Mr Nick Hawkins (Surrey Heath, Conservative)

I beg to move amendment No. 151, in

clause 43, page 25, line 43, at end insert—

'(8) Where any bank or financial institution contacts any of its customers holding a bank or financial account or accounts, they shall not request customer information alleging they require it for legislative or investigative reasons when they actually want it for marketing'.

This is my reassurance to the hon. Member for Wirral, West and other Committee members that, despite my background, I will not always be putting forward proposals on behalf of banks and financial institutions, because there are times when we would all accept that they go too far.

With regard to another recent piece of legislation, we had a debate with the Minister's predecessor, the hon. Member for Coventry, North-East (Mr. Ainsworth), about the problems that some banks and financial institutions have caused to constituents throughout the country. They have misused some of the provisions of the proceeds of crime legislation to enable them to get information by using that legislative framework as a cloak when they actually wanted the information not for the

investigation or prevention of crime but for marketing reasons.

There was such a case in my constituency. It involved a local charity—I am sure that all Members have local charities in their constituencies. This charity—the Windlesham United Charities and Poors' Allotments—has done a great deal of valuable work in my constituency over many years. The secretary to the trustees of the charity is a lady who is well known for her good work in my constituency. Her name is Doris Christie, and she has been honoured for her charity work. She saw me at one of my surgeries to draw attention to the fact that the bank with which the charity had an account was asking for information which I, having been the shadow Minister on the proceeds of crime legislation, happily knew went far beyond the legislative requirements. When we finally got to the bottom of things—after much strongly worded correspondence from me—the bank admitted that some of the information that it was seeking about the trustees' personal details went beyond the legislative requirements and was simply required by it for marketing purposes.

Therefore, I have had experience of how previous legislation has been working. The hon. Member for Wirral, West and others might recall that when my hon. Friend the Member for Beaconsfield and I were leading for the Opposition on the proceeds of crime legislation, we expressed worries that it might be misused—that it might sometimes be used as a sledgehammer to crack a nut. I have seen a subsequent example of how some of the requirements have been misused.

I hope that the Minister will understand that Opposition Members do not always defend everything that banks and financial institutions do. I felt that it might be helpful to introduce a correction into this Bill to make it clear that banks and financial institutions, while they should be encouraged to help the Government, police and prosecution forces generally to investigate crime, must not misuse their powers and start trying to seek information that they use purely for marketing purposes under the cloak of this Bill, the Proceeds of Crime Act 2002, or any other legislation.

Mr David Heath (Somerton & Frome, Liberal Democrat)

In a genuine spirit of inquiry, I wonder why the hon. Gentleman tabled this amendment to the clause, which appears primarily to deal with banking transactions outside the United Kingdom, rather than inside it. I wonder whether overseas banks would be more likely to use this ploy than banking institutions in this country.

Mr Nick Hawkins (Surrey Heath, Conservative)

The hon. Gentleman's last point was one of the things that I had in mind. However, in response to his genuine inquiry, I was in not one or two, but several minds about where to insert the amendment. I was relieved that the Clerk and the Chairman regarded the proposal as being in order and that it was on the amendment selection list. While I may not have chosen the most perfect place in the Bill to insert the amendment, at least it was selected. To that extent, I am pleased to have had the chance to pass on the worries of my constituents.

If other members of the Committee have not yet experienced such a problem, they will. Small charities are worried about these matters. People who administer them are receiving onerous requests for personal information. While the particular local charity that I have mentioned has been the most obvious case, similar issues have been raised with other hon. Friends who are members of the all-party insurance and financial services group. I hope that the Minister will understand where I am coming from and that she can give me a helpful response.

Ms Caroline Flint (Parliamentary Under-Secretary (reducing organised and international crime, anti drugs co-ordination and international and European issues), Home Office; Don Valley, Labour)

Let me clear up any confusion. When the Bill was discussed on Second Reading, the hon. Member for Surrey Heath expressed worry about alleged practices by some banks when obtaining inappropriate information from their customers, but here is not the place to discuss such matters. I am not sure that they have anything to do with the Bill.

However, the amendment is listed on the selection list, and I want to clarify a few points. There is no question of a bank or financial institution contacting its customers about any of the requests made under chapter 4. Indeed, they will be guilty of an offence if they disclose the existence of a request or an investigation, let alone if they disclose it to the customer in question. The Bill does not create a new obligation on banks about the records that they hold about its customers. Its purpose is to find out information about an existing account, pursuant to criminal investigations, not to find out new information about the individual. It is about gaining access to a person's financial records. That is the purpose of the customer information and account monitoring orders. If banks were to contact their customers about anything else, they would be guilty of the offence of disclosing the existence of a request for an investigation or of, at least, putting that investigation in jeopardy.

To include a provision along the lines of that proposed by the amendment would be inappropriate. Clause 43 regulates outgoing mutual legal assistance requests from the United Kingdom to identify and provide details of accounts that are held overseas. It deals with requests from UK prosecuting authorities to overseas judicial authorities, which they will execute in the way most appropriate to their law. In France, for example, there will be no need to involve banks at all in requests to identify accounts, because it has a central register of bank accounts. While I appreciate that the hon. Gentleman has more general worries, I hope that he will withdraw the amendment in light of my comments.

Mr Nick Hawkins (Surrey Heath, Conservative)

The Minister has been helpful. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

Mr David Heath (Somerton & Frome, Liberal Democrat)

I have a question for the Minister. I had intended to table an amendment about the matter, but I forgot. The term used for requests outside the United Kingdom to this country is ''financial institutions''. In the case of requests from the United Kingdom to other participating countries, the term is ''banks''. Why is

there such a difference? Are we not applying an artificial restriction to the financial institutions from which we can request information? As we know, financial institutions take many forms, which is why we have them in our part, as it were, of the Bill. Many companies that operate in a similar way to banks in other countries may be differently incorporated.

The Minister mentioned France, and it is interesting that there is a central collection of banking information there. It occurred to me that some of the major ''banks'' in France are in fact mutual societies and credit unions. I do not know whether they would come under the definition of a ''bank'' as specified in clauses 43 and 44. My question is, why do we use the term ''financial institutions'' when we talk about those in this country, but ''banks'' when we talk about the same thing in other countries? That does not seem consistent. Indeed, it is potentially dangerous in terms of a challenge if information from another country comes from a financial institution that is not a bank.

Ms Caroline Flint (Parliamentary Under-Secretary (reducing organised and international crime, anti drugs co-ordination and international and European issues), Home Office; Don Valley, Labour)

I thank the hon. Gentleman for raising that question. It needs to be answered. I shall ask officials to find an answer, and shall write to him before we finishing our proceedings.

Mr David Heath (Somerton & Frome, Liberal Democrat)

I am grateful.

Question put and agreed to.

Clause 43 ordered to stand part of the Bill.