Clause 33
Policing and Crime Bill
4:00 pm
Vernon Coaker (Minister of State (Policing, Crime & Security), Home Office; Gedling, Labour)
I have spoken to the hon. Members for Hornchurch and for Chesterfield, and I will move some of the Government amendments formally. On others, however, I will read into the record the facts, which may be of help not only to the Committee, but also to other hon. Members.
The amendments add to the new provisions in the Proceeds of Crime Act, as set out in clauses 33 to 38. Clauses 33 to 35 introduce a new power to continue to detain property seized under other powers where the relevant property is subject to an existing restraint order. As the Committee knows, a restraint order is an interim measure under the Proceeds of Crime Act, which prohibits persons from dealing with or disposing of specified property. A restraint order does not, however, provide for a general power to retain property. Although restraint orders effectively freeze property, that property may remain in the hands of a defendant. That obviously carries the risk that the defendant may dispose of, hide or devalue it to frustrate a subsequent confiscation order. That is particularly true of moveable property such as cars, jewellery and electronic equipment.
There is, of course, provision for those affected by the restraint order, and therefore the detention of the property, to challenge the order. If a decision discharges or varies the restraint order and releases the said property from detention, the prosecutors or others have the right of appeal. Clause 33 provides that in England and Wales, such property can continue to be retained by law enforcement with a view to it still being available for sale to meet a future confiscation order. That will ensure that items from which the defendant benefits as a result of criminal conduct are available for confiscation, which is only right, just and proper. The powers under which property has been seized and can be detained are certain powers of the Police and Criminal Evidence Act 1984 and the Proceeds of Crime Act 2002. For example, property seized as evidence under PACE, and also subject to a restraint order may continue to be retained even when the evidential purpose for retention no longer exists.
To explain why there seem to be so many amendments, clauses 34 and 35 provide equivalent provisions for the equivalent schemes in Scotland and Northern Ireland. The amendments are parallel amendments to those provisions. Clause 36 inserts several new sections—47A to 47P—into the Proceeds of Crime Act. It provides for specific search and seizure powers in England and Wales to prevent the dispersal or devaluation of personal property in anticipation of a confiscation order being made. Therefore, it differs from clauses 33 to 35, which provide for detention powers only. The powers are subject to judicial oversight and various other safeguards. Clauses 37 and 38 provide equivalent provisions for the equivalent schemes in Scotland and Northern Ireland. Once property has been seized under clauses 36 to 38, the seizing officer can initially detain it for 48 hours. He then needs to obtain judicial approval for continued detention. That will ensure, along with other safeguards, that the detention of the property is proportionate. Depending on the facts of the case, the judicial approval may be from a magistrates court making a detention order or a Crown court making a restraint order or varying an existing order to authorise the continued detention. Restraint orders are, and will be, used in more complex and high-value cases.
The amendments provide that if a decision is made by the courts relating to the detention of property, which is then appealed, the property remains detained until the appeal is concluded. That also applies in cases where there is an outstanding application before the courts. That is necessary as the circumstances by which the property is detained may cease while the appeal or application is pending, if, for example, under proposed new section 47K of the Proceeds of Crime Act, the initial 48 hours of detention expires and an application to the Crown court for a restraint order, which would authorise the continuing detention of that property, has been made but awaits a decision. In those circumstances, as the provisions are currently drafted, the property would have to be returned.
Amendment 172 provides that during an appeal the property remains detained until that appeal is concluded. That is necessary as the provisions, as currently drafted, require the property to be returned. Other amendments in the group achieve the same in other applications and appeals where otherwise have to be returned. The amendments ensure that property continues to be detained until there is no further possibility of an appeal. If the property were returned, it would be to those who are likely to dissipate it, thwarting the original reason for the seizure and detention and thereby undermining the policy intention. The property could be unavailable when a confiscation is made and needs to be paid, which would undermine the purpose of the clause.
In the clauses, the powers to detain are made with the view that when a confiscation order is made and requires payment, the property retained under the order can be sold to meet that confiscation order. The power of the magistrates courts to authorise sale of seized property is provided in clause 39. The amendments plug a gap to ensure the ongoing detention of property when that continuing detention is being contested.
Amendments 194 to 200 add to the new search and seizure provisions in clauses 36 to 38 of the Proceeds of Crime Act 2002. The three clauses are necessary for each of the three jurisdictions of the UK. They provide powers for the search and seizure of property to prevent its being made unavailable for satisfying a confiscation that has been, or might be, made. It also provides for the seizure of property that might otherwise be diminished in value by the conduct of a defendant or anyone else. That is an important addition to ensure that confiscation orders are paid when they are made.
As background to the amendments, the existing confiscation provisions in the Proceeds of Crime Act relate not only to the property held by a defendant but to certain gifts made by them to third parties, such as family and friends. That is an important provision as it stops offenders circumventing confiscation by placing their proceeds into the hands of other people, notably immediate family. The legislation calls such property “tainted gifts”, and it is an established and accepted law that in calculating a confiscation order, the court also considers the value of the property that the defendant has given away. “Tainted gifts” includes outright gifts, as well as under-value transactions. It is of note that criminals often reside in houses registered in another family member’s name.
Regarding the amendments, although aware of the tainted gift aspect of confiscation, our initial thinking was that the new powers of search and seize should be limited to the suspect. Practitioners have since voiced concerns that that would be a significant loophole. Defendants could engineer the exclusion of their property by making gifts; an extreme example being a defendant handing over his jewellery and other expensive moveable goods to family members present at a search. Accordingly, the amendments introduce the ability to search for and seize not only property directly held by the defendant, but those tainted gifts made by him or her.
I have tried to answer the point that the hon. Member for Hornchurch made at the beginning, and to look at such matters during the development of the Bill. It is significant that the same stringent safeguards will apply to such searches and seizures. For example, an officer would need reasonable grounds of suspicion before carrying out a search and seizure, and either a warrant or consent to be on the premises would be required for a premises search.
The code of practice will deal with the point of search and seizure from third parties suspected of being recipients of tainted gifts. Under the Proceeds of Crime Act, restraint orders can refer to third parties if they are recipients of tainted gifts. It is also of note that under that Act a search and seizure of cash under Part 5, and the execution of an investigation search and seizure warrant under Part 8 do not have to be against a person suspected of crime. As with this new power, both those measures are subject to a code of practice and have been operating successfully for six years.
Amendments 193 and 211 repeal the existing seizure power in the confiscation provisions of the Proceeds of Crime Act. Section 126 in Scotland and the Northern Ireland equivalent provide that property subject to an interim restraint order may be seized in the one circumstance of preventing its removal from the country. Clauses 37 and 38 of the Bill make provision for more extensive search and seizure powers that subsume those existing powers. Their continued existence is therefore not justified and the powers are repealed.
Amendments 239 to 241 are consequential on those made in respect of the powers to detain property under clauses 36 to 38. Those clauses specify that property may continue to be detained until there is no further possibility of an appeal. The amendments clarify the meaning of that. There are three amendments for the three separate UK jurisdictions.
I apologise to the Committee for the length of that, but sometimes that is necessary, because we must ensure that accurate information is read into the record, so that our legislators can refer back to it. Many of the provisions in this part of the Bill will have to be dealt with that way, and I apologise in advance.