Examination of Witnesses (Questions 50-59)|
QC AND MR
14 MARCH 2003
Q50 Chairman: We are very much obliged
to you both for coming, and for the written papers which have
been put in by the Serious Fraud Office and by the Crown Prosecution
Service. Some of the questions we ask may well arise out of or
appear to duplicate the written material, and if there is nothing
to add to the written material, you can just say. This is only
the second day of our oral evidence, so we have not necessarily
yet reached any final conclusions on anything, and we shall be
very glad to have your advice. This room needs a certain amount
of volume if everyone is going to hear clearly. One of the things
that has been said to us by a number of written papers and also
yesterday in oral evidence is that corruption seems to be increasing
in central government, and perhaps even in government agencies
set up under the big changes that took place 10 or more years
ago. Do you see that happening? Is corruption worse than before?
Mr Wardle: My Lord Chairman, I
really could not say. One of the problems is that we have very
little information as to the level of corruption, either now or
previously. All I can say is that when we investigate suspected
offences of fraud, very often corruption is present in the course
of those investigations.
Q51 Chairman: It is curious that
the main corruption cases appear to come from the public service
rather than the private sector, and yet it is suggested that by
contracting out to the private sector the degree of corruption
has increased. There seems a certain illogicality there.
Mr Wardle: Yes, indeed, possibly
because it is easier to detect in the course of the public service.
I do not know.
Q52 Chairman: You would not say there
is a marked increase because of the recent changes?
Mr Wardle: I am not in a position
to say because I have nothing to compare it against.
Q53 Chairman: Sir David, would you
have a view on that?
Sir David Calvert-Smith: I think
I would agree with that. We are totally governed by what the police
choose to give us by way of investigation for us to decide whether
there is a prosecution. Unlike Robert, we do not direct investigations.
I do not think there has been any increase in the level of prosecutions
that we have undertaken over the last few years, but whether that
is simply because the iceberg is getting bigger and bigger under
the water, and the little tip that we deal with is remaining much
the same size, I do not know. I do know that, like Robert, most
of the corruption cases with which we dealcertainly those
that I have dealt with personally, as an advocate, over the yearshave
been attached to what is obviously a fraud, and it has often been
a toss-up as to whether you charge a conspiracy to defraud or
offences of corruption, or both. 
Q54 Chairman: In this sort of area
of large amounts of money, even medium amounts of money, is fraud
more prevalent than corruption, or do the two run together?
Sir David Calvert-Smith: I think
they both run together normally. You normally take a bribe, and
in taking a bribe, you are actually committing a fraud in any
event on your principal.
Mr Wardle: Absolutely. I would
agree with that. The purpose of most bribes is to ensure that
the fraud can take place. It facilitates; it oils the wheels.
Q55 Chairman: But in terms of the
social, criminal seriousness, would you rank fraud higher than
corruption, or money-laundering higher than corruption, or corruption
higher than similar crimes?
Mr Wardle: It must depend on the
nature and the severity of the particular offence. For example,
laundering money for terrorists is in a different league than
laundering money for, say, fraudsters, so I think you have to
look at the circumstances behind it.
Sir David Calvert-Smith: Going
back to the days before the sentence for corruption was increased
to seven years, there was an oddity. I can remember a number of
cases where both fraud and corruption were on the indictment covering
effectively the same behaviour, and the defendant who wished to
plead guilty to something had a real difficulty. Corruption sounded
worse and would probably have a more detrimental effect on his
future prospects. On the other hand, the maximum was only two
years in those days, whereas he was at large for a far greater
penalty if he pleaded guilty to fraud. So I think the moral obloquy
is corruption, which sounds worse, and sometimes the penalties
can be higher for fraud.
Q56 Chairman: Obviously there is
something to aim at in the sphere of corruption. What do you see
the new Bill, if adopted as drafted, doing to make it easier to
prosecute more successfully?
Mr Wardle: I think the advantage
is that it brings together both the public and private aspects
of corruption into one offence or series of offences. I think
the Bill will be understandable to juries, at least as far as
Clauses 1, 2, and 3 are concerned. There may be disadvantages
in the wording which explains the meaning of corruption and the
like, which I think juries may find quite difficult. Otherwise,
I think it is a helpful Bill overall.
Q57 Lord Waddington: Surely, one
could bring together private and public corruption without going
down the route which the draftsmen of this proposed Bill have
gone. Surely, there is a real danger of the sheer complications
of this form of legislation leading to fewer convictions rather
Sir David Calvert-Smith: I do
think that the clauses beyond 1-3 are extremely difficult to follow.
As a fan myself of a criminal code which the public can understand,
this Act seems to me to fall short of the clear, comprehensive
statement of the law that one would like. On the other hand, it
is an extremely complex area because as soon as you try to define
corruption in one sense, you find that you have included behaviour
which people find perfectly acceptable, and you then move to another
one and find you have excluded by mistake behaviour which people
find unacceptable. I have great sympathy with the draftsmen, but
it is very, very complex, and I do believe that unless the judges
are able, perhaps by model directions from the Judicial Studies
Board and the like, to sum these cases up in ways which are more
comprehensible than the legislation on its face is, there will
be real problems.
Q58 Dr Turner: Can you suggest ways
in which the drafting of this legislation could be improved to
make your job easier in terms of bringing successful prosecutions?
Sir David Calvert-Smith: I am
sure it would be easier for prosecutors were we to focus on the
passing of the bribe rather than on the agent/principal relationship.
It is easier, I would say, for ordinary folk to understand that
when the money changes hands, that is when the offence is committed,
rather than in the breach of trust between the agent and his or
her principal. So from a prosecutor's point of view, and thinking
back to my days as an advocate, I would find it easier to present
to a jury in those terms. On the other hand, it is perfectly clear,
both to those who commission the draftsmen and to the draftsmen,
that did not necessarily cover the full ambit of the offence that
they wished to cover, and that is simply a matter of policy and
not for me to comment on.
Q59 Chairman: What I am not sure
about is whether the relatively small number of prosecutions for
corruption is due to the inherent difficulties of establishing
corruption or whether it is due to defects in the drafting of
the present legislation. Are you deterred by the present legislation
Mr Wardle: No, I do not think
we are. I think the small number of prosecutions is because of
the relatively small number of detections of the offence because
it is a difficult offence to detect, and normally will only be
detected if there is some sort of investigation, say by the company
which has suffered at the hands of one of its employees when they
discover that he has been taking bribes, or, perhaps more frequently,
if the company were to go into liquidation and the receiver or
the liquidator is able to find out what has happened. One of the
other things about the small number of prosecutions for corruption
which is worth pointing out is that I think that if there are
easier offences to prove, perhaps more serious offences, surrounding
the fraud generally, then prosecutors, and indeed investigators,
will tend to go for those. I think it is worthwhile perhaps comparing
this Bill with the draft Bill published by the Law Commission
in its Commission Report 276 on the general offence of fraud.
For example, in clause 4 of that draft there is the proposed offence
of fraud by abuse of position, which in a lot of cases I think
might encompass the facts of corruption.
1 Note by witness: The supplementary memorandum
(DCB 29) prepared by the CPS/Visa Team sets out the figures for
police corruption and other public offences since early 1998 to
date. The tables referred to are not included as the information
they contain is sensitive. Back