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