Economic Crime (Transparency and Enforcement) Bill

Debate between Lord Thomas of Cwmgiedd and Viscount Waverley

Committee stage
Monday 14th March 2022 Lords Chamber

[Viscount Waverley (CB)]

My Lords, given the hour, I will be concise and crack on in support of the need for sufficient human and financial resources being made available, given the global implications.

Despite high-level government commitments on fighting economic crime, the Government have hitherto failed to invest sufficient resources to ensure that enforcement is effective. Reinforcing the case is paramount. We should double key law enforcement annual budgets from £852 million to £1.7 billion. A £2.7 billion increase in funding for national and local agencies to tackle serious and organised crime and to improve the system’s capabilities across digital, forensics, covert surveillance and financial investigations, to match the increasing technological sophistication of the serious and organised crime groups operating in the UK, is necessary, with budgets to invest in structures, skills, capabilities and technologies across the system.

We should double the budget for sanctions enforcement. In the past three years, the NCA has conducted only three criminal investigations into sanctions breaches, with no resulting prosecutions. It has just 40 employees.

We should create a central economic crime-fighting fund out of the money generated by law enforcement’s economic crime activity. If the proceeds had been reinvested into the agencies, on top of their core budgets, overall enforcement spending could have been provisionally increased by an additional £748 million a year—an increase of approximately 93% on current funding levels. This would allow investment in state-of-the-art IT infrastructure and data analysis capabilities. This central fund would replace the system for redistributing the proceeds of asset recovery—the asset recovery incentivisation scheme—which is broken.

Working with the judiciary to ensure better judicial management of cases to strike out abusive litigation tactics is key, in addition to working with industry to develop an enforceable model litigant code for lawyers, to prevent the use of stalling and spurious tactics that waste court time and drain public resources, and allowing law enforcement bodies to raise salaries within their budgets, so that they can be more competitive in the salaries they provide to attract the best and brightest.

I will bring my remarks to a close. We must allow law enforcement to spend more on legal fees to get the best legal advice; prosecuting and investigating bodies cannot compete. We need specialist economic crime judges; enforcement bodies face a UK court system with few judges specialised in economic crime or confiscation. Finally, we must raise Companies House fees to £100. Current fees of just £12 for an incorporated company are too low, allowing considerable abuse of the system. Companies House needs to become a key digital data hub to help law enforcement and provide a service for the whole of the UK about suspicious corporate behaviour, rather than its current state as a passive receiver of false or inaccurate information.

[Lord Thomas of Cwmgiedd (CB)]

My Lords, I rise briefly to support the amendment from the noble Lord, Lord Agnew. Over the years, one has seen concentrations move as to what parts of the criminal justice or investigation system matter. It is important to appreciate that this will be expensive, but we must have a system that, as regards the resources we give to justice, is open and transparent. There is no way this can be done without a proper annual report. Too often have I heard, “Oh, we can have an efficiency here or an efficiency there; we’ll do a little bit less of that or find incentives somewhere else”. No, that is not good enough for the task that faces us, and our nation, in ensuring the reputation of the City of London. I therefore warmly support the view that we should have a proper economic and financial analysis of the tools needed.