Money Transfer Accounts and Remittance Sector

Debate between Kevin Brennan and Cathy Jamieson

Wednesday 22nd January 2014 Westminster Hall

[Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)]

We have had an interesting debate. I thank my hon. Friend the Member for Cardiff West (Kevin Brennan) for securing the debate. I thank all those who have participated, particularly my hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali), who gave a comprehensive speech, and my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty).

I will be brief, because it is important that the Minister has the opportunity to outline fully the work that has been done since the previous debate, and I am sure my hon. Friends will want to intervene and ask him further questions. It is important to put on the record how much of an interest people have taken in this topic since the debate in July. Having read the transcripts of that debate and looked closely at the parliamentary questions and the responses since then, I suspect it is more with sorrow than with anger that people have called for this additional debate today, because, to be fair, there seemed to be a sense of hope after the previous debate that the Minister had taken on board the importance of the issue. During that debate he gave a personal account of how his own family had been affected and how he wanted to see progress made.

I am trying to be fair. All of us know that sometimes when things go into the machinery of Government, that machinery can grind somewhat more slowly than even Ministers would like. Hopefully, however, the continued voicing of concern even by the Prime Minister, the Secretary of State for International Development and so on, has shown the urgent need to tackle the problem, notwithstanding some of the other legal reasons for urgent action.

In his opening contribution, my hon. Friend the Member for Cardiff West outlined how important this issue is, not only for individuals and particular businesses but for the economy, both here and in Somalia and Somaliland. There is also the relationship between the moral issues and the economic issues, if you like: people are trying to provide assistance to individual families and to support businesses, and if that help is not provided there are dangers for the whole economy. We also heard some of the history, going back to the previous debate about the decision that Barclays took at that time and the pressure from campaigners to make Barclays change that decision.

There is an understanding on all sides that we want to do everything we can to ensure that when money is remitted or transferred it is done so legally and safely. I doubt that anyone in any part of the House does not want tough action to be taken on money laundering or any other illegality, or in situations where people are perhaps being unduly and inappropriately pressured over money. However, the point was well made in this debate, and indeed in the previous debate, that some of the smaller organisations and institutions that have been carrying out money transfers have not been found guilty of any misdemeanours or wrongdoing, unlike—as was fairly pointed out—some of our larger financial institutions, which have been involved in practices over the years that have now been brought into disrepute and, in some instances, resulted in serious fines. There are still serious questions to be asked about why there is a problem making progress on this issue. I would be interested to hear from the Minister what work has gone on in relation to the National Crime Agency and to ensure that those aspects are not inappropriately becoming barriers to progress.

I hope that the Minister can also answer the important questions put by my hon. Friends. Some months on from the original debate, during which the commitment was made to establish a working group to take work forward, I find it surprising that my hon. Friends still have to ask who is chairing that group. Has the group met? It has not met. There is now a date for a meeting, but when will it report? Will there be an interim report? What progress has been made? What discussions have taken place in an international context with, for example, the US Treasury and State Department? What discussions have taken place more widely? Are there more reports commissioned by the Government that have not been made public? What is the status of the promised discussions with the British Bankers Association? What can the Government say at this stage, notwithstanding the legal constraints on discussion of the particular issue with Barclays and the possibility of accounts being reopened?

I want the Minister to respond to those questions, although he already has a very long list of questions from my hon. Friends. One important question is about the role of the Financial Conduct Authority. Can he say a bit more about that role this morning?

Having given commitments in the previous debate, and because he obviously understands this subject from a personal perspective, I am sure that the Minister wants not only to listen today, so that he can give answers to the questions that have been put, but to ensure that a degree of urgency is injected into wherever it is in the system that the barriers to action are found. If that does not happen and if we do not have a system that is properly set up and regulated, the danger is that remittances will take place anyway, that the people involved will not be safe, and that there will be further problems down the line.

[Kevin Brennan]

My hon. Friend is talking about action by Government and Government agencies, and she mentioned the FCA. I understand from the UK Money Transmitters Association that the FCA has started contacting authorised payment institutions to confirm whether or not they have bank accounts that are suitable for safeguarding client funds, as required by the Payment Services Regulations 2009. So action is being taken, but it is action that will result in the closure of these businesses unless a solution is found.

[Cathy Jamieson]

Indeed, and I am grateful to both Oxfam, which has provided me with a briefing, and the UKMTA, which has also provided me with that information. Of course, one of the dangers is that when we begin to investigate these matters, people start to find that there are problems and rather than finding solutions to those problems, the response is, “Well, we will just make sure that it is closed down and doesn’t happen.”