Serious Crime Bill [HL]

Baroness Williams of Trafford Excerpts

Wednesday 2nd July 2014 Lords Chamber

[Baroness Williams of Trafford (Con)]

My Lords, Clause 5 includes provisions designed to minimise delays in the confiscation process. This is achieved by amending Section 11 of POCA to make it crystal clear that the full amount that is ordered to be paid by the court must be paid on the day on which the order is made, unless the court is satisfied that the defendant is unable to do so, for example, because they need time to realise their property.

The maximum additional time allowed for a defendant to pay their confiscation orders has been reduced from 12 months to six. There will also be a further restriction on the length of an extension of the time to pay limiting it to more than is necessary, for example, to realise funds from a specific asset.

My noble friend has indicated that this amendment is designed to tease out whether the defendant has a right to make representations to the court about the time for payment. She has rightly pointed out the fact that the proposed new Section 11(8) expressly confers on the prosecutor the right to make representations, but no such express right is conferred on the defendant.

I can assure my noble friend that the defendant will indeed be able to make representations to the court. However, in view of the way in which the process will operate, it is not necessary to provide for this in the legislation. As I have explained, the default position is that a confiscation order will be payable on the day that it is made. This is the current position. We do not believe that it is impractical. Certainly, for lower value orders, there is no reason why the defendant cannot visit the fines officer and discharge the confiscation order before leaving the court.

The court will not be expected to allow additional time for payment on its own motion. In practice, the court will only be in the position to consider making an order under proposed new Section 11(2) of POCA to extend the time given to the defendant to pay their order if the defendant has made representations to the effect that they need more time to pay their order or part of it. This will be done as part of the confiscation hearing.

Similarly, under proposed new Section 11(4) of POCA, it will be for the defendant to make an application to the court to extend the period allowed for payment. It is implicit in making such an application that the defendant will set out his or her arguments for being afforded more time to pay the confiscation order. New Section 11(8) is intended to ensure that the prosecutor has the right to respond to the case made by the defendant. Having heard the explanation, I trust that my noble friend will agree that the amendment is unnecessary.

[Baroness Hamwee]

My Lords, the noble Baroness will know that I was concerned about the very tight provisions of new Section 11. She has explained that the defendant will have an opportunity to make representations at the time. That is reassuring, because it is almost never possible to realise an asset on the day that an order is made and it is often not even possible to transfer money immediately. What she has said about the processes is helpful and I am grateful to her for her explanation of proposed new Section 11(8). I beg leave to withdraw the amendment.

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[Baroness Hamwee]

My Lords, this is a short point because it is just a short question. Amendment 5 is to Clause 8 and Amendment 26 is to Clause 28—the equivalent Northern Ireland provision. Amendment 5 seeks to leave out new Section 25A(2)(a) of POCA, which allows the court to discharge an order in the case of a deceased defendant where,

“it is not possible to recover anything from the estate”.

My question is: is this not covered by new Section 25A(2)(b), which says that a discharge could be made where it is not,

“reasonable to make any attempt … to recover anything”?

It seems to me that if it is not possible to make an attempt, it certainly would not be reasonable. That is my question. I beg to move.

[Baroness Williams of Trafford]

My Lords, Clause 8 deals with the discharge of certain unpaid confiscation orders and applications to vary unpaid orders down in value. Despite the best efforts of law enforcement agencies, some confiscation orders are uncollectable and sit on the books of Her Majesty’s Courts and Tribunals Service, accruing interest at 8% a year.

Clause 8 provides that the court will be able to write off unpaid confiscation orders where the defendant has died and it is not possible or reasonable to seek payment of the order from the defendant’s estate: where, for example, there are no assets remaining in the estate. Clause 28 makes the same provision for Northern Ireland.

In Clauses 8 and 28 there are two cases where orders may be written off: first, where it is impossible to get any money out of the estate; and, secondly, where it is not reasonable to make any attempt or further attempt to get money out of the estate.

These amendments suggest removing the case for discharging orders where it is impossible to get any money at all out of the estate. My noble friend has indicated these amendments are essentially designed to probe what would be covered by a first set of circumstances for discharging an order that is not covered by a second set of circumstances.

My noble friend is correct to say that there is certainly a significant degree of overlap between the two. If there are no assets of any note in the estate, it would not be reasonable to make an attempt to recover moneys owing to discharge a confiscation order. Equally, it would not be possible to recover anything from the estate.

That said, I believe it is helpful to retain both cases. The first case where it is impossible to get any money at all out of the estate could be said to be a subset of the second case, where it is not reasonable to make any attempt or further attempt. However, there may be circumstances not covered by the second case. It is important that this clause should encompass all possible scenarios to ensure uncollectible orders may be discharged.

I hope that, in light of that explanation, my noble friend will be content to withdraw her amendment.

[Baroness Hamwee]

My Lords, I am not sure that I do understand that it would ever be reasonable to make an attempt to recover something where it is not possible to recover it. I am not going to make a fuss about it. However, when I hear about 8% a year, I think I need to review my investment strategy. I beg leave to withdraw the amendment.

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Moved by

[Baroness Williams of Trafford]

17: Clause 13, page 11, line 6, at end insert—
“( ) In section 47B of the Proceeds of Crime Act 2002 (conditions for exercise of powers), in subsection (2)(d), for “is reasonable cause to believe” substitute “are reasonable grounds to suspect”.”

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[Baroness Williams of Trafford]

My Lords, Clause 13 deals with the search and seizure powers available to appropriate officers under Sections 47A to 47S of the Proceeds of Crime Act. Sections 47A to 47S, which were inserted into POCA by the Policing and Crime Act 2009, provide for search and seizure powers, in England and Wales, to prevent the dissipation of realisable property that may be used to satisfy a confiscation order. These powers will, once commenced later this year, be available to law enforcement officers, such as the police and National Crime Agency officers. The power to seize property is currently subject to the same test as for the making of a restraint order. The existing test is that there is reasonable cause to believe that the person has benefited from conduct constituting the offence.

As we have already debated, Clause 11 is designed to enable assets to be restrained more quickly and earlier in investigations. It does this by lowering the test for the grant of a restraint order from the court having “reasonable cause to believe” that the alleged offender has benefited from his criminal conduct to the court having “reasonable grounds to suspect” that the alleged offender has benefited from his criminal conduct.

To exercise certain powers and investigative tools at the early stages of an investigation, the officer and the court have to be satisfied only to the threshold of suspicion, rather than of belief. For example, in order to obtain a production order under POCA, reasonable grounds for suspecting have to be shown, and under the Police and Criminal Evidence Act 1984, a police officer may arrest without a warrant anyone whom he has reasonable grounds for suspecting of committing an offence.

It therefore follows that the legal test for exercising search and seizure powers, which will enable law enforcement agencies to identify and protect assets through search and seizure for a future confiscation order, should complement that of a restraint order. Indeed, it is already the case that the reasonable grounds for suspecting test applies to certain of the powers in Sections 47A to 47S. For example, this lower test already applies to the power to search premises in Section 47D of POCA.

Amendment 17 therefore brings the test for the seizure of property in Section 47B into line with the change we are making in relation to restraint orders; namely, reducing the legal test to “reasonable grounds to suspect”. Amendments 25 and 28 insert a new clause into Chapters 2 and 3 of Part 1. These new clauses simply replicate for Scotland and Northern Ireland the provisions in Clause 13, as amended by Amendment 16. I beg to move.

Amendment 17 agreed.

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Moved by

[Baroness Williams of Trafford]

18: Clause 14, page 11, line 28, at end insert—
“(5B) In the case of money held in an account not maintained by the person against whom the confiscation order is made, a magistrates’ court—
(a) may make an order under subsection (5) only if the extent of the person’s interest in the money has been determined under section 10A, and(b) must have regard to that determination in deciding what is the appropriate order to make.””

[Baroness Williams of Trafford]

My Lords, as we have debated, Clauses 1 to 4 include provisions designed to ensure that criminal assets cannot be hidden with spouses, associates or other third parties. This is achieved under Clause 1 by enabling a court to make a determination as to the extent of the defendant’s interest in property. Any such determination will be made by the court at a confiscation hearing. This determination may include money held in a bank or building society account.

Section 67 of POCA currently enables a magistrates’ court to order a bank or building society to pay over money to satisfy a confiscation order. This provision needs to be able to work in conjunction with Clauses 1 to 4 when the court makes a determination that the defendant has an interest in a bank account that is, for example, held by a third party, such as a company owned by the defendant.

Amendment 18 accordingly amends Section 67 of POCA so as to reflect the court’s new power to make a determination as to a defendant’s interest in property. The amendment provides for a magistrates’ court to order payment of funds held in a bank account that is not in the name of the defendant towards the satisfaction of the defendant’s confiscation order, in accordance with the court’s determination of the defendant’s interest in that account. This will enable funds held in a bank account to be confiscated rapidly where the account is not held in the name of the defendant. Any third parties affected would have the opportunity to make representations before such a determination was made. Only accounts subject to a determination by the court at the confiscation hearing will be affected by this amendment.

Amendment 29 makes a similar change to the Northern Ireland provision in Clause 33. I aim to bring forward on Report a new clause which will replicate for Scotland Clause 14 in its amended form. I beg to move.

Amendment 18 agreed.

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Moved by

[Baroness Williams of Trafford]

23: Before Clause 15, insert the following new Clause—
“Restitution order and victim surcharge
(1) In section 97 of the Proceeds of Crime Act 2002 (effect of order on court’s other powers), in subsection (3)(a), at the end insert “, a restitution order or a victim surcharge under section 253F(2) of the Procedure Act”.
(2) After that section insert—
“97A Application of receipts: restitution order and victim surcharge
(1) Subsection (2) applies if—
(a) a court makes a confiscation order and a relevant order against the same person in the same proceedings, and(b) the court believes that the person will not have sufficient means to satisfy both orders in full.(2) In such a case the court must direct that so much of the amount payable under the relevant order as it specifies is to be paid out of any sums recovered under the confiscation order.
(3) Subsection (4) applies if—
(a) a court makes a confiscation order, a compensation order under section 249 of the Procedure Act and a relevant order against the same person in the same proceedings, and(b) the court believes that the person will not have sufficient means to satisfy all the orders in full. (4) In such a case the court must direct that so much of the compensation, and so much of the amount payable under the relevant order, as it specifies is to be paid out of any sums recovered under the confiscation order.
(5) The amount a court specifies under subsection (2) or (4) must be the amount the court believes will not be recoverable because of the insufficiency of the person’s means.
(6) Where the amount a court specifies in a direction under subsection (4) is sufficient to satisfy in full the compensation, the direction must provide for the compensation to be so satisfied before payment of the amount payable under the relevant order.
(7) Where the amount a court specifies in a direction under subsection (4) is not sufficient to satisfy in full the compensation, the direction must provide for the compensation to be satisfied to the extent of the amount specified in the direction.
(8) In this section, “relevant order” means—
(a) a restitution order, or(b) a victim surcharge under section 253F(2) of the Procedure Act.(9) In this Part, “restitution order” is to be construed in accordance with section 253A(2) of the Procedure Act.””

[Baroness Williams of Trafford]

My Lords, the new clause proposed by Amendment 23 makes equivalent provision for Scotland to that contained in Clause 6 as regards England and Wales. It provides for the money collected under a confiscation order to be diverted to pay other financial penalties imposed by the court where the accused has insufficient means to meet all the financial penalties imposed on him or her.

The proposed new clause ensures that where the court imposes a confiscation order alongside a compensatory financial penalty, those compensatory penalties can be paid from money collected under the confiscation order where the accused does not have sufficient means to satisfy all the orders in full. The new clause caters for the situation where the court has imposed a confiscation order alongside either the victim surcharge or a restitution order. It also caters for the situation where a confiscation order is imposed alongside a compensation order and either the victim surcharge or a restitution order. The victim surcharge and restitution orders are financial penalties which can be imposed by the court under the Criminal Procedure (Scotland) Act 1995.

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Moved by

[Baroness Williams of Trafford]

24: Clause 15, page 12, line 16, leave out paragraph (b)

[Baroness Williams of Trafford]

My Lords, the intention behind Clause 15 is to provide that the serving of a default sentence in Scotland for failure to pay a confiscation order does not discharge the outstanding debt. In making such provision, the clause brings the position in Scotland into line with that in England and Wales. Paragraph (a) of the clause achieves this intended outcome by amending Section 118 of POCA to disapply the relevant provision in the Criminal Procedure (Scotland) Act 1995, which relates to fine enforcement.

Paragraph (b) of Clause 15 makes a consequential amendment to POCA to modify the application of Section 224 of the Criminal Procedure (Scotland) Act 1995. That section requires warrants of imprisonment for non-payment of a fine to specify the date for the discharge of the liability to pay the fine—in practice once the default sentence has been served—notwithstanding the fact that it has not been paid. The effect of paragraph (b) is that that requirement will no longer operate where an administrator is appointed in relation to the confiscation order in respect of which the default sentence was served.

However, on further examination, the Scottish Government have concluded that Section 224 should be disapplied entirely. As currently drafted, the clause would result in some individuals still having their confiscation order discharged once they have served a default sentence, which is not the outcome the Scottish Government are seeking to achieve. I beg to move.

Amendment 24 agreed.