Draft Criminal Finances Act 2017 and Economic Crime and Corporate Transparency Act 2023 (Consequential Amendments) Regulations 2024

Dan Jarvis Excerpts

Wednesday 13th November 2024 General Committees

[The Minister for Security (Dan Jarvis)]

I beg to move,

That the Committee has considered the draft Criminal Finances Act 2017 and Economic Crime and Corporate Transparency Act 2023 (Consequential Amendments) Regulations 2024.

It is a great pleasure to serve under your chairship, Mr Efford, and to welcome the shadow Minister, the hon. Member for Stockton West, to his place. I spent a very long time on the Opposition Benches in various shadow ministerial roles, so I hope the shadow Minister will take it in the right spirit when I say that I wish him much longevity on the Opposition Front Bench. I note that he has been busy and has already done two statutory instrument Committees since his appointment. Opposition is hard work, as I know all too well. As he settles into his important role as a shadow Home Office Minister, I wish him the very best over the coming months—maybe years. Despite our political differences, I know that we both care deeply about the security and safety of our country. In that spirit, I very much hope to work constructively and in the national interest with all of the shadow Home Office team.

Before I address the contents of the statutory instrument, I will briefly provide some background. The Economic Crime and Corporate Transparency Act 2023 contained a wide range of reforms to reduce economic crime and increase transparency over corporate entities conducting business in the UK. This included reforms to enable targeted information sharing to tackle money laundering and remove reporting burdens on businesses. Additionally, the 2023 Act introduced new intelligence-gathering powers for law enforcement and reformed outdated criminal corporate liability laws.

The reforms to the unexplained wealth orders regime, corporate liability laws and targeted information sharing are already in force. More recently, guidance for the new offence of failure to prevent fraud was published last week, on 6 November. The offence itself will come into effect in September next year, allowing organisations to develop their fraud-prevention measures before the offence comes into force.

The 2023 Act also introduced—this is of most relevance to this debate—a new regime to tackle criminal and terrorist cryptoassets. The use of cryptoassets in illegal activity is increasing. When introducing and reviewing legislation, we must consider emerging technologies and how they can be harnessed by criminals to commit crimes or to hide their ill-gotten gains. Under the previous Government, a bespoke regime was included in the Proceeds of Crime Act 2002 to allow the effective seizure of both criminal and terrorist cryptoassets. The regime was included in the 2023 Act to make it easier to confiscate cryptoassets from criminals and to forfeit cryptoassets that are obtained from or intended to be used in either crime or terrorism.

On 26 April, the relevant cryptoassets measures came into force, and the powers are operational in England and Wales. As of the end of October, the new powers have been exercised in more than 80 cases, including cryptoasset seizures or confiscation cases involving cryptoassets. I do not intend to cover the content of the powers themselves, as they were debated extensively by both Houses during the passage of the 2023 Act. I will instead outline briefly the purpose of the statutory instrument and the reason why we are gathered here this morning.

The regulations will make a set of amendments that are consequential on the Criminal Finances Act 2017 and the Economic Crime and Corporate Transparency Act 2023. The regulations address missed consequential amendments to the Proceeds of Crime Act 2002 and ensure that the investigative powers that that Act included —for example, reference to cryptoasset investigations—are included in all necessary sections of the powers in order that they function properly and act in accordance with the policy intention.

The statutory instrument is required to complete the commencement of the Economic Crime and Corporate Transparency Act 2023. It will ensure that all the necessary legislation is in place and that there is legal certainty as to how cases will be dealt with. I commend the statutory instrument to the Committee.

--- Later in debate ---

[Dan Jarvis]

I thank the shadow Minister for the constructive tone of his remarks. I am very grateful. I was particularly pleased to hear him reference the National Crime Agency, which provides me with a good opportunity to pay tribute to its work in this area. The NCA does not always get the acclaim that I think it deserves. The people who work there are fantastically dedicated public servants and, on matters relating to economic crime, as well as on other matters, they do an extraordinary job to serve the public.

The shadow Minister raised a number of entirely reasonable and constructive points. He pressed me on the need to ensure that the work we are doing sits as part of a broader strategy; I absolutely give him that assurance. I discussed these matters with the Minister at the time when we were in opposition, and we worked on them co-operatively and on a cross-party basis. Matters relating to cryptocurrency and the seizure of such assets and matters relating to economic crime are not matters of party politics. It is my intention to work co-operatively with the shadow Minister and Members from all parties to progress the work we are doing in government.

The shadow Minister rightly made the point about ensuring that the Government’s legislative approach keeps up with emerging technology and with criminals’ developing tactics and techniques. Criminals can be incredibly cunning. It is part of the nature of the way in which they operate, particularly in the field of economic crime, that the rapid rate of technology change and the different measures they employ, very much on an internationalised basis, means that Government and law enforcement agencies must constantly review their approach. We must ensure that we do not just seek to keep pace with criminals but are one step ahead of them.

The shadow Minister made an entirely reasonable point about whether the Government consider it likely that, as a consequence of the changes to the legislation, there will be an increase in arrests and custodial sentences. Rather than give him an answer that is not as considered as I would want it to be, I will write to him on that point. It is an entirely fair question, but one on which I want to take advice. I will get back to him as as soon as possible.

There is nothing more that I can add, other than to thank the Committee for considering the statutory instrument. As I have set out, it is necessary to complete the commencement of the Economic Crime and Corporate Transparency Act 2023. I therefore commend it to the Committee.

Question put and agreed to.