Financial Services and Markets Bill

Debate between Lord Thomas of Cwmgiedd and Lord Naseby

Committee stage
Monday 6th February 2023 Grand Committee

[Lord Thomas of Cwmgiedd (CB)]

My Lords, I want to make just four points on fraud, which damages the markets so greatly and damages individuals. The amendments reflect the four points. First, we need a strategy. I do not see how we can go forward any longer without one. I have two comments on strategy. First, the bodies to be consulted should include lawyers and accountants, not because there might be a bent lawyer or bent accountant in the fraud but because often it is their failure to see a flaw in the system that has caused the fraud. Therefore, they need to be part of those consulted. Secondly, five years is a long time for a new strategy. We need some form of accountability for the performance of the strategy in the meantime.

My second point is the object, the principle or the duty—however you put it—of the regulators looking into fraud. This seems critical, and there are two primary reasons for this. First, there is the prevention of fraud. I have too often been told after a fraud has come to knowledge and things are being done about it by those in the market, “Oh, the return was too good to be true. Him? We would not have touched him with a bargepole.” Regulators ought to be able to pick that up, and the duty on them ought to emphasise that responsibility.

Secondly, if fraud occurs—and it is bound to—the expertise of the regulators is needed to guide the way in which prosecutions take place. These days, because virtually everything is documented, you cannot move money. In the old days you could take a suitcase of cash somewhere, but you cannot do that any more. You need someone who can interpret what is usually the defence, “Yes, I did this but I wasn’t dishonest”. The skill and expertise of those in the market who can point to and make clear why it was so obviously dishonest are critical.

Thirdly, dealing with fraud is expensive. If you are accused of fraud, you have nothing to lose by spending all you have in defending yourself. If you fail, that was the end anyway, so you might as well have tried to save your money. If you are successful, you generally get most of it back. In a sense, there is an imbalance. Therefore, I warmly support the amendment saying that the Treasury should hand over the cash. There is no conflict of interest there, because the decision on the level of fine is made by the court. That is a good idea.

Fourthly and finally, the idea of criminalisation is essential. It is often nice to be able to pay tribute to the wisdom of His Majesty’s Treasury. One of the most effective tools in its armoury in relation to sanctions has been criminalisation, because that is what frightens people. Therefore, criminalising the failure to act would be a welcome step, and is something that I hope His Majesty’s Treasury, with all its wisdom, will see the force of.

[Lord Naseby (Con)]

My Lords, I support Amendments 67 and 75—obviously, as I added my name. I will speak only to Amendment 67. I have spent nearly 50 years in Parliament, legislating on issues that needed urgent attention. I cannot think of any issue more important in monetary affairs, now or in previous years, than the one before us in this group of amendments.

In particular, I am very grateful to the UK Finance Annual Fraud Report, which highlights in some detail what is happening. Indeed, one of the paragraphs at the end says that the Bill before us, which the Government proposed, will legislate to deal with it. Look at the figures and the sheer scale of it:

“Most notable is the rise in impersonation scams and in authorised push payment (APP) fraud overall. In 2021 communications regulator Ofcom found that eight out of ten people that were surveyed had been targeted with scam texts or phone calls, intended to convince them that they were from trusted organisations such as banks, the NHS or government departments.”


The report goes on to say:

“The majority of APP fraud starts with some type of social engineering. As well as scam texts, phone calls and emails, more and more of us are paying for goods and services remotely”,


which opens the door to the fraudsters.

I will say no more other than this. My friend the noble Baroness, Lady Bowles—I greatly respect the work she does in this area—has produced a very simple amendment, but it is very powerful and clear and I highly recommend it to His Majesty’s Government.

Covert Human Intelligence Sources (Criminal Conduct) Bill

Debate between Lord Thomas of Cwmgiedd and Lord Naseby

Committee stage & Committee: 2nd sitting (Hansard) & Committee: 2nd sitting (Hansard): House of Lords
Tuesday 1st December 2020 Lords Chamber

[Lord Thomas of Cwmgiedd (CB) [V]]

I can be very brief in support of Amendment 17 and its Scottish equivalent. The intention appears to be clear: that the belief of the person has to be reasonably held on an objective basis. It would, in fact, be quite exceptional to have any other provision. It seems to me that the Bill ought to be clear and, on such an important point as this, there should be no room for ambiguity or argument if this matter ever comes before a court.

[Lord Naseby (Con)]

My Lords, I listened to my noble friend opposite and his detailed, and quite persuasive, contribution. I mentioned competence in the previous group. It is absolutely vital, but I do not need to say anything further on it, because the noble Lord has covered that in great depth.

The other two amendments—Amendments 16 and 17 —both claim to be more objective, and there is a powerful case for clarity. My only other comment is on Amendment 19. I do not want to be too hurtful but frankly, all it does is complicate the whole issue by a huge margin. For anybody to balance

“the size and scope of the proposed activity against the gravity and extent of the perceived crime or harm”,

they really need to be very experienced in the whole of this market. That is not at all possible.

It is difficult for my noble friend on the Front Bench. I can see that there is a need to get more bite into it, if possible, but it is not an easy issue. The contribution on competence from the noble Lord needs to be taken very seriously.

Prisoners (Disclosure of Information About Victims) Bill

Debate between Lord Thomas of Cwmgiedd and Lord Naseby

Committee stage & Committee: 1st sitting (Hansard) & Committee: 1st sitting (Hansard): House of Lords
Wednesday 20th May 2020 Lords Chamber

[Lord Naseby]

My Lords, I do not wish to contribute at this point, but I will listen to the Minister’s response.

[Lord Thomas of Cwmgiedd (CB)]

My Lords, I wish to speak briefly to the amendments tabled by my noble friend Lady Bull, and to support them, but before turning to that, I will make two points.

I entirely agree with and support the purposes of the Bill because, as has been shown on so many occasions, closure is impossible to achieve to any degree without knowledge of what has happened to the body of the deceased. However, there is another observation which it is important to make. If there is to be a proper review and recasting of the Parole Board system, which is long overdue, it is not sensible to make piecemeal amendments at this stage. Therefore, I urge that this Bill be passed without significant amendment.

The only amendment which I support, and I do so warmly, is that tabled by my noble friend Lady Bull. My reason for doing so is very straightforward. It is my experience that, when hearing evidence, trying to determine whether someone has had memory loss and whether that loss is genuine is an extremely difficult exercise. Medical opinion may well vary on either side of the argument. Therefore, it is very important that, if there is a case in which mental capacity or the mental state of the convicted person is to be examined, it is done very carefully before the board. It seems self-evident that if, after a long time in prison, a person is to be considered unsuitable for release because disclosure of the whereabouts of the body or other matters has not been made, the judgment should take into account, if the question arises, whether the prisoner has the mental capacity to recall the events, whether his mental health permits him to do so or whether this is all phony. That is a difficult determination and it should be done by the board.