Hurricane Dorian

Lord Naseby Excerpts

Monday 9th September 2019 Lords Chamber

[Lord Ahmad of Wimbledon]

The noble Lord is absolutely right to raise that, and I refer to my response to the noble Baroness, Lady Northover. We have been working with regional partners and, most importantly, with CDEMA, the aid agency that responds to these issues in the Caribbean. We have been bolstering its responsibility and investing with our key partners. I assure the noble Lord that my conversation yesterday with the Foreign Affairs Minister of the Bahamas focused specifically on ensuring that the technical support and the reports that we are getting reflect the type and focus of the assistance that can be provided. For example, we are working with American colleagues on ensuring that the airport is functional so that more aid and support can be provided.

[Lord Naseby (Con)]

As my noble friend will recall, lessons were learned from Hurricane Irma, one of which concerned the speed of the response. Can he assure the House that we are using the facilities at Brize Norton? If planes cannot land at Nassau, they should at least land at the Cayman Islands and be trans-shipped. Can my noble friend bring us up to date? Are we using the facilities and heavy-lift equipment at Brize Norton on the ground in the Bahamas now?

[Lord Ahmad of Wimbledon]

My noble friend raises an important point about lessons learned. I believe that I have already indicated the importance of staying focused after Hurricane Irma and Hurricane Maria. On the specific issues raised, RFA “Mounts Bay” was the only vessel that had the ability to access the Bahamas. As many noble Lords know, the hurricane stayed over the Bahamas and at one point moved at about 1 mph, so for two consecutive days the Abaco Islands, in particular, were battered quite considerably. We provided support at the first point of access. The runway needed to be cleared to allow access and the US has been leading in providing support in that respect. In terms of the wider response, my noble friend talked about the Caymans and so on. I have been pleased that, because of co-ordination, we have seen support from the British Overseas Territories—namely, the Turks and Caicos and the Cayman Islands—in alleviating the suffering of the people of the Bahamas, and that co-ordination continues.

Sri Lanka

Lord Naseby Excerpts

Tuesday 5th February 2019 Lords Chamber

Asked by

[Lord Naseby]

To ask Her Majesty’s Government, following the resignation of the government of the United States from the United Nations Human Rights Council where they co-sponsored with the United Kingdom Resolution 30/1 in 2015 and Resolution 34/1 in 2017, in regard to Sri Lanka, and given the progress made towards many aspects highlighted in the resolutions, what assessment they have made of whether to annul or withdraw those resolutions.

[Lord Naseby (Con)]

My Lords, it is my privilege to introduce this debate this evening. In doing so, I declare an interest in that I started the All-Party Parliamentary Group on Sri Lanka in 1975 and had the privilege of being made its honorary president four years ago.

In a sense, this evening is almost an auspicious day in Sri Lankan terms. Yesterday was the 71st anniversary of the independence of Sri Lanka, so it is no young nation—indeed, it is a very senior nation—and, in democratic terms, it is looked upon as the leading democracy in that part of the world, with regular elections, Governments changing here and there, and so far, thankfully, no sign of any dictator.

The reason for this evening’s debate is very straightforward. I thought about this six months ago and realised that the UN Motions on Sri Lanka will be reviewed in March 2019—that is, next month—by the UNHCR in Geneva, and I decided to initiate a debate. It is, after all, nearly four years since the resolutions were passed, having originally been moved by the US and the UK. They were co-sponsored by the Government of Sri Lanka, who welcomed help along the way.

There are two resolutions: one was adopted in September 2015 and the other in March 2017. The key point about them is that they promoted reconciliation, accountability and human rights in Sri Lanka. The cause was really the war in Sri Lanka, and the end of that war has resulted in Eelam being something that nobody in Sri Lanka, other than the Tamil Tigers, really wants. Certainly it is not wanted today and it is not wanted by India. However, unfortunately the UN received the Darusman report, which indicated that 40,000 civilians had been killed.

I have done a great deal of research. Nearly three years ago I made a request under the Freedom of Information Act and secured the publication of Colonel Gash’s dispatches to the United Kingdom. I have 40 pages of them here, some of which have been totally redacted, and I shall quote from one this evening. It is the dispatch of 16 February 2009 and concerns 400 IDPs being transferred from the fighting area to Trincomalee. Colonel Gash writes:

“The operation was efficient and effective, but most importantly was carried out with compassion, respect and concern. I am entirely certain that this was genuine—my presence was not planned and was based on a sudden opportunity”.


There are many more references in the dispatches to the fact that it was never a policy of the Sri Lankan Government to kill civilians.

I have one other reference that I think is useful. It comes from the University Teachers for Human Rights, which is essentially a Tamil organisation. It says:

“From what has happened we cannot say that the purpose of bombing or shelling by the government forces was to kill civilians … ground troops took care not to harm civilians”.


There is a host of other references but I shall quote one more:

“Soldiers who entered the No Fire Zone on 19th April 2009 and again on the 9th and 15th May acted with considerable credit when they reached … civilians. They took risks to protect civilians and helped … the elderly who could not walk. Those who escaped have readily acknowledged this”.


Again, that provides proof.

Interestingly, the US has now withdrawn from being a sponsor. My personal guess, following some inquiries, is that the US Government now assess that the Sri Lankan Government have done a huge amount to meet the UN requirements, so they see very little purpose in prolonging what is in effect almost a policing surveillance of the actions of another sovereign state which is now 71 years old. Nevertheless, I think it is right to evaluate what has happened over the last four years.

I pay tribute to Her Majesty’s Government for some of the help they have given, particularly in the reconciliation process, through their Conflict, Stability and Security Fund. The HALO Trust has done a wonderful job. I have visited the de-mining operation on two occasions and have seen the very careful work of a Sri Lankan individual clearing one square metre a day. It is very dangerous work and is being done beautifully, so I thank all those involved and look forward to the day in 2020 when the million-plus mines will have been removed.

The UK has also assisted in setting up the Office on Missing Persons. Reflecting on the work I have done, I have noticed that more and more missing persons have reappeared. I received notification three weeks ago of a well-known Tamil activist appearing in the middle of France, complete with wife and children. I believe that this is not terribly unusual, but it is quite some time since the war ended and people are still reappearing.

The Sri Lankan Government have set up their Office for Reparations, which is useful and doing good work. They have also set up a framework for a truth and reconciliation commission. This is absolutely vital in my judgment. It means that all those who were involved have to be prepared to come and give evidence, including members of the LTTE who have disappeared to Canada, the USA or Australia. They must be subpoenaed to attend; otherwise the process will be totally one-sided. Even in the UK, we still have people such as Mrs Balasingham who was a real activist for the LTTE in the recruitment of child soldiers.

I understand why the Sri Lankan Government believe that the judges should be Sri Lankan; I think that they are right. If nothing else, the recent argument in the Supreme Court indicated that the Supreme Court rules supreme in Sri Lanka, whatever the politicians might think. There is a new counterterrorism Act on the way; 90% of the land requisitioned during the war has now been returned to the original citizens; 880,000 displaced people have been resettled, which is a huge achievement, by any yardstick, for any country; and 12,000 former LTTE cadres have been rehabilitated and integrated back into society—I have met some of them, and they are most grateful for what was done for them.

In reality, Sri Lanka has taken positive steps on the four pillars of transitional justice: truth, reconciliation, accountability and guarantees of non-recurrence, which must be taken into account by the Human Rights Council. Add to this the continuing co-operation, almost on a daily basis, with human rights people on the ground in Sri Lanka and the question has to be asked: what is the point of continuing with these resolutions?

It is 10 years, almost to the day, since the end of the war. Surely now is the time for closure and to let this proud country stand on its own two feet. Is it really a good use of resources for Sri Lanka to be monitored by the West almost every day? My view as president of the all-party group is: no, it is not. Frankly, I say to my noble friend on the Front Bench, too easily do we forget what a good friend Sri Lanka has been to the UK over decades. When it was a colony, thousands of Sri Lankans volunteered for the two World Wars. Indeed, the eighth-largest number of people who gave their lives for us in the United Kingdom were from this small island; and, as my noble friend must know, Sri Lanka was one of just seven countries to support us over the Falklands War.

There is a very old adage, “Keep your friendships in repair”. Today, there is peace in Sri Lanka. You can go wherever you like. In the north, the infrastructure is repaired—that is pretty crucial—and the trains run on time. They do not run on time on the Peterborough line, I can tell you. The final proof of the normality of life are the 254,176 visitors from the UK who went to Sri Lanka in 2018—up 20%. They voted with their money and feet. I submit that Her Majesty’s Government should do the same in Geneva: recognise the good, genuine work done, show some leadership, bring closure to the UN resolution and, in doing so, make it quite clear that there were not 40,000 civilians killed—and, if it helps, I will give all the evidence I have to my noble friend on the Front Bench, so that he can be totally convinced that that is indeed the case.

--- Later in debate ---

[Lord Collins of Highbury (Lab)]

My Lords, I too welcome the opportunity that the noble Lord, Lord Naseby, has given us to address the issues in Sri Lanka. There is no doubt that there has been progress but, as the noble Baroness, Lady Northover, said, it has been glacial. When we talk about truth, reconciliation and—the most important element—peace, we must not forget accountability. That is vital to ensure that reconciliation is sustainable. From the response to a number of Written Questions, it certainly seems clear that the United Kingdom remains committed to the full implementation of the UN Human Rights Council resolutions, particularly Resolution 34/1. As the noble Baroness also highlighted, there has been such limited progress on accountability.

There is therefore a clear expectation among the Sri Lanka core group in Geneva, consisting of the United Kingdom and Germany, to ensure the adoption of a further rollover resolution at the upcoming Human Rights Council session, with the co-sponsorship of the Government of Sri Lanka. However, there is a great deal of concern that support from the Sri Lankan Government, which emanates largely from their Prime Minister’s office and is perhaps better described as grudging acquiescence, could be derailed in the light of the open conflict between the Prime Minister and President of Sri Lanka, especially after the events of last December, as described by the noble Baroness, Lady Northover.

It would be easy to see the President seeking to gain political advantage by making a stink of the notion that the Prime Minister’s party, the UNP, is selling out war heroes. The fact that we are having this debate leads me to think that there is absolutely no room for complacency. It is important to refocus our minds on the central reason that Sri Lanka came before the HRC in the first place: allegations of atrocity crimes. The fact is that these have not in any sense been addressed.

In his debate in October 2017, which I also participated in, the noble Lord, Lord Naseby, argued that the Government should drop their call for a credible accountability process to look into the wartime violations in Sri Lanka, in view of the exonerating contents of a series of confidential wartime British diplomatic dispatches obtained from the FCO via FoI request. The noble Lord referred to that again this evening. As it happens, in June 2018 Private Eye referred to the Sri Lanka Campaign’s similar request for FoI over these dispatches. Its assessment suggested in particular that the casualty figures to which the noble Lord referred did not represent the independent assessment of the UK military’s attaché, but rather were derived from UN Country Team estimates, which have been in the public domain since 2009 and remarked upon by subsequent UN investigations for the conservative nature of their methodology.

The other thing in that debate was giving the wrong impression that the statement “no cluster munitions were used” was attributable to, and represented the independent assessment of, the UK military attaché. As Private Eye revealed, this was in fact a description of the position of the then Sri Lankan Defence Secretary, Gotabaya Rajapaksa, an alleged perpetrator of grave human rights violations. Sadly, your Lordships’ debate of 14 months ago continues to be used by hardliners in Sri Lanka to erode efforts to bring about a meaningful process of accountability and reconciliation for wartime atrocities. For example, in July last year, GL Peiris, a member of the former regime and Mahinda Rajapaksa ally, wrote to the new UK Foreign Secretary, calling on him to withdraw the UN Human Rights Council resolution on Sri Lanka, in view of the “entirely flawed” basis for it, as revealed by the noble Lord, Lord Naseby.

Many are concerned about how that FoI request and the dispatches will be used to sway international public opinion at crunch time at the Human Rights Council in March— next month. Therefore it is important to correct the dangerous and unhelpful narrative that the original debate of the noble Lord, Lord Naseby, has helped to foment in Sri Lanka.

If we are talking about anniversaries, as documented in great detail by the United Nations High Commissioner for Human Rights’ 2015 investigation—

[Lord Naseby]

My freedom of information request was duly passed to me. It is my privilege, according to the judge of the First-tier tribunal, to use that information as I see fit. I am more than happy to give copies to all Front-Bench persons present, and will make sure that happens immediately. However, those dispatches are not written by me, they are written by the official attaché from the United Kingdom who served throughout the war and was at the front line during that war.

[Lord Collins of Highbury]

I am grateful for the offer. I am sorry it has come 14 months late, but I would have appreciated—and certainly the campaign for Sri Lanka would have appreciated—copies earlier. That is why, according to Private Eye, it put in its own FoI requests and has got the material. The important point about the narrative that we have heard this evening, which the noble Baroness, Lady Northover, also made, is that we want to see the full implementation of the resolution, which has not been properly addressed and certainly in no way can be considered fully addressed.

I want to point out something in that report of the UN High Commissioner for Human Rights in 2015 into the final stages of the civil war. On this day—5 February—10 years ago, the UN, the International Committee of the Red Cross and medical workers were finally forced to evacuate from PTK hospital. For three weeks, the hospital had been subjected to intense shelling by suspected government forces, which continued despite—or perhaps because of—the GPS co-ordinates having been communicated to them. It was the only hospital in the war zone that was equipped with an operating theatre, where hundreds of patients were being treated. To quote the report:

“Witnesses told investigators that as shells fell, people ran to take cover, including several patients who ran towards bunkers located outside the hospital, carrying their intravenous drips with them”.


An attack on 3 February,

“hit a ward with women and children, killing at least four patients and injuring at least 14 others. The hospital was hit again during the following evening, damaging the children’s ward, reportedly killing seven people, including one medical staff member and a baby … One hospital worker described the situation in the hospital by 4 February as ‘carnage’, the likes of which she had never seen before”.

As we approach the 10th anniversary of these events, I hope the Minister will join me in expressing concern that, despite the various promises made by the Government of Sri Lanka before the Human Rights Council in October 2015, they have not yet succeeded in holding accountable a single member of the Sri Lankan armed forces for those appalling atrocities. I hope that he will reassure us that we will seek full implementation of those UN resolutions.

British Overseas Territories: Same-Sex Marriage

Lord Naseby Excerpts

Monday 23rd July 2018 Lords Chamber

[Lord Ahmad of Wimbledon]

First, on the latter point, I assure the noble Lord that we work very constructively with our British Overseas Territories to ensure that they comply with international obligations. Indeed, the progress we have seen in Bermuda is reflective of the fact that equality for all citizens, including members of the LGBT community, is safeguarded and that they will continue to be able to play a full and active role in the future. On the specific issue of equal marriage, as I said, we are engaging constructively and it remains the British Government’s position. The noble Lord mentioned the 2012 paper. The basis of that was to encourage and continue to support the overseas territories to make progress on this important issue directly themselves.

[Lord Naseby (Con)]

Will my noble friend confirm—and I declare an interest as vice-chairman of the all-party Cayman group—that, particularly in the Caribbean, a number of the overseas territories have their own constitution to deal with domestic matters? As I understand it, in their view the subject raised by this Question is a domestic issue. They have elected Members of Parliament. Those Parliaments debate these issues, and surely it is for those Parliaments, which after all represent the people living in those islands, to decide what is appropriate or not.

[Lord Ahmad of Wimbledon]

My Lords, as I have already said, of course we respect the rights of our British Overseas Territories to decide their own domestic issues, but it is also important that on issues of fairness the Government of the United Kingdom continue to hold constructive discussions, as we do in broader terms as well. I am minded to quote my right honourable friend the Prime Minister when she addressed this important issue in the context of the Commonwealth conference:

“As a family of nations we must respect one another’s cultures and traditions. But we must do so in a manner consistent with our common value of equality, a value that is clearly stated in the Commonwealth Charter ... Nobody should face persecution or discrimination because of who they are or who they love. And the UK stands ready to support any Commonwealth member wanting to reform outdated legislation that makes such discrimination possible”.


It is a constructive, progressive approach, and is the same approach that we adopt with our British Overseas Territories.

Sanctions and Anti-Money Laundering Bill [HL]

Lord Naseby Excerpts

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

Moved by

[Lord Naseby]

Leave out “agree” and insert “disagree”.

[Lord Naseby (Con)]

My Lords, in speaking to Amendment 22A I declare an interest as vice-chairman of the All-Party Group for the Cayman Islands; I also have family working in financial services in the Cayman Islands.

Last weekend, 100,000 people lined the route of the wedding party. There was great joy there and in the rest of the country. Some 100,000 people in the overseas territories shared the joy of the Royal Family, except that every one of them was fearful for the future of their families. As matters stand today, what happened in the Commons—we have now heard from the Minister that the Government are not prepared to overturn it—is a catastrophe for financial services in the overseas territories. That cannot be taken lightly.

Your Lordships will remember that Prime Minister Cameron, who started the idea of public registers, thought he should lead in the world. He did not work out, however, what the impact would be on the rest of the overseas territories. He was more interested, I suspect, to lead, and to lead at a time when, if you look at our own Companies House, you cannot today get a really up-to-date situation on a great many companies, because Companies House is rarely up to date. Indeed, Companies House looks carefully at perhaps only one-third of companies that register. So that is not the answer. Why did Her Majesty’s Government not think a little further at that time about what was going to happen?

--- Later in debate ---

[Lord Ahmad of Wimbledon]

My Lords, I am grateful to all noble Lords for an extensive, well-reasoned, well-argued and expert debate in your Lordships’ House. I am grateful in particular to my noble friend Lord Naseby, who presented a case for the overseas territories which I empathise with. Noble Lords who were in the Chamber when I opened this debate would have heard the points that I made. I will respond to a few specific points and questions raised, but I want first to set the record straight. First and foremost, the Government’s position is what it was when the Bill left your Lordships’ House. As the noble Baroness, Lady Northover, said, the Government defeated the amendment tabled by the noble Baroness, Lady Stern. That was done because of reasoned debate and expert insight, which has been reflected in your Lordships’ House again today.

As my noble friend Lord Hunt said, my noble friend Lord Naseby has allowed us all an opportunity again to demonstrate the wisdom, insight and expertise your Lordships have, but the point of principle highlighted by the noble and learned Lord, Lord Brown, remains: notwithstanding the valuable discourse that we have had, the House of Commons has sought to vote otherwise. In that regard, I want to clarify a few points.

My noble friend Lord Northbrook mentioned that it was a government amendment. Of course, it was not; it was tabled from the government Benches—it was a joint amendment. In light of the support that the amendment had gathered, the Government decided not to oppose it. My noble friend Lord Naseby referred to the Government’s amendment being tabled late in the day. Let me assure my noble friends and your Lordships’ House that we had been in extensive negotiations with many Members of Parliament, including those of other parties and most notably the Scottish National Party, on the important issues of the constitution and about this Parliament voting on something that would apply to parliaments that did not have a say in the debate taking place—a point well made by the noble Earl, Lord Kinnoull. We were trying to find a way forward that respected both the drive for transparency, which many noble Lords have raised today, and the constitutional settlement with the overseas territories and Crown dependencies. It was also important that we continued to do this to reach the cross-party consensus that was being sought. We brought further amendments forward on 30 April and brought that to the attention of the House to find that consensus. That is why conversations were still ongoing throughout that morning. The amendment we tabled was taken as in order but, as I said in my opening remarks, it was not then debated or taken for debate by the Speaker of the House of Commons.

That said, we have had an extensive debate. The noble Lord, Lord Anderson, who I see is not in his place as such, asked for comment on the Foreign Affairs Committee’s report. We are looking at that report, which was issued this morning, carefully but the Prime Minister has made the general principle clear. I say to all noble Lords that there is not a difference between ourselves and the Governments of the overseas territories. Everyone wants to see us tackle illicit finance effectively. Let me assure the noble Lord, Lord Collins, that it remains a priority for this Government and that we will continue to take a leading role in this respect.

The noble Lord, Lord Beith, my noble friend Lord Naseby and my noble and learned friend Lord Mackay all touched on the important issues of the constitutional arguments. Our position in the light of the circumstances set out in the 2012 White Paper has not changed. We believe that the fundamental structure of our constitutional relationships is the right one. Of course, we retain the power to legislate directly and have done so, as I said in my opening remarks, but in this case we would prefer not to have done so without consent. However, as we have all heard, we are all in this situation since the decision taken by the House of Commons.

My noble and learned friend Lord Mackay raised how this provision will come into force. As I always do, I listened carefully to his insight on this matter and I can confirm that it will not come into force through Royal Assent; it will come into force and commence by regulations. We need to establish the detail, as he said, but I listened carefully to the points he raised in this respect.

My noble friend Lord Faulks asked about the next Bill and I again pay tribute to his efforts in this regard. Let me assure him once again that we have committed to bring forward legislation early in the next Session on the important issue, which he has raised during debate on this Bill, of the register of overseas companies that own UK property. We anticipate that that register will be ready for use in 2021.

The noble and learned Baroness, Lady Butler-Sloss, pointed to other jurisdictions such as Gibraltar. At this point, I acknowledge the contributions of my noble friend Lord Naseby and other noble friends, and noble Lords across the Chamber, who acknowledged the efforts that our overseas territories have made. While I totally accept the principle highlighted by the noble Lord, Lord Collins, and the noble Baroness, Lady Northover, of the importance of transparency—of seeing that flow of illicit finance coming to an end—let us not forget that, in the UK, we have a public register. This is not a panacea to end this issue. It needs concerted action, which is why I have been vocal in my defence of the overseas territories and not just, as the noble Lord, Lord Beith, pointed out, because I am the Minister responsible. Genuinely, when we look at the track record from the overseas territories—the exchange of notes that are operational and which we are reporting back on, or the accessibility for tax and law enforcement agencies—those jurisdictions have been co-operating fully and effectively. That is why I, as the Minister responsible, made that robust defence of the overseas territories. Not only has progress been made; the overseas territories are ahead of the curve. There is just not a case for not doing something until the others catch up, as they are already fully co-operating.

Several noble Lords alluded to the EU list. Anguilla, Bermuda, the BVI, the Cayman Islands and all three Crown dependencies are not included on any list because they are deemed to have been holding back by the EU Code of Conduct Group. They have been put on lists and acknowledged for being co-operative jurisdictions. All our Crown dependencies and overseas territories with financial centres are already committed to global tax transparency standards, which we all agree on, and the commitments that they have made go beyond those. I say again for the record that there is no grey list. All the overseas territories, as the noble Earl, Lord Kinnoull, highlighted, have made great strides, ahead of many other jurisdictions, in ensuring that they adhere not to any international standard but to the principles of ensuring that they can address the fact that law authorities and tax authorities can access such registers.

That said, we are in a position where the other place has decided—on a cross-party basis in certain respects, as the noble Lord, Lord Collins, said—that it is its will to go forward with public registers for the overseas territories, and it is the Government’s position that we have accepted that point of the elected Chamber. In doing so, though, I assure my noble friend Lord Naseby and others who have spoken about the overseas territories that from a government perspective we will seek to ensure that we collaborate and co-operate fully and work with the overseas territories to ensure that we get the results we want. We do not want to disable the overseas territories and we do not want them to lose out, but there is a reality of decisions that this Parliament has taken, and they have implications. We need to ensure that we work effectively and collaboratively with those overseas territories to ensure that we can still sustain and strengthen their economies for years to come.

I put on record for my noble friend Lord Naseby that I am very grateful to him for once again allowing me to articulate the Government’s position and my position as the Minister responsible for the overseas territories. I am also grateful for, as I am sure my noble friend has acknowledged, the great and wise expertise that we have heard from around your Lordships’ House, demonstrating again the wise insight on this subject and many. However, mindful of the fact that the other place has decided to pursue the issue of public registers with the overseas territories, an amendment that the Government have now accepted, I hope that after listening to the debate my noble friend is minded to withdraw his amendment.

[Lord Naseby]

My Lords, those were fine words from the Minister, and we have heard fine words from my colleagues who have supported me this evening. I hope those fine words have some strength behind them. Many noble Lords will know that I have been in the two Houses for 44 years. I deeply respect the rights of the House of Commons, so it is not with an easy heart that I resist the temptation to test the views of this House.

I have reflected deeply on this. I am trusting my noble friend on the Front Bench to move this forward. As my noble and learned friend Lord Mackay of Clashfern said: justice for all—which means, in particular, justice for all the overseas territories. I shall watch, be vigilant and challenge, but on this occasion I beg leave to withdraw the amendment.

Amendment 22A withdrawn.

Sanctions and Anti-Money Laundering Bill [HL]

Lord Naseby Excerpts

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

Moved by

[Lord Naseby]

4: After Clause 43, in paragraph (6)(a), after “entities” insert “that own or buy property in the United Kingdom”

[Lord Naseby]

My Lords, when I studied the amendment that my noble friend on the Front Bench tabled, I was concerned about the expression “overseas entities”, so I went to the dictionary and looked up “entities”. The Bill does not use the terminology “overseas entities” anywhere, nor do any of the proposed amendments, so it is unclear what it means except in the ordinary meaning of the words; that is, they may apply to structures or arrangements that have legal personality and are not formed in the United Kingdom. My noble friend on the Front Bench made it clear that the Bill does not intend to single out the overseas territories but would apply to all entities registered in all jurisdictions around the world.

I do not believe that it is the United Kingdom Government’s intention to allow the power in proposed new subsection (6)(b) to be infinitely broad. My interpretation is that it is an attempt to refer to entities for which the Government launched a consultation in April 2017. It was called the OCBO register at one point; it has also been called the register of OLEs. This extends to overseas entities that are legal owners of UK real estate or that enter into contracts with UK public authorities. As such, it seems aimed primarily at entities used by certain Middle Eastern investors to purchase London real estate.

However, as I understand it, the Government have yet to respond to that consultation with details as to precisely which activities should or should not be captured. There seems still to be degree of indecision. As a result, I hurriedly put down an amendment, which is why it is starred on the Marshalled List.

There is a concern on my part and, I imagine, that of others, that the Government may be attempting through this amendment to give themselves latitude to decide the precise definition at a later date. I hope that that is not the case, but there seems a possibility as the Bill stands at the moment. Either I will withdraw the amendment if I receive a reassurance from my noble friend or it may be left to the Commons to put down a precise amendment to cover this slight difficulty that I and others foresee. I beg to move.

[Lord Faulks (Con)]

My Lords, I was responsible for putting down the amendment which I think provoked this amendment to the Bill. As many noble Lords may remember, the background was anxiety expressed around the House about the fact that large parts of central London and outside London were being bought up by legal entities and companies, often with money laundered proceeds of crime and corruption—it is an increasing problem. Although the Government had committed to set up a register, they were taking some time about doing it and the attempt was to bring matters forward.

I am glad that my noble friend was able to give reassurance to the House that the register would be coming forward and that a Bill would be drafted, and indeed went further by promising that there would be regular reporting about progress. That, as I understand it, is the purport of proposed new subsection (3).

I am sorry that I have banged on about this issue for some time—throughout the passage of Criminal Finances Act, through Questions and through the course of this Bill—but I remain unrepentant. I was particularly reassured about this when I attended a lecture given by the distinguished author and journalist Misha Glenny on Monday. He has spent 10 years or so studying international crime and money laundering and is the author of the book McMafia, which is now the basis of a successful television series. He outlined for the audience the scale of money laundering throughout the world, principally following the collapse of communism, and how it has spread to all sorts of jurisdictions, the United Kingdom being one in principle. He showed the audience a map of central London showing the extent to which prime London property is now owned by kleptocrats: let us not beat about the bush—that is the position. He said, however, that worldwide there is a feeling that we should be fighting back against this appalling scourge of money laundering. He identified the most effective way this country could do this as being to set up a register to make sure that nobody could hide behind the cloak of anonymity and thus be able to launder the proceeds of crime through central London property. This is why this remains an important procedure.

I am very glad that the Government are committed to doing what they said they will do. I will be keeping the Government up to the mark, as I am sure other noble Lords will. My noble friend Lord Hodgson has one query about the amendment. Subject, of course, to the clarification that my noble friend Lord Naseby seeks, I join others in thanking the Minister and his Bill team for their co-operation on this issue and on all issues. My real sense in dealing with the Bill is that it is not a party political exercise at all; there is a real cross-party endeavour to make sure that this is as effective as possible.

--- Later in debate ---

[Lord Ahmad of Wimbledon]

My Lords, I am grateful to noble Lords. I reiterate my thanks to my noble friends Lord Faulks and Lord Hodgson for pressing the Government and holding us to account in this respect and ensuring that we move forward. I am also grateful to my noble friend Lord Naseby, who sought clarification. I have looked carefully at his amendment and I think what the Government have tabled and his amendment have the same intent. However, in the interests of ensuring thoroughness and completeness, I have asked officials to look again to make sure that the intent behind his amendment is achieved.

The Government have committed to the new Bill establishing the register. It will be primary legislation and will pass through your Lordships’ House, so I am sure there will be further discussions and plenty of opportunity to ensure that all issues, particularly those raised by my noble friend, are addressed. I assure him that we feel the intent behind his amendment has been achieved. I will, however, look at this again, and if there is a need to do anything further, we will seek to do that in the other place.

My noble friend Lord Hodgson asked me when Royal Assent might be granted. It is not within my gift as the Minister at the Dispatch Box to confirm that, but we are expecting Royal Assent at the end of this Session. On accountability, I reassure my noble friend that through the additional ministerial Statement laid today, I have sought to provide as much detail as I can at this juncture in the parliamentary timetable. However, as I said to him in our bilateral meetings—I believe this was communicated to him subsequently in other meetings we had—we have worked back, and as the Written Ministerial Statement again confirms, we are looking to have the register operational by 2021. I am sure there will be other opportunities. As for the Government laying a report, I confirm that the 12- month clock—the countdown—will commence as soon as Her Majesty has signed off on the Bill. However, it would be beyond the scope of my responsibilities to give an absolute, cast-iron guarantee as to when Royal Assent will be. I am sure my noble friend appreciates and respects that we have to follow due process. However, the Government are committed to the register being operational in 2021. From the points made by other noble Lords, I appreciate that wherever one is sitting in your Lordships’ House, there is no disagreement on the need to move forward on this and to do so as rapidly as we can.

My noble friend raised another issue, about procurement. Again, to reassure him on that, I draw his attention to the Written Ministerial Statement laid today by my noble friend Lord Henley, which says:

“I am today confirming to Parliament the Government’s timetable for implementation of its policy to achieve greater transparency around foreign entities that own or buy property in the UK or participate in UK Government procurement”.


As the Bill is drafted and pre-legislative scrutiny takes place on it—if that is the process which is agreed—that will allow further discussion to address the very points my noble friend raises in that primary piece of legislation.

The point about local government is well made. As someone who served 10 years in local government, I am acutely aware of how procurement works. It will reflect the very policies adopted by the UK Government. With those reassurances, I hope my noble friend will be minded to withdraw his amendment.

[Lord Naseby]

My Lords, having listened to my noble friend, I am most grateful to him for the patience he has shown and the care he has taken over the Bill and this amendment. In light of the commitment he has made—as he says, if necessary, some amendment could be made in another place—it is my pleasure to withdraw the amendment.

Amendment 4 (to Amendment 3) withdrawn.

Sanctions and Anti-Money Laundering Bill [HL]

Lord Naseby Excerpts

Wednesday 17th January 2018 Lords Chamber

[Lord Flight (Con)]

My Lords, I very much agreed with the constitutional points made, particularly by the noble Earl, Lord Kinnoull. More widely, I suggest that this amendment would be counterproductive in its effect. It is interesting to note that law enforcement agencies do not support public registers, particularly in such territories, as they do not improve law enforcement capabilities.

As David Lewis, head of the world’s anti-money laundering standard-setter, the Financial Action Task Force, and formerly of the UK National Crime Agency, said:

“Incomplete, unverified, out of date information in a public register is not as useful as law enforcement agencies being able to access the right information at the point they need it”.


Moreover, the UK’s overseas dependencies have already shown themselves extremely efficient in responding to the requests of policing and other agencies. Interestingly, tax authorities do not support public registers either, as people report less candidly than when information is available only to public authorities. The OECD’s Keeping It Safe states that to,

“comply with their obligations under the law, taxpayers need to have confidence that the often sensitive financial information is not disclosed inappropriately”.

Australia’s chief tax collector opposes public registers. Interestingly, UK intelligence and law enforcement, a key foreign policy asset, is likely to be undermined. UK law enforcement has access to information in the overseas territories’ central platforms. This can be exchanged with other countries to secure reciprocity or other benefits to the UK. Public registers remove this leverage and facilitate identity theft. The Financial Times has reported that directors are twice as likely to be victims of identity theft due to the Companies House public register of directors.

It is pretty clear that international standards do not require public registers but do require verification. That is the key point: you can have effective verification when registers are not public. However, as the, I am afraid, rather disappointing results of what has happened in the UK show, you cannot have verification with an open system. For once, even the EU was correct: it withdrew its proposal for public registers in December 2016 on the grounds that they disproportionately infringe human rights. The EU’s Legal Service stated that introducing public registers was a disproportionate infringement of the right to privacy and the European Data Protection Supervisor stated that it would breach data protection principles.

I think everyone is in favour of the objective; the question is how you achieve it most effectively. I have been a commissioner on the Guernsey Financial Services Commission for a number of years and have had some involvement in what Guernsey has done. Interestingly, Guernsey scores higher than the UK for general regulatory effectiveness and compliance. However, the crucial thing is that the registers are accurate, have been verified and can be used swiftly by the proper authorities that need that information. I am afraid that making them public undoes a lot of the point of them.

[Lord Naseby (Con)]

My Lords, I had the privilege of speaking in Committee, when I declared my interests as a vice-chairman of the All-Party Parliamentary Group for the Cayman Islands, and the fact that I have family working in the Cayman Islands.

I reflected on what the noble Baroness, Lady Stern, said in Committee, particularly the examples she gave of developing countries being fleeced by the operations of the overseas territories—my words, not hers. I did a bit of research and asked the Cayman Islands for information on the type of operations conducted there. I give a case history that I think your Lordships will find interesting. Money does not stay in the Cayman Islands but flows through them to support growth in onshore jurisdictions, including in developing countries. An example of this is the World Bank’s International Finance Corporation, which invested more than $400 million through Cayman-based investment vehicles in 2015 alone. The money supported critical development projects in more than 24 developing countries. That is not just a one-off example; there are many others in what I call the leading overseas territories. I will not repeat what the noble Earl, Lord Kinnoull, said; I am grateful to him for the research that he has done.

I point out that the Cayman Islands had a new constitution in 2009, which was approved at Lancaster House and contained measures on the rule of law and human rights that meet the most stringent international and European standards. Included in their Bill of Rights is the right to privacy and strong laws on data protection.

It has already been made clear that most countries are not adopting public registers. Certainly, for the overseas territories in the Caribbean, the rival centres are the United States, Hong Kong and Singapore. They have all looked at public registers but not one has agreed to it. So if we force the overseas territories to have public registers, the effect will be that business will move away—there will be none of the sort of business that I have just cited, which is increasingly the nature of the business done in the overseas territories. Furthermore, the information Her Majesty’s Government get on money laundering or anything else they require would certainly be weakened greatly because the activities that people are interested in would not be available. My noble friend Lord Flight mentioned the situation in the EU, which takes the view that it would disproportionately infringe on human rights. I do not need to expand on that.

I will finish on a key constitutional point—perhaps, as someone who took the Maastricht treaty through, I had to learn something about constitutional law. I re-emphasise that the overseas territories are self-governing territories, and legislating for them is constitutionally questionable. It is true that Orders in Council have been used to impose legislation on the overseas territories, but only for constitutional or human rights issues. The need to consider the overseas territories’ interests was confirmed by the House of Lords in 2008. To use an Order in Council for financial regulation when the overseas territories have already adopted international standards while the UK has not would expose the UK to legal challenge as potentially irrational and therefore could be overturned on judicial review. It would also be provocative, as my noble friend has indicated, to Scotland and the other devolved Administrations in the United Kingdom. I for one will certainly, with a clear conscience, vote totally against this amendment.

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, I see the beguiling simplicity of the noble Baroness’s amendment, and after the powerful speech she made in moving it and the graphic examples she gave, I find myself carried along on an emotional tide. But the House needs to be aware of some of the unintended consequences that may flow from this if we are inclined to accept it.

The amendment refers to the Companies House regulatory scheme as being the standard to which we should aspire. Companies House is a recipient of information; its interrogation is pretty limited. Noble Lords may be inclined to look in detail at the amendment and say, “Yes, but this is a higher standard because we are dealing with the section on persons with significant control”. As is shown in the register of your Lordships’ House, I am a person with significant control of a company, and I have never been asked anything at all about my entry. I hope—I intend—that it is accurate, but nobody at Companies House has ever approached me to say, “Is this correct?”; it is just accepted. There is therefore a danger that the seductive idea of a public register means that it is somehow better verified than the situation we now have. That is my first concern about the amendment.

The second relates to a point made by other noble Lords. If you raise the standards or increase exposure and transparency in one area, you merely drive business to another corner of the world. My noble friend Lord Naseby referred to Singapore and Hong Kong but there are other places a great deal less attractive to which business might be driven. As I understand it, each of the overseas territories has already established a proper register of beneficial owners of companies which can be interrogated at all times by our law enforcement agencies. My noble friend Lord Leigh of Hurley referred to the fact that the efficacy of that regime is to be tested in a review which will be put before Parliament in the next couple of years. Really, the question at issue is whether there should be public access to that register. Those are the words that make the difference, but in my view in the present situation that will have little practical effect. At present, our law enforcers can interrogate the register. If the public are also able to access it, the result might be that it will drive people to areas of the world where we cannot have even a vestigial chance of enforcing the proper levels of law.

Like my noble friend Lord Flight, I absolutely understand the purpose behind the noble Baroness’s amendment, but in my view the best should not be the enemy of the good.

--- Later in debate ---

Moved by

[Lord Naseby]

76: After Clause 41, insert the following new Clause—
“Registration of companies: anti-money laundering checks
(1) The Registrar of Companies must not register a company unless he or she is satisfied that appropriate anti-money laundering checks have taken place. (2) The Companies Act 2006 is amended as follows— (a) in section 9, after subsection (5), insert— “(5ZA) The application must provide satisfactory evidence that anti-money laundering checks have taken place.” (b) after section 13 insert— “13A” Satisfactory evidence of anti-money laundering checks (1) The Registrar is entitled to accept the anti-money laundering registration number of the United Kingdom body that has submitted the application as satisfactory evidence under section 9(5ZA), provided he or she believes that number to be valid. (2) The Secretary of State may by regulations made by statutory instrument specify any other evidence that the Registrar may accept under section 9(5ZA). (3) A statutory instrument containing regulations under this section is subject to annulment in pursuance of a resolution of either House of Parliament.””

[Lord Naseby]

My Lords, this amendment is about closing a major money laundering loophole. Noble Lords will be aware that, last year, 606,000 companies were formed in the UK. Of these, 250,000 were set up through Companies House, but the majority were set up by company formation agents. In the middle of last year, the fourth EU anti-money laundering directive came into force, requiring company formation agents to complete due diligence checks on anyone setting up a company.

However, for reasons that are not clear to me, the Government decided to exclude Companies House from doing such due diligence. For years, Companies House has set up companies and has had to accept documents sent to it in good faith. It is not required to and does not have any statutory powers to verify or validate the information contained in them. It can act only within the parameters of the Companies Act. It certainly has no investigatory powers under that legislation and, therefore, there are no significant checks being done on companies registered through Companies House. In reality, this means that, for just £12, someone can set up a company using entirely false details without having to go through any verification checks on beneficial ownership, and with only limited checks on registered directors. Therefore, individuals who have been involved in money laundering, have convictions or have been debarred as owners in other jurisdictions can gain access to UK companies though Companies House.

Why does this matter? It is because, unfortunately, there are some companies being set up whose principal purpose is one of committing crime or which subsequently lend themselves to being used for that purpose. In extreme cases, incorporation is used entirely as a front to enable fraud to flourish. This leaves British businesses, consumers and taxpayers open to abuse. The evidence is there from an organisation called Transparency International. A couple of months ago, in November, it found that there were hundreds of British shell companies implicated in nearly £80 billion-worth of money laundering. That in itself should set off alarm bells in my judgment. Additionally, this lack of checks harms Britain’s reputation as a leading place to do business and must be addressed in the run-up to Brexit. It is essential to close this loophole to combat fraud, prevent money laundering and boost our country’s reputation.

The solutions seems pretty simple. In Committee, the Government said that they were not prepared to impose a financial burden on Companies House. However, we have to have some detailed checks and by adding a simple automated check of due diligence during the filing process, the Government can close their own loophole at a fractional cost while ensuring that the UK remains a competitive, low-cost place in which to do business. I understand that Her Majesty’s Government have recognised this is a problem and have given due thought to it. I look forward to hearing from my noble friend exactly how they may seek to close this large loophole. I beg to move.

[Baroness Bowles of Berkhamsted]

My Lords, I have added my name to the amendment of the noble Lord, Lord Naseby. We had a good mini-debate on this issue in Committee. His amendment is a neat solution to the problem that those of us involved in that mini-debate identified—that some sort of check has to be done at the Companies House stage. If money is not put behind that to enable personnel to do that, this proposal seems a neat solution. I would be interested to know whether the Government will take it up or provide something similar.

--- Later in debate ---

[Lord Naseby]

My Lords, I am particularly grateful to the Minister for the work that he has clearly done since Committee. Nevertheless, £80 billion is a huge amount of money and needs to be taken very seriously. I understand and appreciate the evaluation that is being undertaken, which is due to report in a couple of months. I urge the Minister to work with the trade association for the company formation agents. They must have a multitude of information that I have not managed to have the time or the resources to go into.

I also thank the noble Baroness for her support, particularly in Committee, when we spent a considerable amount of time on this matter. I deeply appreciate that, as well as the very generous contribution from the Opposition Front Bench. I also thank the Minister for the assurances that he has given today. I ask quite a lot of Oral Questions, but I will hold back in the hope that the evaluation agency reports and that we then move forward as swiftly as possible to close the £80 billion loophole that exists at the moment. With permission, I beg leave to withdraw the amendment.

Amendment 76 withdrawn.

Sanctions and Anti-Money Laundering Bill [HL]

Lord Naseby Excerpts

Committee: 3rd sitting (Hansard - continued): House of Lords
Wednesday 6th December 2017 Lords Chamber

[Baroness Kramer (LD)]

My Lords, Amendments 69H, 69J and 69L in this group are in my name and that of my noble friend Lady Bowles, but the group also encompasses Amendment 69K in the name of the noble Lord, Lord Naseby. This cluster of four amendments work extremely well together, and we are very grateful to the noble Lord for bringing in a piece which strengthens this cluster.

Even the unobservant will have noticed that, in a sense, this is about starting to close loopholes. We had a very interesting comment, I think from the noble Lord, Lord Naseby, earlier—he can tell me if I am wrong—talking about the reputation and the failures of the UK to manage money laundering that involves the overseas ownership of property in London. The noble Lord, Lord Naseby, may not have had the opportunity to be here earlier, but we did have Amendment 69 in the name of the noble Lords, Lord Faulks, Lord Rooker and Lord Collins, and the noble Baroness, Lady Bowles, which directly addressed the public register of beneficial ownership of UK property by companies and other legal entities registered outside the UK, in an attempt to speed up the whole process of getting a public register of beneficial ownership.

[Lord Naseby (Con)]

I sat through the whole debate on Amendment 69, which took a fair amount of time.

[Baroness Kramer]

I do apologise, but the noble Lord will know then that that issue was addressed at that point in time. The Government gave us an update on the progress they are making towards what we hope will be such a public register. Indeed, I believe the Minister said it was not a question of whether but how there would be a public register. In a sense, that is one of the criticisms of London that hopefully will be closed within a reasonable period of time. We are still waiting on the timetable, but that is indeed what we hope.

However, the noble Lord is absolutely right that whenever issues are raised, particularly when the UK talks of issues around tax havens in other countries, or we on these various Benches talk about trying to get public registers in the overseas territories and Crown dependencies, the answer nearly always comes back, “Clean up your own house first”. Indeed, that is one of the reasons why I and so many in this House support that public register of beneficial ownership of property.

These amendments that I now address follow on that same theme. I remember the noble Lord, Lord Eatwell, in particular in the debates on the Criminal Finances Bill, being highly critical, comparing London very badly with Jersey. Although we have a public register for companies, it is not one that has any verification system, and he saw that as a very fundamental flaw in the UK system. That accusation comes again and again, whenever we look at trying to do anything with the overseas territories. Whenever we look at any kind of more global activity, the answer that always comes back is: “You say that you’re well in advance of other countries, but look at your own house—you’ve plenty there to get in order”. I would agree that we have plenty to get in order, so let us do it.

The three amendments that I have tabled with the noble Baroness, Lady Bowles, deal with various aspects of this. Amendment 69H deals with an issue that has generally been overlooked. I am very grateful to the noble Baroness, Lady Bowles, for identifying it—as noble Lords can probably tell, she is the expert hand in these amendments and has drafted all three. Amendment 69H proposes that trust or company service providers that do not carry on business in the UK and ensures that they may not incorporate UK companies without oversight from an anti-money laundering supervisor. I will not go through the details of each of its provisions, but essentially it makes sure that anti-money laundering authorities can get a grip on a series of organisations—trust or company service providers—that may have escaped notice up to this point in time. It is one loophole closed.

Amendment 69J takes another tack to close loopholes. It recognises that a company can be tracked if it has a UK bank account, but if the company does not, it is much harder to identify that particular company and make sure that the money laundering authorities can give it due and appropriate attention. In the proposed new clause, if an entity falling under the Companies Act 2006 does not have a UK bank account, it will have to provide a fee. The reason it should provide a fee is that it means that the cost of doing due diligence falls not on the UK taxpayer but on the company. That provides every incentive and every opportunity for the various authorities to pay due attention to that company. That is another loophole closed.

That fits brilliantly with the new clause proposed by the noble Lord, Lord Naseby. I will let him explain that because he will understand it far better than me, but again it highlights the importance of due diligence which flows through the first two amendments that I have described. Due diligence is vital to make sure that those entities that are active in the UK have very limited opportunity—or, preferably, no opportunity—to engage in nefarious activity.

Finally, Amendment 69L directly addresses that issue that was raised by the noble Lord, Lord Eatwell, and others. As noble Lords know, we have a public register of companies here in the UK, but the Government have never used a verification procedure. I understand why they have not. When a register is public, it is transparent. Journalists, NGOs, and members of the public have the opportunity to trawl that database, and that provides for many additional eyes to look through the material. That is exceedingly important, but perhaps it is not sufficient. At this point in time, issues of tax avoidance, tax evasion and money laundering have become far more significant—and on a far more significant scale. This is the time to turn to the supervisory authorities and give them the power and the wherewithal —the wherewithal probably being the critical element—to do verification and proper due diligence on that register.

That is the purpose of the three new clauses proposed in my name and that of the noble Baroness, Lady Bowles. They are to close the kinds of loopholes which leave the UK open to regular criticism that we talk about cleaning other people’s houses but we have not done what is necessary to clean our own. Read those together with Amendment 69 and you have a package that makes a very fundamental difference—one I am sure ought to be acceptable to the Government. I beg to move.

[Lord Naseby]

My Lords, I shall speak to Amendment 69K, which contains a new clause that I believe would meet a need arising from an apparent money laundering loophole to do with Companies House. Before I get on to it, I thank the Minister and particularly his staff for the consultation periods that were made available to Members of your Lordships’ House; they were extremely well run. I have also had correspondence with his office and I found it extremely helpful, so I put on record my personal thanks.

There are two ways of registering a company in this country, either directly through Companies House or via a company formation agent. Currently, 40% of all companies are incorporated through Companies House. As we probably all know, in July this year the fourth EU anti-money laundering directive came into force. It required considerable change for company formation agents in that they now had to take out enhanced due diligence checks when registering a company. Obviously this increased their workload and indeed the cost considerably, but nevertheless it was to the credit of the industry that it welcomed the changes that came with the directive.

However, under current provisions, fraudsters can still register a business direct with Companies House, either on paper or via the GOV.UK website, and, through that, avoid all the checks now required when company formation agents carry out exactly the same process. My understanding of the rationale behind this is that Companies House is not a business provider, but instead is fulfilling a statutory duty just to register businesses and issue incorporation certificates. Legally, Companies House has to accept in good faith all documents sent to it, and has no statutory power whatever to verify or validate the information contained in them. It can act only within the parameters of the Companies Act, and it has no investigatory powers under that legislation.

In reality, that means that for just £12 someone can set up a company using entirely false details without having to go through any verification checks on beneficial ownership, and with limited checks on registered directors. Individuals who have been involved in money laundering, who have convictions or who have been disbarred as owners in other jurisdictions can therefore gain access to UK companies through Companies House. This loophole cannot be justified; by incorporating at Companies House, fraudsters are able to create the illusion of their company being financially secure and sustainable. That leaves British business, consumers and taxpayers open to abuse through fraud or money laundering.

The organisation Transparency International reports that in the UK last year 251,628 UK companies were created with no checks being made on the person setting up the company or their source of wealth. A further TI report found that there were hundreds of British shell companies implicated, in its judgment, in nearly £80 billion of money laundering. The report goes on to say:

“The fact that a large proportion of firms are incorporated directly through Companies House and undergo no due diligence checks creates a significant money laundering risk to the UK framework”.


That lack of checks and balances harms Britain’s reputation as a leading place to do business, and in my judgment it is essential that that reputation is protected in the lead-up to Brexit. To protect businesses, taxpayers, and the UK’s reputation, it is essential that this loophole is closed.

I do not necessarily expect the Minister to take the precise wording in my amendment. It was written largely by myself with the help of the Public Bill Office, so in a sense it is a probing amendment, but I believe it is one with such depth of information that I would be enormously surprised if Her Majesty’s Government did not respond to it and come back with something similar on Report.

[Lord Davidson of Glen Clova (Lab)]

My Lords, the Opposition are sympathetic to many of the points that have been made, and I single out Amendment 69H. The capacity to carry out UK company formation from outside the UK is a real lacuna in the current money laundering regime. Monitoring within the UK is difficult enough, as is evidenced by the use of, for example, Scottish limited partnerships in Russian and former eastern-bloc bank fraud and money laundering of gigantic proportions. This vulnerability is of course magnified when the company information provider eludes the UK’s money laundering oversight.

Amendment 69J provides, we respectfully suggest, a useful additional hurdle for any prospective money launderer to negotiate. While the provision of the requisite materials for opening a bank account no doubt seems irksome to many, it none the less provides an additional external check on the background of those seeking to operate via a UK company.

The amendment of the noble Lord, Lord Naseby, offers a clear and useful mechanism for combating money laundering and I share his observation that it would be surprising if the Government did not support this measure with considerable force.

--- Later in debate ---

For these reasons, I therefore ask the noble Baronesses, Lady Bowles and Lady Kramer, and my noble friend Lord Naseby, to withdraw or not press their amendments.

[Lord Naseby]

My Lords, I am grateful to the Minister, but he is just repeating the problem. I understand what he is saying about the EU directive, although I am not skilled in that area and would not claim to be. However, I am quite skilled in the practicalities of life, and if a quarter of a million companies are being registered and nobody is checking them, that is a huge loophole, and Her Majesty’s Government have to find a way around that. The commercial sector is doing its proper due diligence—yes, it does it for a fee—but the Government have to say, “Right, it shall all be done by the private sector and Companies House will carry on doing the little bit of work it does for £12”, or develop a section at Companies House to do it. I accept that more work may well need to be done, but we cannot have such a situation in this country.

I can even give the Minister a small case history of what could happen. Somebody goes to Companies House, pays their £12 and registers. It is then reported to HMRC that they have registered. They then write in four months later to say that they have ceased trading. That is a wonderful vehicle for money laundering: they are a registered company, and HMRC has forgotten about them because they have told it that they are not trading. If a quarter of a million of them are doing this—I am not saying there are quite as many as that—it is a huge loophole and Her Majesty’s Government have to figure out how to deal with that section of companies that are currently being registered fully through Companies House.

[Lord Bates]

I do not accept that all we are doing is describing a problem. We are of course doing that, but we are also highlighting that we are about to formally establish the office for professional body anti-money laundering supervision, which will be responsible for supervising the very professional body of trust companies to which my noble friend was referring. We will have to keep an eye on and watch out for this issue, but we are certainly not complacent about it; we are aware of it and watching it carefully.

Syria

Lord Naseby Excerpts

Thursday 19th October 2017 Lords Chamber

[Lord Ahmad of Wimbledon]

I totally concur with the noble Lord’s sentiments. I assure him that he is right: this is not just about Daesh, although I am pleased that at the UN recently we passed a resolution in the Security Council that was all about holding to account those who committed these heinous crimes against humanity and wore the name of Daesh in committing their actions, which bear no resemblance to any humanitarian act. Regarding the Syrian regime, as the noble Lord knows, we are supportive of all resolutions. That is why we also take the strong stance that while the Assad regime is in place there can be no long-term political settlement of the situation. Let us not forget who created the crisis in the first place.

[Lord Naseby (Con)]

My Lords, why do Her Majesty’s Government not recognise that Assad is not going anywhere and that the Syria that he holds is growing back almost to the boundaries it had before? Against that background, does my noble friend really think that British taxpayers want £14 million to be spent on supporting the so-called opposition? Surely it would have been better spent on fuel poverty.

[Lord Ahmad of Wimbledon]

My noble friend perhaps mixes two issues. I think that all these issues are of equal importance. We have just heard from him about the importance of addressing fuel poverty. Equally, I think I speak for many in this House when I say it is right that we stand up for the oppressed of Syria and support the opposition forces because it is they, not Bashar al-Assad, who hold the key to the future development of all communities in Syria, including all minority communities.

Sri Lanka

Lord Naseby Excerpts

Thursday 12th October 2017 Lords Chamber

Asked by

[Lord Naseby]

To ask Her Majesty's Government what assessment they have made of the progress made by the coalition government of Sri Lanka in meeting the requirements on reconciliation established by the United Nations Human Rights Council.

[Lord Naseby (Con)]

My Lords, I declare an interest: I started the All-Party Parliamentary Group on Sri Lanka in 1975 and am currently its president. I have known Sri Lanka for over 50 years.

I believe the UK has a unique role to play in the future of Sri Lanka, but we need to understand the history behind the current situation. In the 11th century AD Tamil Cholas invaded Sri Lanka and took over the north and north-east. Understandably, the Sinhalese were left with the remainder. Then there was colonisation by the Portuguese, the Dutch and then of course the UK. The British left behind a very good civil service; unfortunately, it was not spread across the two main denominations. It was dominated by the Tamils, who looked after the civil service and indeed the professions. On independence, sadly, this position was somewhat resented by the Sinhalese, and they passed the Sinhalese official language Act.

There remained some smouldering resentment from 1948 right through to around 1973. The Tamil youth have been activated by two people in particular. One is Mr Balasingham, a British citizen after Mr Blair’s Government gave him that, and the other is a man called Prabhakaran, a single-minded ruthless activist. In 1973 Prabhakaran killed the mayor of Jaffna, along with six soldiers whose bodies were brought to Colombo. There was a resentful response from the Sinhalese youth; very sadly it was three days before a curfew was brought in, and well over 1,000 Tamils were killed. From then on it has been a situation of Eelam, the independent state, on one side versus the unitary state of Sri Lanka on the other.

Fast forward to 18 May 2009. The Tamil Tiger terrorists are defeated in a military solution, and after nearly 30 years of war there is peace across the whole island, as there is today. This is followed by a presidential election in January 2015 when President Sirisena is elected to head a coalition Government. The platform of that Government was to achieve reconciliation, ensure a durable peace, promote and protect human rights, uphold the rule of law and strengthen good governance and democracy. Out of that flowed UN Resolution 30/1 of 1 October 2015.

I visited Sri Lanka last February. Eight months on it is quite clear to me, from the context that I have, that the Government are addressing all the issues raised in the UN resolution. It may be taking longer than some would wish but that is life, I think. I shall highlight three. The first is missing persons. A massive amount of time and effort was put into the Paranagama commission, set up by the previous Rajapaksa Government, identifying some 20,000 missing persons and actually following up 10,000 of them. To this can be added the superb work done by the ICRC.

The good news is that a commissioner and a department are now set up, and in passing I pay tribute to the enormous hard work put in by Sir Desmond de Silva and his two colleagues. Sri Lanka must be eternally grateful that men of their wisdom and experience have got this task moving in the first place.

On prevention of terrorism, there is acceptance that a new Act is needed—there was in February. I cannot understand why it is taking quite so long to get it on the statute book. The constitution is being debated—the good news is that the leading Tamil party is actively taking part—and the problem of devolution is being addressed. However, the West needs to understand that the East cannot necessarily produce a mirror image of a western structure.

In passing, I pay considerable tribute to Halo and its Sri Lankan operatives, along with the Indians, Canadians and the Sri Lankan army, for clearing a square metre a day of ground, which makes it possible for families to return to the land.

What is not on track and needs urgent attention is the war crimes allegations hanging over the country. These flow from the Darusman report, which, on a best-guess basis, two years after the end of the war, stated,

“there is still no reliable figure for civilian deaths”,

but then guessed at 40,000. This figure is bandied about by virtually every human rights organisation and the thousands of Tamil diaspora throughout the world, many of whom were LTTE Tamil Tiger supporters and still are, inflamed by Tamil Net and those ghastly Channel 4 “Killing Fields” films, which so influenced the previous Prime Minister.

I have discovered an unpublished report from the United Nations country team, which stated that from August 2008 up to 13 May 2009, the number of civilians killed was 7,721. The war ended six days later, so it cannot possibly have got up to 40,000. Then I looked at what Gordon Weiss, the former UN spokesman said. He produced an estimate in 2009 of 7,000 civilian deaths. He also made the simple observation that, for the Sri Lankan army, it made no tactical sense to kill civilians. University Teachers for Human Rights is not exactly a right-wing organisation; in fact, it is probably on the far left. It had similar figures, and commented that from what happened it could not say that the purpose of bombing or shelling by government forces was to kill civilians. It also said that ground troops took great trouble not to harm civilians.

The Sri Lankan Government’s census department—a very genuine department—issued an in-depth census leading to the conclusion that 7,000 to 8,000 were missing. US Ambassador Blake stated on 7 April that there were deaths of 4,164 from 20 January to 6 April. Major General Holmes in his expert military report of March 2015 concurs with 7,000 to 8,000. Above all, all the people I have cited state that there was no policy to kill civilians—in fact, the opposite. To these I add the British defence attaché, Lieutenant Colonel Anton Gash, who said to me in January 2009 that he was surprised at the controlled discipline and success of the Sri Lankan army and in particular the care that it was taking to encourage civilians to escape and how well they were looked after, and that certainly there was no policy to kill civilians. There could not be a better military man: he is knowledgeable, independent and would be authoritative about what happened in his reports in his dispatches. So I decided to make a freedom of information submission to the UK Foreign and Commonwealth Office concerning those dispatches in the period 1 January to 19 May 2009. The original submission went in on 6 November, but was rejected. Two appeals to higher authorities at the Foreign Office were rejected, so I appealed to the Information Commissioner—with more success. She listened and, as a result of her representations, 26 pages of heavily redacted dispatches were sent me. Obviously, I looked at them with some care. I challenged the lack of dispatches in the last two months. Amazingly, another 12 pages appeared, all redacted.

Still concerned about the lack of dispatches in the past few days, I made a final appeal to the First-tier Tribunal, assisted by my very good friend Amal Abeywardene. We had the sympathy of the judges for the cause, but they accepted the Foreign Office view that if confidential information was given out, nobody in future would give us any more. So I now have the princely sum of 39 pages of heavily redacted dispatches—nevertheless, if you dig deeply, as in life, you find some real gems. For example, on 28 January:

“It is not possible to distinguish civilians from LTTE cadres as few are in uniform”.


Then, from 16 February:

“IDPs being cared for in Trincomalee. Welfare appears to be overriding security considerations”.


Then on 20 January they say,

“no cluster munitions were used”,

and on 26 April,

“civilians killed Feb 1-April 26—6432”.

I hope and pray that, as a result of this debate, the UK will recognise the truth that no one in the Sri Lankan Government ever wanted to kill Tamil civilians. Furthermore, the UK must now get the UN and the UNHCR in Geneva to accept a civilian casualty level of 7,000 to 8,000, not 40,000. On top of that, the UK must recognise that this was a war against terrorism, so the rules of engagement are based on international humanitarian law, not the European Convention on Human Rights. The West, and in particular the US and UK, must remove the threat of war crimes and foreign judges that overhangs and overshadows all Sri Lankans, especially their leaders. We in the UK should reflect on the sacrifices of thousands of young Sri Lankan soldiers who died to create peace in that country. Finally, I reflect that Sri Lanka came to our need in two world wars and had casualties, and it was one of just a handful of countries who supported the UK over the Falklands. Now is the time to offer the hand of friendship and act to lead the international community to recognise what the truth really was.

--- Later in debate ---

[Lord Collins of Highbury (Lab)]

My Lords, I too thank the noble Lord, Lord Naseby, for initiating the debate and for his comprehensive introduction. As we have heard from all noble Lords, in 2009, Sri Lanka emerged from a brutal Tamil war of independence after 26 years of fighting and terrorism. Since the adoption of the Human Rights Commission resolution in 2015, the Sri Lankan coalition Government formed that year were expected to fulfil the recommendations of taking specific measures for institutional reform, justice, truth and reparations.

Although I hear the noble Lord’s optimism, I have to also acknowledge the comments made by the noble Lord, Lord Sheikh. Last month, following a four-day visit, the UN’s special rapporteur, Ben Emmerson, found that the country’s judicial system and tolerance of torture is a,

“stain on the country’s international reputation”.

He warned that if government inertia over reform does not end, the authorities will have created,

“precisely the conditions likely to produce festering grievances, to foster unrest and even to reignite conflict”.

As we have heard, one of the key undertakings in the resolution was security sector reform, including repealing and replacing the draconian Prevention of Terrorism Act. I very much support the United Kingdom’s call on the Sri Lankan Government to deliver on their commitments laid out in the UN resolution at the Human Rights Council on 11 September. I welcome our Government’s actions in that respect.

President Sirisena held a meeting with the UN High Commissioner for Human Rights, Zeid Ra’ad Al Hussein, on the margins of the recent UN General Assembly. He was told by the commissioner to accelerate the pace of fulfilling all the obligations in the 2015 consensual resolution. However, President Sirisena argued that hastening the process would give an undue advantage to extremists and invited the high commissioner to visit Sri Lanka next year to see progress.

Noble Lords have highlighted the progress made and I do not want to undermine it. The president pointed out that he had signed the gazette notification operationalising the Office on Missing Persons before he left for the US. He also said that the draft Bill on a new constitution was presented to the Parliament—all good progress. The Sri Lankan Government also stated that all lands in the eastern province that were under the custody of the security forces had now been released and a considerable number of lands in the north, too, have already been released. For the rest of the lands, measures are being taken to resolve the administrative problems and these will also be released to people gradually.

But there still is a heavy military presence in the northern part of the country, which is a serious challenge to transitional justice. The largely Sinhalese and Buddhist army engages in everyday commercial activity, for example. It runs shops, restaurants and hotels, leaving local businesses unable to compete. It is common practice for the army to occupy, cultivate and harvest farmlands and sell produce back to the local community. If that continues, it is bound to increase discontent among Tamil communities and lead to a rise in protests. Those are the issues that need to be addressed.

[Lord Naseby]

As I said, I went there in February and I saw the shops being closed. I was told that there was no trading activity anymore and I checked with the traders who confirmed that. The noble Lord is right that trading was happening extensively, but it now seems to have ceased—or at any rate at least 95% ceased.

[Lord Collins of Highbury]

My Lords, I think that the difference between us is about the pace of progress. I acknowledge that things are happening—I said that in my opening remarks. But if we do not speed up the pace of reform, there is certainly the prospect of continuing discontent. What ongoing discussions are the Government having with the Sri Lankan Government to encourage this demilitarisation of the north and expedite the full return of land by the military to the owners?

As we have been reminded in this debate—by the noble Lord, Lord Sheikh, in particular—the last session of the UN Human Rights Council on 29 September heard allegations of genocide, systematic discrimination, torture, extrajudicial killings and militarisation levelled against Sri Lanka. That is beside the call by the UN High Commissioner for Human Rights for the second time in two sessions for universal jurisdiction to be exercised. Of course, universal jurisdiction is the principle etched in law that every country has an interest in and responsibility to bring to justice perpetrators of the most abhorrent crimes, enforcing international legal norms. That is absolutely fundamental to protecting human rights and supporting peace and stability. They must be a priority for the international community. Does the Minister agree that all nations must reject impunity, embrace the principle of universal jurisdiction and clearly state that the alleged perpetrators will be arrested if they cross international borders?

Accountability for atrocities committed in Sri Lanka can offer the country a chance to heal the divisions of the past. That is the process that all noble Lords have been referring to. What effort is the FCO making to constructively engage with Sri Lanka and advance its commitments to reconciliation? Security sector reform, including repealing and replacing the draconian Prevention of Terrorism Act, must be a key feature of that. As Ben Emmerson concluded, the use of torture has been and remains today endemic and routine for those arrested and detained on national security grounds. Since the authorities use that legislation disproportionately against members of the Tamil community, that community has borne the brunt of the state’s well-oiled torture apparatus. What representations have the UK Government made to Sri Lanka on the conclusions reached by Ben Emmerson, which confirmed similar findings to those of Human Rights Watch and other organisations?

The noble Baroness, Lady Berridge, referred to the events of two weeks ago in Sri Lanka when a mob led by Buddhist monks filmed a UN safe house sheltering Rohingya refugees. I, too, welcome both the condemnation from the Sri Lankan Government and the actions to be taken against the perpetrators of that crime. I ask the Minister whether the Government have urged the Sri Lankan people to ensure the perpetrators are properly held to account. There is, and remains, widespread concern that they will not be, and it is important that we keep up the pressure.

I join in the support of the noble Baroness, Lady Berridge, for sharing best practice, particularly in terms of extending freedom of religious belief, but human rights is a broad band of principles. One of the things that concerns me, to which I want the Minister to respond, is that earlier this year, after a vote in their Parliament, the Sri Lankan Government decided to keep their law making homosexuality illegal. Despite that decision, Cabinet members agreed to update their human rights action plan with an addendum that bans discrimination against someone based on their sexual orientation. Although that is a step in the right direction for the Sri Lankan LGBT community, it fears it will not stop facing abuse while the law telling people homosexuality is wrong exists. Many of the LGBT citizens polled by Human Rights Watch revealed they had been sexually or physically abused by local police, and at one point over half of them said they had been detained by police without reason. There was also a recent hate crime where a trans woman and HIV advocate was murdered. Can the Minister assure us that adequate time, not only for freedom of religious belief and other human rights issues, will be given at the Commonwealth Summit for these issues to be fully aired and considered at all the fora—including, most importantly, at the Heads of Government Meeting?

Hurricane Irma: Disaster Relief

Lord Naseby Excerpts

Tuesday 10th October 2017 Lords Chamber

Asked by

[Lord Naseby]

To ask Her Majesty’s Government whether they intend to undertake an urgent review of the anticipation, preparation, speed of response and chain of command for the United Kingdom’s disaster relief operations in the Caribbean, in the light of the United Kingdom’s response to Hurricane Irma; and if so, whether they will publish the results and any recommendations for change.

[Lord Naseby (Con)]

My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I declare an interest in that I have family living in the Caymans.

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

My Lords, we are conducting an internal review to identify the lessons learned from the Government’s response to Hurricane Irma, as indeed we do in response to all crisis situations. These findings will of course be incorporated into future crisis responses. The timing of this review will be considered alongside the ongoing recovery efforts in the Caribbean, including the overseas territories. Meanwhile, the Foreign and Commonwealth Office will continue to co-ordinate a cross-government response to any new crisis which may arise.

[Lord Naseby]

The Minister’s Answer is very welcome, but in this review will he go back to the review after the tsunami in 2005, when it was clearly stated that the most vital part was for help to arrive in the first 24 hours, or, if that is not absolutely possible, in the first 36 hours? Against that background, will he make sure that the review looks at the date at which the FCO crisis committee met, on 5 September, and say why it did not meet in the previous week? Will that review look at the situation regarding the movement of aircraft from Brize Norton and say why they did not get into the air immediately after the hurricane had left the British Virgin Islands, instead going two days later? Finally, will the review look at why HMS “Ocean” was not moved at least a week earlier to somewhere nearer this side of the Atlantic rather than the middle of the Mediterranean, even though, sadly, it broke down en route in any case?

[Lord Ahmad of Wimbledon]

My noble friend raises a series of questions; in the interest of allowing more questions to be asked, I will write to him specifically to answer them. However, I will pick up on one or two of his points. The UK Government responded within 24 hours. My noble friend may well be aware that RFA “Mounts Bay” arrived within 24 hours of the storm’s impact and restored power supplies at Anguilla’s hospital, rebuilt the emergency operations centres and, importantly, cleared the runway to allow planes that were waiting to arrive at the airports to come in. It then followed on and delivered a similar response to BVI. However, I will respond to the issues my noble friend raised in his other questions.