Beneficial Ownership Registers: Overseas Territories and Crown Dependencies

Julian Lewis Excerpts

Thursday 7th December 2023 Commons Chamber

[Dame Margaret Hodge]

I thank my hon. Friend for his support—he is probably my oldest friend in the House; we go back many years—and I hope that the Government heard his urging.

[Sir Julian Lewis (New Forest East) (Con)]

Could we add one more to the list of reasons why people conceal their identities in this way, which is to avoid sanctions, including sanctions placed by our own Government?

[Dame Margaret Hodge]

The right hon. Member makes a really important point, which I will come to later. He is right: this is a national security threat as well as a threat to our economy.

The Government have yet to comply with the legislation by making an Order in Council to mandate compliance by the overseas territories. After discussions between the Crown dependencies and the right hon. Member for Sutton Coldfield and myself, the three Crown dependencies —Jersey, Guernsey and the Isle of Man—announced in May 2019 that they were committed to introducing public registers and set out a plan to do so. Although I welcomed that in principle, I was concerned that their commitment was qualified and that their action plan contained a number of opt-out clauses. However, on the basis of their commitment, we chose not to legislate but to trust them. It now seems that our trust was misplaced. They are reneging on that commitment and using every excuse not to comply.

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[Dame Margaret Hodge]

My hon. Friend makes an important point: those who suffer the most are the poorest in our community. One must remember that no tax is levied on all this illicit finance, so it does not fund the public services that we require. I would also point out to the Minister that a legitimate interest proviso does not meet the requirements of the Sanctions and Anti-Money Laundering Act 2018: the terms of the draft Order in Council specifically said that we want

“a compliant publicly accessible register”.

I ask the Minister to think about that.

Sunlight is the best disinfectant—we all know that. If we are serious about our effects to clamp down on dirty money and eliminate it from Britain, and from our overseas territories and Crown dependencies, we must have public registers, so that we can at the very least start to follow the money.

[Sir Julian Lewis]

For the sake of people who might not be experts in this field, can the right hon. Lady explain the extent to which those Crown dependencies and overseas territories themselves know where the real ownership of the resources resides? Can we be sure that they themselves know what information is being concealed and ought to be made public, or that we will have got to the bottom of the matter if it is made public?

[Dame Margaret Hodge]

I am not sure I can answer that, because I do not know whether they know, but there have been one or two instances where whistleblowers have come to see me—about Jersey, for example. It has been very difficult to find out and identify how much the Jersey authorities knew, and why or whether they took action on the information that is available. It would be wonderful if the right hon. Gentleman’s Committee could look at this issue in greater detail to establish that.

Illicit finance is not just an evil in itself: it is the golden thread that runs through all serious crime, from drug smuggling to people smuggling. It threatens our national security, hits the poorest countries the hardest, and starves our public services of much-needed investment. It was in recognition of that importance that we established the strong cross-party consensus in the House that led to the 2018 law, which was agreed unanimously in this House. Ten years have passed since David Cameron first openly supported public registers, and five years have passed since we legislated, but we are still waiting. That is not good enough.

It is the job of the Executive to implement the will of Parliament. To that end, I ask the Minister to take two actions. First, will he now lay an Order in Council, requiring the overseas territories to introduce public registers of beneficial ownership forthwith? Secondly, will he legislate to require Crown dependencies to do the same? If the Government do not act, I can assure him that Parliament will, for we must—for the sake of our economy, for the sake of our security and for the sake of our reputation. I urge the Government to move forward on this issue.

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[David Rutley]

That is not the intention. We want the light to shine on these issues. That will involve media and non-governmental organisations too. I can give the hon. Lady that reassurance.

[Sir Julian Lewis]

rose—

[David Rutley]

I will give way and then I will wind up very quickly.

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[Sir Julian Lewis]

Surely, the problem is that if the Minister were correct and any legitimate media could make an inquiry, any citizen with a real interest could go to the media and get the information that way. That must be known in opting for the filter, so presumably its purpose is only to be obstructive and to create legal barriers.

[David Rutley]

The filter is fundamental to the EU’s plans. We want this to be important in and of itself, and also a step on the journey to having full beneficial ownership registers. That remains the case.

I am conscious of time, but I want to assure the House that we are absolutely clear that we want to take this interim step further. We will continue active discussions. The majority of the five territories that we have talked about will sign up to the legitimate interest access filter, and we will continue to have discussions with other jurisdictions that need to do more. As I set out in my response to the right hon. Member for Barking, I intend to update the House with full details before Christmas, and I will lay a written ministerial statement on the outcomes of the ongoing negotiations.

We are continuing further productive discussions with Crown dependencies. In line with the overseas territories, we are recognising our different legal positions following the court judgment, but we are making our expectation clear that the registers need to be implemented during the course of next year. Again, the Home Office will update Parliament before the recess on the outcomes of those serious discussions, as we want to move forward.

In conclusion, I would like to give our great friends in the overseas territories and Crown dependencies the message that we are determined and keen to achieve this important goal for us all. The train is leaving the station. We know the direction of travel. It is time for all our friends in the overseas territories and CDs to get on board. We will do all we can to support them, and it remains a clear priority.