pretty similar so we do not have a problem. There is possibly a little bit of a difference with the Criminal Assets Bureau, but we have no difficulty in ---

Q71 Dr McDonnell: But that is not a problem for you?

Mr Whiting: No.

Q72 Mr Anderson: The last discussion has reflected what we have heard for at least the last three years on this Committee, that thankfully there is very, very good co-operation across the border with virtually all the agencies, yet it is also three years since we first heard about the real issues of fuel laundering. Yesterday in the Grand Committee colleagues from Northern Ireland were saying as far as they can see there has been hardly any improvement in the situation regarding fuel, and in fact raised other issues about pollution as well as other issues which are becoming more and more noticeable. You set up the Fuel Fraud Enforcement Group in July, (a) can you tell us why that was seen as being necessary and (b) whether it produced any increases in results?

Mr Whiting: The driver was very much the murder of Paul Quinn and the political interest which showed that there was a connection between paramilitaries who were involved in fuel fraud in South Armagh and the perception, media, political and public, that PIRA were still operating and controlling fuel fraud in South Armagh. I would applaud Paul Goggins for his response because I think he said, "You are doing a good job but it would be fair to say you can do more and you can do it better". We saw that a collaborative approach, a multi-agency cross-border approach, could produce more results. Also, we have not done ourselves justice in telling the story of what we have achieved. The achievements of all the agencies in Northern Ireland and, indeed, the Republic of Ireland are much greater than the simple bare results achieved by HMRC and Customs & Excise before us. I suppose that was the driver for starting to do something. What have we achieved? We have had two meetings. We have set out an action plan which has short-term, medium-term and long-term objectives. We have already made some progress in respect of each of those objectives. If you would like me to put some meat on the bones I am happy to do that. For example, we have agreed a single target that we will work together against as our first testing ground to conduct a joint operation. We have already in mind additional targets, suspects, that we would like to work against together in the future. We have looked at our media strategy and I think those of you who live in Northern Ireland will probably have seen that we have been very much more proactive in telling the public what HMRC and our partner agencies have been involved in in terms of fuel fraud. Part of that is actually telling the story that there is a problem with laundered fuel, and this was where you started from. The fact of the matter is that HMRC introduced the Registered Deals in Controlled Oil Scheme some years ago and that has been very successful in Northern Ireland in squeezing the market in respect of red diesel.

Q73 Chairman: Would your task be made easier if fuel laundering were made a separate offence because the Government has been publicly toying with this idea for some time and the Committee was minded to think it was a good thing to do? What is your view?

Mr Lawrence: I will answer that question but, if I may, I would just like to come back on Mr Anderson's question. One of my specific roles is to look at the way that our strategic approaches to the investigation of organised crime work, how effective they are. Two or three years ago when Criminal Investigation in Belfast began to tell me that they had a problem with crime around oils, the problem was not that they did not know it was there or were not investigating it, the problem was that nationally it was not a particular priority for us. The step that I took to change that was to persuade the senior levels of Criminal Investigation that we should devote more resources and a greater priority to dealing with oils offences in Northern Ireland. The results we have seen more recently, for example the television coverage in the operation Mr Whiting mentioned and one we might mention to you in private a little later, show that we have put more effort into the investigation of oils offences and we are getting more results out of it. Turning to your question, Chairman, you are quite right that we have looked very long and hard at the idea of whether there should be a specific offence of oils laundering and we have been looking at that in the context of the legislation in the Republic which provides a model offence along those lines. We have two issues. The first is that we are not yet convinced that offence would actually give us better tools to attack oil offences than we currently have. We are getting results using the offences that are presently on the statute book. Secondly, our colleagues in the South tell us that they do not use their specific oil laundering offence. In the face of those two pieces of evidence, at the moment we are reluctant to take this forward. What we would end up with is an offence on the statute book which would not actually add anything effective to the armoury we already have. If that proves to be wrong and that would give us something extra over and above what we can attack at the moment then, of course, we will look at this again, but at the moment we are still looking at that and thinking probably not.

Chairman: I see. Thank you.

Q74 Mr Anderson: Mr Whiting mentioned that you do a good job and we need to see the evidence of that. We have got figures showing that convictions are in single figures. For 2006 there were six convictions, four in 2007 and none in 2005. I suppose you have improved slightly. In the discussion s yesterday in the Grand Committee people were saying that when vehicles are seized people go out and buy another one and they are back the same day. Either you cannot catch them or if you do catch them you are not dissuading them from taking it up again, so either it is not working because they are not going to jail or it is worth them carrying on doing it because they can make money without the risk. Is it seen as being a risk worth taking by these people? It must be.

Mrs Smith: I think it is fair to say that is the case, but added to our armoury in the kinds of things we can do there are Serious Crime Prevention Orders. Although you may not get a conviction you might be able to apply for that which will help to disrupt the crime. I am sure Mr Whiting can add a few things to that.

Mr Whiting: We have not got a lot of figures with us today, but we could send them to you.

Q75 Mr Anderson: It would help if you could give them to us.

Mr Whiting: I appreciate the figures will be right, I do not dispute them. I would like to say we have increased our activity in the recent past. It will take some time because some of our cases ---

Q76 Mr Hepburn: How many people have actually gone to prison?

Mr Whiting: None.

Q77 Mr Anderson: None since the new regime, but it is only three or four months old.

Mr Whiting: None for a long time, that is correct, and that is a different issue. We have increased our activity and if you deal with the number of people we have arrested in respect of fuel fraud, that number has increased dramatically.

Chairman: When you have got a crime that is so prevalent with so many people engaged in it, surely there is some value in a deterrent sentence?

Q78 Christopher Fraser: You said it is a different issue, why is it a different issue?

Mr Whiting: It is a different issue in the sense of answering the question. We have increased our activity. It is a different issue in the sense that none of those people we have dealt with since we increased our activity in the past 12 months will have come before the courts. For example, a case that has been concluded today commenced probably four years ago, and that is a cigarette smuggling case. It is taking a long time to get those cases through the courts.

Q79 Chairman: For this sort of person prison is a deterrent and many of these people regard it as part of the, as it were, interchange of normal daily life if they have to pay a fine because they think, "I'll pay a fine here, pay a fine there, it doesn't really matter". If you put those people inside for a year or two and will think rather differently. That is certainly the public perception. What worries me, and I think colleagues, is that there you and your colleagues are beavering away, doing hard work very conscientiously, we are not criticising you at all, and the people who are apprehended and are clearly guilty of these crimes - they are not victimless crimes, they are real crimes - appear to get away, if not scot-free at least without a deterrent sentence. We would like your reaction to that.

Mrs Smith: It is fair to say that is a concern. Obviously it is not within HMRC's power to get the sentence, it is in the power of the court.

Q80 Chairman: No, but you can have a view on it.

Mrs Smith: Yes.

Q81 Christopher Fraser: So what is the view?

Mrs Smith: It is obviously a slight worry that we do not get the sentences.

Mr Anderson: Slight worry!

Q82 Chairman: You do measure your words with great care.

Mr Lawrence: If I may, the position we find ourselves in is the position that you well understand, that we bring criminals before the courts ---

Q83 Chairman: Yes.

Mr Lawrence: --- and it is up the legal profession then to obtain a conviction and it is up to the judge to make the sentence. We are not going to express a view on the conduct of the legal profession or the conduct of the judges. Privately we might have a view of the likelihood of obtaining a conviction in front of a particular jury, but that would be a private view.

Christopher Fraser: Can you give us that view in private later?

Chairman: We will return to that in private.

Q84 Christopher Fraser: Exactly.

Mr Lawrence: We referred to the case today, the cigarette smuggling case, in which we had £730,000 worth of confiscation, but the principal here has been sentenced to three years' imprisonment suspended for four years.

Q85 Mr Hepburn: As an individual you can comment on a matter of fact. If you were a criminal, are you better off being captured in the North or the South?

Mr Lawrence: I have no familiarity with sentencing in the South.

Mr Whiting: I can only refer in respect of fuel fraud to a Primetime Investigates programme that was shown by RTE which alluded to the fact that similar sentences were being dished out in the Republic of Ireland.

Chairman: We will return to this in private session. We are all very exercised by this prevalent crime and it is a costly crime from the point of view of the Revenue, and you clearly understand that better than we do. We feel it would be desirable if those who commit these crimes were punished in a way that deterred others from emulating them, I think that would be the Committee's view.

Q86 Christopher Fraser: I do apologise for arriving late. There might a simple answer to this. Where it says "Seizures of illicit oils" in 2004-05 it was 1.78 million litres and has gone down to 840,000 litres. Why is that?

Mr Whiting: Sorry, I cannot answer that because it is not entirely part of my command.

Q87 Christopher Fraser: Okay. Fewer people are ---

Mr Whiting: I am not sure whether that relates to ---

Chairman: Whether it is a measure of success or failure, that is the point. It could be a measure of your outstanding success or it could be your failure to nab a few more people, could it not?

Q88 Christopher Fraser: Or you are spreading it over more years to keep the job going!

Mr Whiting: One of the things we are trying to do is focus on the major criminals who are involved in this particular crime.

Chairman: I think we will leave that one at this point because I want to ask you about that in private and I am certainly not going to do so in public. If I can bring in two new members of the Committee, although very experienced parliamentarians and members of the Assembly. Who would like to go first?

Christopher Fraser: Ladies first!

David Simpson: Of course, being the perfect gentleman, ladies first.

Chairman: The age of chivalry lives on!

Q89 Mrs Robinson: I concur with your view that you are a gentleman. Thank you, Sir Patrick. I think we have laboured on the fuel aspect, if I may go to other related issues in terms of fraud and how much cross-border crime is related to alcohol and tobacco fraud and how does this compare to fuel fraud.

Mr Whiting: We have very little work in respect of alcohol. However, I know there is one operation in particular just a few months ago where the Revenue Commissioners had conducted enquiries for over 12 months. I think it was an EU-wide fraud. They really had not had much success in finding out what was happening to the alcohol, but they did ask us to support a surveillance operation. We did that and in fact the alcohol arrived some 100 or 200 metres across the border and we made one arrest and conducted interviews, so we have supported the Revenue Commissioners with that particular fraud.

Q90 Chairman: What sort of alcohol? One of the things again that came out in our investigations into organised crime, referred to yesterday, was the fact that some of the alcohol, some of the fuel, and indeed a great deal of the tobacco is counterfeit, and therefore not only is it cheating the Revenue, it is excessively injurious to the health of the individual or the car engine as the case may be because of its counterfeit nature. The alcohol that you were just talking about was this real alcohol where they were just seeking to evade duty or was it counterfeit?

Mr Coll: It was actually genuine wine. It was a movement between a bonded warehouse in Germany and one in the Republic of Ireland but it did not reach the Republic, it was diverted and ended up in Northern Ireland.

Q91 Chairman: Green Nun perhaps!

Mr Whiting: Can I refer to tobacco. We do have significant tobacco fraud. As I said, it was our joint top priority with oils. We are working very closely with the Revenue Commissioners in respect of that. There is not a particular issue in respect of tobacco being smuggled from one jurisdiction to the other in terms of differences in duty rates between the Republic of Ireland and the UK, but I think it would be our observation that Irish criminals, and I include Northern Ireland in that, are significantly involved in UK cigarette fraud, which is assessed to be something like £3 billion per annum.

Q92 Chairman: What about the stuff that we were told earlier was coming in often from China via Poland and Lithuania and places, is this still a great problem?

Mr Whiting: The reality is that we have worked with the tobacco manufacturers to actually stifle the business of genuine cigarettes being exported and then being smuggled back into the UK. As a result of that success the criminals who are working with criminal gangs worldwide are now smuggling counterfeit cigarettes, yes.

Q93 Chairman: The phoney stuff?

Mr Whiting: Yes.

Q94 Mrs Robinson: Would you say then that it has internationalised very considerably?

Mr Whiting: Yes.

Q95 Mrs Robinson: That would lead me on very nicely to the next question I would like to pose and that is: do criminals see the border with the Republic an easy way to access the UK?

Mr Whiting: I would not put it in those terms because I think they probably see it as easy just to put it on a ferry from Dublin to Holyhead or to use Fishguard, so I do not think it is seen as easy in that respect. I think the border is used to frustrate law enforcement officers because we have to keep to our side and the Irish have to keep to their side, generally speaking, so that is why we are working together so that we can frustrate the criminals as they use the border to hide.

Q96 Chairman: When we had Sir Hugh and his colleagues in a couple of weeks ago one interesting aspect came out - the incompatibility of equipment - and indeed we were told that the Northern Ireland side, the PSNI, is going to supply some electronic devices free of charge to Gardaí Síochána so they can actually communicate directly with each other rather than having to go through a control room. Are there any other similar impediments within your field?

Mr Whiting: At the moment the radio systems are different but in fact the radio system that Sir Hugh alluded to is actually being rolled out.

Q97 Chairman: So this will apply to you as well?

Mr Whiting: It is coming out to us, it is going out to the Revenue Commissioners and the Ambulance Service; it is going out to all the services.

Q98 Chairman: Good.

Mr Whiting: What we will be able to do if we are conducting a joint operation with three or four of the agencies or two of the agencies is to set aside a discrete radio channel to conduct that operation.

Q99 Chairman: And this will be operational as from early next year?

Mr Whiting: Yes.

Chairman: That is good. Mr Simpson?

Q100 David Simpson: Thank you very much indeed for your answers today. The Chairman raised an issue at the very start in relation to his concerns about the reduction of manpower and, as you would know, with the whole restructuring of HMRC right across the whole of Northern Ireland, indeed the whole of the UK, that is causing major concern especially for the subject I want to deal with here, which is tax evasion, because I personally believe and a lot of politicians in Northern Ireland believe that certainly within Northern Ireland and the Republic there is a lot more that could be done in relation to tax evasion. The HMRC fiscal crime liaison officer based in Dublin has been given competent authority status. Could you elaborate on that a wee bit please, what it means?

Mr Lawrence: The FCLO in Dublin is a former Customs officer. He is the first of the FCLOs to be given the ability to exchange direct tax information with his opposite numbers in the Irish authorities. Financial crime liaison officers in other parts of the world do not currently have that ability. We are using the Dublin situation as a model to see how that would work. The FCLO in Dublin is able to talk to the Revenue Commissioners, he is able to talk to the Gardaí Síochána, he is able to talk to the Criminal Assets Bureau and any other agency he wishes about direct tax matters, tax evasion, as you put it, or Excise matters or Customs matters.

Q101 David Simpson: Is there an equivalent in the Irish government based in the UK?

Mr Lawrence: Not that I am aware.

Q102 David Simpson: Do you think it would be a good idea?

Mr Whiting: There is an equivalent to the fiscal crime liaison officer here but I think the person with the competent authority status is in Dublin.

Q103 Chairman: So it is not entirely reciprocal then?

Mr Whiting: No, but I am not sure that it has caused any difficulty yet. This is a very new initiative which in fact is the officer's own initiative, I think was how it started. There are some very interesting opportunities which are coming out of it and, for example, I think one of the things they are looking at is properties and assets which are owned in opposite jurisdictions, so individuals in the North who have property in the South, and they are looking at sharing that intelligence.

Q104 David Simpson: A final point, Chairman, when you have large operations and you have a lot of different agencies involved, how do they operate? What are the biggest obstacles that you see in relation to that when you are carrying out a large operation? What are the biggest obstacles that your enquiries would face?

Mr Whiting: Part of this is manpower very often. Whilst we have increased the numbers we still have a finite number of resources. That said, Beth manages a large region and so for example for the past two months I have been importing resources from my colleagues who are based in Cardiff, Birmingham, Bristol and Manchester to get support. When we have a very large operation we import large numbers, but I have also got to go cap-in-hand to our partner agencies, and clearly if it is a solely Revenue matter then of course all they are doing very often is simply supporting us, for example PSNI in terms of public order, so there is no common interest.

Q105 David Simpson: The bottom line in this is that you do not have enough staff?

Mrs Smith: I think it is fair to say that there are enough staff to deal with on-going operations but obviously when we carry out a search operation or whatever then that is quite labour-intensive so we utilise our national resource or regional resource as appropriate.

Q106 Chairman: I will bring in Mr Fraser in a second but let me just ask you a question that follows on in a sense. Is it easier to hide things in one part of the island of Ireland rather than another? Is it easy to transfer your ill-gotten gains and keep them ill-gotten in the South or in the North?

Mr Coll: I do not think that is the case.

Q107 Chairman: Good, I am delighted that is the answer but I just wanted to know.

Mr Whiting: The Republic of Ireland has the Criminal Assets Bureau who are very tenacious in their own jurisdiction. They are the former Assets Recovery Agency, who were equally tenacious and would go after the property identified.

Q108 Chairman: And has the demise of the Assets Recovery Agency as an independent agency affected that in any way?

Mr Whiting: Not at all. We have also set up throughout the country a Criminal Taxes Unit which again is pretty tenacious with good-quality work on hand.

Chairman: I am not seeking to trip you up. We need to know these things and ask you these questions. I am going to bring in Mr Fraser and then after his questions we will go into private session.

Q109 Christopher Fraser: You have talked about this multi-agency approach and you obviously all sit round the table and talk together on occasions. Can you give me some examples of some of the benefits of that and what problems have been identified and how you then dealt with them?

Mrs Smith: From a strategic point of view it is helpful when people get together and talk because it then becomes much easier to know who to go to if you have got a problem, so from that point of view it is very useful.

Q110 Christopher Fraser: We might pursue that.

Mr Whiting: It was not one of the cases I intended to speak about in private but I can give you a good example.

Chairman: Let us talk about it in private because I think we would like to be able to inform our own discussions when we are formally making our report with a little more detail. We appreciate some of these things are very sensitive so I will call the public session to an end, which means that you can then talk to us entirely in private.