Oral Answers to Questions

Tom Tugendhat Excerpts

Monday 6th February 2023 Commons Chamber

[Mr Virendra Sharma (Ealing, Southall) (Lab)]

2. What recent assessment her Department has made of the level of threat posed by the Iranian regime to people in the UK.

[The Minister for Security (Tom Tugendhat)]

The director general of MI5 recently outlined that, since January 2022, there have been at least 10 Iranian threats to kidnap or even kill UK-based individuals. The level of the Iranian threat is kept under constant review. The Home Secretary and I are working with our partners across Government to ensure that all tools at our disposal are used to protect individuals in the UK against any threats from the Iranian state.

[Mr Sharma]

It has been patently obvious for years that the whole Iranian Government are rotten. Iranian Revolutionary Guard Corps leaders are allowed to travel to the UK and store their stolen wealth almost with impunity. The people of Iran are fighting back. Why do we not stop their abusers stealing the wealth of the country and sanction more than just 50 people at the top of the organisation?

[Tom Tugendhat]

The hon. Member is absolutely correct: the IRGC is a vicious organisation and its first victims are the Iranian people, who have been brutalised and murdered by that despotic regime for far too long. I hope he will be encouraged by the actions the UK Government are taking at the moment in looking into various of these areas, and also by the work being done by some of our partners. It is interesting to note that, of the so-called E3+3, Germany and France appear to be looking at proscribing the IRGC, as the United States has already done. It seems that not only is there international agreement on the point the hon. Member raises, but that action is absolutely ready to go.

[Theresa Villiers (Chipping Barnet) (Con)]

As part of the sanctions the Government are imposing on this evil regime, will they please shut down the Islamic centre in Maida Vale, which is the voice of the supreme leader in this country? It should not have charitable status and should be shut down.

[Tom Tugendhat]

My right hon. Friend has raised an extremely important issue, of which I am acutely aware and which has not gone without notice.

[John Cryer (Leyton and Wanstead) (Lab)]

The Minister seemed to say in response to the original question from my hon. Friend the Member for Ealing, Southall (Mr Sharma) that we were considering proscribing the IRGC. Is that the case?

[Tom Tugendhat]

The Government always keep all areas under review, and speculation has certainly been in that direction. What we have already done is sanction various different elements. Any further action will no doubt be announced as soon as it is ready, and we will see as soon as that can be done.

[Bob Blackman (Harrow East) (Con)]

Clearly, the threat from the IRGC to people in this country—be they opposition journalists reporting on what is going on in Iran at the moment or UK citizens—is paramount. Foreign Office Ministers have responded to all the urgent questions the Speaker has granted and the debates we have had, but will my right hon. Friend now take the obvious step, which is supported by all political parties in the Chamber, and proscribe the IRGC in its entirety?

[Tom Tugendhat]

My hon. Friend will know that it is not me he has to persuade in this matter and that there are many areas where I would like to go. I can assure him that the Government are absolutely listening to exactly what he is saying. The Home Secretary and I are as one on this.

[Mr Speaker]

I call the shadow Minister.

[Holly Lynch (Halifax) (Lab)]

The Minister has been explicit, as have others, about the threat we face in the UK from the Iranian regime. I really welcome what he has said, and we stand ready to work with him on this issue, but the truth is that we have not seen anything like the sanctions and immigration controls that have been deployed against Russia being deployed against Iran. Will the Government go further and be clear? Will they proscribe the IRGC using either existing terror laws or new state threat variations to drive out this threat and keep people safe?

[Tom Tugendhat]

The hon. Lady knows very well that the Government have already sanctioned many individuals inside the Iranian regime and have taken action on individuals who may have had access around Europe and indeed into the United Kingdom. Those people have been either controlled or not allowed permission to travel. She should also be aware that our embassy in Iran is keeping us closely informed of how the sanctions are playing out and making sure that we target appropriately individuals who are a threat to the United Kingdom.

It is completely wrong that any foreign state should be able to threaten anybody in the United Kingdom. Anybody in the UK should have the same protection and be afforded the same rights as anybody else. The action we have taken to protect some journalists in the UK, which was highlighted only recently by some of our agencies, is absolutely vital to the security of our whole society.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

3. What steps she is taking to help ensure that refugees are placed in adequate housing.

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[Sir Desmond Swayne (New Forest West) (Con)]

T8. What is being done to reduce the impact of fraud?

[The Minister for Security (Tom Tugendhat)]

My right hon. Friend is right to ask the question, because fraud has been a blight on too many communities. I assure him that the fraud strategy that many of us have been working on for a number of months is coming out very soon.

[Mr Speaker]

That was a quick answer.

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[Sir Chris Bryant (Rhondda) (Lab)]

The biggest criminal in Europe, with the most blood on his hands, is Vladimir Putin. We have frozen his Russian state assets in the UK; will the Home Secretary support my Bill tomorrow to allow us to seize those assets and give them to the Ukrainian people, so that they can rebuild their country?

[Tom Tugendhat]

Going from freezing to seizing, as the hon. Gentleman knows, is a slightly difficult procedure under our laws, due to the rights that people have. We have looked at that matter with partners, particularly in common law jurisdictions, and I hope to have further conversations on the subject with the United States when I go there tomorrow.

[Sir David Evennett (Bexleyheath and Crayford) (Con)]

My constituents remain concerned about the victims of people-smuggling gangs. Can my right hon. Friend advise how many people smugglers have been caught and arrested under the Nationality and Borders Act 2022, and confirm that the Government will continue to act with vigour against people smuggling and illegal immigration?

Draft Police and Criminal Evidence Act 1984 (Codes of Practice) (Revision of Code H) Order 2023

Tom Tugendhat Excerpts

Tuesday 31st January 2023 General Committees

[The Minister for Security (Tom Tugendhat)]

I beg to move,

That the Committee has considered the draft Police and Criminal Evidence Act 1984 (Codes of Practice) (Revision of Code H) Order 2023.

It is a pleasure to work under your chairmanship, Mr Bone.

Following the horrific terrorist attack at Fishmongers’ Hall in November 2019, the then Home Secretary commissioned the Independent Reviewer of Terrorism Legislation, Jonathan Hall KC, to review the multi-agency public protection arrangements—commonly referred to as MAPPA—used to supervise terrorist and terrorist-risk offenders on licence in the community. The Police, Crime, Sentencing and Courts Act 2022, which I will subsequently refer to as the 2022 Act, established three new powers for counter-terrorism policing: a personal search power, a premises search power, and a power of urgent arrest. Those powers were established in response to recommendations made by Mr Hall KC following his review of MAPPA.

The order relates to the new power of urgent arrest, which has been inserted into the Terrorism Act 2000 - new section 43B of that Act - by the 2022 Act. The new arrest power came into force on 28 June last year. The Government have also taken this opportunity to make a small number of updates to the code to reflect changes previously made by primary legislation, including ensuring relevant terminology within the code is up to date.

As was set out by the Government during the passage of the 2022 Act, the new power of urgent arrest applies across the UK. The power enables the police to arrest without warrant a terrorist or terrorism-connected offender who has been released on licence and is suspected to have breached their licence conditions when it is considered necessary, for purposes connected with protecting members of the public from a terrorism risk, to detain the offender until a recall decision is made.

Section 66 of the Police and Criminal Evidence Act1984—normally referred to as PACE—requires the Secretary of State to issue codes of practice in connection with the exercise by police officers of statutory powers to arrest a person and the detention, treatment, questioning and identification of persons by police officers. We have prepared a revised PACE code H, which relates to the detention and treatment of people arrested under the Terrorism Act 2000 and applies across England and Wales. The order seeks Parliament’s approval to bring the revised code of practice into force. The primary update to PACE code H is the incorporation of the new urgent arrest power provided for by section 43B of the Terrorism Act 2000.

A terrorist offender who is detained under new section 43B must, unless recalled to prison or otherwise detained under any other power, be released if a decision is made not to revoke their licence and accordingly the offender is not recalled to prison. A terrorist offender must also be released from police detention if a recall decision has not been made by the end of the relevant period, which in relation to terrorist offenders who have been released on licence under the law of England and Wales is six hours beginning with the time of the arrest.

The Government have updated PACE code H to reflect that new arrest power, including ensuring that there is clarity for the police on the length of time for which the terrorist offender on licence can be detained and their rights upon first being detained, including to have one named person informed of their whereabouts and their right to consult and communicate privately with a solicitor. The revised PACE code H also reflects that there is no requirement to caution a terrorist offender on licence who is arrested under section 43B as they will not have been arrested on suspicion of committing a criminal offence and so will not be questioned or interviewed by the police under caution while being detained under this power.

The Government plan to collect data from police forces on the use of that targeted power, as we routinely do for other police arrest powers, and to make this data publicly available through future statistical publications. The Government have also updated PACE code H to reflect other changes already made to primary legislation by the Counter-Terrorism and Border Security Act 2019—I will subsequently refer to it as the 2019 Act. That Act amended provisions in schedule 8 to the Terrorism Act 2000 to specify on the face of the legislation that on first being detained a detainee must be informed of their rights to inform a named person of their detention and consult a solicitor. The 2019 Act replaced provisions in schedule 8 that would enable a senior officer, in certain exceptional circumstances, to direct that the detainee has to consult their solicitor in the sight and hearing of another officer with one whereby a senior officer can, in those exceptional circumstances, require the detainee to consult a different solicitor of the detainee’s choosing.

[Kevin Brennan (Cardiff West) (Lab)]

I am extremely grateful to the Minister for giving way. We are considering a very interesting provision of the Act. Can he explain to the Committee what are those certain exceptional circumstances that would mean that a senior officer could, rather than say that a detainee had to consult in sight and hearing of another officer, direct that the detainee had to consult a different solicitor. [Interruption.]

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[Tom Tugendhat]

Thank you for your instruction, Mr Bone. I will stay in order if ever I am in your presence, as always, and as you always are, and Mrs Bone would be as well.

Interference with or harm to evidence of a serious offence and the alerting of persons who are suspected to have committed a serious offence, who have not yet been arrested, are among the circumstances in which the provision would be invoked. They would come under the Terrorism Act 2000. Under that Act, a police officer of at least the rank of superintendent may direct that the detainee consults a different solicitor if that officer has reasonable grounds for believing that any of a number of specified consequences, which I have just outlined, will occur unless that direction is given.

To carry on—unless you have anything further to say, Mr Bone—

[The Chair]

You may carry on until you are precluded.

[Tom Tugendhat]

You are extremely generous, Mr Bone.

The 2019 Act also amended section 41 of, and schedule 7 to, the Terrorism Act 2000 to give effect to a recommendation made by a former Independent Reviewer of Terrorism Legislation that the detention clock should be suspended in the case of detainees who are admitted to hospital. Finally, the 2019 Act created powers to stop, question, search and detain a person at UK ports and the Northern Ireland border area for the purpose of determining whether the person appears to be someone who is, or has been, engaged in hostile state activity.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

This is important legislation. Years ago, when I was shadow Home Affairs Minister, I remember dealing with PACE, and it is a very intricate. The Minister has read his speech very well, but quite quickly. Would he say that the order represents a tightening up, or is it a loosening? What is the essence of the order, and will it help our police to detain terrorists and deal with them effectively?

[Tom Tugendhat]

I would say very simply that the order is an updating. Some of the laws have changed because we have left the European Union, and some of the areas covered have changed because of the nature of how we collect evidence. The order is an updating to ensure that the law is still relevant and appropriate to the challenges that we face. Sadly, terrorism has not gone away despite the few years since the hon. Gentleman was first elected to the House or, indeed, was a shadow Home Office Minister.

When revising PACE code H, the Government have also made other minor, non-discretionary updates to ensure terminology contained within it is up-to-date and reflects wider legislative changes. The revised code makes a clarification to refer to retained EU law to reflect the effect of the European Union (Withdrawal) Act 2018, updates the wording regarding offences having a terrorist connection to reflect changes made by the Sentencing Act 2020, and updates a reference to the relevant department to the Foreign, Commonwealth and Development Office.

In the course of revising the code, we have consulted key stakeholders, including Counter Terrorism Policing, the National Police Chiefs’ Council, the College of Policing and the Independent Reviewer of Terrorism Legislation, all of whom are supportive of the approach being taken.

While powers such as the section 43B urgent arrest power in the Terrorism Act 2000 apply UK-wide, our revised PACE code H applies in England and Wales. We have, of course, liaised with the Scottish Government and Northern Ireland Executive on our proposed revisions, and they intend to update their respective equivalent guidelines and code of practice correspondingly in due course.

The revised code promotes the fundamental principles to be observed by the police and helps preserve the effectiveness of, and public confidence in, the use of arrest powers under the Terrorism Act 2000. I very much hope that Committee members will support the revisions to PACE code H, and I commend the order to the Committee.

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[Tom Tugendhat]

I am very grateful to the hon. Lady for her support. She kindly asked me to write to her and I will do so, because there is a relatively detailed set of elements to consider. As she rightly said, the statistical basis of such arrests under the legislation and checking them against future and comparable areas of law and law enforcement are important. Those statistics will be published, and I am sure that hon. Lady will keep a close eye on them, as will I.

Question put and agreed.

Economic Crime and Corporate Transparency Bill

Tom Tugendhat Excerpts

Report stage
Wednesday 25th January 2023 Commons Chamber

[The Minister for Security (Tom Tugendhat)]

I beg to move, That the clause be read a Second time.

[Mr Deputy Speaker (Sir Roger Gale)]

With this it will be convenient to discuss the following:

New clause 1—Disclosure of information in the public interest likely to be relevant to the investigation of economic crime—

‘(1) It is a defence to an action based on the disclosure or publication of information for the defendant to show that—

(a) the disclosure or publication complained of was likely to be relevant to the investigation of an economic crime, and

(b) the defendant reasonably believed that the disclosure or publication complained of was likely to be relevant to the investigation of an economic crime.

(2) Subject to subsection (3), in determining whether the defendant has shown the matters mentioned in subsection (1), the court must have regard to all the circumstances of the case.

(3) In determining whether it was reasonable for the defendant to believe that the disclosure or publication complained of was likely to be relevant to the investigation of an economic crime, the court must make such allowance for editorial judgement as it considers appropriate.

(4) For the avoidance of doubt, the defence under this section may be relied upon irrespective of whether the statement complained of is a statement of fact or a statement of opinion.”

New clause 2—Economic crime: power to strike out statement of case for abuse of process—

The court may strike out the whole or part of any statement of case which can be reasonably understood as having the purpose of concealing, or preventing disclosure or publication of, any information likely to be relevant to the investigation of an economic crime.”

New clause 3—Home Office review of the Tier 1 (Investor) visa scheme: publication—

Within a day of the passage of this Act, the Secretary of State must publish in full the findings of the Home Office review of the Tier 1 (Investor) visa scheme which relate to economic crime.”

New clause 4—Offence of failure to prevent fraud, false accounting or money laundering—

‘(1) A relevant commercial organisation (“C”) is guilty of an offence under this section where—

(a) a person (“A”) associated with C commits a fraud, false accounting or an act of money laundering, or aids and abets a fraud, false accounting or act of money laundering, intending—

(i) to confer a business advantage on C, or

(ii) to confer a benefit on a person to whom A provides services on behalf of C, and

(b) fails to prevent the activity set out in paragraph (a).

(2) C does not commit an offence where C can prove that the conduct detailed in subsection (1)(a) was intended to cause harm to C.

(3) It is a defence for C to prove that, at the relevant time, C had in place procedures that were reasonable in all the circumstances and which were designed to prevent persons associated with C from undertaking the conduct detailed in subsection (1)(a).

(4) For the purposes of this section “relevant commercial organisation” means—

(a) for the offence as it relates to false accounting and fraud, “relevant commercial organisations” are defined as—

(i) a body which is incorporated under the law of any part of the United Kingdom and which carries on a business (whether there or elsewhere),

(ii) any other body corporate (wherever incorporated) which carries on a business, or part of a business, in any part of the United Kingdom,

(iii) a partnership which is formed under the law of any part of the United Kingdom and which carries on a business (whether there or elsewhere), or

(iv) any other partnership (wherever formed) which carries on a business, or part of a business, in any part of the United Kingdom, and

(v) for the purposes of this section, a trade or profession is a business;

(b) for the offence as it relates to money laundering, “relevant commercial organisations” are defined as—

(i) credit institutions;

(ii) financial institutions;

(iii) auditors, insolvency practitioners, external accountants and tax advisers;

(iv) independent legal professionals;

(v) trust or company service providers;

(vi) estate agents and letting agents;

(vii) high value dealers;

(viii) casinos;

(ix) art market participants;

(x) cryptoasset exchange providers;

(xi) custodian wallet providers.”

This new clause introduces a new criminal corporate offence for failure to prevent fraud, false accounting and money laundering, by aligning it with other corporate criminal offences.

New clause 5—Identification doctrine—

‘(1) A body corporate commits an offence of fraud, money laundering, false accounting, bribery and tax evasion where the offence is committed with the consent, connivance or neglect of a senior manager.

(2) An individual is a “senior manager” of an entity if the individual—

(a) plays a significant role in—

(i) the making of decisions about how the entity’s relevant activities are to be managed or organised, or

(ii) the managing or organising of the entity’s relevant activities, or

(b) is the Chief Executive or Chief Financial Officer of the body corporate.

(3) A body corporate also commits an offence if, acting within the scope of their authority—

(a) one or more senior managers engage in conduct, whether by act or omission, such that, if it had been the conduct of only one representative, that representative would have been a party to the offence; and

(b) the senior manager who is responsible for the aspect of the organization’s activities that is relevant to the offence — or the senior managers collectively — fail to take all reasonable steps to prevent that offence being committed.”

This new clause reforms the “identification doctrine”, so that a body corporate commits an economic crime offence where the offence is committed with the consent, connivance or neglect of a senior manager or senior managers.

New clause 6—Failure to prevent fraud, false accounting or money laundering: individual liability—

‘(1) A person (“S”) commits an offence if—

(a) at a time when S is a senior manager or corporate officer of a corporate body (“C”), S—

(i) takes, or agrees to the taking of, a decision by or on behalf of the corporate body as to the way in which the business of the corporate body is conducted, and

(ii) fails to take any steps that S could take to prevent such a decision being taken;

(b) at the time of the decision, S is aware of a risk that the implementation of the decision may lead to the commission of an offence of money laundering, fraud, false accounting, bribery or tax evasion; and

(c) the implementation of the decision causes C to commit such an offence.

(2) For the purposes of this section—

(a) an individual is a “senior manager” of a corporate body if the individual plays a significant role in—

(i) the making of decisions about how the entity’s relevant activities are to be managed or organised, or

(ii) the actual managing or organising of the entity’s relevant activities;

(b) “officer”, in relation to a body corporate, means—

(i) a director, manager, associate, secretary or other similar officer, or

(ii) a person purporting to act in any such capacity;

(c) in paragraph (b)(i) “director”, in relation to a body corporate whose affairs are managed by its members, means a member of the body corporate.

(3) A person guilty of an offence under this section is liable—

(a) on summary conviction—

(i) in England and Wales, to imprisonment for a term not exceeding 12 months (or 6 months, if the offence was committed before the commencement of section 154(1) of the Criminal Justice Act 2003) or a fine, or both;

(ii) in Scotland, to imprisonment for a term not exceeding 12 months or a fine not exceeding the statutory maximum, or both;

(iii) in Northern Ireland, to imprisonment for a term not exceeding 6 months or a fine not exceeding the statutory maximum, or both;

(b) on conviction on indictment, to imprisonment for a term not exceeding 7 years or a fine, or both.”

This new clause introduces direct criminal liability for corporate officers who take a decision, or fail to take a decision, that knowingly results in an offence being committed.

New clause 7—Whistleblowing: economic crime—

‘(1) Whistleblowing is defined for the purposes of this section as any disclosure of information suggesting that, in the reasonable opinion of the whistleblower, an economic crime—

(a) has occurred,

(b) is occurring, or

(c) is likely to occur.

(2) The Secretary of State must, within twelve months of the date of Royal Assent to this Act, set up an office to receive reports of whistleblowing as defined in subsection (1) to be known as the Office for Whistleblowers.

(3) The Office for Whistleblowers must—

(a) protect whistleblowers from detriment resulting from their whistleblowing,

(b) ensure that disclosures by whistleblowers are investigated, and

(c) escalate information and evidence of wrongdoing outside of its remit to another appropriate authority.

(4) The objectives of the Office for Whistleblowers are—

(a) to encourage and support whistleblowers to make whistleblowing reports,

(b) to provide an independent, confidential and safe environment for making and receiving whistleblowing information,

(c) to provide information and advice on whistleblowing, and

(d) to act on evidence of detriment to the whistleblower in line with guidance set out by the Secretary of State in regulations.

(5) The Office for Whistleblowers must report annually to Parliament on the exercise of its duties, objectives and functions.”

New clause 21—Civil recovery: costs of proceedings—

After section 313 of the Proceeds of Crime Act 2002 insert—

“313A    Costs orders

(1) This section applies to proceedings brought by an enforcement authority under part 5 of the Proceeds of Crime Act 2002 where the property in respect of which the proceedings have been brought has been obtained through economic crime.

(2) The court may not make an order that any costs of proceedings relating to a case to which this section applies (including appeal proceedings) are payable by an enforcement authority to a respondent or a specified responsible officer in respect of the involvement of the respondent or the officer in those proceedings, unless—

(a) the authority acted unreasonably in making or opposing the application to which the proceedings relate, or in supporting or opposing the making of the order to which the proceedings relate, or

(b) the authority acted dishonestly or improperly in the course of the proceedings.”

This new clause extends the cap on adverse costs introduced by the first Economic Crime Act (Transparency and Enforcement) 2022 for Unexplained Wealth Orders, to all civil recovery orders.

New clause 23—Review of measures to prevent proceeds of economic crime entering the UK economy—

Within six months of the passage of this Act, the Secretary of State must lay before Parliament the report of a review of what further regulatory measures could be taken to prevent the circulation in the UK economy of the proceeds of economic crime controlled by individuals or entities subject to sanctions.”

This new clause creates an obligation for the Secretary of State to report to Parliament on the merits of further regulatory measures for preventing the circulation in the economy of the proceeds of economic crime controlled by individuals or entities subject to sanctions.

New clause 25—Report into effectiveness of Act in addressing economic crime involving sanctioned individuals—

‘(1) The Secretary of State must, within six months of this Act being passed, lay before Parliament a report of a review into the effectiveness of the measures in this Act in addressing economic crime involving designated persons.

(2) The report must consider the case for further legislation to make provision for the seizing of assets of a designated person where there is evidence that the designated person has been involved in economic crime.

(3) In this section, “designated persons” has the meaning given in section 9 of the Sanctions and Anti-Money Laundering Act 2018.”

New clause 27—Compensation for Victims of Economic Crime—

‘(1) The Secretary of State must, no later than 90 days from the date on which this Act comes into force, publish and lay before Parliament a strategy for the potential establishment of a fund for the compensation of victims of economic crime.

(2) The strategy may include provisions on the management and disposal of any assets realised by the government, or any body with law enforcement responsibilities in relation to economic crime, under relevant UK legislation.”

This new clause would require the Secretary of State to prepare and publish a strategy on the potential establishment of a fund to provide compensation to victims of economic crime.

New clause 30—Assets of Iranian officials obtained through economic crime—

Within six months of the passage of this Act, the Secretary of State must lay before Parliament the report of a review of regulatory measures to prevent the circulation in the UK economy of assets of Iranian officials which have been obtained through economic crime.”

New clause 31—Fund for the purposes of tackling economic crime—

In the Companies Act 2006, after Part 29 insert—

Part 29A

Economic Crime

993A Fund for the purposes of tackling economic crime

‘(1) The Secretary of State must by regulations establish a fund for the purposes of tackling economic crime.

(2) The regulations must specify the purposes for which the fund may be used, including funding the activities of law enforcement agencies in tackling economic crime.””

New clause 32—Review of definition of cryptoassets—

Within 18 months of the passage of this Act, the Secretary of State must lay before Parliament the report of a review of the adequacy of the definitions of cryptoassets contained in this Act.”

New clause 33—Economic Crime Committee of Parliament—

‘(1) The Secretary of State must by regulations establish a body to be known as the Economic Crime Committee of Parliament (in this section referred to as “the ECC”).

(2) The ECC will consist of nine members who are to be drawn both from the members of the House of Commons and from the members of the House of Lords.

(3) Each member of the ECC is to be appointed by the House of Parliament from which the member is to be drawn.

(4) The ECC will have the power to meet confidentially.

(5) The ECC may examine or otherwise oversee any regulatory, enforcement or supervision agencies involved in work related, but not limited to—

(a) tax avoidance and evasion by corporations;

(b) illicit finance;

(c) anti-money laundering supervision;

(d) tackling fraud;

(e) kleptocracy and corruption; and

(f) whistleblower protection.”

This new clause would oblige the Secretary of State to establish an Economic Crime Committee of parliament to examine and oversee regulatory, enforcement and supervisory action against economic crime.

New clause 39—Duty to report on economic crime resourcing and performance—

‘(1) The Director General of the National Crime Agency must—

(a) prepare a report on the resourcing and staffing of its work to counter economic crime, and its performance tackling economic crime, and

(b) send it to the Secretary of State as soon as practicable after this section comes into force.

(2) The Director General must prepare and send to the Secretary of State further reports on these topics annually.

(3) Each report must include, in particular—

(a) a report of the total annual budget and number of staff allocated to economic crime for each unit within the National Crime Agency,

(b) a report of the number of investigations, arrests, prosecutions and convictions relating to economic crime for each unit within the National Crime Agency, and

(c) a report of other relevant data including, but not limited to, cases per year broken down by both type and outcome; number of restraint or confiscation orders obtained; and value of assets confiscated.

(4) Reporting under subsection (3) must provide a breakdown between domestic economic crime and international economic crime. Reporting on international economic crime under subsections (3)(b) and (3)(c) must provide a breakdown by the income classification of the countries affected.

(5) The Director General must publish every report under this section—

(a) as soon as practicable after they send it to the Secretary of State, and

(b) in such manner as they consider appropriate.”

Section 6 of the Crime and Courts Act 2006 currently places a duty on the Director General of the National Crime Agency to make arrangements for publishing information about the exercise of NCA functions and other matters relating to the NCA, and publish information in accordance with those arrangements. This new clause inserts a new section that places a specific duty on the Director General to prepare an annual report on the NCA’s resourcing and performance relating to economic crime. The section stipulates the minimum information that the Director General must include in the report.

New clause 40—Report into options for corporate liability for economic crime—

‘(1) The Secretary of State must produce a report on corporate criminal liability for economic crime offences.

(2) The report must consider the merits of different models for corporate liability in respect of economic crime, including but not limited to—

(a) the respondeat superior model; and

(b) the failure to prevent model, insofar as it has not already been introduced by the enactment of this Act.

(3) The report must be laid before Parliament within six months of this Act being passed.

(4) In this section—

“the respondeat superior model” means a model for corporate criminal liability in which an entity is guilty of an offence if an employee or agent commits an economic crime offence—

(a) in the course of their employment or agency, or

(b) with an intent to benefit that entity;

“the failure to prevent model” means a model for corporate criminal liability in which an entity is guilty of an offence if a person associated with that entity commits an economic crime offence, intending—

(a) to confer a business advantage on that entity, or

(b) to confer a benefit on a person or other entity to whom the associated person provides services on behalf of the entity with which it is associated, except that the entity shall not be liable where the conduct was intended to cause harm to that entity,

unless the entity can prove that it had in place such prevention procedures as were reasonable in the circumstances, or that it was reasonable not to have any such procedures in place;

a person is “associated with” an entity if they are a person who performs services for or on behalf of that entity, including in, but not limited to, the capacity of an employee, agent or subsidiary.”

Government amendments 44 to 49, 57 and 58 to 100.

[Tom Tugendhat]

It is a pleasure to see you in your place, Mr Deputy Speaker, and it is the first time I have had the privilege of speaking under your chairmanship on these matters. It is also a pleasure to see so many of the usual faces on this matter. Many of us have gone over these questions in Committee and, actually, in the many years beforehand in various different ways, so it is an enormous privilege to be here. It is particularly a privilege to be speaking after the Minister my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) did such a brilliant job yesterday. I am only picking up where he left off, so I am afraid the second act will not be nearly as compelling as the first.

All those who participated in the Bill Committee gave enormous insights into various different perceptions of how we should be thinking about economic crime and corporate transparency. We have had many interesting debates, and I thank enormously those who have taken part in the various different ways. The fact that we have a two-day debate on Report speaks pretty clearly about the significant size and complexity of this Bill.

Yesterday, we debated parts 1 to 3, which cover Companies House reform and corporate transparency. Today, we turn our attention to parts 4 to 6. The clauses in part 4 create new powers that allow law enforcement to more quickly and easily seize and recover cryptoassets. The creation of the civil forfeiture power for cryptoassets will mitigate the risk posed by those who cannot be criminally prosecuted, but who use their funds to further criminality or for terrorist purposes. This did not prove to be particularly contentious in Committee.

In part 5 of the Bill, we are making it easier for businesses to share information more effectively with each other and with law enforcement to prevent and detect economic crime. We are also creating new exemptions to reduce unnecessary reporting by businesses carrying out transactions on behalf of their customers. We are also giving frontline legal services regulators enhanced enforcement powers to support them as they uphold the economic crime agenda within their regulated community.

I will briefly summarise the amendments we have tabled relating to parts 4, 5 and 6 of the Bill. Many of them address the debate that took place in Committee and will ensure that the Bill works as intended. I should acknowledge that the amendments are perhaps slightly greater in number than we would have liked. The vast majority—amendments 51 and 57 to 100—are minor technical or consequential amendments to ensure that the detail of the cryptoasset measures will work effectively and can be used as soon as possible. That reflects the technical detail of the subject area and the need to make the changes work for each of the jurisdictions of England and Wales, Scotland and Northern Ireland that are covered by the Proceeds of Crime Act 2002.

I now turn to the more substantive Government amendments. New clause 14 allows the Solicitors Regulation Authority to proactively request information from its regulated community for the purpose of monitoring compliance with the economic crime regime. It will enable the SRA to monitor and detect breaches of the rules and legislation related to economic crime, including offences related to money laundering, terrorist financing and sanctions.

Government amendments 44 to 47 to clauses 171 and 172 concern information orders. They seek to clarify the cases in which the information order power can be used and to provide clarity to operational partners about how they should be used. They will ensure that the power can be used only for the criminal intelligence functions of the National Crime Agency, and that when assessing a request for information from a foreign intelligence unit, the NCA must be satisfied that the information would support the FIU’s intelligence function.

[Bob Seely (Isle of Wight) (Con)]

On the SRA, will the Bill address the strategic lawsuits against public participation that we have been discussing for the last couple of days, or does it purely concern money laundering and other offences unrelated to SLAPPs?

[Tom Tugendhat]

The Bill is concerned only with economic crime and corporate transparency, and the regulations will cover only that. Many Ministers, including the Lord Chancellor, have spoken about SLAPPs—I will touch on them later—but the reality is that they require a separate jurisdiction and a separate Bill.

Government amendments 48 and 49 concern information sharing. In Committee, Opposition Members rightly pointed out that our proposed definition of large accountancy firms did not include insolvency practitioners, auditors and tax advisers. I thank them for that. These amendments will rectify that omission by expanding the scope of the indirect information sharing clauses to include those sectors.

In addition to the Government amendments, several other amendments on a broad range of topics will be debated today. As in Committee, I look forward to what I anticipate will be a lively but extremely well-considered debate. The contributions of all hon. Members who participated in earlier debates have helped to shape the Bill into an effective tool to tackle illicit finance and ensure that the UK is a great place to do legitimate business.

I know that there are places where hon. Members would like the Bill to go further and do more. Indeed, I am as keen as many of them to solve some of the outstanding problems that we all wish to address, but we need to ensure that those ambitions are delivered in the most effective way and that we use the appropriate legislative vehicles to ensure that they have the desired outcome. Limiting the scope to just economic crime can, in several cases, create more problems than it solves, and I assure right hon. and hon. Members that I have strenuously tested what can be effectively delivered within the scope of the Bill.

[Dame Margaret Hodge (Barking) (Lab)]

Will the Minister expand on that interesting point? How would any of the amendments on SLAPPs, a duty to prevent or seizing assets limit what could be done in future?

[Tom Tugendhat]

The question is at what stage do we bring a Bill forward—do we wait for it to be perfect or do we bring forward what we can get at a certain point? The right hon. Lady raises some interesting points. She knows my views on SLAPPS; indeed, in a former incarnation, I may have expressed them extremely clearly. She knows that we share views on asset seizures too. I should point out, however, that no common law jurisdiction has successfully solved the question of asset seizures, although many of us have tried and, indeed, some of us are in conversation with others to try to work out ways of doing it—forfeiture and seizure are not quite the same thing.

[Mr Jonathan Djanogly (Huntingdon) (Con)]

Will my right hon. Friend give way?

[Tom Tugendhat]

I will give way; I should have known that I was lining that up.

[Mr Djanogly]

Yes, because my right hon. Friend touched on asset seizures and tempted me. Of course, Canada has enacted an Act of Parliament that provides for freezing orders to be translated into seizing orders at the request of the Attorney General of Canada.

[Tom Tugendhat]

My hon. Friend is absolutely right, but he is also no doubt aware that there is much discussion in the Canadian legal community about whether those orders will be challenged in different ways and how exactly they will work. There is still a serious debate about the nature of translating from forfeiture to seizure.

[Mr Djanogly]

My right hon. Friend is generous in giving way again. All this law is new: our unexplained wealth orders were new, and they have been questioned in the courts, so that is not the question. The question is whether we have the guts to stand up and move on this issue, as the whole western world wants to see.

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[Hon. Members]

Hear, hear!

[Tom Tugendhat]

My hon. Friend is absolutely right, but I note that some hon. Members cheering would also cheer the provisions of the European convention on human rights that guarantee the right to private property and many of the areas that cause the difficulties that the UK has and Canada does not.

I do not deny that there is an enormous question for debate here and that many hon. Members would like to move quickly to seizure on many areas, but sadly, that may take a bit longer. One thing on which we all agree is that the UK’s place as a rule-of-law jurisdiction and as a home for justice, not just to ourselves but to many others around the world, is essential to our prosperity and to liberties around the world. It is therefore important to ensure that we correctly transfer from forfeiture to seizure, and recognise the rights and limits that we should respect.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

I salute the Minister’s leadership on much of this agenda when he was a brilliant Chair of the Foreign Affairs Committee. He will not, however, want to go down in history as the Minister for mañana. In his responses to the hon. Member for Huntingdon (Mr Djanogly), he has said that the timing is not right and we must wait for future Bills. Can he put our minds at rest and give us a sense of when we might expect a Bill to come forward to address the concerns of the hon. Member for Huntingdon?

[Tom Tugendhat]

The right hon. Gentleman is extremely kind about my former work and, typically, slightly less so about my current employ. He can be assured that, no doubt, it will be temporary, as it is for all occupants.

That matter has seized my attention and has been of some interest to me in further discussions in different areas. I will not put a time on it, because it is not my ministerial responsibility; the right hon. Gentleman will know from his time in Government that talking across other Ministers’ briefs does not always help to advance the case. I assure him, however, that it has come up frequently in conversation with an intent to bring something forward. As I said, the Lord Chancellor has spoken about it to highlight that it is an area where various elements of change are necessary, so I look forward to hearing the proposals as they come forward. I certainly do not think that the matter can wait. We have sadly seen SLAPPs used against such inspiring examples as Eliot Higgins and Catherine Belton, who have stood up for justice in this country and around the world.

[Bob Seely]

Will the Minister give way?

[Tom Tugendhat]

I will not, because I am going to close.

Despite all the areas that we could have gone into, and would like to go into at a different time, the Bill is closely focused on economic crime and corporate transparency for the purpose of passing a series of measures that are essential to ensure that we keep our country safe and our economic jurisdictions clean.

[Stephen Kinnock (Aberavon) (Lab)]

We on the Opposition Benches have been clear that the Bill is long overdue. It has been painful to witness London becoming the world’s laundromat for dirty money with the National Crime Agency calculating that £100 billion of illicit finance flows through the UK every single year. Add to that the Government’s abject failure to properly scrutinise the issuing of golden visas to Russian oligarchs—seven now-sanctioned Russians were awarded such visas even after the invasion of Crimea in 2014—and we see a pattern emerging of Ministers failing to treat economic crime with the seriousness it deserves.

This legislation, which is finally wending its way towards the statute book five years after it was promised—and, let us face it, was only brought forward in response to Putin’s invasion—is a step in the right direction that we on these Benches support. However, it still falls short in a number of areas, as I will cover in my remarks.

--- Later in debate ---

[Sir Robert Buckland]

I was going to spare the blushes of the Minister for Security, my right hon. Friend the Member for Tonbridge and Malling (Tom Tugendhat) and the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), but my hon. Friend has said it for me, and he is right. They know that what I am saying does not just have force, but that they agree with it. That will no doubt carry great weight—

[Tom Tugendhat]

Will my right hon. and learned Friend give way?

[Sir Robert Buckland]

Of course.

[Tom Tugendhat]

What I am enormously enjoying in this Session is the way in which Bills are being picked up and put down by different Ministers. When they are on the Front Bench, they do one thing; when they are on the Back Benches, they say another—sadly, that is the nature of our current political system. It is taking a little while, I admit, for many of us to realise quite how long it can take to get things through in government. Those who have been in government for many years are sharing their knowledge very generously.

[Sir Robert Buckland]

Well, my right hon. Friend must speak for himself. I will tell the House a story: I remember when the present Secretary of State for Defence, my right hon. Friend the Member for Wyre and Preston North (Mr Wallace), held the office of Minister for Security, which my right hon. Friend the Member for Tonbridge and Malling now enjoys. We used to have cross-governmental committee meetings—this was during the Government of my right hon. Friend the Member for Maidenhead (Mrs May)—and I remember having a very fierce argument with a very senior permanent secretary at the Treasury about this very issue. I will not name them, because that would be wrong, but they told me that there was concern about the proliferation of criminal offences in this area because somehow it would add more of a regulatory burden to business. I disagreed hotly with that civil servant then, and I disagree hotly now.

The Minister for Security now has a great opportunity. It is a great privilege as a Minister to get on with a job that others would have wished to finish. We have passed the parcel to him, and he can open it and enjoy the gifts within.

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[Alison Thewliss]

One Minister is on his phone and the other—the hon. Member for Thirsk and Malton—is sitting at the back of the Chamber having a gab. This is not ideal, but perhaps the Minister has already heard what I have to say and does not want to hear it again.

“O, wad some Power the giftie gie us

To see oursels as others see us!”

[Tom Tugendhat]

It is not the first time I have heard this speech.

[Alison Thewliss]

It is not, and it certainly will not be the last. It could be if the Minister accepted the amendments, but he is not going to do that, and he will keep hearing this speech until he does: that is the truth of the matter.

As other Members have said, there is a precedent for a “failure to prevent” measure. It is in the Health and Safety at Work etc. Act 1974 and the Bribery Act 2010, so the concept already exists, and there is no reason why it cannot be applied today. Even if the Government are saying, “We want to extend it to other areas”, that should not limit us today, when the Bill gives us the opportunity.

I also support new clauses 4, 5 and 6. The right hon. and learned Member for South Swindon made an important point about what senior managers have to do, which is also relevant to the Online Safety Bill. I rather like the definition of an offence committed with

“the consent, connivance or neglect of a senior manager.”

All those things contribute to economic crime. This is, if you will, a sin of omission, and we should take the opportunity to tighten up these loopholes. It is one thing to know about something that is happening, it is another thing to look the other way, and it is another thing not to do your job properly and allow that something to happen. This would cover all those eventualities.

New clause 7, in the name of the hon. Member for Cheadle (Mary Robinson) deals with whistleblowing. It is an excellent new clause which would enhance the Bill and offer protection to the very people who flag up these economic crimes. Whenever I think about whistleblowing, I remember a little cartoon that I saw many years ago showing a man sitting at a computer terminal in an office with a sign above his head saying, “Congratulations Frank, whistleblower of the month.” I understand that the cartoonist was Bill Proud. Every time I think about that, I think about the lack of protection offered to whistleblowers, and how much more the Government could be doing to ensure that those who do speak up are protected.

The organisation Protect says that it has offered advice on whistleblowing to 2,500 people a year, and that of those who have contacted it about their experiences, 65% have suffered some kind of detriment as a result of their whistleblowing. There is no incentive for many people to speak out when they see something wrong. They feel that they will lose their job or their promotion and will have to work somewhere else, and also that this might follow them around if they are seeking references for a new job. There is a real problem here, and the Government could, if they wished, deal with it in the Bill: it would make sense for them to do so.

I also support the cost cap suggested in new clause 21. Bill Browder spoke about this issue very powerfully during the Public Bill Committee evidence sessions. The balance is completely skewed to the side of the criminals and away from the Government, and away from the prosecutors and the agencies who want to take on these crimes but simply cannot afford to do so. Bill Browder said:

“What I have learned is that the law enforcement agencies effectively refuse to open criminal cases unless they are 100% sure that they can win without any tough fight on the other side.”––[Official Report, Economic Crime and Corporate Transparency Public Bill Committee, 25 October 2022; c. 65.]

And what we have learned, even just this week, is that the other side can afford anything that allows them to support their case. Indeed, that was made clear in the exchanges on the urgent question on the Wagner Group earlier today. The other side are very well set up financially: they can afford the very best lawyers, while the prosecutors sit there with nothing in their armoury to take on these oligarchs and kleptocrats. That is not acceptable, and a cost cap such as the one suggested in new clause 21 would go some way to addressing it.

Bill Browder has also talked powerfully about the Magnitsky case. He produced a load of evidence about money that been stolen and laundered, being put through various accounts. He had traced all the money, some of which had ended up in the United Kingdom. When he presented the case to prosecutors, to the National Crime Agency and to various other agencies, they all refused to take it on. A crime has been committed, and we know who committed it and where the money ended up, but prosecutors here do nothing about it because it would cost them money that they might never see again. As a result, crimes go unprosecuted in the United Kingdom. It is unacceptable that, by failing to take on new clause 21 and other such measures that would cap costs, the Government are allowing this to continue.

I would support further measures on sanctions. Further to the urgent question, monitoring of sanctions and their effectiveness needs to be a lot tighter. Any sensible sanctions scheme would not have waivers for warlords.

I very much support the new clauses on the proceeds of crime and compensation for victims, for the people of Ukraine and indeed for the people of Iran, as has been suggested by the hon. Member for Oxford West and Abingdon (Layla Moran). Those measures are important. There are schemes such as the financial services compensation scheme, but in many cases that does not fully compensate, or compensate at all, those victims of economic crime. Appropriate compensation should be given, given the real and devastating effect that financial crime can have on our constituents. People who feel that they have been duped will carry that around for a long time, so compensation is important, and there is real need for finance both to fight the war in Ukraine and to rebuild that country thereafter.

--- Later in debate ---

[Dame Margaret Hodge]

I shall be very brief, because I took a lot of time in the House yesterday. I strongly support many of the new clauses being moved by Back Benchers across the Chamber today. If I can just say something about politics, this heartens me and shows that there are ways in which we can work together to pursue the national interest across the political divide. It breathes a bit of confidence and life back into the political process that we have all chosen to join in our careers, so I commend those individual Back Benchers who have put themselves forward and who are speaking today.

The proposals from the hon. Member for Cheadle (Mary Robinson) on strengthening the support for whistleblowing are hugely important. Whistleblowers are an essential part of our armoury in the fight against money laundering and fraud, and we know that, despite all the legal rights, they are not protected. People lose their jobs, their families get destroyed and they are left penniless. Therefore, the establishment of a capability that will do nothing other than protect and promote whistleblowers in the crucial work they do is really important, and I hope that it will be adopted.

The importance of legislating to tackle the abuse of our legal system by oligarchs and others, which the right hon. Member for Haltemprice and Howden (Mr Davis) has just talked about so eloquently, is also really important. I want to be blunt about this and say to those on the Government Front Bench that, if they do not accept this new clause, they will not get a Bill during this Parliament. I bet that is right, so for heaven’s sake let us use this opportunity to get this bit of legislation in. It does not cover everything we would like it to cover, but it will have an impact. It will also give us the experience to see whether we have got the legislation right. I am sure that all the lawyers who helped to draft these new clauses put their best brains into them, but if they have not got them right, we will be able to learn those lessons when we come to extend these measures beyond economic crime.

The right hon. and learned Member for South Swindon (Sir Robert Buckland) made an excellent contribution on the reform of criminal corporate liability, and I want to say something about that. It is not that we want to suddenly bang up a whole load of lawyers, accountants, companies, service providers and all those people who we know are the ones that facilitate or collude with much of the economic crime that takes place. Only the best preventive mechanism that we can think of will force a change of behaviour, and we are not doing that on the back of hope; we are doing it on the back of reality. We know from the Bribery Act 2010 and from the regulations on tax evasion and on health and safety at work that putting this sort of liability on individuals and corporations is the only way to transform behaviour. Last week’s amendment to the Online Safety Bill by the Conservative rebels showed the mood of the House, and I would urge Ministers to think about that. The mood of the House is to use this effective tool to try to transform behaviour in all spheres of life, whether in relation to online harms or to economic crime.

I hope that we will hear from the hon. Member for Huntingdon (Mr Djanogly) soon on the issue of “freeze not seize”. I know he is going to make a number of propositions, and I hope he will not mind if I say something about this. We have been working with an extensive group of lawyers to see whether we can move to a position where we do not just freeze the assets but seize them in order to repurpose them and, particularly in the current context, use them to support the reconstruction of Ukraine. We have finally got a chink in the armour in that regard, but let me say something else first. The lawyers we have talked to work with non-governmental organisations in this field, and the advice they give is always going to be slightly different from the advice that comes from the lawyers working in the Government service. I think we bring a new perspective, and I urge Ministers to listen to what we have to say. The chink is worth examining at this stage, even if we do not go for the further propositions, to show that we mean it when we say that we want to seize this money.

[Tom Tugendhat]

If the right hon. Lady can come up with a way to seize assets and use them for the purposes we have been discussing—notably for the reconstruction of Ukraine, but for other purposes, too—I am all ears. I have had long conversations with the representatives of Governments around the world, and I am yet to hear an idea that works. If she has one, I am happy to hear it.

[Dame Margaret Hodge]

This is not our idea. It comes from a recent seminar we held with lawyers who support the Royal United Services Institute and Spotlight on Corruption. I will leave it to the hon. Member for Huntingdon to expand on it, but I think it is a very interesting chink that we can exploit, although it is not the total answer.

A draft Bill is being prepared by another group of lawyers, but I do not think we can add it to this Economic Crime and Corporate Transparency Bill. I am sceptical that we will find a chance to introduce the draft Bill in this Parliament, but I assure the Minister that we will pursue it after this Bill has passed. I just hope the Government examine the chink we have identified and run with it.

New clause 21 on cost caps, which stands in my name, is part of the way in which we could better fund the enforcement agencies in their fight against economic crime while also preventing economic criminals from exploiting our legal system. At the moment, we have a “loser pays” law, which has two consequences. First, when our enforcement agencies embark on litigation and lose, there is a massive cost to the public purse. We saw that with the unexplained wealth order against Kazakhstan’s Nazarbayeva family. Subsequent investigative journalism suggested that the family told mistruths to the court, but that has never been rectified. Nevertheless, the costs vary from £1.5 million to £2 million.

The SFO took a similar case against Serco involving prisoners who were—I have forgotten the word.

[Tom Tugendhat]

Tagged.

[Dame Margaret Hodge]

I thank the Minister. I am having a senior moment.

The SFO had clearly prepared the case badly, but there was a discovery point that got the litigation thrown out of court, and a huge sum was claimed in costs. The cost to the public purse is enormous.

--- Later in debate ---

[Hon. Members]

Minister!

[Tom Tugendhat]

My apologies, Madam Deputy Speaker. For some reason I was under the impression that the hon. Member for Aberavon (Stephen Kinnock) would be speaking first.

[Stephen Kinnock]

No, no!

--- Later in debate ---

[Tom Tugendhat]

Oh, are you ducking out? Very well.

[Stephen Kinnock]

I will be back for Third Reading.

[Tom Tugendhat]

It is always a joy to hear from the hon. Gentleman.

[Madam Deputy Speaker]

Order. I think I should explain, for the benefit of Hansard, that the shadow Minister will be coming back on Third Reading. It is customary to go straight to the Minister, given that he moved the motion for the lead new clause.

[Tom Tugendhat]

I thought that we were to have the joy and the privilege of hearing from the hon. Member for Aberavon, who can never say too much in this Chamber, or indeed anywhere else—which is lucky, because he very rarely says too little.

It is a huge pleasure to have been here this afternoon. Members in all parts of the House have made extremely powerful points, but I will touch on just a few of them, because many have been covered at length and in detail on numerous other occasions. If Members will forgive me, I will deal straight away with a few of the matters that I think require immediate attention.

I thank my right hon. and learned Friend the Member for South Swindon (Sir Robert Buckland) for tabling new clause 6 and for the way in which he has approached the area of corporate criminal liability, in which he and I agree that reform is required. That is why the Government commissioned a review by the Law Commission, which my right hon. and learned Friend cited and which showed a definite need to clamp down on economic crime conducted by commercial organisations. We have been working closely across Government and with prosecutors in carefully considering its recommendations and how improvements can best be made. It is vital that any reform can be used by law enforcement agencies, does not duplicate what already exists and avoids placing unnecessary burdens on legitimate businesses, but we must also operate within the constraints of the Bill.

I share my right hon. and learned Friend’s passion for change. I am immensely grateful for his thoughtful input, and I greatly value my engagement with him, and with other Members, on this issue. I can assure him that the Government intend to address the need for a “failure to prevent” offence in the other place, and I would welcome further discussion with him about the most effective way in which that can be done.

[Sir Robert Buckland]

I am extremely grateful for what my right hon. Friend has said, but may I gently press him on the issues of “failure to prevent”, fraud, money laundering and false accounting offences—I accept that they may well have to be separate—and a further discussion on the identification doctrine? If so, I will not need to press my new clauses to a vote.

[Tom Tugendhat]

My right hon. and learned Friend is certainly more learned than me, and I will certainly be listening to his views. There are a number of areas that I am sure we will be able to discuss, and I am sure we will reach a conclusion that is acceptable to all sides.

[Dame Margaret Hodge]

I am grateful for the assurance that an amendment will be introduced in another place, but may I also have an assurance that it will cover both corporations and individual directors?

--- Later in debate ---

[Tom Tugendhat]

The right hon. Lady knows very well that I would find it impossible not to listen to her. I look forward to seeing how we can return to this issue. The Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), will no doubt wish to have a strong input as well, so I shall say no more at this stage.

Let me now touch on the question of whistleblowers, and pay enormous tribute to my hon. Friend the Member for Cheadle (Mary Robinson), who has been a friend of many of us for a number of years since she was first elected and who has championed, consistently and clearly, the need for an office for whistleblowers. She is absolutely right: what the country needs is an office for whistleblowers, and what we need to do is ensure that we have the updates to the legislation that she so correctly highlighted. The establishment of such an office would, however, be a significant undertaking. It would have major financial applications owing to its size, it would require significant staffing, and, as matters stand, it might duplicate the role of regulators without the same level of sector expertise. I know that my hon. Friend had the opportunity to meet my hon. Friend the Under-Secretary of State earlier this week to discuss her new clause and plans for the review, which I understand will be set out soon, I hope that the meeting was constructive.

[Mary Robinson]

I have indeed had a meeting with the Under-Secretary to discuss this. There is a long way to go on it and I am steadfast about setting up the office for whistleblowers. However, the conversations have been constructive, I am grateful to Ministers and I will not be pressing my new clause to a vote.

[Tom Tugendhat]

I am grateful to my hon. Friend for that and to the Under-Secretary for having had those conversations. He knows my support for her interest in this important matter.

Clearly, many amendments have been tabled today. The last point I wish to make before we move on to Third Reading is that the Government listened an awful lot on this Bill. Many of us, including myself and the Under-Secretary, who have been taking it through this place, have been listening extremely carefully, for many reasons. One of those reasons is that we picked this up, as many people do, a long way down its process of drafting and through its progress through this House. No doubt there are areas where all of us could tweak, adjust, test and push, but we think that the Bill offers major progress on the situation where we began; I am delighted that that point was shared across this House. So although there are areas where we could have further discussion—I am sure the other place will have criticisms and comment, and we will have improvements and additions—we feel that this Bill, as it stands, is a vast improvement on where we are. Although there is progress to be made, and there always will be, we believe that the Bill marks a useful point of progress for our country in fighting economic crime.

Question put and agreed to.

New clause 14 accordingly read a Second time, and added to the Bill.

New Clause 3

Home Office review of the Tier 1 (Investor) visa scheme: publication

“Home Office review of the Tier 1 (Investor) visa scheme: publication

Within a day of the passage of this Act, the Secretary of State must publish in full the findings of the Home Office review of the Tier 1 (Investor) visa scheme which relate to economic crime.” —(Layla Moran.)

Brought up, and read the First time.

Question put, That the clause be read a Second time.

--- Later in debate ---

[Tom Tugendhat]

I beg to move, That the Bill be now read the Third time.

I will briefly thank a few people on my behalf and on behalf of the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake). I must thank my noble friend Lord Callanan, the Minister for Business, Energy and Corporate Responsibility, who continues to do so much to support the Bill and has been a great help. I also thank the Home Office Minister, Lord Sharpe of Epsom, who is a fantastic asset to our Department.

I thank my right hon. Friend the Member for East Hampshire (Damian Hinds) and my hon. Friend the Member for Sutton and Cheam (Paul Scully), who helped so much to prepare the Bill. Furthermore, I thank my hon. Friend the Member for Watford (Dean Russell), who ably shepherded the Bill through its early parliamentary stages, and the Lord Commissioner of His Majesty’s Treasury, my hon. Friend the Member for North Cornwall (Scott Mann), and his team for their excellent assistance, particularly when he courageously stood in and answered on behalf of the Department in a brief moment of surprise—mostly to him. I also thank the Home Secretary and the Secretary of State for Business, Energy and Industrial Strategy for their contributions.

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

I thank the Minister for his positive response to the amendments tabled by my right hon. and learned Friend the Member for South Swindon (Sir Robert Buckland) and others in relation to the reform of corporate criminal responsibility. That is welcome. Will he take on board the importance of including in that the reform of the identification principle, which is a major bar to corporate prosecutions? The Justice Committee has called for that more than once in its recent reports, and it is supported by the current and previous Directors of Public Prosecutions and the current and previous Directors of the Serious Fraud Office.

[Tom Tugendhat]

I thank my hon. Friend the Chair of the Justice Committee. As he knows, this is an area of great interest and for further discussion, which we are indeed looking at taking forward.

I finish by saying an enormous thank you to the Bill team, who are in the Box today—Tom Ball and the rest of the clan—who have done a fantastic job on Burns night, of all times. Because it is a time for us to find that we are no longer wee and tim’rous beasties, but are instead going to look for that fair trojan of the human race, the “puddin’-race”—forgive me—I look forward very much to being freed of the Dispatch Box and skipping off to the whisky and the haggis. On that, Mr Deputy Speaker, thank you.

[Mr Deputy Speaker (Mr Nigel Evans)]

Lucky Minister. I call the shadow Minister.

Control of Explosives Precursors and Poisons

Tom Tugendhat Excerpts

Monday 23rd January 2023 Written Statements

[The Minister for Security (Tom Tugendhat)]

Today I am laying before both Houses a statutory instrument to strengthen the controls of explosives precursors and poisons in Great Britain.

Following the tragic Manchester Arena attack in 2017, the Government committed to enhance their capabilities to detect and prevent terrorist activity, including that which involves the use of explosives precursors.

The Control of Explosives Precursors and Poisons Regulations 2023 will build on existing safeguards in the Poisons Act 1972 to prevent terrorist access to substances of concern, while ensuring that legitimate users of these products can still access them to pursue lawful activity. These regulations follow a public consultation that ran between December 2021 and March 2022.

Around Great Britain, businesses and individuals use various chemicals for a wide range of legitimate uses. While we do not want to hinder this, we must minimise the risk posed by the illicit use of explosives precursors and poisons. Shops and business are already required to report suspicious activity on the sale, attempted sale, loss or theft of the most dangerous explosives precursors and poisons. Through this legislation, we are adding to the lists of reportable and regulated explosives precursors and poisons, improving the requirements for reporting suspicious activity, as well as providing additional obligations on online marketplaces. Businesses will also be required to record certain information when selling regulated explosives precursors to professional users. This will have minimal impact on businesses already required to report those chemicals and poisons liable to cause harm.

The measures will come into force on 1 October 2023. Guidance on these measures will be available on www.gov.uk in due course ahead of the regulations commencing on 1 October. A full impact assessment and explanatory memorandum will also be laid alongside the regulations in both Houses.

[HCWS509]

Spiking Incidents: Prevention

Tom Tugendhat Excerpts

Wednesday 11th January 2023 Westminster Hall

[The Minister for Security (Tom Tugendhat)]

I am entirely mindful of that, Ms McVey. As my hon. Friend the Member for Gloucester (Richard Graham) quite rightly stated at the beginning of the debate, this is not normally an area I have taken the active interest in that I have today. The reason is that it has been covered by many other brilliant Ministers, and I am delighted to see several of them in the Chamber, notably my right hon. Friend the Member for Witham (Priti Patel), who has done so much for the protection of women and girls in her role in the Home Office. She has spoken out in many other ways and at many other times for the protection of women and girls, not just in the United Kingdom but around the world. If I may, I pay personal tribute to her on the record and thank her for the protection she offered Afghan women and girls, when she was instrumental in helping so many escape that terrible moment in 2021 when the Taliban were doing more than anyone has done in decades to reverse the rights of women and girls.

Many powerful voices have spoken out. She did not speak today, but I speak in particular praise of the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Mid Sussex (Mims Davies), who has spoken out on the record publicly about her own experience of spiking and the reason it matters so much to her and many others. She has exposed a very important truth, which is that, although we have spoken a lot about women and girls today, this crime is not about women and girls, but about our whole society. It affects many young men as well, and it affects many more people in our community than just those who are spiked. It affects families and loved ones. It affects partners and friends, who deal with the pain of seeing a victim suffer and with the trauma that affects a community afterwards.

I place on the record the importance I attach to this crime, as I know the Safeguarding Minister, my hon. Friend the Member for Derbyshire Dales (Miss Dines), also does, as does the Home Secretary, who has been very clear in her defence of not just women and girls, but all people in our society over the months in which she has been in post. This is an enormously important issue, and I am extremely grateful to my hon. Friend the Member for Gloucester and to all other Members who have spoken out today. As my hon. Friend the Member for Rushcliffe (Ruth Edwards) put it, this is a crime of violence, and violence should be punished.

There is an awful lot that is already being done. We should be especially grateful to people such as Deputy Chief Constable Maggie Blyth, who is the national policing lead in this area. She has done huge amounts of work to make sure that, in cities across England and Wales, uniformed police officers visit venues and work closely with those who are guarding them. The SIA has also made it part of the conditions for licensing in the industry, including for bouncers, to consider the importance of standing up for women and girls and knowing how to act in certain circumstances. That change was brought in by my right hon. Friend the Member for Witham—that was another moment when she was active in defending people who require assistance in moments of emergency and trauma. I am extremely grateful for the work that has been done.

I am also grateful for the work done with groups such as Eurofins, which has developed a rapid testing capability. Forgive me for going on about it, but my right hon. Friend the Member for Witham was again instrumental in that development. I am also grateful for the work of police forces around the country, in England, Wales, Scotland and Northern Ireland, in making sure that police officers are properly trained and ready to respond.

It is absolutely right that we now look at where the law is. Last year, we reclassified the so-called date rape drug GHB and two related substances from class C to class B, under the Misuse of Drugs Act 1971, which made those drugs harder to access and increased the maximum jail sentence from two to five years. Spiking is one of the crimes that is affected by those drugs, and that change was an important step in addressing the use of those drugs and their availability.

Since 2021, £30 million has been invested in projects with a particular focus on protecting women in communities. This Government have also been absolutely adamant about setting up a tackling violence against women and girls strategy, to ensure that women and girls are safe on our streets and in our night-time economy. It is worth saying that action taken to protect women and girls protects all people in our night-time economy, which is absolutely essential.

It is also important that the Enough communications campaign has been having an impact. It is good to see so many different groups supporting it and pushing out the different ways in which it can been helpful.

Another aspect is the additional £50 million invested into the 111 projects through the safer streets fund, which has focused on tackling violence against women and girls in public places, as well as neighbourhood crime and antisocial behaviour. I am very grateful that so much of that funding has gone through and has now been seen in a range of interventions, including bystander training programmes, taxi marshals, CCTV and street lighting, drink protectors and educational training for night-time economy staff.

Public safety is of course paramount, which is why we worked so closely with festivals and festival organisers and the outdoor events sector last summer to ensure that the necessary protocols, training, communications and guidance were in place ahead of events, and why so much work has been done with universities ahead of freshers week. Sadly, it is a time when events can lead to offences, and we need to ensure that everyone is aware of the challenges that we face and the dangers that some people bring. I am extremely grateful for all the work that my hon. Friend the Member for Gloucester has done to highlight the issue, not least through introducing a private Member’s Bill last year.

The Home Office, and the Home Secretary in particular, is committed to examining whether, in addition to the existing range of offences that can be used to cover spiking, there is need for a further criminal offence. The Home Office has told me that it has carefully considered the case for further legislation, and the Minister for Safeguarding has written to the Home Affairs Committee. There is clearly more that has come out today. There is clearly a strength of feeling in the House and a voice that is coming from so many parts of this Chamber that needs to be listened to. I am sure that the Minister for Safeguarding will listen to this debate and hear exactly what has been said.

I am interested to note that my hon. Friend the Member for Gloucester has mentioned that, given the strength of existing legislation, he is not of the opinion that a new offence is required. I will listen carefully to his point and his suggestion that a so-called umbrella amendment may be possible. This is not an area on which I have spoken to officials, so I hope he will forgive me, but my understanding is that this would come under the Offences against the Person Act 1861 and would require—I see that my right hon. Friend the Member for Witham is nodding, as she is more aware of this than I am—conversation and discussion with the Ministry of Justice. I will take that away and come back to him, or ask the Minister for Safeguarding to come back to him to look at where different aspects could be investigated, because no one wants a gap in the law. No one wants to see crimes going unpunished and no one wants to see victims unable to achieve the level of protection that is absolutely essential.

Having heard the Chair of the Home Affairs Committee, the right hon. Member for Kingston upon Hull North (Dame Diana Johnson), and the Chair of the Women and Equalities Committee, my right hon. Friend the Member for Romsey and Southampton North (Caroline Nokes), make such powerful points in the debate, I think there certainly are areas in which we could investigate further opportunities for co-operation and ensuring that spiking is not only reported but counted in the data, so that we can target responses in exactly the way we should for the protection of others.

[Dame Diana Johnson]

This morning, the Home Affairs Committee published the letter from the Minister for Safeguarding, which is dated 20 December—sent just before Parliament rose for the Christmas recess. Is the Minister now saying that he is moving away from the unequivocal position set out in that letter, which said that there was going to be no change to the law because existing legislation stands and is sufficient? From what the Minister is now saying, it sounds that way to me. If he is, can he please write to the Committee and to the hon. Member for Gloucester (Richard Graham), because we were under the impression that that was not the Government’s case at all?

[Tom Tugendhat]

My position and the Government’s position on this is that the Minister for Safeguarding has written clearly to the right hon. Lady, but I was merely identifying the fact that the whole point of this Chamber is to debate and explore ideas, and ideas have been explored this afternoon. As new ideas come forward and new issues are raised, it is appropriate that we respond to them. I am sure the Minister for Safeguarding will be delighted to respond to them, and my hon. Friend the Member for Gloucester has raised other issues that could offer a different way of looking at things. There are always areas where we can engage in debate and discussion. After all, that is the point of this Chamber.

I am going to leave it there, because my hon. Friend the Member for Gloucester will want to wrap up, but I will very briefly go through the facts that have been laid out so clearly. First, this is a crime that sadly affects far too many people in this country and seems to be growing. Secondly, this is a crime that disproportionately affects women and girls, but does also affect many others. Thirdly, the Government take this extremely seriously. In many ways, over many years, they have sought to tighten up the defence of women and girls, of those enjoying the night-time economy and of individuals who may find themselves vulnerable. In that light, I pay huge tribute to my hon. Friends the Members for Mid Sussex, for Derby North (Amanda Solloway), for Redditch (Rachel Maclean) and for Louth and Horncastle (Victoria Atkins), and my right hon. Friend the Member for Witham, for the work that they have done in this area in safeguarding others, because it is hugely important not just to the Government, but to all Members of this House.

Oral Answers to Questions

Tom Tugendhat Excerpts

Monday 19th December 2022 Commons Chamber

[Neil Coyle (Bermondsey and Old Southwark) (Ind)]

6. When her Department plans to publish the review of tier 1 investor visas.

[The Minister for Security (Tom Tugendhat)]

This question has been raised on many occasions, including, funnily enough, by me in a former incarnation. I am pleased to say that we are approaching the moment when I will be able to satisfy not only the hon. Gentleman’s but my desires.

[Neil Coyle]

Sounds fascinating, Mr Speaker, but the Minister—whom I congratulate on his role—knows that this review was commissioned nearly five years ago, so it is pathetic not to be able to give us a direct answer on when it is coming. Contrary to today’s rhetoric on securing borders, can he confirm that this scheme quickly became a security risk to this country, with no fewer than 10 Russians who were approved under the scheme now being sanctioned by the UK, and that more than 6,000 others granted tier 1 visa status are now being reviewed as a security risk to this country?

[Tom Tugendhat]

The hon. Member makes some solid points about the dangers of the involvement of certain states—in this case, Russia—in the United Kingdom. He should also be aware that the visa scheme closed in February 2022, and the response to Russian aggression or Russian influence in this country has been pretty robust. Indeed, since 2019, we have increased spending on the National Crime Agency by 30% and £200 million extra has gone in. As he knows, there is a long way to go and that is exactly what I am going to be doing over the next few years.

[Rachael Maskell (York Central) (Lab/Co-op)]

7. What steps she is taking to support asylum seekers while their applications are being processed.

--- Later in debate ---

[Mr Speaker]

Order. You know the game: the game is short questions in topicals. Please do not take advantage of the situation, because all the Back Benchers want to get in as well.

[The Minister for Security (Tom Tugendhat)]

I am delighted that the hon. Lady has raised the question of the Iranian threat in the UK. As she knows very well, the head of MI5, Ken McCallum, has cited the issue that our country faces in this arena. He has also, however, prepared many different aspects of the National Security Bill, which will help to put the country on a much stronger footing. We have enjoyed strong cross-party co-operation on this, and I look forward to the hon. Lady’s co-operating further with the Government in ensuring that this country is in a much stronger position than it has been in recent years, particularly in facing the Iranian threat, which sadly has become all too great here, quite apart from the extraordinary brutality that we are seeing in Tehran today.

[Sir Edward Leigh (Gainsborough) (Con)]

T8. Given that, under the 1951 refugee convention, if no legal and safe routes are available it is illegal to arrest and detain an asylum seeker landing on our shores at Dover, does the Minister agree that we can make as many statements and pass as many laws as we like, but unless we achieve a temporary derogation for the convention—and, if necessary, from the European Court of Human Rights on this particular issue—we will never solve the problem?

Draft Investigatory Powers (Communications Data) (Relevant Public Authorities and Designated Senior Officers) Regulations 2022

Tom Tugendhat Excerpts

Tuesday 13th December 2022 General Committees

[The Minister for Security (Tom Tugendhat)]

I beg to move,

That the Committee has considered the draft Investigatory Powers (Communications Data) (Relevant Public Authorities and Designated Senior Officers) Regulations 2022.

It is, as always, a pleasure to serve under your chairmanship, Ms Bardell. Protecting our national security and public safety are key priorities for this Government, and I hope every Government. One of the main ways in which we achieve that is by ensuring that our intelligence agencies, law enforcement bodies and public authorities are equipped with the powers to carry out their statutory duties.

The Investigatory Powers Act 2016, which I will refer to as the IPA, provides extensive and robust privacy safeguards for investigatory powers. We rightly have in place world-leading standards on transparency, privacy, redress and oversight to accompany the exercise of those important powers. The regulations will make two necessary amendments to schedule 4 of the IPA.

The first will implement the findings of the High Court in the case of Liberty v. the Secretary of State for the Home Department and the Secretary of State for Foreign and Commonwealth Affairs. The judgment in the case was handed down in June this year, and its coming into effect was stayed until 1 January 2023 to allow for the appropriate changes to be made to the legislation and for the appropriate processes to be put in place. This amendment will remove the power for the UK intelligence community to internally authorise the acquisition of communications data for purposes that relate solely to serious crime other than in urgent circumstances. From this point, I will refer to communications data as CD and the UK intelligence community as UKIC.

In line with the Court’s judgment, it will be a requirement for UKIC to seek authorisations for acquisitions of this type from the Office for Communications Data Authorisations. The OCDA is currently responsible for considering nearly all CD applications made by public authorities in the UK, on behalf of the Investigatory Powers Commissioner. OCDA operates during normal office hours only and our intelligence services need to be able to access CD at all hours in urgent situations. It is imperative that UKIC retains the ability to self-authorise the acquisition of CD for urgent applications. The regulations give it the power to self-authorise in urgent situations where those authorisations relate solely to serious crime. It is important to note that law enforcement bodies such as police forces are already able to self-authorise urgent CD requests in the same way. The statutory instrument simply puts UKIC in the same position as the police in relation to serious crime applications. If the change were not made, there would be an increase in the risk of serious crime impacting our communities because of the delays that would cause to UKIC’s operations.

[Hilary Benn (Leeds Central) (Lab)]

The explanatory memorandum states that the High Court held that the ability to self-authorise was

“incompatible with retained European Union law.”

Will the Minister identify which part of retained European law was the cause of the problem and confirm that the regulations solve the problem in its entirety? In other words, do there need to be any other changes to retained EU law in order to deal with the difficulties identified? If he wants to write to me afterwards, I would be happy to receive a letter.

[Tom Tugendhat]

The right hon. Gentleman will be getting a letter.

[Hilary Benn]

I am very grateful—happy Christmas!

[Tom Tugendhat]

It will not be a Christmas card!

Additionally, the regulations will amend the schedule 4 entry for the United Kingdom National Authority for Counter-Eavesdropping, which I will refer to as UK NACE. UK NACE is a critical organisation that protects our national security, and it is essential that it is equipped with the appropriate powers to carry out that activity effectively. That is why UK NACE was added to schedule 4 in 2020.

The regulations do not change the powers afforded to UK NACE but will make its designation more consistent with the approach taken for other similar bodies in schedule 4 to the IPA. I can also provide reassurance that as per the obligations set out in section 72 of the IPA, appropriate consultation has taken place with UK NACE, the Foreign, Commonwealth and Development Office and the Investigatory Powers Commissioner’s Office in respect of these amendments. In summary, the regulations will enable UKIC and UK NACE to continue carrying out their statutory duties effectively in order to protect the public, while ensuring that the appropriate oversight is in place to ensure compliance with the Investigatory Powers Act and to protect the privacy of UK citizens. I commend the draft regulations to the Committee.

[Holly Lynch (Halifax) (Lab)]

It is a pleasure to serve under your chairmanship, Ms Bardell. I thank the Minister for his opening remarks. He has outlined what the statutory instrument does, and we are very aware that these changes come as a result of the High Court ruling in June this year in the case of Liberty v. the Secretary of State for the Home Department and the Secretary of State for Foreign and Commonwealth Affairs. The SI will now allow for the internal authorisation of the acquisition of communications data solely for serious crime purposes in urgent situations, as prescribed by section 61A of the Investigatory Powers Act 2016.

I understand that parts of the wider case were dismissed, however the High Court ruled in favour of Liberty on a key point, deeming it to be unlawful for the security services to obtain individuals’ communications data from telecom providers without having prior independent authorisation in certain circumstances. We welcome the weight of the ruling of the High Court and, therefore, the Government’s corrective action with this statutory instrument. In an ever-changing world, it is crucial we get the investigatory powers available to our security services right in order to deal properly with the modern threats we face, including from serious and organised crime. However, that must always be prudently balanced against civil liberties.

I see that there was a period of consultation on these changes with the agencies most affected, and while I am curious to know what their response was, I know from my work in the area that a great deal will not be able to be shared with the Committee or more widely. I welcome the fact that the consultation took place. I also welcome the letter the Minister promised to my right hon. Friend the Member for Leeds Central, and I would be grateful for a copy.

[Tom Tugendhat]

I would be delighted.

[Holly Lynch]

I will not detain the Committee any longer, and we will not divide on the regulations.

--- Later in debate ---

[Tom Tugendhat]

I am delighted that the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East is happy now that Liberty is happy. That leaves us all happy. On that note, I will rest.

Question put and agreed to.

Draft Proceeds of Crime (Money Laundering) (Threshold Amount) Order 2022

Tom Tugendhat Excerpts

Monday 12th December 2022 General Committees

[The Minister for Security (Tom Tugendhat)]

I beg to move,

That the Committee has considered the draft Proceeds of Crime (Money Laundering) (Threshold Amount) Order 2022.

It is very nice to serve under your chairmanship for the first time, Mrs Murray. The amendment is a relatively simple one, and I hope it will be relatively uncontentious: it allows the declaration for defence against money laundering suspicious activity reports, known as DAMLs, to be raised from £250 to £1,000. Doing so makes eminent sense, partly because of the increasing cost of everyday items, but also because of the need for us to have a system that is able to check the genuine threats to our money laundering regime, rather than simply keeping an eye on absolutely everything that might happen to be going on.

Every DAML is submitted to the National Crime Agency by a person proposing to deal with suspected criminal property that may make them liable for money laundering under the Proceeds of Crime Act 2002; that DAML would make sure that that person is avoiding liability. Clearly, if someone is paying their rent or taking part in an ordinary transaction, we are not trying to criminalise every transaction, but to make sure that we have a proper awareness of what is going on and what could pose a threat. That is why I believe that we must raise the threshold to £1,000, because the vast majority of DAMLs do not provide law enforcement with asset seizure opportunities—opportunities to take money away from criminals. Instead, they place a regulatory burden on businesses such as banks to submit, place a burden on law enforcement to review, and create a delay for customers, who must often wait seven days for their transactions to process. I think there is general agreement with that.

--- Later in debate ---

[Tom Tugendhat]

A quick note on the staffing: 45 officers are already in post, and no doubt the others will come onstream very soon, because that milestone is extremely important for making sure that we have properly recruited for 2022-23. So I can update clearly on that.

There will of course be a constant review of the number of officers we keep in post in order to make sure that we have proper staffing for the requirements. As the hon. Member for Halifax can see, we are increasing numbers because the demands are great. I understand the point made by the right hon. Member for Hayes and Harlington about staffing, and I completely agree—

--- Later in debate ---

On resuming—

[Tom Tugendhat]

Please pass on my thanks to the right hon. Member for Hayes and Harlington for his kind note, Mrs Murray. He wants to speak in the debate in the Chamber, so I completely understand why he is not here. His points, which I was going to address before we were interrupted, are entirely valid. He asked about the change from £250 to £1,000. The reality is that we are overloading the system. It is true that we can constantly hire more people, but we need to use them to analyse the data, not overload the system with smaller transactions. That is why the request to raise the threshold has been put before Parliament today.

I think this is an important, sensible adjustment, and we will keep it under review. As the right hon. Gentleman said, there is a broken windows theory that goes along with this: smaller crimes can lead to larger ones. The UKFIU is keeping an eye on the build-up of transactions, and not just the absolute numbers, so in different areas it will be aware of how these elements are going. I appreciate Members’ comments—I understand the spirit in which they are raised—and I entirely respect their positions. However, in order to achieve the aims that we are all seeking, this is a sensible amendment to the existing regulations, and no doubt it will be kept under review should the situation change.

Question put and agreed to.

Resolved,

That the Committee has considered the draft Proceeds of Crime (Money Laundering) (Threshold Amount) Order 2022.

Granted Accredited Financial Investigation Powers to Additional Agencies: Consultation

Tom Tugendhat Excerpts

Wednesday 7th December 2022 Written Statements

[The Minister for Security (Tom Tugendhat)]

I intend to lay a statutory instrument before the House next year which will amend the Proceeds of Crime Act 2002 (References to Financial Investigators) (England and Wales and Northern Ireland) Order 2021/640 to ensure that the new powers introduced in the Economic Crime and Corporate Transparency Bill are operational and able to be used by accredited financial investigators.

This SI will also grant accredited financial investigator powers to an additional five agencies. This will bring the total number of agencies with access to these powers to 41 in addition to all police forces and local authorities in England, Wales and Northern Ireland.

Accredited financial investigator powers grant civilians working for that agency access to certain Proceeds of Crime Act 2002 powers, which assist in the effective recovery of proceeds of a crime that falls under that agency’s jurisdiction.

The following organisations have sought access to accredited financial investigator powers:

Security Industry Authority

Food Standards Agency

Environment Agency

Public Sector Fraud Authority

Department for Work and Pensions

I have assessed the value of extending the powers to each of these agencies—in particular whether effective criminal justice outcomes could be reached in their jurisdictions without access to these powers—and I have provisionally concluded that we should seek to grant the powers to all five. However, I intend to seek the views of the wider public as to whether these organisations should be granted these powers.

As such, I am today publishing a consultation for 12 weeks. This consultation will seek to establish the views from the public on whether or not these organisations should be granted the financial investigator powers.

A copy of the consultation document will be placed in the Libraries of both Houses and also made available on www.gov.uk.

[HCWS419]

Draft Investigatory Powers Commissioner (Oversight Functions) Regulations 2022 Draft Investigatory Powers (Covert Human Intelligence Sources and Interception: Codes of Practice) Regulations 2022

Tom Tugendhat Excerpts

Wednesday 23rd November 2022 General Committees

[The Minister for Security (Tom Tugendhat)]

I beg to move,

That the Committee has considered the draft Investigatory Powers Commissioner (Oversight Functions) Regulations 2022.

[The Chair]

With this it will be convenient to consider the draft Investigatory Powers (Covert Human Intelligence Sources and Interception: Codes of Practice) Regulations 2022.

[Tom Tugendhat]

It is a pleasure, as always, to see you and to serve under your chairmanship, Sir Robert. The draft Investigatory Powers (Covert Human Intelligence Sources and Interception: Codes of Practice) Regulations 2022 were laid before the House on 19 October, while the Investigatory Powers Commissioner (Oversight Functions) Regulations 2022 were laid on 18 October.

Maintaining our national security and keeping the public safe is the top priority of this Government and, I hope, every Government. We seek to make these regulations to ensure the maintenance of transparent oversight and the effective operation of the safeguards that are in place to manage the important powers exercised under both the Investigatory Powers Act 2016 and the Regulation of Investigatory Powers Act 2000.

There are three key points to discuss. First, there are the amendments to the covert human intelligence sources code of practice, which I will refer to as the CHIS code—a lovely phrase. The regulations will update the CHIS code in light of the amendments made to the Regulation of Investigatory Powers Act, henceforth known as RIPA, by the Covert Human Intelligence Sources (Criminal Conduct) Act 2021. The amendments to part 2 of RIPA sought to ensure that there is a clear and consistent statutory basis to authorise CHIS to engage in conduct that could otherwise be criminal where it is necessary and proportionate to do so, having regard to the UK’s obligations under the European convention on human rights and the Human Rights Act 1998. The CHIS code sets out the processes and safeguards governing the use of CHIS by public authorities, and provides detail on how CHIS powers should be exercised and duties performed, including examples of best practice. The draft revised CHIS code also sets out enhanced protections for children and vulnerable adults where they are to be authorised as CHIS in exceptional circumstances. There has been extensive, valuable consultation with charities and interest groups to inform these changes.

This instrument will also make necessary changes to the interception of communications code of practice, which I will refer to as the draft revised interception code. The draft revised interception code provides further guidance on the use of interception by public authorities that exercise such powers, which are also known as intercepting authorities. The changes to the draft revised interception code will reflect the Government’s long-standing position on serving intercept warrants on cloud service providers and the enterprise service that they provide to customers. These limited changes will bring much-needed clarity for relevant UK and US companies that are impacted by enterprise service issues.

A public consultation on the proposed changes was carried out between July and October. After further cross-governmental engagement on the draft revised interception code, there are three additional changes to the proposed revisions, to reflect that an intercepting authority may opt not to serve a warrant on the enterprise if doing so would compromise national security. These changes are intended to provide further examples of the circumstances under which a warrant may be served on a cloud service provider instead of an enterprise customer, and outlines the obligations imposed by the Investigatory Powers Act regarding unauthorised disclosure to help protect national security.

Finally, I turn to the changes to the investigatory powers commissioner’s oversight functions. I will refer to the investigatory powers commissioner as the IPC. These regulations place two areas on a statutory footing: first, the IPC’s oversight of the GCHQ equities process, and secondly compliance by members and civilian staff of SO15 at the Metropolitan Police Service and members of the National Crime Agency with the guidance referred to as “The Principles relating to the detention and interviewing of detainees overseas”. These areas have previously been overseen by the IPC and his office on a non-statutory basis.

The changes will provide greater public accountability and enable the effective discharge of the IPC’s responsibilities. As a statutory authority, the parameters of the IPC’s remit are set by Parliament and the IPC has made it clear, and the Government agree, that he considers formalising his oversight responsibilities as being in the best interests of transparency and robust oversight. In summary, the regulations provide clarity and transparency around the use of oversight powers that are vital for keeping the public safe. I commend the regulations to the Committee.

--- Later in debate ---

[Tom Tugendhat]

I thank both Opposition parties for their co-operation. Both codes are very important, and the commissioner is an important addition, so I am extremely grateful that they have given their consent.

Sadly, tracking not only individuals but state-based threats around our country requires powers that many of us wish we did not have to exercise or use, but it would be irresponsible of the state not to have them. Governments in the past have always supported this, so I am glad that we have done so.

It is worth noting that the IPC only has the powers to oversee the process and report, not to intervene or act in any other way, so that has not changed; it has just been extended. Chapter 2 of the CHIS code makes clear that criminal conduct authorisation must be set out clearly for each CHIS. The hon. Member for Halifax is right to ask about the use of children. Of course, children would always be extremely cautiously used in any Government activity and only in the most appropriate circumstances, when no other way could be found to achieve the same result. I assure her that no authorisation would be given unless it was absolutely necessary and the interests of the child were fully taken into account. It is such commitments that have allowed us to get through the consultation process with many groups that are rightly entirely focused on the interests of the child.

I thank the Committee for considering these regulations. Thank you, Sir Robert, for your chairmanship; it is always a pleasure to see you. I thank the Opposition parties for supporting these important SIs.

Question put and agreed to.

DRAFT INVESTIGATORY POWERS (COVERT HUMAN INTELLIGENCE SOURCES AND INTERCEPTION: CODE OF PRACTICE) REGULATIONS 2022

Resolved,

That the Committee has considered the draft Investigatory Powers (Covert Human Intelligence Sources and Interception: Codes of Practice) Regulations 2022 .—(Tom Tugendhat.)