I beg to move amendment No. 325, in page 170, line 14, at end insert—

'(1A) A customs officer or constable may also seize cash part of which he has reasonable grounds for suspecting to be—

(a) recoverable property, or

(b) intended by any person for use in unlawful conduct,

if it is not reasonably practicable to seize only that part.'.

With this it will be convenient to take Government amendments Nos. 444 to 447.

Amendment No. 325 permits the seizure of cash of which only part is suspected of being related to crime, if it is not reasonably practicable to seize only the suspect part of the cash. When notes and coins are involved, there will usually be no difficulty in separating the suspect part from the non-suspect part and seizing only the part of the cash that is under suspicion.

However, when the cash takes the form of a monetary instrument, such as a cheque or a banker's draft, separation may not always be practicable at the point of seizure. We therefore propose that the whole instrument should be capable of seizure, provided that the non-suspect part is returned as soon as the money has been paid into an account. An example of that would be a single cheque to the value of £50,000 when, say, it is suspected that half represents the proceeds of unlawful conduct and the other half is not under suspicion.

In such a situation, the cheque would be seized and converted quickly into a divisible form, and the part of the money not under suspicion would be released. The provision is required to ensure that mixing suspect cash with clean money cannot circumvent the seizure of tainted cash. The amendment follows the approach taken under schedule 1 of the Anti-terrorism, Crime and Security Act 2001 in relation to the seizure of suspected terrorist cash.

Amendments Nos. 444 to 447 are required to ensure that proper provision is made at all stages of the process for cases when only part of the money is liable to forfeiture.

The amendment is not one to which I, nor, I suspect, any member of the

Committee, can have great objection. If a sum of money cannot be split conveniently, it is desirable that the whole of it should be seized, otherwise there would be a risk that substantial amounts of money that were thought to be the proceeds of crime, or associated with criminal conduct, could not be touched.

Will the Under-Secretary amplify his explanation a little and tell us about the mechanisms that would exist to ensure that the splitting of the money can take place as quickly as possible? I ask him to do that because we shall soon be discussing the detention of seized cash. As matters stand, it is possible for seized cash to be detained for a substantial time. What procedures does the hon. Gentleman envisage being operated to ensure, for example, that if there is a substantial cheque, the part of its value that represents money that is not considered to be recoverable property can be returned to the person who is entitled to it, without waiting for the completion of the whole process?

I am not sure that the matter is so complicated. There is a requirement in the Bill that all money is to be paid into interest-bearing accounts within 48 hours. Obviously we are talking about a cheque or a banker's draft that represents mixed property, and which should be paid into an account for the purpose of being split. The part identified as not being either the proceeds of crime or intended for criminal purposes, should be returned immediately to the person from whom it has been seized. There does not need to be a lengthy or complicated procedure, which might cause difficulty.

The Minister may be right. With regard to cash, there is no difficulty. I raised the matter because I wanted to ascertain whether any of the instruments on the list—unfortunately I do not have it in front of me—might be of a type that were not immediately payable into a bank account. Clearly, if the instruments are payable into a bank account they can be split up and sorted out. That is my only caveat.

The instruments that we are discussing are immediately payable into bank accounts. There are, of course, clearance procedures and deadlines applied by banks. It will not be possible to pay back a proportion of the money until the cheque—if it is a cheque—has been cleared by the banking system and found to be valid. There is likely to be some delay, due to the clearance procedures of the financial institutions, but none other than that.

My hon. Friend said that the money would be paid back immediately. Where in the Bill is the word ''immediately''? Where does it say that there is a time limit within which the money must be paid back?

The Bill does not say ''immediately''. The money is not forfeit. If it is kept, it will be subject to compensatory interest. Thus there is no incentive for anyone to detain for any length of time cash that is not suspect and is not forfeit. It imposes a liability on those who detain it. In exceptional circumstances, compensation may be payable above an interest rate. It would be in everyone's interests to return the non-tainted part of the money to its rightful owner as soon as is practical.

I am not satisfied. The hon. Gentleman responds to my question about the word ''immediate'' by saying that compensation may be payable. That is a potentially serious issue. Let us suppose that there are reasonable grounds for suspicion—and it must be remembered that that is reasonable suspicion that has not been proven—that some of the seized money is connected with crime. A person who has been charged with a crime of that type may later be cleared, but some of the money seized that was not connected with the crime may have been held for some time. The Minister gives assurances that interest is payable, and that action will be taken as soon as is practical. However, although interest may be payable, the money that earns the interest has been seized. No one is penalised by the fact that in the end that person will receive the interest from the money that has been seized and invested. Handing back the money plus the interest does not achieve anything.

It has been suggested that compensation may be payable. That idea, presumably, would give rise to a claim. In turn, that might result in a court case, which would drag out the matter even further. Irrespective of what we might think about being hard or soft on criminals or suspected criminals, we must keep our eyes on natural justice. If there were no suspicion that the money was connected with criminal activity and if it were accepted that there was no claim on it, it would be unsatisfactory to leave the matter to people's best endeavours; to deal with it ''as soon as is practical'' is inadequate.

I support what the Minister wants to achieve. I see the loophole and know that it needs to be closed. However, it should be stated under the Bill that such money will be dealt with within X hours, and that if it is not, there will be specific penalties—not just interest—for seizing money that no one has any reasonable grounds for believing should have been seized.

I apologise if I have not been clear. It is early in the morning. There is a requirement that the money be released. It is a requirement under the Bill that all the money seized, whether part tainted or otherwise, be paid into an interest-bearing account within 48 hours. We see no reason why that should not be done within 48 hours.

I draw the hon. Gentleman's attention to amendment No. 446, on which I did not expand in moving the lead amendment. Amendment No. 446 states:

''In the case of cash detained under section 294 which was seized under section 293(1A), the customs officer or constable must, on paying it into the account, release the part of the cash to which the suspicion does not relate''.

Under the Bill, it is a requirement to pay money seized into an interest-bearing account within 48 hours. Under the amendment, it would be a requirement to pay out the part that is not tainted immediately on paying the money into the account. The only justified delay that I can foresee might occur if moneys were paid into the account in the form of a cheque and the cheque could not be immediately cleared. Financial institutions place restrictions on the time within which they are prepared to clear cheques. However, as soon

as the cheque has been cleared, recognised as bona fide money and accepted by the financial institution involved, the money should be returned to its rightful owner.

I thank the Minister for drawing my attention to amendment No. 446. However, it merely says that the money must be released, not that it must be released immediately. That could be interpreted as meaning that it will be released when the person involved gets round to it.

The amendment provides that the person involved must,

''on paying it into the account, release the part of the cash to which the suspicion does not relate''.

In that case, why wait until the cheque has cleared? No power is provided to meet that assurance and say that the cheque must clear first. It must be one or the other. If the Minister is suggesting that the moment the money is paid in it must be given back, how will he meet the requirement that it must be cleared first?

We cannot accept that the money has been paid into and accepted by the account until it has been cleared by the financial institution involved. The intention is not to allow the forces of law and order to delay the return of non-tainted money to its rightful owner. Surely the hon. Gentleman accepts that procedures must be followed to ensure that real money, rather than a dud cheque, has been seized.

The matter is becoming further confused. The Minister now refers to the money being paid in and accepted. However, the provision does not state ''and accepted''. If the Minister wants it to state ''paid in and cleared'', he should introduce another amendment so that it says what he believes that it should.

I think that it is obvious that the money must be cleared before it can be returned. It is not possible to return money that has not been seized. I shall check whether there is a problem with the wording of the Bill and ensure that that problem does not arise. The substantive issue is that the hon. Gentleman does not want the customs officer or constable to be able to keep money unnecessarily, and cause a delay in its return. That is not the intention.

I have now had a chance to look at what we incorporated into the Bill on Tuesday, and the instruments include bearer bonds and bearer shares. I am no great expert on those, but it strikes me that they may have a fluctuating value. They have no fixed monetary value. If those were involved, what would happen in terms of identifying the person's share that is not the recoverable property? As the bearer share had been realised, there might be a subsequent loss. If it had been retained, it might have increased in value. Should we consider that?

Such property has been identified in this part of the Bill because it is exchangeable. The Bill provides that the money be taken into an interest-bearing account. In most normal circumstances, provision for compensation that might arise—either for a person whose property is subsequently found not

to be forfeit or for someone who is recognised to be a part-owner of the property that has been seized, but who was never under suspicion—relates to interest, because the products are exchangeable. Only in exceptional circumstances should compensation be paid above the level of interest. I suppose that someone could, through their legal representative, say that they had incurred exceptional losses because of the way in which the money was placed—and the Bill allows such cases to be heard. However, the change is not necessary, because in exceptional circumstances, compensation can be paid above the level of interest.

Like the hon. Gentleman, I am not an expert on bearer bonds, but I am told that they are exchangeable, and it is therefore appropriate to deal with them as cash. It would be best to pay them into an interest-bearing account, so that if they are forfeited to the state, there is no loss of accrual of value, and if they are returned to the person, there is no unnecessary loss of value.

Thank you for calling me, Mr. O'Brien. It is a pleasure to see you again. I hope that you enjoyed the break for Christmas and the new year. I hope that the Minister had an agreeable break, too; he seems extremely agreeable—perhaps unduly so—towards the Opposition today.

The first line of amendment No. 325 states:

''A customs officer or constable may''.

Why does it not say ''must''? If the officer has ''reasonable grounds for suspecting'', surely he would be negligent if he did not seize the assets. I do not understand why the amendment uses the word ''may'', rather than the word ''must''. That also applies to subsection (1), although perhaps that is a matter for the stand part debate. I raise the matter now, however, because it arises in the amendment, too.

I would like clarification of the Minister's view, and the view that he believes should be taken by the legal authorities, of the habit of carrying huge amounts of money. Perhaps I am from a particularly sheltered environment, but I am not aware that my constituents are in the habit of wandering around carrying huge amounts of money. That is what banks are for—and goodness knows, they rip people off enough for using them. There are credit cards and all sorts of means of transferring money.

I believe that it is suspicious to carry huge amounts of money. The assumption should be that anyone found carrying huge amounts of money is to be looked on with scepticism. [Interruption.] I missed that remark by the hon. Member for Orkney and Shetland (Mr. Carmichael), who has just joined us here on the mainland.

I should like clarification on the subject of ''unmixing'' money. If someone carrying an enormous amount of money, far more than any of us might envisage carrying on any occasion, says that it is his wife's or his children's money, what steps will be taken to clarify the fact that the money is not a tainted gift, and was honestly earned by the wife or the family? I am concerned, and I hope that the Minister will row back from the ''agreeability''—if such a word

exists—that he has shown towards the Opposition on the question of penalties.

The Opposition's attitude to penalties for inappropriate seizure is presumably designed to deter those who can seize from doing so. It is deliberately designed to make seizures less likely. That is yet another manifestation of the Opposition's enthusiasm for protecting criminals, would-be criminals and former criminals. Gosh, I feel fired up, even this early in the morning, for the first time in many sittings. I hope that the Minister can satisfy me on all the points that I have made, otherwise I may have to table an amendment for Report stage.

I cannot possibly let that remark go unchallenged—

Yes, you can.

I am sorry if I introduce a note of less than good humour. It is being suggested that someone minding their own business is suspect just because they choose to carry money. That strikes at the heart of the presumption of innocence, at natural justice and at the idea that people can do as they choose. It might be eccentric and stupid, but if someone wants to do that, thereby running the risk of being mugged, all hon. Members should defend their right to do so.

Is the hon. Gentleman saying that someone who carries £25,000—a sum that was mentioned in a previous sitting—is not suspicious? Would it not be necessary to ask that person why he was carrying £25,000? Is the hon. Gentleman saying that such a person is just an eccentric?

I am saying exactly that. If somebody has that kind of money—sometimes I wish that I did—because they have just come out of a betting shop, won the lottery, or acquired it in some other way, I am amazed that some Committee members are not prepared to defend that person's right to carry it if they are stupid enough to do so, given that they could be mugged. What sort of a society are we trying to build if anybody who carries money in his pocket is assumed to be a shady character?

The suggestion that anybody who speaks up for the principle that someone is innocent until proved guilty is somehow trying to defend the criminal is extraordinary. I consider that monstrously stupid, unfair and unreasonable. Until such people are convicted, and while there is no reason to have suspicions about the money, why should there not be penalties for taking money away from people when they are entitled to have it? It is not a question of being soft on them. At some stage in the future, they may be found innocent of all charges.

At 2.30 this afternoon I shall remind my hon. Friend the Member for Glasgow, Pollok (Mr. Davidson) how fired up he was at 9.10 this morning.

Five o'clock this afternoon.

Five o'clock, then. Clearly my hon. Friend has led a sheltered life in the drawing rooms of

Pollok. There are people whose practices he does not understand.

Changing ''may'' to ''must'' would not make any difference. Effectively, we are empowering the constable or customs officer to seize cash, part of which he has reasonable grounds for suspecting is connected with crime. Using the word ''may'' gives him that power. Using the word ''must'' would not add to those powers.

I am astonished by the Minister's response. He is making exactly the argument that we rejected when we debated the use of the word ''must'' rather than the word ''may'' before. We were not happy with the idea that those who ran the system should have discretionary power, and we wanted to send a clear instruction that exercising the power was a must. Surely the pendulum should swing much more towards the idea of ''must seize cash'', to give a clear indication that we do not approve of people carrying around huge amounts of cash without excuse. That is suspicious in itself, especially in an area such as Glasgow, Pollok, where few people have enough money to put down at the bookies to win £25,000, never mind acquiring it from another source.

Will the hon. Gentleman give way?

It is difficult for me to give way, as I am intervening myself, but if Mr. O'Brien is prepared to allow it, I am happy to give way.

I call the Minister.

My hon. Friend must accept that just because the word ''must'' might be appropriate in one sentence, it is not necessarily appropriate in every sentence. He is now extending his total lack of confidence in the courts, the judiciary and lawyers to constables and customs officers, too.

I wonder whether the hon. Member for Glasgow, Pollok is being slightly disingenuous. He must be aware that there would be occasional operational reasons why an obligation to seize cash could jeopardise a more significant police operation. If he wishes to draw attention away from the bigger issues via the back door, he is soft on criminals.

It is indeed possible that serious criminals could be protected by a seizure of cash that prevented an on-going investigation.

I am glad that the hon. Member for Orkney and Shetland raised that point, because that is a valid reason why cash could not be seized. If the Minister accepts that that is the only reason, I am happy. However, the assumption must be that unless there are exceptionally good reasons for not seizing the cash, it should be seized. I hope that the Minister accepts that.

I do not disagree. I accept that the hon. Member for Orkney and Shetland gave a good reason not to seize cash in some circumstances. We do not intend that powers should be introduced to seize automatically any cash found in the possession of

suspicious characters throughout the land. We intend to give powers to constables and Customs officers to use appropriately when they encounter suspicious cash while performing other duties. We do not share the attitude that my hon. Friend the Member for Glasgow, Pollok displayed.

A further point was covered by the hon. Member for Spelthorne (Mr. Wilshire), and I shall continue to cause annoyance by agreeing with the Opposition. There are people who are strange indeed, and their strangeness is not a reason for the forfeiture of their property to the forces of law and order. That is not a line that the Government propose in this Bill or plan to propose elsewhere.

Perhaps for the benefit of the hon. Member for Glasgow, Pollok, I should tell the Committee that I noted in yesterday's Glasgow edition of The Herald that the Minister was quoted as describing me as the shadow Home Secretary's sidekick. I assumed that he had thereby vented his spleen regarding the Committee's proceedings, and I am delighted that he agrees with the Opposition today.

On this matter.

That is quite scary.

Amendment agreed to.

Amendment made: No. 444, in page 170, line 15, after 'cash' insert

'if it or, as the case may be, the part to which his suspicion relates, is'.—[Mr. Bob Ainsworth.]

Clause 293, as amended, ordered to stand part of the Bill.