Sanctions and Anti-Money Laundering Bill [HL]

Debate between Lord Hunt of Wirral and Lord McNally

Ping Pong (Hansard): House of Lords
Monday 21st May 2018 Lords Chamber

[Lord McNally]

My Lords, I gladly gave way to the noble and learned Lord, Lord Mackay, because I know from long experience that his contributions are always of great help to the Minister at the Dispatch Box, as they were for me for a number of years.

The overseas territories cannot say that they have not been represented in the House this afternoon. There have been passionate speeches, not least by the noble Lord, Lord Naseby. I am not going to be so hypocritical as to advise him that he should not challenge the wisdom of the other place, having only a couple of hours ago extolled to your Lordships the very virtues of this House occasionally challenging the views of the other place.

Following on from the intervention of the noble Lord, Lord Judd, this has to be put in context. The noble and learned Lord, Lord Neuberger, said that we had no direct interest in this legislation, but when places are called the British Virgin Islands or the British Overseas Territories, we have a reputational responsibility we cannot avoid. If we do, we will damage our reputation. It is therefore right to look at this issue.

I was Minister for the Crown Dependencies—I see the noble Lord, Lord Faulks, nodding—and my noble friend Lord Beith and I worked closely together precisely to avoid the impasse we have now reached. We recognised that we had to work out the problems so that Britain could take on its proper responsibilities for these matters without doing too much damage to the dependencies which were trying to catch up. The way it has worked is one of the reasons why the dependencies qualify so well in the temperature-taking of various international organisations.

However, we have to go beyond the technicalities. Much of the cynicism, particularly among young people, is caused by issues such as the Panama papers and other exposures. Yes, the City of London has to take responsibility for the obscene avoidance of taxes and its co-operation with criminality in moving large amounts of money around in a dark economy. It is that which produces the cynicism that undermines our democracies. Ever since I have been in politics we usually blame the French, but we cannot simply use the argument that if we stop doing it, the French will do it. That is not an excuse for not doing the right thing and trying to set standards. David Cameron was quite right in trying to do this.

It is quite clear, not least from the interventions of the distinguished jurists we have in this House, that there is a problem. The solution was given by the noble and learned Lord, Lord Brown. My opinion of the Minister is boundless—he is going to have a couple of tough years ahead—and it would give him an opportunity to engage with the overseas territories to see whether the full implications of this legislation can be avoided by co-operation and initiatives, rather than the kind of process suggested by the noble and learned Lord, Lord Mackay. We have to see this in the context of a general public who are looking with nausea at what seems to be the ability of this money to find a home outside proper accountability.

I refer the noble Lord, Lord Naseby, to the briefing from 12 highly respected charities, and I understand the passion of the noble Lord, Lord Judd, in defending Oxfam. Although he did not name the Members of the other place, I will do so. In fact, Margaret Hodge and Andrew Mitchell are very well respected for their knowledge of and interest in these areas. We have to realise that the other place has been neither impetuous nor ill-informed in what it wants to do. But within the wider moral context set out by the noble Lord, Lord Judd, I hope that the Minister will find this debate useful in the very difficult diplomatic task that he now faces.

[Lord Hunt of Wirral (Con)]

My Lords, I declare my interests as set out in the register. I want only to say how much I agree with the noble and learned Lord, Lord Hope of Craighead, when he paid tribute to my noble friend Lord Naseby for giving us the opportunity to discuss this matter. When the noble Lord, Lord McNally, was in charge of our overseas territories, together with others, he embarked on a very positive consultation with them. What we are now trying to put right are a number of intemperate comments made in the House of Commons during its debate, and here I want to thank my noble friend the Minister for the way in which he opened the debate in this House. He recognised that a number of people in the British Overseas Territories feel outraged about some of those comments. However, as the noble and learned Lord, Lord Neuberger of Abbotsbury, pointed out, we are in the process of legislating for British Overseas Territories without proper prior consultation with their respective parliaments. I think it was my noble friend the Minister who said that this in effect disenfranchises their elected representatives.

Because of my connections to one of the territories, Bermuda, I am aware of the huge concern about some of the comments which have been made. It is sad that this year Bermuda’s constitution will celebrate 50 years of enactment. Moreover, Bermuda’s Parliament dates back to 1612 and is the third-oldest continuous parliament in the world, with the first assembly meeting in 1620. The Bermudians are very proud of that, and rightly so. When those intemperate comments were made, one person emailed me immediately to say that the Bermudian Mary Prince was the first slave to present an anti-slavery petition to these Houses and the first black woman to write and publish an autobiography in 1831. Her experience of the horrors she endured was the first of its kind to be documented by a slave and her words were instrumental in this House in contributing to the abolition of the slave trade in British colonies in 1838, some 30 years following the abolition of slavery in this country. We have to recognise the huge amount of pride among Bermudians about their history. I think that they have every right to feel insulted, which is the word that several of them have used to me.

Furthermore, under the Bermudian constitution, the application of an Order in Council to the island would be technically illegal, and I hope that my noble friend the Minister will think carefully about the words of my noble and learned friend Lord Mackay of Clashfern, in that there really must be a way through this somewhere. I suppose we ought to put on the record that for some 80 years Bermuda has been a world-leading public authority with a central register of beneficial ownership which long predates those in developed countries, including the United Kingdom. At every stage the island has shared this information upon request with legitimate international authorities. Moreover, Bermuda provides the information within 24 hours or, in extreme cases, two hours. I hope that my colleagues understand that we must have this debate to put on record the case for the overseas territories and what they have done so well for so long.

Data Protection Bill [HL]

Debate between Lord Hunt of Wirral and Lord McNally

Monday 14th May 2018 Lords Chamber

[Lord Hunt of Wirral]

I raise fake news as an issue not because it is or is not covered by the amendment but because it must concern us all, particularly as a society.

There are good reasons for rejecting the amendment. It would be an analogue inquiry in an overwhelmingly digital age. It would also—rightly, in my view—be seen as yet another attempt by politicians to meddle in the internal affairs of news media and, ultimately, to muzzle free expression.

This country, which should be a beacon of free expression in a world bedevilled by state censorship, has just fallen from 30th to 40th in the global ranking for free speech, according to a survey conducted by independent minds right across the world. Let that sink in my lords: from 30th to 40th. It is shaming. What message are we now to send out? That the free media are enemies of the state? They may be unruly and they may challenge us in ways that make us uncomfortable, but they are not our enemies.

Furthermore, it concerns me that we are playing around with the Salisbury convention. The noble and learned Lord has just spoken about promises. As the noble Lord, Lord Pannick, pointed out, this amendment flies directly in the face of last year’s Conservative Party manifesto. On page 80, that document said that,

“we will not proceed with the second stage of the Leveson Inquiry into the culture, practices and ethics of the press”.

That was pretty clear. I know that the Labour Party had a euphoric moment after the last general election, almost persuading itself that it had won, but it did not.

I take no comfort from the qualifying words that the noble Baroness has added to her amendment this time around. We are dealing here with profound matters that touch on the very basis of our society and our political philosophy, and the question of whether we truly cherish our freedom of expression and our free media. I suppose ping-pong can be an enjoyable pastime but at some point the views of the elected House must prevail. I have the utmost respect for the noble Baroness and the greatest sympathy for the unacceptable treatment that she and her family, and far too many others, have received from the press. Having said that, I sincerely hope she will not seek to divide the House again on this matter.

[Lord McNally (LD)]

My Lords, as the noble Lord, Lord Grade, said, this has been a passionate and, actually, very balanced debate. A number of noble Lords have expressed concern about the amendment before us and have, sort of, made a case against it.

When the noble Lord, Lord Black, came in, struggling on his crutches, I did think: is there no end to which this man will not go to get sympathy from this House? I wish him a speedy recovery.

When introducing the debate, the Minister said first that these amendments have no place in the Bill because it is about data protection and then began to dazzle us with the number of government amendments that pertain to the media. Of course it is perfectly sensible that this matter should be in the Bill.

By the way, I say to the noble Baroness, Lady Cavendish, that I did not say I object to journalists; I object to journalists at the Times. She mentioned the growing power of the ICO in all this, which is something that the press should think hard about. The press have been so busy trying to avoid having a proper regulator for themselves that they find themselves well and truly regulated by a powerful ICO. Where the ICO does not regulate the press, the courts may with some of the judgments that are coming down the track.

As always, the perorations against, as with the noble Lord, Lord Hunt, have been about freedom and liberty, as though we on this side are not as passionate in our defence of those. Today’s debate has produced the usual press stories that crop up when either House debates the issue. They always either rubbish one or other of the more popular proponents of reform or carry, as did the Evening Standard just before the Commons debate, such headlines as that from the Commons Culture Minister, Margot James: “We will lose freedom of the press if MPs back new curbs”. It is my belief that the real defenders of press freedom are not the Ministers scrambling to close Leveson down but those of us who want to see a press that is respected and trusted, as well as free.

When the Commons debated our amendment, Mr Jacob Rees-Mogg, the new Erskine May, said rather imperiously that Parliament had every right to renege on promises made by a predecessor. Of course, he is right—we know that, Jacob. However, it is also a long and honourable convention that there is a continuity of responsibility from one Parliament and one Government to another. We saw it last week when the Prime Minister gave a full and unequivocal apology to the Libyan family for Britain’s part in their rendition and subsequent torture, although it did not happen on her watch. The long tradition of continuity of responsibility means that a promise given by one Prime Minister and one Parliament is unlikely to be abandoned by another. There is a double matter of honour when the promise in question was made by a Prime Minister of the party now in power. David Cameron gave such commitments, and the amendment from the noble Baroness, Lady Hollins, gives the House of Commons a way of redeeming that promise while taking into account the passage of time since it was made.

I often find that, when I am indignant having read in the newspaper or seen on TV some summing up or sentence by a judge, my lawyer friends will say, “Ah, but the judge who has heard all the evidence is the best placed to make a balanced judgment on the matter”. In this case, we have the balanced judgment of Sir Brian Leveson himself. Let us remember, after the speeches of the noble and learned Lord, Lord Brown, and the noble Lord, Lord Pannick, that Sir Brian had all the information they had to make their speeches but came to a different conclusion: that it should go on. As I said when the Leveson letter first came up, here is the third most senior judge in the land taking six pages in a very carefully argued letter to give his views on the inquiry on which he spent a year of his life. Some noble and learned Lords in the House should have a little modesty when challenging his judgment because it is absolutely clear that Leveson 2 should go ahead. The noble and learned Lord, Lord Falconer, has already quoted from the letter, so I will not waste time.

The amendment before us is proportionate to the task at hand in addressing issues not yet adequately addressed. It redeems a solemn promise made by our Prime Minister and our Parliament. Jodie Ginsberg, the CEO of Index on Censorship, when briefing against these proposals before the Commons debate, said that she wanted,

“a free, vibrant, independent and troublesome media”.

So do I, and so does the proposer of the amendment. The biggest threat to a free, vibrant, independent and troublesome media is one so held in public contempt because of corrupt and illegal practices that few defenders will come to its aid if press freedom is really threatened.

I say to the noble Baroness, Lady Cavendish, that, when the Leveson inquiry exposed sins and criminality, the Government of the day could at that time have done anything they liked to the press. What they did was make a strong attempt to create something as far from political control as possible—I was one of the privy counsellors who signed the royal charter. It is absolutely false to claim that the attempt was to create a state-controlled press. That was never on the table and it is not on the table now.

The noble Earl, Lord Attlee, who has been brave in carrying through on Section 40, has said that we will not press it beyond tonight. I am interested to see which bit of legislation will include its repeal and how that will be favoured when it comes back to us. I say to the Minister: this is not the end of Section 40.

Tonight, we are looking for something more. As the noble Baroness, Lady Hollins, and the noble Lord, Lord Kerslake, have shown, we are looking at something for the victims. The noble Baroness, Lady Cavendish, should note that it is also something for journalists who need protection from being bullied into illegal acts by their employers. Most of all, it is for our own self-respect in keeping a promise made. I urge support for this amendment.

Legal Aid, Sentencing and Punishment of Offenders Bill

Debate between Lord Hunt of Wirral and Lord McNally

Tuesday 27th March 2012 Lords Chamber

[Lord McNally]

My Lords, I committed on Report to bring back at Third Reading amendments to address issues raised by my noble friend Lord Hunt of Wirral in respect of Clause 57. Amendment 29 addresses situations where the referral fee for an ancillary claim, such as for damage to a motor vehicle involved in a road traffic accident, in addition to a personal injury claim, may be inflated to include a payment for a referral fee for the personal injury claim. Amendment 30 makes it clear in the Bill that the payment of referral fees to a third party, whether or not they are regulated, will not avoid the prohibition on the payment of referral fees. This gives both practitioners and regulators a clear marker and removes doubt as to the effect of the clause. We do not wish to place additional burdens on regulators and these amendments will remove the potential for confusion on what is and what is not covered by the ban.

I wish to put on record my thanks to my noble friend for tabling his amendments, which have enabled the Government to strengthen and clarify the ban on referral fees in personal injury cases. I beg to move.

[Lord Hunt of Wirral]

My Lords, I thank the Minister and declare my interest as a partner in the international commercial law firm, DAC Beachcroft LLP, and my other interests in the register.

I warmly applaud the coalition Government’s intention to ban referral fees in personal injury cases. The amendments establish greater clarity around the operation of the ban on referral fees to ensure that there must be no side-stepping of the intention to ban them. I thank him warmly for bringing forward these amendments at Third Reading.

Rehabilitation of Offenders Act 1974 (Exceptions) (Amendment) (England and Wales) Order 2011

Debate between Lord Hunt of Wirral and Lord McNally

Tuesday 5th July 2011 Grand Committee

[The Minister of State, Ministry of Justice (Lord McNally)]

My Lords, as the Committee will be aware, the Rehabilitation of Offenders Act 1974 exists to support the resettlement of offenders into society where they have demonstrated that they have put their criminal behaviour behind them. After a prolonged period of time, therefore, the Act declares convictions spent and an ex-offender need no longer declare them. When they apply for jobs, or seek insurance, they need not disclose this information and subsequently not suffer the potential discrimination as a result of it.

There must of course be exceptions to this rule. Where, for example, someone is applying to work with children or with vulnerable adults, it is appropriate that the employer knows the full history of the individual. The exceptions order to the Act is the means by which this is achieved.

The exceptions order lists certain activities that are exempt from the Act. This means that where an individual is applying for a job within a specified activity or is involved in specified proceedings, their full criminal record history is available to the employer. If an individual has a conviction that has been declared spent, the prospective employer will then see it. We must be careful not to jeopardise the operation of the Rehabilitation of Offenders Act, so the activities listed on the exceptions order are only those that present an opportunity for people involved to cause harm to the public or the work concerned is of a sensitive nature, which might include children, the finance sector or national security.

This careful balance between allowing offenders to lead law-abiding lives by removing barriers and maintaining public protection needs to keep pace with the present. The exceptions order must therefore remain up to date with developments elsewhere. The order presented today is an illustration of the Government seeking to maintain this balance in line with the developments occurring in the financial and legal sectors.

Noble Lords will know that wide proposals for reform of the Rehabilitation of Offenders Act are being considered by the Government. Today is not the day to debate these, and I cannot make further announcements at this stage.

The current exceptions order enables the Financial Services Authority to take spent convictions into account when authorising a person to carry out regulated activities under the Financial Services and Markets Act 2000. This amendment will enable the Financial Services Authority to take spent convictions into account when authorising a new category of business—payments institutions.

Payments institutions were brought within the scope of regulation by the Financial Services Authority in 2009. They provide payment services, for example enabling cash to be placed in or withdrawn from a payment account, and range from large credit card companies to sole traders offering to send money abroad for a small fee. Money remitters, for example, transfer large amounts of money to and from overseas, with many specialising in remitting funds to specific accounts, such as in India, Pakistan or Poland, on behalf of immigrant communities. In many cases these customers are financially disadvantaged people, who have limited access to the banking system.

There have been a number of failures of business in the money remittance industry, and the failures have uncovered an element of mismanagement, financial impropriety or fraud. It is therefore important that the Financial Services Authority can assess those responsible for management of these businesses before authorising them to carry on business. This amendment will therefore bring payments institutions within the exceptions order so that the Financial Services Authority can take into account the full background of those responsible for the management of these bodies.

The second amendment relates to the introduction of alternative business structures, which will allow lawyers and non-lawyers to work together to provide legal and non-legal services. These bodies will be licensed and regulated by licensing authorities. Two new roles—head of legal practice and head of finance administration—are being introduced and will be responsible for an alternative business structure’s compliance with their licence. Licensing authorities must be satisfied that individuals applying to be heads of legal practice and heads of finance administration are fit and proper persons for appointment. In particular, not only will persons in these roles be responsible for compliance with the body’s licence, they could have access to vulnerable clients, client money and personal or sensitive client information. Making this amendment means that licensing authorities can seek information on previous convictions and cautions from applicants seeking to take up the role of head of legal practice and head of finance and administration. This will ensure that they are fit and proper for appointment.

I am aware that a further request has recently been made by the Legal Services Board for non-lawyer owners and managers of alternative business structures to be added to the exceptions order. At this early stage, no decision has been made. We will of course give careful consideration to this request, and this process is under way.

The final amendment is one of wording only. There is currently an entry on the exceptions order relating to “actuary”. The term is currently defined in the exceptions order as,

“a member of the Institute of Actuaries or a member or student of the Faculty of Actuaries”.

On 1 August 2010, these two bodies merged to become the Institute and Faculty of Actuaries. In order to continue to give effect to the applicable exception the definition is to be updated to reflect this change.

I hope that I will have the agreement of all noble Lords that the exceptions order is an important means of protecting the public. The instrument presented today responds to the latest analysis of risks. It therefore ensures that legislation is up to date and effective in its aim, while maintaining the vital balance towards the resettlement of offenders that the Rehabilitation of Offenders Act seeks to achieve. I beg to move.

[Lord Hunt of Wirral]

My Lords, I declare an interest in the global firm of solicitors, Beachcroft LLP, where I have been a partner since 1969, and as vice-chairman of Justice. I say that with trepidation in the presence of the emeritus chairman of Justice—my noble friend Lord Goodhart—because Justice must deserve a great deal of credit for the original rehabilitation of offenders legislation.

However, I need help from my noble friend the Minister on giving a commitment—a commitment that was given by the party opposite when it had responsibility. I also gave personal commitments when I was leading for the Opposition from the Front Bench and made it clear, right at the outset, that a single set of regulatory standards would be required for alternative business structures.

The Minister has received a fascinating brief from his officials to explain the mistake in singling out “head of legal practice” or “head of finance and administration”. I warmly commend the officials for having thought up this reason, but it was two years ago that we made it clear that it is the owners and managers of the alternative business structures who must be the people in the spotlight. It may well be that they will need under them a head of legal practice or finance and administration, but at the end of the day the key role played by the owner/investor/manager of the alternative business structures must mean that they should be subject to the same authorisation rules as solicitors in regard to disclosing criminal offences. Why? Because we must ensure, as both Front Benches agreed we had to, that convicted criminals are not able to become owners and managers of legal practices.

It is not just that a request has only just been received from the Legal Services Board, because it was in June 2009 that the Solicitors Regulation Authority made it clear that a single set of regulatory standards would be required. Why on earth this is not included now I just do not know, because what it means is that someone who has served a sentence for a serious crime such as money laundering does not have to disclose this when applying to be an owner or investor in an alternative business structure firm.

I suppose that my noble friend can immediately move to give me assistance by promising that there will be a further order to rectify this omission, which will then make it clear that the exemption of course also applies to owners and managers of ABS firms, as well as to the heads of legal practice and finance and administration within those firms.