South Africa: Money Laundering and Corruption

Lord Hain Excerpts

Thursday 17th October 2019 Lords Chamber

Asked by

[Lord Hain]

To ask Her Majesty’s Government what plans they have to impose similar sanctions to those announced by the United States Department of the Treasury on 10 October against Rajesh Gupta, Atul Gupta and Ajay Gupta for money laundering and corruption in South Africa.

[The Minister of State, Foreign and Commonwealth Office (Lord Ahmad of Wimbledon) (Con)]

My Lords, I thank the noble Lord for raising this important issue and also for his recent letter to my right honourable friend the Chancellor of the Exchequer. We note with interest the recent announcement by the US Administration and will consider the noble Lord’s request very carefully. We are aware fully of the allegations relating to these individuals and are discussing with the South African National Prosecuting Authority how we can best support its work to pursue proceedings against those implicated in corruption.

[Lord Hain (Lab)]

I am grateful to the noble Lord for his Answer. Will the Chancellor follow the US Treasury in imposing sanctions on Rajesh Gupta, Atul Gupta and Ajay Gupta, to block all of their property and interests in property within the UK’s jurisdiction and, like US persons, prohibit UK citizens and UK-based financial institutions and other UK-based entities from engaging in any transactions anywhere across the world with them? Will the Chancellor also immediately contact the Dubai, Hong Kong and Indian authorities and ask them to do the same?

Through their corrupt criminality and shameful looting, blessed by former President Zuma, the Gupta brothers have ripped off South African taxpayers by well over £500 million, a lot of it laundered through London, Dubai, India and Hong Kong, and assisted by London-based corporates such as McKinsey, KPMG, Bain & Co and Hogan Lovells. Any failure by global Governments to act against all this would echo their failure to impose sanctions on apartheid South Africa.

[Lord Ahmad of Wimbledon]

My Lords, I am sure the noble Lord will appreciate that I cannot say any more on the specific matter he has raised at this point. We are in touch with the South African authorities. The noble Lord is also very much aware of the strong stance that the UK Government and indeed the United Kingdom have taken over several years in further strengthening our work on tackling corruption and illicit finance. He raised a specific question on the UAE and India and whether my right honourable friend would write. I have been informed that the South African authorities have already made mutual legal assistance requests to the Governments of those countries. Additionally, similar requests have been made to the Governments of Canada, Switzerland, Mauritius, Hong Kong and China. As I said, I am aware of the letter the noble Lord wrote to my right honourable friend and I know the Chancellor will respond to him shortly.

Kimberley Process Certification Scheme (Amendment) (EU Exit) Regulations 2019

Lord Hain Excerpts

Thursday 28th February 2019 Lords Chamber

[Baroness Northover (LD)]

My Lords, I was unable to be present when this SI was considered in Grand Committee, and I am very grateful for this opportunity to comment briefly. If the UK is indeed to leave the EU, this is an area in which we must put in place our own arrangements. The Kimberly process is an extremely important certification scheme to address the appalling abuses involving so-called blood diamonds which drive conflict, particularly in Africa. The Kimberley process seeks transparent and fair practice in this sector, and we are rightly signed up to it. I note and share the concerns expressed in Grand Committee by the noble Lord, Lord Collins, about exactly what would happen if we were to leave the EU with no deal. Nevertheless, on behalf of these Benches, we welcome the Government’s continued commitment to the Kimberley process as expressed in this SI. Whether we are in or outside the EU, this commitment is vitally important.

[Lord Hain (Lab)]

My Lords, I endorse what the noble Baroness has said, and what my noble friend Lord Collins said in Committee. Can the Minister give us a categorical assurance that there will be no gap when Britain is no longer a signatory and supporter of this scheme? I declare an interest as I was the British Foreign Office Minister who initiated this treaty and Britain’s involvement in it. Britain led the way to get the international treaty, and we got the rest of the European Union signed up to it—initially against resistance from the World Diamond Council but, ultimately, with its support. This is a very important scheme, making sure that conflict diamonds do not enter the international arena illegally and fuel conflict, as they once did in Angola, Sierra Leone and the DRC.

[Lord Foulkes of Cumnock (Lab Co-op)]

My Lords, the noble Baroness, Lady Northover, can be excused totally for being unable to be present. In fact, hundreds of us were not able to be present; the only people present were the Minister and my noble friend Lord Collins.

Jamal Khashoggi

Lord Hain Excerpts

Tuesday 23rd October 2018 Lords Chamber

[Lord Ahmad of Wimbledon]

The noble Lord speaks from wide experience in this respect and I agree with him on principle. I fully support his position but what Germany exports and what is does is really a matter for the German Chancellor and Government. I have looked at the structure and support of arms sales. This was put in place by the very respected Robin Cook when he was Foreign Secretary. There are quite strict procedures in place to ensure that these weapons comply with international humanitarian law.

Notwithstanding that, the noble Lord will also be aware that our export licensing system also builds in flexibility to allow us to respond quickly to changing circumstances. Since 2015 we have suspended more than 331 licences. This is not a case of once agreed, never suspended. I agree with the noble Lord that we must be very careful to ensure that our response is considered, clear and unequivocal. We should act only, I stress again, once the full facts have been presented. As I said, we await the full facts from the Turkish investigation.

[Lord Hain (Lab)]

My Lords, following up the noble Lord’s Statement, we brought in legislation on arms sales, which this Government profess to comply with, saying that arms could not be sold to be used for external aggression or internal repression. External aggression is what the Saudis are doing in Yemen on a massive scale. We need to reset our relationship with Saudi Arabia, particularly in light of this barbaric murder. By the way, President Erdoğan championing journalistic freedom is something else.

Will the Minister consider the case for resetting the relationship with Saudi Arabia without turning our backs on an important strategic relationship in intelligence and defence terms? I understand that, having been a Middle East Minister. We should adopt a much more even-handed attitude in that region, especially between Riyadh and Tehran. We treat Iran as a pariah state but we treat the Saudis as brothers in arms. Maybe the Crown Prince took that and the signals from President Trump as giving him a blank cheque, as it were, to operate with impunity in a lawless way, as has clearly happened in Istanbul.

[Lord Ahmad of Wimbledon]

My Lords, the noble Lord mentioned how Saudi Arabia has been acting and this crime in particular. The reaction to it and the changing position from the Saudi Government reflect the strength of opinion and representations made not just by the United Kingdom but others. It has resulted in the admittance that a crime—indeed, a murder—took place in the consulate in Istanbul. As I said, we await the full facts of what will be determined from the investigation by Turkey, which we fully support.

Picking up a thread from the earlier questions from the noble Lord, Lord West, about training and support, it is right that we provide support in terms of training to militaries across the world, as we do to the Saudi military. There is an advantage in doing this because we share elsewhere the values and the strong sense of training deployed by our troops, which stress the importance of international humanitarian law.

As for resetting relationships, the noble Lord acknowledged the importance of the strategic partnership, but lessons will be learned from this incident, which resulted in the murder of Jamal Khashoggi. As I said, once all the facts have been presented, the United Kingdom Government will consider them very carefully and act accordingly.

Palestinian Territories

Lord Hain Excerpts

Thursday 7th June 2018 Lords Chamber

[Lord Hain (Lab)]

My Lords, I am both a long-standing supporter of the Palestinian cause and a friend of Israel. As a British Minister for the Middle East from 1999 to 2001, I worked closely with both Israeli Government Ministers and Palestinian leaders. My background of fighting apartheid, racism, Islamophobia and anti-Semitism is recorded. For decades I have favoured the internationally supported two-state solution as the best plan for peace and the fairest outcome, but is this now in any way feasible? Prime Minister Netanyahu and other members of his Government and MPs have recently spoken out against it, endorsed by the renewed “Greater Israel” discourse of the growing Israeli right calling for the annexation of Palestinian territories. Negotiations between Israeli and Palestinian leaders have failed, as has a reliance on the US to deliver Israeli co-operation. Europeans, meanwhile, have been unable to deliver the settlement freeze they advocate.

Today, the situation of Palestinians living on their own land resembles a harsh civil rights struggle. Gaza is under Israeli siege. Palestinian life in the West Bank and east Jerusalem is untenable because they have little or no say over the running of a land that has increasingly become an archipelago of isolated Palestinian territorial islands in a sea of Israeli-controlled land, checkpoints, bases and settlements. If Israel’s relentless expansion into Palestinian territories cannot be stopped, we face one of two possible outcomes. The first is that all Palestinian presence in the West Bank and east Jerusalem remains in a permanent and ever more formalised “Bantustan” status; islands of minimal self-governance with the continued denial of basic rights, facing perpetual insecurity and possible future physical removal, deprived of full access to water and subject to all manner of restrictions on land rights and free transport across their own territory. The second is that they are absorbed into a common Israeli-Palestinian state with the opportunity for pluralism and human rights advancement.

Tense and difficult though the current standoff may be for Israel, it is not going to be defeated and therefore holds the stronger hand. Would Palestinians, absorbed into their traditional homeland, albeit alongside Jewish citizens with a narrow majority over them, drop their historic grievance and quickly adjust to the new reality? That is optimistic to say the least. But if the window for the two-state solution has indeed closed, should the EU, the US and the UK make it plain to Israel that a one-state alternative may be the only one available to ensure its own security? If so, what guarantees might there be for Jewish citizens both within Israel and worldwide if they agree to this merger? Could the Arab nations join those in the West like the US and the UK to provide the post-World War Two guarantee of “never again”? Could a federal or confederal state provide a way forward, with common security, a unified economy, common civil rights and guarantees of religious freedom for Jews and Muslims, but considerable political autonomy for the territories within it of “Israel” and “Palestine”?

Is it not the blunt truth that we must either undertake a massive social and geographical reverse engineering to re-enable a genuine two-state outcome, with two sovereign independent states based on 1967 lines with equal land swaps—and without all the unreasonable Israeli caveats that drain the Palestinian state of any real meaning—or recognise a common-state reality and make it truly democratic, with enfranchisement and rights for all?

I am making a plea for honesty because it seems that the international community is publicly sheltering behind the policy of a two-state solution, while privately knowing that it has become a convenient mantra rather than a deliverable policy.

Sanctions and Anti-Money Laundering Bill [HL]

Lord Hain Excerpts

Ping Pong (Hansard): House of Lords
Monday 21st May 2018 Lords Chamber

[Baroness Northover (LD)]

My Lords, we, too, welcome Amendment 1 and the consequential amendments, which are the concession made by the Government in the Commons explicitly to include gross human rights abuses in the Bill, recognising the vote in the House of Lords led by the noble Lord, Lord Pannick, and others. We also welcome Amendment 16, which deals with the concern raised by the Independent Reviewer of Terrorism Legislation and the Joint Committee on Human Rights. We also welcome Amendment 17, requiring the Government to make periodic reports on the use of powers to make sanctions. How frequently may those occur and what form may they take? Most of all, I thank the Government for listening to the views expressed here and hope that we can take heart in relation to other legislation and votes we have seen in recent times.

[Lord Hain (Lab)]

My Lords, I, too, welcome government Amendment 1 and its associated amendments and applaud the Minister for the way he has spoken forthrightly on the human rights agenda and stewarded the Bill, which is a case study in how a Government and a Minister should and can respond to amendments from the Opposition, the Liberal Democrats and Cross-Benchers.

At the same time, I crave the indulgence of the Minister, the Whip sitting next to him and your Lordships’ House in returning to a subject which I have raised before—which, I am authoritatively told, has had some impact on the welcome change in the leadership of South Africa. This week marks South African President Cyril Ramaphosa’s first 100 days in office. I will be brief, but the official state money laundering and corruption virus he inherited from President Zuma is significantly more virulent and pervasive than even Ramaphosa could have anticipated, made immeasurably worse by the complicity of UK-based global corporates.

Take Hogan Lovells, the international law firm headquartered here in London and in Washington, its role starkly exposed in documents recently released to the parliamentary finance committee in South Africa. In your Lordships’ House, Report on the Bill on 15 January, I first criticised its role for whitewashing corruption by Tom Moyane, chief of the South African Revenue Service, now suspended by the new President. According to these documents, Hogan Lovells kept silent even when its findings related to money laundering and corruption by Moyane’s former deputy, Jonas Makwakwa, and even after Moyane misled the South African Parliament. Through its despicable, fee-grabbing complicity, Hogan Lovells spared these two notorious perpetrators of state capture in South Africa from accountability for their complicity in, and cover up of, serious criminal behaviour, including money laundering and corruption.

At the same time, Hogan Lovells has been undermining the criminal justice system in a series of other cases, as proven by the fearless Forensics for Justice NGO investigator, Paul O’Sullivan. Effectively, Hogan Lovells was acting as former President Zuma’s legal fudger-in-chief.

Brave investigative journalist Pauli van Wyk has exposed lies by the senior partner of Hogan Lovells in South Africa, Mr Lavery Modise. In the Daily Maverick, she pointed out:

“Despite having the benefit of the report by Price Waterhouse Coopers (who actually conducted the investigation), Modise and his team ultimately charged Makwakwa with everything he could explain, and with exactly nothing that he previously struggled to explain, or simply refuse to account for”.


Indeed, the more serious allegations in the PwC report were carefully filtered out of Hogan Lovells’s report, and the firm did not point out that Moyane was preventing critical evidence from being given to PwC.

Hogan Lovells’s most specious piece of lawyer sophistry was to claim that it could look only at the employer-employee issue involved and not at any criminal issue, giving the excuse that the employee, Makwakwa, could otherwise implicate himself. Surely all good employers, and indeed employees, should report on any criminality at their workplace, and surely even more so in the vital state revenue agency when the crime relates to money laundering and tax evasion. Effectively, Hogan Lovells turned a blind eye to the looting of the tax agency. It took a fat fee and ignored the truth. Most astonishing to me is that Hogan Lovells still refuses to acknowledge, let alone apologise for, its complicity, thereby actively supporting those still trying to undermine President Ramaphosa’s reform programme.

The behaviour of Hogan Lovells in South Africa is a classic example of a British-based company obfuscating its behaviour, using the complexities afforded by the law, including client confidentiality, to conceal the crimes of money laundering and corruption. Hogan Lovells fits exactly the behaviour exposed by investigator Pauli van Wyk when she concluded:

“The tale of State Capture ... co-exists in a mutually parasitic relationship where the public purse is the feeding ground and corporates are the enablers and agents of whitewash”.


British based corporates such as Hogan Lovells should be supporting, not thwarting, President Ramaphosa’s anti-money laundering agenda.

The Solicitors Regulatory Authority has now declared that Hogan Lovells South Africa is a “connected party” to its UK firm and I therefore request—I hope that I will have the Minister’s support—that the SRA withdraws recognition from Hogan Lovells UK and suspends its UK senior partners from practising here for its scandalous activities in South Africa. I also ask British Ministers to ensure that Hogan Lovells UK receives no more UK public sector contracts until it at least apologises for its shameful and shameless South African role. Additionally I can report that, after I raised this matter at Second Reading in November, the Financial Conduct Authority has recently informed me that it is engaging with the whistleblower who has supplied evidence that I believe should see HSBC prosecuted for conspiracy for facilitating money laundering.

I conclude: unless Ministers ensure that there are penalties for UK-based corporates like Hogan Lovells, HSBC, the Bank of Baroda, Standard Chartered, Bell Pottinger, KPMG, McKinsey—and who knows how many others?—for their complicity in protecting criminals engaged in money laundering in the South African case, I am afraid this legislation will not be worth a candle.

[Lord Pannick (CB)]

The Minister was asked about safeguards. Can he confirm that the safeguards in the Bill, which we debated at great length in its various stages to ensure fairness to those listed, will apply in exactly the same way to those persons accused of human rights violations as they apply to all those listed for other reasons under the Bill?

Sanctions and Anti-Money Laundering Bill [HL]

Lord Hain Excerpts

3rd reading (Hansard): House of Lords
Wednesday 24th January 2018 Lords Chamber

[Baroness Northover (LD)]

My Lords, I thank the Minister for the amendments he has tabled. I support the noble and learned Lord, Lord Judge. One has to think that the continued inclusion we have just heard described was inadvertent and that the Minister will make sure that it is cleaned up immediately in the Commons—otherwise we will have to address the issue when the Bill returns to this House so that it is consistent throughout.

[Lord Hain (Lab)]

My Lords, I rise briefly to thank your Lordships’ House for allowing me to speak at length on three occasions to spell out the corruption and money laundering involving some British companies. I am told by those involved that, when the leadership change took place in South Africa just before Christmas, these interventions had some effect on the margin, and I am grateful for that. I thank in particular the Minister. When last Monday I spoke on Report, I think that I may have strayed outside order, narrowly—or not, as the case may be. I am grateful to him and to those involved for their tolerance. I have thanked him personally but I wanted to put it on the record.

Sanctions and Anti-Money Laundering Bill [HL]

Lord Hain Excerpts

Report: 1st sitting: House of Lords
Monday 15th January 2018 Lords Chamber

[Baroness Northover]

My Lords, I too am very glad that the Minister listened to the debates in Committee and engaged, with his team, so effectively with the noble Lord, Lord Pannick, and others. I was slightly amused that, in his letter to us, the Minister described his amendments as technical in nature. I thought that was a phrase he might have avoided, given the trouble he ran into on it before. That aside, I welcome the amendments.

[Lord Hain (Lab)]

My Lords, I shall speak to these amendments, on which the noble and learned Lord, Lord Judge, and the noble Baroness, Lady Northover, made some persuasive and consensual points about how we uphold our international obligations. I will focus on sanctions in the related context affecting UK-based companies. I would be very grateful for some leeway from your Lordships in this so that we can make progress on the whole Bill, especially on Wednesday, when time will be short.

It should be a matter of shame that companies headquartered here in the UK have so far evaded sanctions for aiding and abetting money laundering, corruption and state capture in South Africa, including Bell Pottinger, KPMG, McKinsey, SAP and banks such as HSBC, Standard Chartered and Baroda, in total betrayal of Nelson Mandela’s legacy. I have just referred Hogan Lovells, the international law firm headquartered here in London, to the Solicitors Regulation Authority—the SRA—for enabling a corrupt money launderer to be returned to his post as second-in-command of the critically important South African Revenue Service, SARS. I have asked the SRA to withdraw Hogan Lovells’ authorisation as a recognised body and to examine what other disciplinary action can be taken against its leading partners, including withdrawing their permission to practise as solicitors.

Hogan Lovells spared two of the most notorious perpetrators of state capture in South Africa, Tom Moyane, head of SARS, and his deputy, Jonas Makwakwa, from accountability for their complicity in and cover up of serious financial crimes. In so doing, Hogan Lovells are complicit in undermining South Africa’s once revered tax-collection agency and thereby effectively underpinning President Jacob Zuma and his business associates, the Gupta brothers and others, in perverting South Africa’s democracy, damaging its economy and robbing its taxpayers. When Hogan Lovells was engaged by the corrupt Moyane in September 2016, it was well known that he and Makwakwa were synonymous with President Jacob Zuma’s capture of the state. Hogan Lovells could therefore not plead ignorance as they walked right into that web of corruption and cronyism for a fat fee.

To help protect himself from 783 counts of corruption, fraud, racketeering and money-laundering levelled against him when he came to power in 2009, President Zuma systematically dismembered and manipulated the once highly functional South African Revenue Service and the National Prosecuting Authority. Zuma’s key man in this process was his long-time comrade, Tom Moyane, whom he appointed as head of SARS, as commissioner, in 2014 and who, from day one, loyally set about obliterating all its investigative capacity, with the assistance of his deputy, Jonas Makwakwa. These two turned the institution, which under the leadership of the highly respected Pravin Gordhan had consistently overdelivered on revenue collection, into one now facing a 51 billion rand, or £3 billion, revenue shortfall.

Makwakwa’s unethical behaviour was quickly exposed in May 2016 when South Africa’s financial crime regulator, the Financial Intelligence Centre, ordered SARS to establish whether several “suspicious and unusual cash deposits and payments” into the accounts of Makwakwa and his lover, a low-level SARS employee, Kelly-Ann Elskie, were “the proceeds of crime and/or money laundering”. About 1.7 million rand—about £100,000, a lot in South African purchasing power—had been paid into their bank accounts over a six-year period. The FIC noted that the amounts flowing out of Makwakwa’s account,

“are of concern as they originate from unknown sources and undetermined legal purpose”.

However, when the FIC reported these suspicious transactions to Moyane, he tried to ignore the request by keeping it a secret. At the same time, the FIC reported the suspicious transactions to the police, known as the Hawks, to investigate the alleged criminality associated with the transactional flows and they opened a case.

Four months later, in September 2016, news of the FIC’s report to Moyane was exposed by investigative journalists and he begrudgingly suspended Makwakwa and later Elskie. This is when Hogan Lovells entered the picture. Moyane appointed the law firm to conduct “an independent investigation” into the Financial Intelligence Centre’s allegations to ensure “transparency, independence and integrity”, and then to recommend and independently facilitate necessary action, including disciplinary action. Hogan Lovells was therefore appointed to investigate the allegations contained in the FIC report and to conduct disciplinary proceedings against Makwakwa on behalf of SARS. To that effect, Hogan Lovells drafted the terms of reference for the engagement, a seven-page roadmap signed and adopted by SARS. However, Hogan Lovells failed to investigate the very reason the firm was appointed; the allegations contained in the FIC report. Hogan Lovells deviated so materially from its own terms of reference, allowing itself to be blindly led by Moyane, who redefined the terms of reference as and when it suited him, that a respected investigative journalist described the outcome as being,

“so tailored that it borders on the realm of being cooked”.

What an indictment of a leading international firm, Hogan Lovells, and its role.

The allegations against Makwakwa involved layers of possible transgressions; these being, first, tax law breaches, linked to whether he declared the transactions; secondly, criminal breaches, linked to whether the suspicious transactions were predicated on corruption or money laundering; and thirdly, whether internal SARS policy breaches had occurred. Moyane also mandated PricewaterhouseCoopers to analyse Makwakwa’s tax compliance, with regards to the “suspicious and unusual” money flows through his accounts. The Hawks were simultaneously investigating the criminality. Hogan Lovells’s mandate was, according to its terms of reference, to institute an independent investigation, partly using the findings of these other processes, to assess the veracity of the FIC allegations against labour and administrative law, and institute a disciplinary process.

But then two things happened. First, SARS declined to provide Hogan Lovells with the PricewaterhouseCoopers investigative report into Makwakwa, citing taxpayer confidentiality—an inaccurate interpretation of the law, which Hogan Lovells accepted without question. Secondly, Hogan Lovells never made contact with the Hawks to assess the status of their investigation—information which would logically be crucial to its assessment of Makwakwa’s fitness as a senior SARS employee. Equally puzzling is that around that time, South Africa’s Parliament got interested in Moyane’s puppet mastery of Hogan Lovells, prompting a parliamentary question about the nature of the engagement between the two organisations.

Sanctions and Anti-Money Laundering Bill [HL]

Lord Hain Excerpts

Committee: 4th sitting (Hansard): House of Lords
Tuesday 12th December 2017 Lords Chamber

[Baroness Sheehan (LD)]

My Lords, I wish to speak to Amendment 75A, which is also in my name. I agree with all that the noble Lord, Lord Collins, said. The Bill allows such sweeping powers to future Ministers that we on this side of the House seek to put in place safeguards which will enable Parliament greater scrutiny over the regulations made under Clause 16—namely, that they are made by the affirmative procedure.

Clause 16 is the enforcement clause which includes not only the creation of criminal offences punishable by up to 10 years in prison but makes provision for matters in relation to those offences, including defences and evidentiary matters. The Constitution Select Committee has recommended that Clause 16 should not remain part of the Bill, stating its opinion that such regulation-making powers are constitutionally unacceptable. Indeed, we heard arguments to that effect from the noble and learned Lord, Lord Judge, and my noble friend Lady Bowles on the first day of Committee. I agree with the noble and learned Lord, Lord Judge, that this clause should not disfigure our statute book, as he said. Therefore, this amendment is purely an attempt to create a safety net should Clause 16 remain part of the Bill.

[Lord Hain (Lab)]

My Lords, I added my name to this group of amendments and I support my noble friend Lord Collins in pressing for greater safeguards and extra parliamentary scrutiny, not least because, as I detailed last week in Committee, the banks and London have an appalling record on money laundering—it gives me no great pleasure to say that. We pride ourselves on having one of the best centres of finance in the world, and it is a tremendous source of employment, which is important. However, there is a record of money laundering that simply requires extra parliamentary scrutiny, which is why this group of amendments is so important. That gives me the opportunity briefly, as noble Lords will be relieved to know, to comment on today’s news that HSBC has been relinquished of the penalties that could have applied in the United States of America for similar allegations. That is good news for a British bank that has a global footprint, and for its many employees here in Britain.

I will make two points on this. I caution all our banks which face allegations of money laundering—the Minister may care to comment on this point. Usually, their initial response is to deny it. Then, for example, HSBC, discovered several accounts held by the Gupta brothers, who are South African associates of President Zuma’s family, and it has closed them down, which is welcome. However, we have had a steady stream of allegations against mainly British companies: Bell Pottinger and KPMG, and then McKinsey, which is an American-based company with a presence here. Their initial stance is to deny, then admit, and then apologise. I caution them that with this disease of money laundering it is better not to deny in the first instance.

My second point is to thank the Financial Conduct Authority for the way it has engaged on this issue. I can report to the House that at least one whistleblower who has been supplying me with information from South Africa has engaged directly with the FCA—it has been a positive experience. I say to the financial institutions involved that I named in your Lordships’ House, including HSBC, Standard Chartered and the Bank of Baroda, that if I find that there is any witch-hunting of those responsible, or of the brave, courageous people in the South African governmental system who have also been supplying me with information, I will name the institutions involved and identify the individuals as having suffered that persecution. I say this before your Lordships because it is important that as we take the Bill through we arm it with the instruments necessary to stop this kind of practice.

[Lord Judge (CB)]

My Lords, I will not say anything that would diminish what we just heard from the noble Lord, Lord Hain, and I do not believe in repetition. However, if I have to repeat it at the next stage of this process, I shall be as vehement as I was before. I support this amendment.

Yemen: Humanitarian and Political Situation

Lord Hain Excerpts

Monday 20th November 2017 Lords Chamber

[Lord Ahmad of Wimbledon]

My noble friend makes a number of important points. I can assure him on one of the central points that he makes, when he gets to the heart or crux of the challenge and the issue on the ground in Yemen—the protracted dispute and regional rivalries being played out in Yemen. In recent history, the current crisis was exacerbated when the then legitimate Government, who had support, was removed by the rebel Houthis, supported again by other regional players in the area. It is important to recognise, as he says, that, as we have made clear to all parties, including the Saudis, protracted conflict through use of military actions and the restrictions that are being applied will not result in the long-term solution required on the ground, which can be achieved only by all parties coming together. That is what we are emphasising not just through the political solution that we seek through the United Nations but through the work that we are doing with key regional players, including the Emiratis—yes, the Saudis as well—but also the Omanis, in ensuring that through the Quint and the Quad we bring all relevant parties forward towards that political solution.

[Lord Hain (Lab)]

My Lords, will the Government accept that their one-sided approach to this whole crisis is prolonging it? The Minister made criticisms of Iran, and rightly so, but he made no criticisms at all of the Saudis, although their strategy is acting as a recruiting sergeant for militant rebels and encouraging Iranian influence in the region. Surely, there should be an even-handed attitude between Iran and Saudi Arabia to get both to accept their responsibilities for this conflict, or we will see a disaster on the kind of scale that we have seen in Syria—and I say that as a former UK Middle East Minister.

[Lord Ahmad of Wimbledon]

Of course, the noble Lord speaks with experience in this regard. I assure him that, as I have said already from this Dispatch Box, not just today but previously as well, regional conflicts are being played out not just in Yemen but in other parts of the Middle East, which tragically go back to a core conflict that exists in the schism, tragically, in the Islamic faith. However, that should not detract from the fact that the United Kingdom, as I assure him and all noble Lords, makes the strongest representations to the Saudis. I assure him that we have tried to ensure that the Saudis and all regional partners bring to an end this conflict, which has gone on for far too long.

Saudi Arabia and Iran

Lord Hain Excerpts

Wednesday 15th November 2017 Lords Chamber

[Lord Ahmad of Wimbledon]

I agree with the sentiments of the noble Lord, who knows the region well. I think I speak for everyone in your Lordships’ House and beyond when I say that we wish to see a resolution not just of the conflict in Yemen, where innocent civilians in particular are suffering, but of any conflict between Iran and Saudi Arabia, which is worrying not just to the region but to the whole world. This conflict is tribally based and has not just arisen since the regime took over in Iran in 1979; it is a deep-rooted, embedded conflict which goes back to the division in Islam between the Sunni and Shia communities. I assure the House that Her Majesty’s Government are using all means available to us to make bilateral representations. We remain very supportive of the nuclear deal with Iran. We are using all good offices to ensure, first and foremost, that the suffering of those in Yemen can be brought to a halt. Ensuring free access for United Nations and other agencies will be a first step in providing humanitarian relief to civilians in Yemen.

[Lord Hain (Lab)]

My Lords—

[Lord Ashdown of Norton-sub-Hamdon]

My Lords—

[The Lord Privy Seal (Baroness Evans of Bowes Park) (Con)]

My Lords, we will hear from the Labour Benches and then from the Liberal Democrat Benches.

[Lord Hain]

My Lords, does the Minister accept that we have to adopt a much more even-handed stance between Tehran and Riyadh in order to resolve the toxic instability afflicting the entire Gulf/Middle East region? We are seen to be allies of Saudi Arabia—I do not dispute the need for that—and to take the side of Saudi Arabia and the Sunni Muslim faith against Iran and the Shia Muslim faith. We need to be equal-handed between the two in order to end the proxy wars in Yemen, Lebanon, increasingly, Syria and Iraq.

[Lord Ahmad of Wimbledon]

I assure the noble Lord that we support the work that Saudi Arabia has done in the region. The stance we have taken on recent events regarding the Iranian nuclear deal shows the importance the UK attaches to bringing stability to the wider region. As for the two branches of Islam, let us not forget that there are 73 branches of Islam and Her Majesty’s Government are neutral in our interpretation of all of them.