Proceeds of Crime Bill

[back to previous text]

Mr. Ainsworth: I would not overextend what I said. I am pretty certain that foreign currency and currency that is not legal tender is covered. I shall make absolutely certain that that is the case.

Column Number: 812

Mr. Hawkins: A thought occurs to me while we discuss things of potential monetary value. Would the article by my hon. Friend the Member for Henley that offers £10 to any reader of The Daily Telegraph if Britain enters the euro be regarded as legal tender?

Mr. Ainsworth: Who would be prepared to pay for that? Labour Members mentioned that we were prepared to pay for signed copies of the book by the hon. Member for Henley before Christmas so perhaps the article is highly valuable and easily tradable property. I am not sure what category it would fall within, although I doubt that it would fall within the category of cash forfeiture. However, it may well do so. That depends on his credibility.

Amendment No. 322 also removes the requirement in subsection (7) that additional monetary instruments may be specified only if the Treasury thinks that they ''may be realised in the form of notes or coins...without the consent or assistance of any other person.'' The provision was intended to ensure that cash could be converted into a form that could be paid into an account or released in part if it could not be forfeited. However, on further inspection, we feel that it is implicit in clause 295 that cash must be in a form that may be paid into an interest-bearing account because the clause states that cash is to be held in such an account unless it is required as evidence in proceedings. Furthermore, some monetary instruments can be paid into, and released from, an interest-bearing account without the need for conversion into notes and coins. Therefore, we are satisfied that subsection (7), in its existing form, is unnecessary and unduly restrictive.

Mr. Grieve: That brings another point to mind, although raising it risks causing further muddle. At some point over the next couple of months, I will carry out a rigorous search of my house for the francs that have been accumulated during 150 years of Anglo-French family life, and I will take them to France to have them realised. I am sure that I will find many coins. After February, it will not be possible to pay them into an account—and it will certainly not be possible for an officer to do that. They will be

    ''notes and coins in any currency,''

but they will not be that in a form that can be realised.

I apologise for raising that point with the Minister, but I wonder whether something has been missed with regard to it.

Mr. Ainsworth: I do not think that we have hit on a point that is of huge significance for the working of the Bill.

Perhaps the hon. Gentleman has raised a significant issue about old coins of value that might not be tradable, and about whether they should be considered as cash, rather than property, in all circumstances—I am thinking about Elizabethan or Victorian coins, for example. The point might need to be examined, to discover whether such coins should be covered by cash forfeiture, or by civil forfeiture, which is laid down in a previous part of the Bill. I will have to study that matter, to try to ensure that there is not an ambiguity.

Column Number: 813

A note has whizzed to me that says that, after February, French francs will have no value, and that they therefore do not fall within the scheme. If we are totally satisfied that they have no value and do not fall within the scheme, we will have covered the point. However, it might need to be further examined.

Mr. Grieve: I do not think that the Minister is right. In the recent past, I took French francs that date from 1967, in banknotes, to the Bank of France. Notes like that are very large, with ''X thousands of francs'' written on them, and when a customer presents them, they are given a few pence in return, because it is necessary to subtract all the noughts. However, they are tradable.

If people take French francs to the Bank of France at any time after February—although there may be a cut-off date—and they say, ''Here are the francs,'' the cashier will give them the equivalent sum in euros—although if someone has found, in a box, three or four franc notes that date from the early 1960s, they will not get very much for them.

Mr. Ainsworth: That is not my understanding of the situation, although I do not pretend to be an expert on the matter.

However, I take on board the hon. Gentleman's point about whether antique coins—that are, nonetheless, coins—should be treated as cash or property. That is an issue that might need to be looked at, and I am happy to do so.

Mr. Wilshire: I again promise, Mr. Gale, that I am not planning to make any sort of political point about Europe.

Even if the situation in France is as the Minister describes it, my understanding is that the situation regarding the trading in of former currencies varies between each of the 12 countries that have adopted the euro. Therefore, we would have to check out the situation not only in France but in the other 11 countries.

In any event, the situation could be much more serious than my hon. Friend the Member for Beaconsfield has suggested, because the proceeds of crime often end up in cash that the villains are reluctant to trade in at the time, because that would draw attention to them, and there could be considerable sums of such money in old currency.

Mr. Ainsworth: I understand, however, that such sums have, effectively, become valueless. Great fear was felt by the forces of law and order about the conversions that have recently taken place, but there were also, perhaps, great opportunities for them to catch up with people who were trying to launder money that they had kept illegally for a long time.

Fundamentally, if something has no value, it is not covered by chapter 3 of part 5, and if it has value, it is covered. There are issues with regard to antique coins that might need to be looked at. My prejudice is that they are property rather than cash, but we must check to ensure that there is no ambiguity.

Column Number: 814

Mr. Hawkins: My hon. Friend the Member for Spelthorne is right. There was a table showing the cut-off points for various different countries. The Minister is mistaken in thinking that the introduction of the euro is a great opportunity for the forces of law and order. In Italy, for example, stashes of previously undeclared ill-gotten gains were rushed across the borders into the non-euro zone country of Switzerland in order to be deposited there. The forces of law and order in Italy found it impossible to track funds that were moved across the border.

5.45 pm

Mr. Ainsworth: That is fascinating stuff. I do not know how relevant it is to the amendment, but it is wonderful to see that the hon. Gentleman is tracing the methods used by criminals to protect their ill-gotten gains in the transfer to the euro.

The amendments are clear and justified. My opinion on antique coins has been reinforced: we do not intend to cover them under the scheme. However, they would count as property and would therefore be potentially forfeit under civil forfeiture. I ask the Committee to accept the amendment.

Mrs. Annette L. Brooke (Mid-Dorset and North Poole) rose—

The Chairman: I call Mr. Grieve. If the hon. Lady wishes to catch my eye, I am sure that she will be able to do so.

Mr. Grieve: I have no difficulty with the amendment or those grouped with it.

I wish to discuss the power to specify which monetary instruments fall under the provisions of subsection (6)(b). I accept that the power to specify should be left to ministerial discretion, but would the Government use affirmative procedure or merely negative procedure to specify the monetary instruments?

Mr. Ainsworth: I think that we were considering negative procedure.

Mr. Grieve: I always consider the darkest possibilities. The power could be used to extend the specified instruments far more widely than Parliament intends. I wonder whether affirmative procedure should be used to decide the instruments. A Committee would take only a few minutes, as is generally the case, to decide by affirmative procedure.

My interventions on the subject of old currencies were made with some frivolity, on the back of my recollections of spending part of Christmas sifting through boxes of old French, Italian and other coins and deciding when I would take them abroad and either put them in a charity box or take them to a bank to get the money back before they lose their value.

An important issue arose in the course of the discussion. Substantial amounts of European currencies must not yet have been converted into euros. One reason for that, as the Minister has rightly said, is that people are reluctant to convert money because the switch to the euro has caused money

Column Number: 815

launderers major problems in realising their assets. There has been a lot of comment in the French press about the problem that the euro poses to the large amounts of illegitimate cash in France and other European countries.

It will be possible for that money to be converted at the central banks of the countries concerned—my recollection from reading the newspapers is that there are differential periods, and some countries have said that they will exchange the bank notes till kingdom come while others have said that there are cut-offs of one year, two years, four years and the like. I would not be at all surprised if Customs officers and police constables did not find stashes of that money in banknotes for some time to come, especially as cashing it will be dependent on cashing only limited amounts at one time without questions being asked. In France, for instance, FF100,000 can be cashed without providing an explanation of origin. For once, thought should be given to whether that money could be seized. There may be a lot of it around, and it may be the proceeds of crime.

The Minister and his officials may want to consider whether there is a loophole, and I am encouraging them to plug it. Although the money is not payable into an account, it is realisable in substantial sums. I may be wrong about that—the Minister's officials may be able to reassure him that it will be covered as another instrument. However, there must be millions of pounds in foreign currencies that have just been demonetised but can still have their value realised if presented at central banks on the continent. Some of that money is likely to be proceeds of crime.

Previous Contents Continue

House of Commons home page Parliament home page House of Lords home page search page enquiries ordering index

©Parliamentary copyright 2002
Prepared 8 January 2002