Proceeds of Crime Bill

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Mr. Hawkins: I beg to move amendment No. 412, in page 170, line 35, leave out 'either of'.

The Chairman: With this it will be convenient to take the following: Amendment No. 413, in page 170, line 35, leave out 'conditions' and insert 'condition'.

Amendment No. 415, in page 170, line 36, leave out subsections (5) and (6).

Government amendments Nos. 326 and 327.

Amendment No. 416, in page 171, line 7, leave out 'second'.

Government amendments Nos. 328, 332 and 342.

Mr. Hawkins: Again, these amendments were drafted by the Law Society of Scotland. Now that the hon. Member for Glasgow, Pollok has returned, I can stress to him—as I have to other members of the Committee—that the Law Society of Scotland intended for the amendments to clarify and improve the Bill. They are not intended to provide lawyers' loopholes through which the Mr. Bigs of Pollok and elsewhere may slip. Government amendment No. 327 would delete subsection (6), in a similar way to half the Law Society of Scotland's amendment No. 415. I hope that that reassures him that the society is again on to a sensible point.

Clearly, the Government have an alternative way of doing things, through the Government amendments, but I stress to the Minister and the Committee that the amendments are probing. I suspect that the Minister will tell us that following his officials' consultation with the Law Society of Scotland, his solution to clarify and improve the clause is better than the society's initial draft, which we have adopted. If he satisfies us that the Government have thought of a better way of dealing with the problem, I will take on board what I anticipate he will say. However, I hope that he will acknowledge that we and the Law Society of Scotland made a legitimate attempt to improve the Bill by clarifying it.

Ian Lucas: Will the hon. Gentleman clarify whether he is suggesting that the only circumstances in which cash may be seized are when proceedings have been commenced? That seems to be the upshot of the amendment. Do I understand him correctly?

Mr. Hawkins: Yes, I think that the hon. Gentleman understands me correctly. I cannot claim to be an expert on Scots law, but I believe that that is what the Law Society of Scotland was driving at. We agree with that, and I shall listen with interest to what the

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Minister and the hon. Member for Orkney and Shetland say.

Mr. Ainsworth: The purpose of the cash recovery scheme is to allow for the seizure, detention and forfeiture of cash that is either recoverable property—in other words the proceeds of crime—or intended for use in unlawful conduct, and is connected to any crime. That reflects exactly the existing similar schemes under the Drug Trafficking Act 1994 and the recent Anti-terrorism, Crime and Security Act 2001. Those Acts allow for the seizure, continued detention and forfeiture of cash that represents the proceeds of either drug trafficking or terrorism.

The cash recovery scheme that we are considering provides a straightforward means of recovering cash, whether it is the proceeds of unlawful conduct or intended for use in unlawful conduct.

The removal of recoverable cash from circulation is a crucial aspect of preventing crime. Recoverable cash is readily recycled—for example, to buy more drugs. It may also serve to allow a person to maintain an extravagant lifestyle that furnishes an undesirable role model for young people.

It would have been possible to include cash that is recoverable property in the civil recovery scheme set out in chapter 2. That will be the case where cash is part of a wider portfolio of property that the director of the Assets Recovery Agency or Scottish Ministers are seeking to recover in civil recovery proceedings.

However, the scheme that is provided for in chapter 3 of part 5 is a rather different one. It is more appropriate to cases where cash is detained after coming to the attention of the police or Customs officers in the normal course of their work. Pure cash is quick and simple, and there is little room for the complex arguments that arose in our roving debates on the previous amendment. The existing pure cash schemes before the magistrates court illustrate the effectiveness of such arrangements. In 2000, £4.5 million of drugs-related cash was forfeited under the Drug Trafficking Act 1994. The scheme is successful and fully understood and has stood the test of time.

The amendments would withdraw the ability to detain cash under the scheme for more than 48 hours if it is suspected of being the proceeds of crime. Under the legislation, such cash can continue to be detained if its derivation is being further investigated or if it is connected to criminal proceedings that are being contemplated or have begun. The amendments would remove the ability to detain such cash beyond 48 hours even if forfeiture proceedings were initiated during that period. Cash that was seized on the basis that it was recoverable property would therefore be detainable for only 48 hours, even if the case for making an application for forfeiture were made at that early stage. That is not desirable, nor would there be any point in detaining cash in those circumstances.

Mr. Grieve: Presumably, if the 48-hour period were to exist, that would be enough time for the director of the Assets Recovery Agency to start such proceedings,

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if he wished to deal with the matter under his other powers.

Mr. Ainsworth: The hon. Gentleman expects that the director could involve himself in every case and satisfy the court that there is a good, arguable case, as required under chapter 2 of part 5, to transfer seized cash in effect to that part of the Bill and to continue with detection under civil forfeiture. That would be difficult to ensure in every case. He is suggesting that we dismantle something that has worked well in its context, which I accept that we are broadening, and replace it with something else. We would do so at great risk of losing that effectiveness and allowing those moneys to continue in circulation. I ask him to reflect on what he is asking us to do. We should not dismantle something that has worked well, which his Government introduced in 1994, and we certainly do not intend to go down that route.

It would be complicated to expect the director to respond to every request in any part of the country from the police who have managed to obtain cash, and make a good, arguable case in civil recovery and take it to court all within 48 hours, or give the money back to the individuals concerned. That would be detrimental.

Under the amendments, cash that was seized on the basis that it was recoverable property could be detained for only 48 hours. If prosecution were contemplated, an application for restraint would be possible, but even in those circumstances the cash would have to be released until a restraint order had been obtained. The cash would remain in the control of the individual concerned rather than in detention and could fairly easily go missing.

10.15 am

Mr. Carmichael: I wonder whether this matter is unnecessarily complicated. If a physical sum of cash is identified as possibly having been the subject of unlawful conduct—the commission of a crime—the police already have the power to hold it as a production and they will routinely do so.

Mr. Ainsworth: I am sorry, but I missed the hon. Gentleman's point. Could he repeat it?

Mr. Carmichael: The Minister is talking about the holding of a physical sum of money in relation to a criminal proceeding. He seems to be suggesting that the money would have to be released before a restraining order could be obtained. We are talking about the investigation of crime. Let us suppose that the police come across a large sum of money and say, ''What's this, then? It looks a bit fishy and we're going to investigate.'' If they are pursuing a reasonable suspicion, they already have the power to take that money to be a production—I think that the term used in England is ''exhibit''—and to hold it under the powers in the Police (Scotland) Act 1967.

Mr. Ainsworth: Not necessarily. The hon. Gentleman is talking about criminal proceedings under part 2; the hon. Member for Beaconsfield talked about the use of civil proceedings under chapter 2 of part 5. Under that part of the Bill, a criminal act does not need to be proven. For part 2 to

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kick in—the hierarchy suggests that that should be the case when appropriate—there will have to be the chance of a prosecution for criminality. That is the test that will apply. Chapter 2 of part 5, on civil recovery, is not intended to be used in cash-only cases. To suggest otherwise would mean having to rewrite almost the entire Bill. Chapter 3 is a straightforward extension of what is currently operated by Customs and Excise at the border, and in inland situations the power is extended to constables.

I struggle to understand the hon. Gentlemen's concerns. They are effectively saying that criminality must be proven at the relevant point or the cash released in relation to part 2 kicking in, which will not always be the case, or that cash be included in the civil recovery case. However, obtaining a restraint order under chapter 2 of part 5 within 48 hours would be difficult.

Mr. Carmichael: I think that I understand the position—perhaps the Minister will correct me if I have misunderstood his scenario. Money is seized within 48 hours, and it becomes apparent that it will be the subject of a criminal investigation. If I misrepresent the Minister, I apologise, but he then seemed to suggest that it would be necessary to obtain a restraining order in order to hold on to the money. That is unnecessary, because the police's existing powers entitle them to hold the money as part of their investigation.

Mr. Ainsworth: But we shall not always be able to bring criminal investigations. We are discussing a civil proceeding for moneys intended for use in crime, or the proceeds of crime.

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