Mr.
Heath: I am most grateful to the Solicitor-General for the
way in which he has approached this discussion. I agree with him: I do
not think that there is any difference in our intentions—in what
we want the clause to do. I believe that, were section 25 of the 1968
Act not to be in place and were we to be creating an offence today in
isolation, my wording would be better. I have been quite plain about
that. My wording is more
explicit. 4.15
pm However,
the Solicitor-General is confident that the Ellames case, imported into
consideration of this offence,
will identify the necessity to prove intent and will be construed in
terms of the article being in the possession of one person, although
possibly being used by another person in the commission of a fraudulent
act. If that confidence is well placed—I have no reason to
suppose that it is not—I think that the provision comes to the
same conclusion as my amendment, were it agreed
to. The
Solicitor-General: Let me provide some reassurance. In
construing a statute, the courts are able, under Pepper v. Hart,
to take account of ministerial statements in the House and explanatory
notes. The explanatory notes on the Bill draw attention to the case of
Ellames. It may be helpful to tell the hon. Gentleman that Lord Steyn
said in Westminster city council v. National Asylum Support
Service in 2002 that explanatory
notes “cast light on the
objective setting or contextual scene of the statute and the mischief
at which it is aimed, such materials are always admissible aids to
construction.” The fact
that the explanatory notes specifically mention Ellames means that the
case is
important.
Mr.
Heath: I think that we have successfully Pepper-and-Harted
Pepper v. Hart, which is helpful in respect of any future
construction placed on the clause. On that basis—I understand
what the hon. Member for Beaconsfield said—I do not intend to
press my
amendments.
Mr.
Grieve: I welcome you to the Chair, Mr. Jones. I reiterate
what I said to the Solicitor-General a moment ago in my intervention.
The purpose of my amendments was not to narrow in a huge fashion the
definition of the person who would be caught by clause
6. It is worth bearing
in mind—perhaps we have not touched on it—that the clause
differs in one important material particular from going equipped to
cheat or to commit theft, in that that is restricted to a person not at
their place of abode. It was clearly envisaged that that definition
should refer to the person with the bag marked “swag”
with a jemmy inside it. That has a rather old-fashioned ring about it
when viewed by the standards of 21st century crime. The Bill would
widen the scope of the effects to include equipment found in a
person’s home. There may be some common ground between the hon.
Member for Somerton and Frome and I on
that. In view of the
fact that I suspect that a great deal of the relevant equipment could
also have an innocent use—I am not an expert, but I can see that
there may be innocent uses for the sorts of equipment that could be
used for the purpose of fraud, including computer fraud—we have
to be careful about ensuring that we leave people with the ability to
mount a satisfactory defence and prove their innocence and do not start
moving towards an offence of strict
liability. Michael
Fabricant (Lichfield) (Con): May I give an example? I have
a CD-ROM, as have many members of PICT—the parliamentary
information and communications group, or whatever it stands
for—that enables us to enter a locked PC. That could conceivably
be used to break into a computer illegally to extract internet banking
information—
Mr.
Heath: A virtual
jemmy.
Michael
Fabricant: Yes; an internet jemmy, in fact. Would that not
fall under the auspices of the
clause?
Mr.
Grieve: My hon. Friend makes a good point. That was
precisely the source of my concern. As to the difference in wording
between what I should like to see included and that of the hon. Member
for Somerton and Frome, on reflection I am not sure that it makes a
huge difference. It is clear that the word “intended”,
inserted by my amendment, could apply to an article that was intended
for use by another as well as for use by that person. My amendment is
more limited in scope than the hon. Gentleman’s, which is why I
was surprised to hear the Solicitor-General suggest that I was trying
to narrow the scope further than the hon.
Gentleman.
The
Solicitor-General: The observation was from the hon.
Gentleman’s broader comments, rather than on the clause. I tend
to agree with his interpretation of the difference—or
not—between his amendment and that of the Liberal Democrats. It
was listening to his remarks rather than looking at the clause that
caused me to make the comment.
Mr.
Grieve: I am grateful to the Solicitor-General. This was a
probing amendment, and he has provided a great deal of reassurance. I
hope that the debate, having gone on the record, can, if necessary, be
quoted along with the explanatory notes should any issue arise. I
certainly agree with the Solicitor-General that it is probably
undesirable for there to be a difference in wording between this and
going equipped. However, there is an inherent difference of wording in
that the scope of the offence is wider because it applies to
people’s domestic premises.
With that in mind, I beg to ask
leave to withdraw the amendment.
Amendment, by leave,
withdrawn.
Clause 6 ordered to stand
part of the Bill.
Clause
7Making
or supplying articles for use in
frauds Mr.
Dominic Grieve: I beg to move amendmentNo. 1, in
clause 7, page 3, line 15, leave out ‘or' and insert
‘and'. This
follows on from our earlier debate, but is slightly different because
there is no equivalent offence to making or supplying an article as
that is defined here. Subsection (1) states:
“A person is guilty of
an offence if he makes, adapts, supplies or offers to supply any
article—knowing that it is designed or adapted for use in the
course of or in connection with fraud, or intending it to be used to
commit, or assist in the commission of,
fraud.” If paragraph (a)
were confined to knowing that it is designed for use in the course of
fraud, I should not be so concerned. However, adapted for use in the
course of or in connection with fraud seems to be a wide term. I worry
that it could catch somebody who makes a
perfectly reasonable device for legitimate use. On
Second Reading, I used the example of the conjuring trick. Such tricks
usually require somebody to commit a fraud upon a willing group of
spectators. To say that an article of that sort is unlawful causes me
concern, particularly as it is not “and” intending it to
be used to commit, or assist in the commission of fraud but
“or” intending it to be used to commit, or assist in the
commission of
fraud. One way of
dealing with the matter would be to say that it should not be
“or” but “and”. That is what the amendment
would achieve. However, I am aware that that would create a restricted
offence of specific intent. I acknowledge straight away to the
Solicitor-General that that might be too restrictive. Therefore, this,
too, is a probing amendment, designed to tease out in the course of
debate whether what has been drafted here correctly meets what we are
trying to achieve, or whether it goes a little too
far. I shall listen to
the Solicitor-General with interest, but my first reading of the clause
made me slightly surprised, because articles made, adapted, supplied or
offered is a wide term. The nature of fraud being what it is, all sorts
of items could be included in that category. I shall be interested to
know what defence could be raised, for example, if a person knows that
he is supplying an article to a conjuror. He knows very well that it is
designed or adapted for use in the course of or in connection with
fraud—or could be—but that is not what is intended. Does
he have a defence? That is the key question that the Committee needs to
debate.
The
Solicitor-General: The clause makes it an offence for a
person to make, adapt, supply or offer to supply any article for use in
fraud. The impact of the amendment would be to place a highly
undesirable restriction on the breadth of the offence. It would narrow
the offence much too much.
As it stands,
clause 7 allows for a precise distinction to be made between the parts
played by those who know that an article is made or adapted for use in
the commission of fraud and those who intend that it should be used for
fraudulent purposes. I assure the Committee that the distinction is a
significant one. For example, it is possible to imagine the supply of
an ordinarily innocent article—in other words, an article, that
under any circumstances, could be used legitimately—to be used
in the commission of a fraud.
The example of a credit card
reader comes to mind. The device has not been made or adapted with the
fraud in mind but could be supplied with the intention of it being used
fraudulently. There are other examples. A person may have software that
is capable of being used fraudulently, but it has not been made for
that purpose. The hon. Member for Lichfield (Michael Fabricant)
referred to such an item. A person supplies security devices that are
designed either to prevent fraud or to give legitimate access to
something and it may well be that a person intends that they be used
for a fraudulent purpose. A person might sell credit card numbers,
usually on the internet, knowing that they could be used to commit
fraud. There are all types of things that might come to
mind. Conversely,
a criminal may make an article specifically for a fraud—for
example, a device covertly to copy credit cards—but be
ambivalent about whether the
person to whom it is supplied will use it for fraud.
He will not have the intention necessary for clause 7(1)(b) but will
fall within clause 7(1)(a). The amendment seeks to provide
not only that the article must be specifically made or adapted for use
in fraud but that the person who makes or adapts it must intend that it
be used in fraud. That would significantly limit the clause’s
effect and would not catch either of those examples.
The importance of the clause is
that it should be able to cover both varieties of offence, thereby
allowing for the fact that those who make, adapt or supply articles for
use in fraud may not have any intention to carry out the fraud
themselves. That carries weight in the fight against organised criminal
gangs, which often prefer to engage in fraud at several moves from the
action, for example, by selling personal financial information. The aim
is that that will be used for a fraud, but they do not carry out the
fraud themselves. Clause 7 will not capture the actions of the
innocent, which necessarily include the actions of those innocently
unaware but somehow caught up in the commission of an
offence.
The clause 7
offence, like the existing law in section 25, does not contain a
dishonesty requirement, but requires that the article be made for use
in a fraud. Therefore, the supply or manufacture of articles, such as
devices and software, which are designed innocently, but might possibly
be misused to commit a fraud would not be grounds to give rise to a
charge for fraud. The
wording used in clause 7 follows the existing law in section 25 of the
Theft Act and, as we have discussed, case law has established that it
requires a general intention to commit fraud. I hope that hon. Members
are reassured by that and that we can make some
progress.
Mr.
Grieve: I am reassured. We can move on. I beg to ask leave
to withdraw the
amendment. Amendment,
by leave,
withdrawn. Clause
7 ordered to stand part of the
Bill.
Clause
8“Article” Question
proposed, That the clause stand part of the
Bill.
The
Solicitor-General: The clause defines
“article” for the purposes of clause 6 and 7 offences and
some other connected provisions. It gives the term a breadth of meaning
that is needed in these days of computer crime. It makes it clear that
the definition includes any programme or data held in electronic form
that may be used in the course of, or in connection with,
fraud. Given the
intense and rapid extension of technology in recent years, it is vital
that the new offences give sufficient coverage to articles such as
computer programmes that generate real credit card numbers, or computer
templates that can be used to produce fake utility bills as proof of
identity. The wording of this part of the clause follows wording in
section 17 of the Computer Misuse Act
1990. Question put
and agreed to.
Clause 8 ordered to stand
part of the
Bill.
Clause
9Participating
in fraudulent business carried on by sole trader
etc. 4.30
pm
Mr.
Heath: I beg to move amendment No. 14, in clause 9, page
4, line 1, leave out paragraph (b) and
insert— ‘(b) for any
fraudulent
purpose.'. The
amendment is probing the precise terms of the clause. It suggests
replacing subsection (2)(b) with a briefer paragraph
(b). The clause is
important, and I do not want in any way to reduce its effectiveness in
dealing with fraudulent business carried out by a sole trader. However,
I do not understand the requirement to
show “intent to defraud
creditors of any person or for any other fraudulent
purpose.” The clause does
not refer to creditors of the business but to creditors of any person,
which I suggest is the universality of people. Most people will be
creditors, at least temporarily, of at least one other person and will
be debtors to at least one other person. Therefore, I do not understand
what is
meant. “Fraudulent
purpose” includes creditors of the company, and indeed creditors
of any other person or any other trader. Therefore, it is a
simplification and a clarification to use the simple phrase “for
any fraudulent purpose” rather than the obscure phrase that is
in the Bill. Perhaps the Solicitor-General will be able to tell me that
I am quite wrong and that there is a specific meaning that necessarily
attaches to the phrase and must be in the Bill. I look forward to his
response.
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