Criminal Finances Bill

Lord James of Blackheath Excerpts

2nd reading (Hansard): House of Lords
Thursday 9th March 2017 Lords Chamber

[Lord James of Blackheath (Con)]

My Lords, I am deeply grateful to be allowed four minutes in the gap to comment on this very important Bill. The Minister is already aware, from our correspondence, of the thrust of my main concern, which is that the Bill does not do anything adequately at this stage to encompass and force the disclosure of the vast amount of information that, for reasons of either negligence or complicity, becomes available to executive structures within companies that have discovered things that ought not to have been done and which they ought to own up to and show.

I will give two examples of how and where this has occurred. In 1986, I went with a certain Dr David Kelly to the head office of Lloyds Bank in the Midlands district in order to inspect the paperwork it had for the payment arrangements for the Iraqi supergun. The papers had been set out by the local director. After about 10 minutes, he turned to Dr Kelly and said, “While you’re here, would you like to see the payment arrangements we’ve got for the manufacture of capacitors for the Iranian nuclear bomb development?”. Yes, he would. So the papers were produced and the whole of this was put into the hands of our senior military intelligence operation at that time. How on earth can that occur in a reputable bank, with an FT top 500 company manufacturing these extremely sensitive components for a very large sum of money? Whatever happened to end-user certificates? That ought to be somewhere in this Bill.

The other example is much more of commercial negligence and complicity. I was put into a company, again by the Bank of England, to try to sort out its horrendous problems. It was a specialist in manufacturing turnkey operations for industrial units to be built in foreign countries, and its main client was Libya. It was building a cola bottling operation at Aziziya, and the total cost at the end, when we sent the final invoice, was set at £126 million. There was no problem getting paid because the next day we got £128 million back. I said, “Send back the £2 million surplus immediately. We don’t want it”. My new colleagues—I had only just joined—said, “No, no, we have to keep it”. I said, “Why?”. They said, “If we don’t, we’ll never get another deal in Libya”. I said, “What’s it all about?”. What it is all about is that they want that £2 million to be used to open bank accounts in Naples and Rome, and they are providing all the details of how this is to be done. When I go back into the records, I find that they have already opened five bank accounts along the Mediterranean coastline for similar sums in the past. It is only on that condition that they get the business. In those circumstances, they claimed that they had done it for commercial reasons and would not have got the business otherwise. They were probably right, but somebody else would have done. That money is just being used for the availability of a turnkey operation for anybody to walk into Rome, and £200,000 buys you an RPG—a rocket-propelled grenade—that gets rid of a Popemobile at 180 yards very securely.

We need to stamp out this sort of thing and we need a wholly new set of standards for the disclosure of information that may be thought innocent or accidental but is not. There is so much of it. I have given noble Lords two examples but I could give a great many more. It is an outrage with a Bill as important as this if we do not crunch this once and for all. I thank noble Lords for my four minutes.