Economic Crime and Corporate Transparency Bill

Baroness Altmann Excerpts

Committee stage
Tuesday 9th May 2023 Grand Committee

[Lord Goldsmith of Richmond Park (Con)]

I thank the noble Lord, but I do not know what the legislative mechanism would look like to make that possible. I am afraid that it is something that I am going to have to—

[Baroness Altmann (Con)]

I thank my noble friend for giving way. I realise that he is in a somewhat difficult position, but I add my encouragement to him to discuss with colleagues the possible amendments that we have laid—

[Lord Fox (LD)]

Amendment 85.

[Baroness Altmann (Con)]

Yes, Amendment 85 would allow seizure of assets with a view, one hopes, eventually to being able to use them to reconstruct Ukraine in this case, but for other purposes as well. It would be an ideal way to pave the way for this to happen.

[Lord Goldsmith of Richmond Park (Con)]

The noble Baroness makes a similar point. It is not for me to determine the legislative or other route for achieving the possibility of using those frozen assets. It is something that I know that the Government are looking at and are sympathetic to, but I cannot go into any further details, because it is not an area where I have any particular expertise or authority. But I know that the Government are looking closely at the possibilities of doing so and recognise that there is a huge value in doing so, if we can.

--- Later in debate ---

The current situation cannot continue. I am obviously going to withdraw my amendment today, but I want to hear from the Government a real commitment to change, to provide a proper framework and context for whistleblowers—one that includes some form of independent office that can stand up on their behalf, stand between them and the powerful employer or institution, and cover those people who do not qualify as workers. It does not have to mirror the US system; that merely stands as a lesson in what can be achieved when there is not only recognition of the significance of whistleblowing but a commitment to make sure that it serves our community by giving us the earliest possible notice of wrongdoing and acting as an extremely effective deterrent.

[Baroness Altmann (Con)]

My Lords, I support Amendment 92, so ably and powerfully moved by the noble Baroness, Lady Kramer. I have added my name to it because, as I have personally seen, this issue is potentially beneficial yet in practice harmful in the financial services sector. It is very often a career-ending move if somebody decides to blow the whistle on fraudulent practice or wrongdoing in their place of work. I had a friend in the City who ended up blowing the whistle but only because she had already decided she was going to retire. She knew that it would be the end of her career and she did not wish to go to the expense of a tribunal, but it was the early warning that the authorities needed to discover that wrongdoing was going on. The problem we have is that those who are inside are best placed to identify the wrongdoing before it becomes more widely known and before more people are perhaps damaged by whatever the wrongdoing is, yet, as the noble Baroness, Lady Kramer, described, there is inadequate protection to recognise the benefits of having a canary in the coal mine being able to identify directly that something is amiss.

Therefore, I hope that we would be able to accept that having an independent office that can oversee and provide a safe space for individuals to notify their concerns, presumably having raised them internally first, could be very helpful in fighting economic crime and fraud. Normally, you would suggest that somebody raises a concern internally, but they might feel that that could be detrimental—there have been threats to people’s lives when they have blown the whistle, so it is not just a financial matter.

I warmly welcome my noble friend to his place. I look forward to hearing his answer and thank him for his engagement with me so far. I look forward to speaking to him on this issue and perhaps others as we proceed with the Bill. I hope that he will be able to accept that there are reasons why the Public Interest Disclosure Act is inadequate and why putting an amendment of this nature in this Bill makes enormous sense. I hope that we will therefore be better able to uncover criminal offences, fraud and deliberate cover-ups that it is in the public interest to expose rather than waiting for after-the-fact things to emerge having caused much more damage.

[The Lord Bishop of St Albans]

My Lords, I think I can be quite brief thanks to the noble Baroness, Lady Kramer, as I have been able to ditch most of what I was going to say because she has already made it so clear. I was persuaded to put my name to this amendment simply because I met a woman in one of my churches on a Sunday after worship who is currently in precisely this situation, and her whole life has basically fallen apart.

She came across something that it was clear to her was wrongdoing; she agonised for weeks and tried to take advice, which was difficult to get because of confidentiality. Eventually she decided that she needed to blow a whistle. She was immediately suspended, taken through a disciplinary process and dismissed. She is now trying to decide whether she can afford to take this through the courts. Her view is that she would probably have to sell her house to do so. It really is a David and Goliath situation.

As has been said, often the best people to spot what is going on are not necessarily the auditors—they try their best, but it is difficult for them; we see constantly how they do not always manage to spot what is going on and get an accurate picture—but those on the inside. Since the whole of our financial services sector, which is one of our great achievements and a fantastic part of our life, relies ultimately on trust—our greatest currency in this country—the integrity issue absolutely kicks in. In a world in which trust is at a low ebb, this is terribly important.

The reason people give for not wanting to be a whistleblower is the cost. A public consultation conducted by the European Commission revealed that the most common reason for not wanting to come forward with allegations of wrongdoing was simply the fear of legal consequences, which 80% of individual respondents reported as their primary reason. After that came fear of financial consequences at 78% and fear of what it would do to your reputation at 45%. As the noble Baroness, Lady Kramer, said, an informal blackballing goes on behind the scenes. The woman I mentioned is now fairly clear that, even if she wins this case, it is very unlikely that she will ever get another job in the financial sector. These are legitimate fears. A 2021 survey conducted by the charity Protect found that over 60% of whistleblowers reported experiencing negative consequences such as being dismissed, victimised or subject to harassment or bullying.

I hope that His Majesty’s Government will look closely at this or at somehow strengthening how we can support whistleblowers, for the long-term prospering of financial services in this country. I look forward to hearing the Minister’s response to this amendment.