Committee (and remaining stages)

Part of Crime and Security Bill – in the House of Lords at 9:00 pm on 7th April 2010.

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Photo of Lord Marlesford Lord Marlesford Conservative 9:00 pm, 7th April 2010

This amendment derives from the report into money laundering and the financing of terrorism that was made by Sub-Committee F and published last year. I was privileged to spend three years as a member of that committee. I must explain, very briefly, of course, what it is all about because we discovered it only when we made the study. The Minister and I have corresponded and talked about it frequently, and I have had answers to a number of Written Questions that have elucidated the case for it.

In order to monitor and prevent money laundering, if the regulated sector, which basically means banks, lawyers, building societies, accountants, finance companies and so on-there is a whole list of them-believes that somebody has been engaged in money laundering, it is required to make a suspicious activity report, commonly known as an SAR. This report is made to the Serious Organised Crime Agency, commonly known as SOCA, which was previously headed by Sir Stephen Lander, the former director-general of the Security Service MI5. It is there to deal with serious and organised crime.

In our inquiries, we discovered that this process of suspicious activity reports has no de minimis condition. A very large number of reports are made. In March last year, there were already 1.5 million reports, and there are now getting on to 2 million. Those who are the subject of such a report are put on to a database known as ELMER. We inquired into it, and found that that is not an acronym. We never discovered what it is, and if the Minister were able to tell us that would advance our knowledge. You get put on this database of suspects. You are not told you are on it, and you will be on it for up to 12 years. It is particularly disturbing that it is not only the regulated sector as it is at present that can put somebody on it, but an anonymous denunciation can result in somebody being put on it. That is quite astonishing and has pretty nasty Stasi overtones.

In our report, we made two recommendations:

"The FATF Recommendations do not require information on the ELMER database to be made available other than in connection with serious crimes. Access for other purposes should be on request to SOCA".

In fact, there is widespread, direct access to this database. The noble Lord, Lord West, has been kind enough to answer questions giving examples of the sort of people who have access. It even goes down to the Neath Port Talbot County Borough Council, which apparently uses the database to check on consumer behaviour. In my view, this is something of an outrage. The database should be secret. People should be assessed before they are put on to it. My amendment would ensure that that happened. It says:

"(1) No suspicious activity report ... on a person ... may be retained on a database operated by a law enforcement agency without having been subject to independent scrutiny under subsection (2).

(2) The Secretary of State shall by regulations establish a system for the independent scrutiny of SARs with a view to ensuring-

(a) the accuracy and reliability of information contained in SARs, and

(b) the protection of", somebody's,

"rights under the European Convention of Human Rights and other relevant international Conventions".

The second recommendation of the Select Committee report from July last year to which I wish to refer was:

"The Information Commissioner should review and report on the operation and use of the ELMER database, and should consider in particular whether the rules for the retention of data are compatible with the jurisprudence of the European Court of Human Rights".

As far as I am aware, the Whitehall process is grinding on and nothing has emerged. In my view and, I think, the view of some of my colleagues on the committee, this is a serious situation, which needs much more action than appears to have taken place. Therefore, I should like to see in this Bill, in which it fits perfectly well, an appropriate protection to make sure that we do not have a secret database of suspects about which people know all too little. I beg to move.