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Lord Donaldson of Lymington: May I ask a question to which I am sure I should know the answer? I hope that there is a forgiveness for those who have not been able to wade through all of this enormous Bill. The question arises from my experience of administering Mareva injunctions. One has situations in which an applicant turns up and says, "The whole of the wealth of this individual has in fact been pinched from me". I even had one case in which the alleged villain had certainly taken some although it was not clear how much. However, that is beside the point. In such circumstances, it was—and, I am sure, still is—the approach of the courts to say, "Until we have decided to whom this property belongs, we must allow the alleged thief"—or whatever—"to use it for his ordinary living expenses, and in particular to pay lawyers to assist in establishing whether it is his property".
There seem to be strong analogies here. I can well understand it being said that, if a creditor gives credit, he takes the risk that he may not be paid either because
the property does not belong to him or because it has been taken by the state. That I can understand. However, what happens meanwhile to the alleged villain? What does he live on? Is he able to take legal advice and pay for it? There may well be answers to these questions, and perhaps I should have discovered them. However, listening to the discussion, I was as I said forcibly reminded of the problems that arise in the nature of Mareva injunctions.6.15 p.m.
Lord Rooker: I received advice on one of the points raised by the noble and learned Lord, Lord Donaldson of Lymington, in earlier discussions and earlier briefs on the Bill. He asked how a person can pay his lawyers if all his assets have been wiped out by means of confiscation. As was said earlier, however, the legal aid system is intended to deal with such cases. We can see the possibility, particularly in relation to the payment of lawyers' fees, of people running up enormous legal bills and running down the assets which we wanted to confiscate. We therefore believe that people in that position will have to turn to legal aid.
The restraint order contains exceptions for living expenses. Of course we expect that people should be able to maintain themselves while the process is continuing. Legal expenses, however, are not part of living expenses. To that extent, therefore, I am perhaps setting right an earlier comment. The restraint order does not address the issue of legal expenses, essentially because the legal aid system is available. Nevertheless, the order may allow for living expenses so that the person concerned is not destitute while undergoing a process that is horrendous for anyone, criminal or not. I accept that.
I hope that that answers the question. If it does not, I have no doubt that noble and learned Lord, Lord Donaldson, will come back to me.
Lord Donaldson of Lymington: The noble Lord has answered it in substance. I am not appearing here on behalf of the legal profession. As far as Mareva injunctions are concerned, however, we did not say to the person subject to an injunction, "All right, transfer all your funds to the nearest solicitor, and the best of British luck to you". We imposed limits, where it was thought necessary, on the amount that could be devoted to the welfare of the legal profession.
Baroness Buscombe: I support the comments of the noble and learned Lord, Lord Donaldson. We discussed the point earlier in Committee, and we on these Benches quite strongly made the point that there should be an allowance for reasonable legal expenses. This may be an issue to which we shall return on Report.
Lord Thomas of Gresford: What appears to be behind the Bill is not simply deterring crime or removing the proceeds of crime but getting money into the coffers of the state. The Government are proposing a form of taxation of crime. Why should the state, as
opposed to bona fide creditors, have the money? That is the point. I do not think that an answer has yet come forward.
Lord Carlisle of Bucklow: Having taken no part in the Bill's passage since Second Reading, when I did speak, I have listened with interest to the Minister's comments today. On every matter, he seems to have taken the attitude that he will attempt where possible to meet any bona fide criticism. In this case, as I understand it, he accepts that innocent creditors will, as has just been said, often lose out to the state. Surely the Minister should at least be willing to look again and see if there is not some way in which that position can be met.
Baroness Buscombe: I thank the Minister for his reply. I particularly thank the noble Lord, Lord Thomas of Gresford, for his support for these amendments. I also thank my noble friend Lord Carlisle of Bucklow. This is an important point which we have covered in principle on earlier occasions. However, like the noble Lord, Lord Thomas of Gresford, I cannot understand where the Government are coming from in terms of priorities. Are we talking about supporting the criminal justice system or about funding the state? I am concerned about some statements by the Minister to the effect of, if these amendments are accepted, we shall not be able to obtain any of the proceeds of crime. It seems that in the Government's understandable effort to do all they can to ensure that these criminals are brought to book and do not benefit from crime, innocent individuals could, as I said, become quite involuntarily caught up in the process. Innocent individuals could be penalised, and surely that cannot be right.
I understand the difficulty: criminals will be tempted to find ways of manipulating the system. However, that will always be the case. Surely in principle that is not a good and acceptable reason for penalising innocent individuals such as traders or creditors. This is something that I should very much like the Government to think about again. If we do not see some support on the matter, we shall return to it on Report. However, for the moment I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 272 to 274 not moved.]
Clauses 412 and 413 agreed to.
Clause 414 [Modifications of the 1985 Act]:
[Amendments Nos. 275 to 278 not moved.]
Clauses 415 and 416 agreed to.
Clause 417 [Modifications of the 1989 Order]:
[Amendments Nos. 279 to 282 not moved.]
Clauses 418 and 419 agreed to.
Clause 420 [Winding up under the 1986 Act]:
[Amendments Nos. 283 to 285 not moved.]
Clause 422 [Winding up under the 1989 Order]:
[Amendments Nos. 286 to 288 not moved.]
Clause 424 [Floating charges]:
[Amendments Nos. 289 and 290 not moved.]
Clause 432 [Disclosure of information by Director]:
[Amendments Nos. 291 and 292 not moved.]
[Amendments Nos. 292ZA and 292ZB not moved.]
Lord Bassam of Brighton moved Amendment No. 292A:
- After Clause 442, insert the following new clause—
The noble Lord said: Amendment No. 292A would allow a member of staff of the agency to identify himself or herself by means of a pseudonym whenever it would otherwise be necessary or expedient to provide his name, including when exercising powers under Part 8 of the Bill. Amendment No. 292AA relates to Scotland and provides similar protection for persons carrying out civil recovery investigations on behalf of Scottish Ministers. I believe that these amendments speak for themselves. I beg to move.
Lord Brooke of Sutton Mandeville: The noble Lord may recall that his noble friend Lord Rooker gave an assurance in response to a new clause that I moved in the early stages of Committee on this subject. He said that the Government would bring forward their own
Part 12, which is devoted to miscellaneous and general matters, seems entirely suited to the two new clauses; pseudonyms being miscellaneous and the director who authorises them being general. I regret that the one query that I have is inappropriate and I shall entirely understand if I am given a general response. However, I have a particular personal reason for raising the query which is borne of experience.
Are the pseudonyms which the director may authorise, either generally or specifically, to be permanent or temporary? In other words, will there be a different pseudonym for particular operations or will the person have a pseudonym with which he lives on a continuing basis? I have a personal reason for asking that question. Those of us who have had experience of being protected from terrorists are given passwords which we have to remember in order to establish our correct identity. If those passwords are used only occasionally, they are astonishingly difficult to remember. Therefore, I am interested to know whether the relevant password will be temporary or permanent. I shall quite understand if that constitutes a state secret which I should not be told.
"AGENCY STAFF: PSEUDONYMS
(1) This section applies to a member of the staff of the Agency if—
(a) he is authorised (generally or specifically) by the Director to do anything for the purposes of this Act, and
(b) it is necessary or expedient for the purpose of doing the thing for the member of the staff of the Agency to identify himself by name.
(2) The Director may direct that such a member of the staff of the Agency may for that purpose identify himself by means of a pseudonym.
(3) For the purposes of any proceedings or application under this Act a certificate signed by the Director which sufficiently identifies the member of the staff of the Agency by reference to the pseudonym is conclusive evidence that that member of the staff of the Agency is authorised to use the pseudonym.
(4) In any proceedings or application under this Act a member of the staff of the Agency in respect of whom a direction under this section is in force must not be asked (and if asked is not required to answer) any question which is likely to reveal his true identity.
(5) Section 1(5) does not apply to anything done by the Director under this section."
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