Economic Crime and Corporate Transparency Bill

Alison Thewliss Excerpts

Report stage
Wednesday 25th January 2023 Commons Chamber

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the SNP spokesperson.

[Alison Thewliss (Glasgow Central) (SNP)]

It is a pleasure to follow the expertise of the right hon. and learned Member for South Swindon (Sir Robert Buckland), who outlined in great detail the significance and importance of the new clauses. Yet again, the House has the opportunity to get it right, and to get it right now, today, rather than at some point or when parliamentary time allows or after consultation or in due course. Why not do it today?

I have heard no arguments from Ministers in Committee, on Second Reading or here this afternoon to excuse why it cannot be done today, now, with the new clauses that have been so diligently and expertly proposed by right hon. and hon. Members. As I said yesterday, these are cross-party new clauses. They are the most widely supported new clauses I have seen, and there is no reason why the Government cannot accept not only the proposals from this side of the House but the diligent work of their own Back Benchers on the new clauses. It makes absolute sense.

I support the Government amendments before us, both the correcting ones and those that allow Scottish Ministers and their responsibilities to be added to the Bill. It is good that they have been brought forward now, although I am slightly wary that that happened at such a late stage and that the problem had been missed. Regardless, I am happy to see them today. I also support the amendments on information sharing between agencies, which make sense.

I am, however, concerned that the Government will not accept the “failure to prevent” amendment. As I said in Committee, when the hon. Member for Thirsk and Malton (Kevin Hollinrake) was a Back Bencher he was very supportive of the “failure to prevent” provisions, right up until 13 October 2022, when he said:

“Of all the measures we have talked about today, this would have the biggest effect in terms of cutting down on economic crime, because lots of our financial organisations are complicit when it suits their interests to be so.”—[Official Report, 13 October 2022; Vol. 720, c. 310.]

There is nothing in the Bill that would change that situation, but the new clause would. As I pointed out in Committee, now he is not just the hon. Member for Thirsk and Malton but the Under-Secretary of State for Business, Energy and Industrial Strategy. He has argued for a “failure to prevent” economic crime offence not just on 13 October last year, but on 7 July 2022, on 1, 22 and 28 February 2022, on 2 December 2021, on 9 November 2021, on 22 September 2021, on 18 May 2021, on 9 November 2020, on 25 February 2020, on 19 July 2019, on 23 April 2019, on 18 December 2018 and on 9 October 2018. Given that the hon. Gentleman has spent his parliamentary career arguing for this, it beggars belief that now he is a Minister with the power to implement it, he is not actually doing so.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

These are very important points. Given their importance, should the Minister not put down his phone and listen to what my hon. Friend is saying?

[Alison Thewliss]

One Minister is on his phone and the other—the hon. Member for Thirsk and Malton—is sitting at the back of the Chamber having a gab. This is not ideal, but perhaps the Minister has already heard what I have to say and does not want to hear it again.

“O, wad some Power the giftie gie us

To see oursels as others see us!”

[Tom Tugendhat]

It is not the first time I have heard this speech.

[Alison Thewliss]

It is not, and it certainly will not be the last. It could be if the Minister accepted the amendments, but he is not going to do that, and he will keep hearing this speech until he does: that is the truth of the matter.

As other Members have said, there is a precedent for a “failure to prevent” measure. It is in the Health and Safety at Work etc. Act 1974 and the Bribery Act 2010, so the concept already exists, and there is no reason why it cannot be applied today. Even if the Government are saying, “We want to extend it to other areas”, that should not limit us today, when the Bill gives us the opportunity.

I also support new clauses 4, 5 and 6. The right hon. and learned Member for South Swindon made an important point about what senior managers have to do, which is also relevant to the Online Safety Bill. I rather like the definition of an offence committed with

“the consent, connivance or neglect of a senior manager.”

All those things contribute to economic crime. This is, if you will, a sin of omission, and we should take the opportunity to tighten up these loopholes. It is one thing to know about something that is happening, it is another thing to look the other way, and it is another thing not to do your job properly and allow that something to happen. This would cover all those eventualities.

New clause 7, in the name of the hon. Member for Cheadle (Mary Robinson) deals with whistleblowing. It is an excellent new clause which would enhance the Bill and offer protection to the very people who flag up these economic crimes. Whenever I think about whistleblowing, I remember a little cartoon that I saw many years ago showing a man sitting at a computer terminal in an office with a sign above his head saying, “Congratulations Frank, whistleblower of the month.” I understand that the cartoonist was Bill Proud. Every time I think about that, I think about the lack of protection offered to whistleblowers, and how much more the Government could be doing to ensure that those who do speak up are protected.

The organisation Protect says that it has offered advice on whistleblowing to 2,500 people a year, and that of those who have contacted it about their experiences, 65% have suffered some kind of detriment as a result of their whistleblowing. There is no incentive for many people to speak out when they see something wrong. They feel that they will lose their job or their promotion and will have to work somewhere else, and also that this might follow them around if they are seeking references for a new job. There is a real problem here, and the Government could, if they wished, deal with it in the Bill: it would make sense for them to do so.

I also support the cost cap suggested in new clause 21. Bill Browder spoke about this issue very powerfully during the Public Bill Committee evidence sessions. The balance is completely skewed to the side of the criminals and away from the Government, and away from the prosecutors and the agencies who want to take on these crimes but simply cannot afford to do so. Bill Browder said:

“What I have learned is that the law enforcement agencies effectively refuse to open criminal cases unless they are 100% sure that they can win without any tough fight on the other side.”––[Official Report, Economic Crime and Corporate Transparency Public Bill Committee, 25 October 2022; c. 65.]

And what we have learned, even just this week, is that the other side can afford anything that allows them to support their case. Indeed, that was made clear in the exchanges on the urgent question on the Wagner Group earlier today. The other side are very well set up financially: they can afford the very best lawyers, while the prosecutors sit there with nothing in their armoury to take on these oligarchs and kleptocrats. That is not acceptable, and a cost cap such as the one suggested in new clause 21 would go some way to addressing it.

Bill Browder has also talked powerfully about the Magnitsky case. He produced a load of evidence about money that been stolen and laundered, being put through various accounts. He had traced all the money, some of which had ended up in the United Kingdom. When he presented the case to prosecutors, to the National Crime Agency and to various other agencies, they all refused to take it on. A crime has been committed, and we know who committed it and where the money ended up, but prosecutors here do nothing about it because it would cost them money that they might never see again. As a result, crimes go unprosecuted in the United Kingdom. It is unacceptable that, by failing to take on new clause 21 and other such measures that would cap costs, the Government are allowing this to continue.

I would support further measures on sanctions. Further to the urgent question, monitoring of sanctions and their effectiveness needs to be a lot tighter. Any sensible sanctions scheme would not have waivers for warlords.

I very much support the new clauses on the proceeds of crime and compensation for victims, for the people of Ukraine and indeed for the people of Iran, as has been suggested by the hon. Member for Oxford West and Abingdon (Layla Moran). Those measures are important. There are schemes such as the financial services compensation scheme, but in many cases that does not fully compensate, or compensate at all, those victims of economic crime. Appropriate compensation should be given, given the real and devastating effect that financial crime can have on our constituents. People who feel that they have been duped will carry that around for a long time, so compensation is important, and there is real need for finance both to fight the war in Ukraine and to rebuild that country thereafter.

--- Later in debate ---

[Alison Thewliss]

The hon. Lady is making some excellent points about the golden visas. Does she find the lack of curiosity from the Government about these golden visa holders and what they have been up to as remarkable as I do, when compared with some of the difficulties that our constituents have in asking for something as simple as a visitor visa to have their granny come over and visit from Iran?

[Layla Moran]

I thank the hon. Lady for her point, which is well made. The thing is that the Government were curious, and they did this review, which is sitting there. That is clear—the one thing that the written statement confirmed was that a review had been done and recommendations had come from it, but all we got was a summary of the recommendations. What I take from that is that they were curious and they found out, but now they do not want to tell us. What on earth happened? It is not a good look.

To move on from golden visas, we desperately need to see more action in a number of other areas to ensure that we properly tackle economic crime, particularly by kleptocrats. It is right that we focus on Russians, but it is worth saying that the Bill will apply to many other flavours of kleptocrats and bad people. As other hon. Members have said, this could be our last chance for many years to get this right, so we should consider how else it might apply. Last year, for example, Hong Kong Watch highlighted concerns about the dirty money that Hong Kong officials had gained through corruption and that has now been spent by the families of officials in the UK, including on property. I raised those concerns at the time and I will continue to press Ministers on them.

I tabled new clause 30, about Iran, to show how important it is to focus not on a single country, but anywhere there are human rights abuses. Anoosheh Ashoori made the point that

“there are a large number of children and relatives of the regime that, like the Russian oligarchs, like living the high life here and have assets here.”

Why are we not pursuing them? The new clause asks the Government to use existing legislation to do an audit and report back to Parliament. We should apply the Bill to as many places as it can be effective.

All that takes resourcing—a familiar refrain in the House—which is addressed by new clause 31. Frankly, resourcing is a lacuna in this Bill and its predecessor. I was encouraged by the number of amendments on establishing an economic crime fighting fund, which shows that it is clearly the shared will of hon. Members on both sides of the House that we put the resourcing and money behind this legislation to ensure that it is done properly. The Liberal Democrats wholeheartedly share that commitment. I say to the Minister that that money would not be frittered away; it would be an investment, because if we fund the agencies properly, they will start to bring the money back in. We know the exorbitant amount that we think we are losing to economic crime, so any investment in getting some of that money back would surely be good.

In conclusion, I urge Ministers to take note of the willingness of hon. Members on both sides of the House to act, and to take heart from it. There is much more to be done. I hope that the Bill is the next chapter, but not the last, in the House’s fight against economic crime in this country. I sincerely hope that Ministers will continue to work with us in our common aim of bringing about transparency and light to tackle this once and for all, so that we are never again left in this embarrassing position.

--- Later in debate ---

[Alison Thewliss]

I thank everybody who has contributed to the Bill. It has been a cross-party and worthwhile effort, and everybody who has been part of it has felt that. I hope the Government do their bit and take that cross-party effort in the spirit in which we meant it. We want to improve the Bill and for it to do everything it can do right now, rather than waiting for some distant point in the future when we come back and say, “We’ve still got these problems and this Bill, which could have addressed them, has not.” We have been there before. We had the Sanctions and Anti-Money Laundering Bill, and other Bills while I have been in this House could have addressed or fixed these problems, yet we are here again today still not fixing all the problems. Who knows when parliamentary time will allow us to pass this way again.

I thank the experts who have given so much evidence to us individually and as parliamentarians in Committee and other places. In particular I thank Helena Wood of the Royal United Services Institute, Duncan Hames of Transparency International, Bill Browder, Oliver Bullough and Graham Barrow, the expert on Companies House. He has had his own health issues but has continued to campaign on Companies House. We wish him well and a speedy recovery, and all the best with his treatment.

I also thank my hon. Friend the Member for Paisley and Renfrewshire North (Gavin Newlands). He came on board with this Bill and was very supportive and helpful throughout its passage, raising the issue of phoenixing, which is of concern to many of our constituents. I encourage the Government to look at how they can fix phoenixing, and ensure that our constituents and companies based in our constituencies do not fall victim to companies that seek to abuse the system in such a way. I give great thanks to the right hon. Member for Barking (Dame Margaret Hodge) who has been such a tremendous champion for all these issues over a long period. Her expertise, her contribution, and the way that she convenes people within this place has been incredibly important for this agenda, and I cannot thank her enough for that work.

I thank the Clerks and the Bill team for all they have done to help support us throughout the passage of the Bill. Putting together all the amendments is not easy, and under pressures of time they have been incredibly helpful in putting them together for us. I also thank Mhairi Love in my own office, and Sarah Callaghan in the SNP research office. Again, they have been incredibly helpful in putting together research on all these areas, and putting up with me when I go down a big rabbit hole of all the things about economic crime that live in my head most of the time. They have been very helpful indeed over the course of things.

I want to make an announcement, Mr Deputy Speaker, before everybody departs—[Interruption.] I am not going to the Government Benches; the Minister is welcome over here any time. I am not sure that his constituents would expect him to be an SNP Member, but any time he feels the need that is fine. As it is Burns Night, there is haggis in the canteen, and I encourage everybody to partake and get their honest, sonsie faces over to the canteen before it goes. I am looking forward to mine. Not related in any way to the Bill, the Ayrshire Fiddlers—not that kind of fiddlers—are in Strangers Bar, and Members should go and see them because they are very good indeed. Crucially for this Bill they are playing the fiddle and they are not on the fiddle, so please go and give them your support.

I finish with some lines from our national bard:

“O, wad some power the giftie gie us

To see oursels as others see us!

It wad frae monie a blunder free us,

An’ foolish notion.”

I ask Ministers to reflect on how others will see the Bill and make amendments to it in the other place to make it befitting of the commitment that we all have to seeing economic crime removed.

[Mr Deputy Speaker (Mr Nigel Evans)]

Happy Burns Night, everyone.

Question put and agreed to.

Bill accordingly read the Third time and passed.