Proceeds of Crime Bill

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Mr. Alistair Carmichael (Orkney and Shetland): Does the hon. Gentleman agree that if that is the intention and effect of the operation under the clause, it would be most unhelpful? It would muddy further an often misunderstood distinction between confiscation and forfeiture. Forfeiture would be the appropriate avenue for the court in relation to the car to which he refers.

Mr. Grieve: I agree entirely. That is precisely the issue that we should address. It is all the more curious because it is highlighted under reconsideration, although I did not flag it up, and I cannot see where it appeared in that form when we considered it under the straight confiscation provisions. I wait to hear from the Minister on that point.

Mr. Bob Ainsworth: The hon. Gentleman is absolutely right that the amendments, taken in isolation, would have a relatively narrow effect, but their consequences would go far wider than that. Let me say, without trying to justify the wording of the Bill, that the measures go no further than the current legislation. If there is a belt and braces approach, or a superabundance of caution, it already exists. The Committee will have to consider whether such caution is necessary.

Mr. Nick Hawkins (Surrey Heath): I understand the point that the Minister makes. However, will he enlighten us as to whether the phraseology about which the hon. Member for Orkney and Shetland (Mr. Carmichael) and my hon. Friend are worried is the precise formulation used in the existing legislation? If not, there is no reason to repeat it, thereby leading to the possible difficulties that they have outlined.

Mr. Ainsworth: I do not think that it is the exact wording in the existing legislation. I shall outline briefly the current legislative position. Section (2)(3) of the Drug Trafficking Act 1994 provides that a person benefits from drug trafficking if he has at any time received any payment or reward in connection with drug trafficking. Section 71(4) of the Criminal Justice Act 1988 states that a person benefits from an offence if he obtains property as a result of or in connection with its commission. Both those statutes have the effect that a court conducting a revaluation exercise can consider benefit received by the defendant at any time, both as a result of and in connection with criminal conduct. The Bill does not go further than existing legislation in that respect: it replicates it.

I shall outline why we are including the words in question, and let the Committee consider whether the abundance of caution is more than is necessary. The Bill applies both limbs of the definition—``as a result of'' and ``in connection with''—in the revaluation clauses and elsewhere, because that is necessary to ensure that offenders are deprived of the full value of their criminal proceeds. There is no reason to treat property obtained after the date of the original court decision or after the conviction differently from other property when the court is reconsidering the case. The court should consider all the information available to it about benefit connected with the conduct. If, for example, a defendant has in his bank account a sum of £50,000 acquired from crime, it is perfectly acceptable that the court should recover the benefit, including any interest that has accrued on that sum, up to the time when a confiscation order is made and not up to the point of conviction. If confiscation powers were limited to property received as a result of conduct, that would not be sufficient to cover every situation in which criminals derive benefit from crime. That has always been accepted, and, in response to the question posed by the hon. Member for Beaconsfield, it applies to revaluation provisions and general provisions.

To give an example, let us suppose that an offender is involved in a drugs ring. The offender's sole involvement in the operation is to carry the drugs into the country in exchange for a payment by the organisers of the ring. It would not be beyond the ability of a lawyer to seek to argue that payment in those circumstances was not received as a result of the conduct. However, we would want such payment to be the subject of confiscation. Perhaps the courts would reject an argument along the lines that I have mentioned, but the wording ``in connection with'' makes that outcome far less likely. Many circumstances exist in which benefit is derived from criminal conduct but is not a direct and immediate causal result of that conduct. It would not be right to place such benefit beyond the reach of confiscation as the amendment would do.

Mr. Carmichael: The Minister just imported some interesting words into the Bill that are not currently there. He referred to a ``direct and immediate'' result. That is not the wording of the Bill, which is ``as a result''. There is no need for immediacy or directness under the Bill.

Mr. Ainsworth: Is the hon. Gentleman arguing that we should limit the ability of the court to consider the proceeds of crime when they cannot be proven to be directly the proceeds of crime. There are all kinds of instances when the individual concerned receives payments not directly but as part of an operation or organisation, and such proceeds can properly be regarded as the proceeds of crime.

Mr. Boris Johnson (Henley): It seems to me that the words ``in connection with'' are superfluous. In the Minister's example of a trafficker who is rewarded, and who plainly receives his reward as a result of engaging in that criminal activity, it would be impossible for a lawyer to argue otherwise. My only suspicion is that the words ``in connection with'' are intended to widen the definition to draw in proceeds that may not be directly related to the particular crime.

Mr. Ainsworth: There is not an intention to widen the definition, and that is not the effect of the wording. Does the hon. Gentleman want to put such issues in doubt, and allow for such arguments to be made when the proceeds are not wholly direct, as I said? Alternatively, does he want to make it absolutely clear to the court—through the wording of the Bill—that when proceeds have been gained ``in connection with'', those proceeds are allowed to be confiscated? The caution expressed in the Bill is necessary in order to preclude that doubt. We should not allow that doubt to enter into the argument. I do not agree that the phrase widens the definition to include benefits that are not the proceeds of crime.

Mr. Grieve: The Minister used the word ``proceeds''. I agree that there would be no difficulty with proceeds gained ``in connection with''. However, the word that appears in the Bill is ``property''. That is one of the reasons why I flag up the point about a car that is legitimately acquired but is used in connection with criminal conduct. The Minister did not suggest that such a vehicle or property was to be taken into account. There is a difference between property and proceeds.

Mr. Ainsworth: Although I used the word ``proceeds'', and the hon. Gentleman is concerned about the word ``property'', the Bill mentions ``property obtained'', not ``property used'', in connection with crime. He would have a point if the Bill referred to ``property used'' in connection with crime. If a criminal had borrowed his granny's car, we would not want the car to become subject to the confiscation procedure. That car would not be property obtained in connection with crime.

Mr. Johnson: What if the culprit used his granny's car to engage in not just criminal activity but lawful activity by which he obtained property in connection with his particular criminal conduct? If I understand the clause correctly, that property would be forfeit, or liable for confiscation.

Mr. Ainsworth: If the culprit used his granny's car to obtain property in connection with crime but did not obtain the car as a result of criminal conduct, how would the car be forfeit? If he obtained it as a result of, or in connection with, criminal conduct—obtained, not used—why should he not forfeit it?

Mr. Johnson: The Minister slightly misunderstands me. The issue is not how the criminal obtained the car, but property obtained with the car that may be connected with criminal conduct. As I understand it, such property would be connected with his criminal conduct. If he were engaged in drug trafficking or whatever, that property, too, would be connected with criminal conduct, and would be forfeit.

Mr. Ainsworth: Property obtained with the car would have been property obtained in connection with criminal conduct; the car itself would not. The car was borrowed from his granny, so it would not be forfeit. I do not believe that the hon. Gentleman's fears are real, and I do not believe that he thinks that we would confiscate the car in the case that he mentions.

Mrs. Brooke: Subsection (4)(c) says

    ``or in connection with conduct''.

It does not mention ``criminal conduct''. Sailing away in granny's car is simply conduct, it is not necessarily criminal conduct. I speak as a lay person, and I hope that I have made the matter clear.

Mr. Ainsworth: Is not the hon. Lady missing out the word ``obtained'', as did the hon. Member for Henley (Mr. Johnson)? If the car is obtained in connection with criminal conduct, it ought to be potentially forfeit, and the courts ought to be allowed to consider the matter.

Mrs. Brooke: I am a lay person, but it seems to me that ``property obtained'' does not necessarily refer to property that has been obtained by criminal means.

11.15 am

Mr. Ainsworth: I am not a lawyer, so I do not know why the hon. Lady makes the distinction that she is a lay person.

I have been advised that the formula ``obtained . . . in connection with'' criminal conduct would not allow the legislation to cover property used in connection with criminal conduct—or the similar kinds of property to which reference has been made. However, as I am a lay person, I do not know how further to assure the hon. Lady about that.

I ask Opposition Members to accept that the words that are used in the Bill would put such issues beyond doubt: they would not raise confusion; and, with regard to confiscation, they would not allow loopholes to occur where there is property that is obtained in connection with the proceeds of crime.

 
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