Corporate Economic Crime

Debate between Stephen Pound and Richard Arkless

Tuesday 3rd November 2015 Westminster Hall

[Richard Arkless (Dumfries and Galloway) (SNP)]

It is a pleasure for me, too, to serve under your chairmanship, Mr Stringer. I thank the hon. Member for Ealing North (Stephen Pound) for introducing the debate. I also thank the hon. Members for Neath (Christina Rees), for Aberavon (Stephen Kinnock) and for Edmonton (Kate Osamor) for their thoughtful and insightful contributions.

The debate is predicated on the widely held public view that the bankers seem to have got away with it over the last five, six or seven years. Whether that is correct or not, it is certainly the widely held public perception. The urgings from the Opposition and the Conservatives’ manifesto pledge seemed to indicate that they were inclined to address that widely held view. I welcome that, and it is right that the issue is addressed. As we have heard from Opposition Members, corporate economic crime has increased over the last few years, and there is a question about whether both the means and the inclination and the will to tackle it exist.

I speak on behalf of the Scottish National party, of course, and section 7 of the Bribery Act applies only to England and Wales, not to Scotland. Most of the prosecutions that could be brought by the Serious Fraud Office or another entity relate to subjects—financial crime and financial regulation—that are reserved functions. However, Scotland has a long and well established criminal court system, which could bring charges for individual crimes to bear on individual directors, but as we have heard, those tools may not be up to the job. The SNP would be very interested, to say the least, in Government proposals on this point, but we recognise that there are difficulties. We, too, live in a jurisdiction where the prevalent public perception is that the bankers have got away with it. My constituents, like people across Scotland, are demanding that something be done.

I should declare a slight interest as a former practising lawyer, qualified on both sides of the border. Having come to this debate fairly recently, one difficulty I would point to is the difference between holding a company, as opposed to an individual, criminally liable. I am not saying that we could not get around that problem in law, but it strikes me, as a legally qualified person, that there are difficulties involved in bringing an entity into the realms of criminal liability. However, if the Government come up with proposals to get round that, I would certainly look at them.

The message to the Government from the SNP and Scotland is that if they do consider giving Scotland more tools to address these reserved issues, they should carefully consider the provisions that already exist in Scots law and make sure that the principles of Scots law are not set aside. It is in that spirit of co-operation that I come to the debate, and I am very interested to hear what the Minister has to say. We welcome moves to tackle this issue, but we are cautious about how they can be achieved.

When it comes to how the bankers have apparently got away with it, the message I hear from my constituents and from people across Scotland is really about actions and consequences. Over the last five to eight years, many ordinary people have, they would argue, suffered enormous consequences as a result of the actions of others. The public’s view in Scotland—I suppose this is replicated across the rest of the UK—is that there are people in the financial services industry who are earning huge sums and have suffered no consequences as a result of their actions or the actions of the company they are employed by. On the face of it, that needs to be addressed. We in Scotland are very interested to hear what the Minister has to say about what seems to be a substantial tide of opinion. Of course, we recognise that there are difficulties, which need to be addressed in any proposals.

[Stephen Pound]

The hon. Gentleman brings a wealth of experience and knowledge to the matter, which is welcome. In the context of what he was saying about perceptions, is he aware that in the summer BIS consulted the business community about whether to water down Labour’s Bribery Act guidance to businesses? That surely sends completely the wrong signal to business. Does the hon. Gentleman agree that when there is consultation on whether even a measure as modest yet effective as the Bribery Act 2010 is potentially dilutable—if there is such a word—it sends an appalling signal?

[Richard Arkless]

Yes, wholeheartedly. The public perception is real and tangible, and in my view it is entirely based in fact. The Government’s reluctance to continue on the road, and the suggestion that the 2010 Act, which does not apply to Scotland, might even be watered down, sends entirely the wrong message. If we can convince the public that we are serious about the issue, the trust in financial services that has evaporated in the past five to 10 years can, I hope, be restored. The reason Parliament thought it right to bail out the banks was their intrinsic role in the economy, and that has not changed; however, the public need to have confidence in the financial services sector. For the time being, they do not have such confidence, and I will be interested to see what the Government will propose.