Fraud Bill [HL]

– in the House of Lords at 3:31 pm on 29th March 2006.

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Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities 3:34 pm, 29th March 2006

moved Amendment No. 1:

Insert the following new Clause

"Prosecution of common law offence of conspiracy to defraud

In making a decision whether to charge a person with a common law offence of conspiracy to defraud, regard shall be had to guidance published by the Attorney General."

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities

My Lords, we on these Benches wanted the Bill to contain a provision to abolish the common-law offence of conspiracy to defraud, as recommended by the Law Commission, and I moved an amendment to that effect on Report. The noble and learned Lord the Attorney-General wishes to retain the offence for the time being because, in his view, it may be useful in certain circumstances. But it is agreed that the retention of the common-law offence will be reviewed in three years' time in the light of the extent to which it turns out to be useful in the interim.

The noble and learned Lord the Attorney-General offered to show the draft advice which he has prepared for prosecutors and which is intended to restrict the use of the common-law offence to cases which are not adequately covered by the new legislation on fraud. He has sent copies of a working draft of his advice to me and the noble Lord, Lord Kingsland. I am satisfied by the advice, but it would be very helpful if the noble and learned Lord could explain it to your Lordships' House and put on record an outline of his advice. In the circumstances, it is my intention to withdraw my amendment at the end of the debate. I beg to move.

Photo of Lord Kingsland Lord Kingsland Shadow Lord Chancellor, Constitutional Affairs, Shadow Lord Chancellor, Parliament

My Lords, my name also is on the amendment. I thank the noble and learned Lord the Attorney-General for expediting this document. It has been extremely helpful in our approach to Third Reading.

The Attorney-General has helpfully summarised in paragraph 8 of his draft advice the judgment of the noble and learned Lord, Lord Bingham, the then Lord Chief Justice, in the joined cases R v Rimmington and R v Goldstein. The latter part of the portion of the judgment which appears in paragraph 8 reads,

"good practice and respect for the primacy of statute do in my judgment require that conduct falling within the terms of a specific statutory provision should be prosecuted under that provision unless there is good reason for doing otherwise".

The Attorney-General's draft goes on in paragraphs 12, 13, 14 and 15 to consider the circumstances in which there might be good reason for doing otherwise. Paragraph 15 is quite unexceptionable. It sets out the specific circumstances in which the definition of fraud in the Bill does not stretch to certain potentially undesirable activities. It might, therefore, be appropriate for those to be prosecuted under the common-law offence of conspiracy to defraud.

More interestingly, the noble and learned Lord the Attorney-General considers a second category in paragraphs 12, 13 and 14, which is,

"Conduct that can more effectively be prosecuted as conspiracy to defraud".

This category was not really dealt with in the Law Commission's report on fraud; that report dealt with the substantive law. Here, the noble and learned Lord the Attorney-General has turned to matters of sentencing and admissibility.

As I understand the thrust of these paragraphs, there may be circumstances in which it is right to use conspiracy to defraud because prosecuting under statutory offences, even though they cover the activity concerned, would not give rise to an appropriate sentence, and because the collection of statutory offences, unlike the offence of conspiracy to defraud, would not reveal to the court the full nature of the crimes prosecuted. In short, there are circumstances in which conspiracy to defraud will be used by the prosecution for sentencing purposes.

Also included within this second category are admissibility matters, which, again, were not explored, at least with any intimacy, by the Law Commission. The noble and learned Lord the Attorney-General refers, particularly in paragraph 13, to circumstances where, under specific statutory accounts, trials might be severed, whereas, if the offence of conspiracy to defraud were used, a trial might embrace all the matters of alleged criminality that were put before the court by the prosecution.

I make no judgment about whether it is appropriate or not to use sentencing and admissibility reasons to retain conspiracy to defraud, because, like the noble Lord, Lord Goodhart, I am content that the noble and learned Lord the Attorney-General should have his three years to see how these matters progress. But, in replying on the contents of the document, I would be most grateful if the noble and learned Lord could just glance at those three paragraphs and, perhaps, unpack what is said in them.

I am particularly grateful for the way in which the noble and learned Lord has set out his future intentions in paragraph 10. The case lawyer, first of all, will consider and set out in writing why it would be appropriate for the common-law offence to be used; then, that judgment will be looked at again and reinforced, or otherwise, by the supervising lawyer. That seems an eminently sensible and reassuring way in which to progress.

I also note in paragraph 11 that the noble and learned Lord has stated that the information from the records of the case officer or the supervising officer "will be collected retrospectively"—those are his words—and then reviewed in 2009. At that point the noble and learned Lord will take a view on where we stand with regard to the offence—whether we need to continue with it as it is at the moment, or in some different form, or whether we can satisfactorily dispense with it.

Despite the fact that I have asked the noble and learned Lord these questions, I would not want him to think anything other than that I find this document most useful.

Photo of Lord Goldsmith Lord Goldsmith Attorney General, Law Officers' Department, Attorney General (Law Officers)

My Lords, I am grateful to both noble Lords who have spoken. In the passage of the Bill so far, we have had quite a thorough discussion of the circumstances in which—in the Government's view, in my view and in that of prosecutors—it would be appropriate to continue to use the common-law conspiracy to defraud. We have had those discussions to some extent outside the House, too; I referred on the last occasion that we debated this matter to a meeting that took place at which prosecutors were available, and I set out examples in a letter that I sent to noble Lords, including both noble Lords who have spoken—the noble Lords, Lord Goodhart and Lord Kingsland.

I also said, when we had a particularly valuable debate on this matter on Report, that the focus on this issue was a result of the inquiry that had been made through observations in the House at Second Reading and in Committee. Those observations were very helpful in focusing attention on the merits of the proposal. I am grateful also to the noble and learned Lord, Lord Lloyd of Berwick, who also took an important part in this debate, although he is not in his place now. I said then that the focus on this issue had left me more persuaded rather than less that it was right to retain the common-law offence of conspiracy to defraud. During discussions both inside and outside the House, I broadly identified the circumstances in which I was persuaded that, at least for the time being, it was right to keep the common-law offence of conspiracy to defraud. That is reflected in the draft working guidance that I sent to noble Lords and to which they have spoken. I am grateful for the warm words that they used about it.

Let me take up the invitation of the noble Lords, Lord Kingsland and Lord Goodhart, to say a little bit more. First, this is working guidance, which has been considered with the directors of the prosecuting authorities, who agree with its content. I propose to issue final guidance around the time of Royal Assent—obviously, I will ensure that noble Lords have it at that stage and I will place copies in the Libraries of both Houses. The guidance will then be issued to the directors of the prosecuting authorities: the Crown Prosecution Service, the Serious Fraud Office, the Revenue and Customs Prosecuting Office and what we call the Whitehall prosecutors—other government prosecutors who do not fall into any of those three offices. I intend the guidance to apply to all of them. They will probably want at least the larger offices to issue their own more detailed guidelines, but those will be based on my guidance.

What, then, does the guidance say? As the noble Lord, Lord Kingsland, has noted, it sets out a little of the background. It then explains the process that we intend to follow. As I said on Report, one of the merits of the approach that I am adopting in this guidance, which is to require prosecutors to record their reasons for using the common-law offence, is that it will both focus their attention on why they are doing it and give us a record that we can look at afterwards to see whether we have got this right.

The guidance will give my view, as in paragraph 9 of the draft, that common-law charges may still be appropriate in two sorts of cases, or in the types of cases set out in paragraphs 12 to 15. First, there are those that the noble Lord, Lord Kingsland, has identified as cases where that approach is desirable for sentencing purposes. I think that that is shorthand; it is rather narrow in its description. In fact, that category covers cases where the interests of justice can be served only by presenting to a court an overall picture that cannot be achieved by charging a series of substantive offences or statutory conspiracy. On earlier occasions, I have given examples of where that may be, and the guidance does that as well. The second category covers cases where, as the noble Lord rightly identified, the conduct is such that it can only be prosecuted as conspiracy to defraud. The purpose of the guidance is therefore to give that guidance.

I turn to the status of the document. I understand why the noble Lord, Lord Goodhart, has tabled his amendment. I noted without any surprise his indication that he did not intend to ask the House to divide on it, and he in turn will not be surprised to learn that I would not have thought the amendment was necessary. I issue guidance and guidelines, as my predecessors have done, on a number of topics. Recently, I have done so regarding disclosure of documents about the acceptance of pleas, and there have also been Attorney-General's guidelines on other matters such as asking jurors to stand by. I would not think it at all necessary for such guidance to have the backing of statutory authority for it to be followed by prosecutors; I know of no problem in that respect. As it happens, I have quite a powerful weapon to enforce it myself: the ability to intervene in any case and to stop that case using my powers of noli prosequi if I were not satisfied with the way in which the prosecuting authority was acting. That is a longstop, but it is effective.

I hope that I have adequately addressed the questions put to me by both noble Lords. I note that the noble Lord will withdraw his amendment on that basis, and I invite him so to do.

Photo of Lord Goodhart Lord Goodhart Spokesperson in the Lords (Shadow Lord Chancellor), Constitutional Affairs, Advisory Team On Legal Matters, Cross-Portfolio and Non-Portfolio Responsibilities 3:45 pm, 29th March 2006

My Lords, I am grateful to the noble and learned Lord the Attorney-General for what he has said. It is useful to get this matter on the record, because we have had a serious debate on it, as I think appropriate for any case in which a recommendation of the Law Commission is not accepted by the Government. For reasons that I find wholly understandable, the matter will now be in effect deferred for some three years, by which time, I hope, evidence will have become available as to whether the retention of this offence is desirable. As I hope I have made clear throughout, my only intention in moving this amendment was to obtain such a statement from the noble and learned Lord. This amendment has now served its purpose, and I therefore beg leave to withdraw it.

Amendment, by leave, withdrawn.

Photo of Lord Goldsmith Lord Goldsmith Attorney General, Law Officers' Department, Attorney General (Law Officers)

My Lords, I beg to move that this Bill do now pass.

Moved, That the Bill do now pass.—(Lord Goldsmith.)

On Question, Bill passed, and sent to the Commons.