Tackling Corruption

Karen Bradley Excerpts

Tuesday 2nd December 2014 Commons Chamber

[The Parliamentary Under-Secretary of State for the Home Department (Karen Bradley)]

I congratulate my hon. Friend the Member for North East Cambridgeshire (Stephen Barclay) on securing the debate. I must be honest: I will endeavour to respond to the many points that he has raised, but, given the time that is available, I suspect that I shall not be able to address them all. Let me reassure him, however, that my officials and I have heard everything that he has said, and I have already asked for a meeting with him to be arranged. I know that he has great expertise and experience in this regard, and I think it would be helpful to sit down with him and explore his comments and their practical implications. The figures he quoted in his speech show just how important it is that the Government tackle this issue, and I was interested to hear his points about the resourcing, having a targeted approach and dealing with loopholes. That offers a good structure to consider this matter by.

This Government recognise that corruption harms society, undermines economic development and threatens democracy. The impact of corruption is disproportionate to the level and the frequency at which it occurs in the United Kingdom, and often has serious ramifications in terms of public confidence across the public and private sectors. I want to make it clear that the Government are totally and absolutely committed to tackling corruption in all its forms. As my hon. Friend highlighted, this Government are doing more than any before to tackle the blight of corruption both here in the UK and around the world. In our serious and organised crime strategy, which we published last year, we set out what the Government are doing to improve our anti-corruption systems and to stop organised criminals using corruption as a tool of their trade, and in our open government partnership national action plan we acknowledged that, although the UK already has good structures and legislation in place, there was more to do to improve our standing at home and better manage our reputation for dealing with corruption and bribery offences overseas.

As part of that work, we committed to publishing a robust cross-Government anti-corruption plan that will bring greater co-ordination and coherence to the work that is already ongoing and the work we plan to take, from preventing corruption in the first instance to taking effective enforcement action when it arises, as well as increasing the protection of the public and private sectors. I am pleased to tell the House that we will publish that plan very shortly.

My hon. Friend is also aware that the Prime Minister recently appointed my right hon. Friend Minister for Business and Enterprise as the Government’s anti-corruption champion, and he and I have been working together across Government to ensure that the commitments set out in our anti-corruption plan are fully implemented and make a real difference to some of the points that my hon. Friend raised tonight.

It is also important to recognise, however, that we have not simply waited to publish a plan before starting work on these important issues. We already have some of the most comprehensive anti-bribery legislation in the world, and were recently recognised as one of only four active enforcers globally by Transparency International, one of the leading non-governmental organisations working in this area. Where we have found gaps in the legislation, such as in relation to police corruption, we have brought forward new measures to address them. My hon. Friend referred to the Serious Crime Bill, which has been through the other place and which will shortly receive its Second Reading here—at some point. In working through that Bill, we will be able to debate again many of the points raised and we will be able to look at how we can tighten our legislative framework as much as possible.

My hon. Friend talked about transparency, which is also a key tool in the fight against corruption, and this Government have put transparency at the heart of our approach to reducing the opportunity for corruption. As my hon. Friend will know, measures are being taken through this House to establish a publicly accessible central register of company beneficial ownership. This will ensure that law enforcement and tax authorities have access to the information that will help them to tackle corruption, tax evasion and the laundering of the proceeds of crime. In my own professional experience before I came to this place as a tax accountant, beneficial ownership was one of those phrases I used on a frequent basis and was a great fan of. It is important to reiterate that the UK made beneficial ownership a cornerstone of our G8 presidency in 2013, so that we can tackle tax evasion and fraud and promote greater transparency of company beneficial ownership.

Despite comprehensive international rules to prevent money laundering from being in place, we recognise that some financial institutions failed to comply effectively with the requirements placed upon them, and we are determined to be a global leader in this space by taking forward legislation to ensure UK companies know who ultimately owns and controls them and that this information is made publicly available. I think we can all agree that greater transparency about who owns and controls our companies should make it more difficult to conceal an individual’s involvement in a company, and should act as a deterrent to crime. The points that my hon. Friend has made about ownership of property and other assets are vital if we are to stand as a world leader in tackling corruption.

[Stephen Barclay]

The measures that the Government have taken on beneficial ownership are hugely positive, but does the Minister accept that if almost half of all property in London worth more than £2 million is owned offshore, the measures will not provide transparency on beneficial ownership? Does she agree that property is a particular opportunity for the Government to extend their reach?

[Karen Bradley]

My hon. Friend has highlighted a powerful fact, which brings home the challenge that we face. I would appreciate it if we could cover that point when we meet outside this place.

The Government have taken steps to strengthen the law enforcement response to corruption. Last year, as I have said, we established the National Crime Agency to manage the overall law enforcement response to serious and organised crime, including bribery, corruption and associated offences such as money laundering. We have introduced measures to create a new offence of police corruption, and the Home Secretary has asked Major General Chip Chapman to chair a review of the police disciplinary system.

The Government have also provided dedicated funding for UK law enforcement units to investigate illicit financial flows to the UK, which are linked to corrupt foreign officials from developing countries. My hon. Friend talked about funding from the Department for International Development for the various units, and he is right to highlight the importance of ensuring that we have a dedicated force working in that area that does not duplicate effort. In such a way, we can ensure that we get the most effective response from law enforcement specialists, who really know what they are doing and are first-class professionals in their field. That approach is recognised internationally as highly successful and innovative. To date, those units have restrained or confiscated more than £120 million of stolen funds, and further investigations and confiscations are under way. Our enforcement response must be the best that it can be, so we are reviewing the overall co-ordination and effectiveness of the UK’s enforcement response to cases of bribery and corruption. That work is ongoing, and Ministers will consider the findings in due course.

My hon. Friend raised points regarding Malawi, and I would appreciate it if we could discuss that point further. If he can provide detailed information about individuals who might be involved, or any other information, it would really assist us in our work. [Interruption.] He is making comments from a sedentary position, but I am sure that if we discussed the matter, it would assist us all.

I am conscious of the time, so I will quickly cover the suspicious activity reporting regime, which is a significant part of our work. Suspicious activity reports are a crucial source of information for law enforcement agencies, and they provide a mechanism for financial institutions and others in the regulated sector to obtain a statutory defence from a money laundering prosecution when they report their suspicions and are granted consent to proceed with a transaction by the NCA. As someone who has worked in risk management at one of the major accounting firms, I remember the joys of having to deal with such things, so I understand the criticism that my hon. Friend has highlighted. The economic crime command in the National Crime Agency is working with banks. The Home Secretary and I attended a business breakfast hosted at the Bank of England to kick off the work that we are doing with the financial institutions to find appropriate and acceptable ways to help them to deal with the bureaucracy of SARs. My hon. Friend made an important point about the profile of the issue, and all financial institutions need to raise the profile of the issue internally and see it as a key part of their own mechanisms for dealing with corruption and bribery.

My hon. Friend mentioned the proceeds of corruption, and there is much that I could say on the matter. Given the time, I will simply say that he made an important point about dealing with pre-regime changes and changes in regimes in other countries. When I attended, on behalf of the Government, the AFAR III—Arab Forum on Financial Recovery—conference about Arab countries in transition, it brought home to me the importance of making sure that we have the information that we need to enable us not only to restrain those assets but to seize them, and to return them to the countries that need the money.

I hope that my hon. Friend will acknowledge the work that the Government have done to tackle this important issue, and the improvements that we have recently initiated. I note the issues that he has raised, and I hope that our forthcoming measures will go some way towards addressing them. I look forward to debating the matter further with him.

Question put and agreed to.