Recovery orders: repatriation

Part of Criminal Finances Bill – in a Public Bill Committee am 2:30 pm ar 22 Tachwedd 2016.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Rupa Huq Rupa Huq Shadow Minister (Home Office) (Crime and Prevention) 2:30, 22 Tachwedd 2016

I beg to move, That the clause be read a Second time.

The new clause would place a duty on the Secretary of State—and the enforcement agencies vested with the power to do so—to receive recovered property under the Proceeds of Crime Act 2002, and to repatriate recovered property where a court is satisfied that the property or the value of the property was begotten by illicit means. I hinted at the issue this morning. The clause builds on former Prime Minister David Cameron’s global forum for asset recovery, which came about after the anti-corruption summit of May 2016. We Opposition Members commend him for that. How he is missed. We have seen the forum begin to bear fruit, with the Government having signed a memorandum of understanding with Nigeria last September. There has clearly been limited progress on repatriation, but the Crown Prosecution Service’s most recent asset recovery strategy laments the low take-up of mutual legal assistance requests:

“Since London is a global centre for finance, there are a large number of criminal proceeds deposited in its financial institutions. Despite this, historically the CPS has not received a high volume of incoming MLA requests for the restraint and recovery of assets.”

Many of the people from the charitable sector who gave evidence worry that, at the end of the process, little will go back to those communities and third-world economies.

The Minister said on Second Reading, in relation to repatriating illicit wealth, that

“It is important to note that we are already doing this. In November 2015, the UK returned £28 million to Macau, which were the proceeds of corruption laundered in the UK. That is a concrete example of our giving back money to those countries that have been robbed by crooks who have used Britain to launder the money or to make the money in its jurisdiction. I want to see more of that and to see it go further.”—[Official Report, 25 October 2016; Vol. 616, c. 198.]

Through this new clause, we seek to help him with that process. He has made a clear commitment to seeing repatriation go further, and to ensuring that there is more of it. The CPS has also stated that mutual legal assistance is seriously underused, and that massive sums of illicit wealth are simply not subject to such requests and are therefore not being repatriated.

The new clause would not obstruct the Minister or the Government in their desire to see greater repatriation of illicit wealth. In fact, it would aid the Government in realising their aims. The new clause seeks to provide a different avenue from mutual legal assistance for repatriating illicit wealth, and it has a number of in-built safeguards to ensure that the UK repatriates such wealth to deserving countries, as well as safeguarding against the UK’s time being wasted.

Although the new clause is substantial in scope and takes up a number of pages in the amendment paper, we are not trying to cause an argument for argument’s sake. A precedent for repatriating wealth has been set, and the Committee has heard an example. The new clause would streamline the process, and I hope that the Government will take that in good faith; the new clause is technical, rather than political.

This is how we envisage the new clause working: where a court is satisfied that property is recoverable and issues a recovery order, and where it is also satisfied that the property was acquired with wealth illicitly obtained abroad, it may instruct a receiving enforcement agency to take steps towards repatriating that wealth upon the property being initially recovered. We term that a “repatriation order”—that is snappy.

Once such an order has been made, the Secretary of State would request co-operation and assistance in the repatriation process from a representative of the Government of the country of origin. The Secretary of State would then be free to enter into consultation with any other relevant third party. After that initial contact, an agreement would be reached with the aforementioned actors on how the value of the property would be used on repatriation.

The purpose of the measure is international development. In the new clause, proposed new section 266A(3)(a) of the Proceeds of Crime Act 2002 states that

“wherever possible the property repatriated will be used in a manner that will contribute to the implementation of Sustainable Development Goal 16”,

or the repatriated property will benefit the victims of the crime, or it will be used for its original purpose. The Government have some flexibility and room for discretion in the phrase “wherever possible”. Proposed subsection (4) contains a list of definitions.

There are two obvious questions: what are the conditions by which the property will be repatriated, and how will this large-scale, cross-jurisdictional activity be funded? To answer the first question, if a court is satisfied that on the balance of probabilities, the property or value of the property, if repatriated, would be put to a use that would violate the Human Rights Act 1998, the UK would have the right to retain the entirety of the property and its value, and no repatriation order would be issued.

Secondly, if a court was satisfied that on the balance of probabilities, a politically exposed person or group of PEPs would subject the property or value of the property to illicit financial activity, the UK would retain the property or its value, and no repatriation order would be issued. If the court was satisfied that on the balance of probabilities, the property or its value, if repatriated, would not be put to use for the purposes agreed by the Secretary of State and the country of origin, yet again, the UK would retain the entire value of the property, and the repatriation order would be rescinded.

Finally, proposed new subsections (6) and (7) stipulate that the UK will retain the total value of the property if the Secretary of State has taken all the necessary steps to aid the country of origin in working towards the provisions set down in proposed new subsection 3(a), but the other state has been unco-operative. That is meant to be the basis of the new clause. As for the timescales, they are in proposed new subsections (9) to (14).

Proposed new subsection 8 is a last-chance saloon for an unco-operative state that receives a repatriation order. Lots of conditions must be satisfied first. It simply affords the courts the chance to grant the Secretary of State the discretion to work towards an agreement by which a non-state actor may distribute the property or its value in the country of origin, provided that the distribution would not violate proposed new subsections 3(a) and (b).

On funding, the new clause would basically pay for itself. It is common practice for the UK to retain some of the value of any property that it repatriates to another country. I see no reason why that should change, and the new clause does not argue that it should. We acknowledge that there are states that are hugely corrupt—I think “fantastically corrupt” were David Cameron’s words —that routinely violate human rights agreements, and that engage in behaviour that would be deemed illegal here. In such instances, it is only fair that the UK retains the value and puts it to good use.

There is a third dimension to the new clause: it provides the UK with soft power to influence other states, to ensure that the UK does not stand idly by where there is corruption and systemic human rights violations. Nor can it be even remotely complicit by returning value to countries if it could be used for untoward purposes. I am open to questions from the Minister and tweaks to the clause, but I hope that he will agree that the principle is a good one.