Clause 98 - Money laundering: miscellaneous amendments

Serious Organised Crime and Police Bill – in a Public Bill Committee at 4:45 pm on 13 January 2005.

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

Photo of Mrs Marion Roe Mrs Marion Roe Conservative, Broxbourne

With this it will be convenient to consider new clause 24—Tipping off—

'(1) In the Proceeds of Crime Act 2002, section 333 is amended as follows.

(2) In subsection (1)(a) after ''has been made'', insert ''or knows that such a disclosure is going to be made''.'.

Photo of Dominic Grieve Dominic Grieve Shadow Attorney General

Clause 98 provides for an offence of tipping off, but does not provide for circumstances in which tipping off takes place immediately prior to the disclosure being made. The intention of the new clause is to beef up the provisions and to make it an offence to tip off, not only where a disclosure has been made, but where the person knows that such a disclosure is going to be made. I would have been quite comfortable to reinforce the structure of the Proceeds of Crime Act 2002. Otherwise, the offence is a slightly different one from tipping off. Tipping off is either knowing or believing that a disclosure is going to be made. Here, one commits the offence only if one knew that a disclosure was about to happen. I should be interested to hear the Minister's response on that point and the comments that I thought she was about to make about clause 98.

Photo of Caroline Flint Caroline Flint Parliamentary Under-Secretary (Home Office)

At present, the tipping off offence is in respect of disclosures about money laundering that have already been made to NCIS. We have not had sufficient time to consider the new clause fully. I should like to get the views of NCIS and law enforcement on this matter. I would also want to ensure that the amendment would not tighten the tipping off offence in a way that was unacceptable. For example, a solicitor acting for a wife in divorce proceedings might feel professionally obliged to warn her that, as a result of what she told him about her husband's finances, he would need to make a disclosure and seek consent from NCIS under section 328 of the Proceeds of Crime Act 2002 if he continued to act for her. Such a warning might constitute tipping off under the new clause if, as a result of him telling the client, a subsequent criminal investigation is likely to be prejudiced. We need to consider the implications, and I would like to report back later, but the hon. Gentleman has raised issues that give us pause for thought.

Clause 98 is a tidying-up clause that addresses an anomaly identified by the legal and accountancy professions. Under the Proceeds of Crime Act 2002, a professional legal adviser advising a client is not obliged to disclose to NCIS information that they obtain from the client in privileged circumstances. The   definition of privileged circumstances does not cover the case in which a professional adviser passes to his nominated officer information that he has received in privileged circumstances. Passing the information would constitute disclosure and trigger the nominated officer's duty to tell NCIS. That would put a professional adviser in a dilemma of whether not to disclose to NCIS and risk a breach of the reporting requirements, or to disclose and risk a breach of professional privilege or other confidence intended to be protected. Clause 98 amends the Act so that the nominated officer is not obliged to disclose to NCIS when the professional legal adviser seeks advise for him on whether the facts known to him give rise to the need for a disclosure.

With that explanation and with what I have said about the hon. Gentleman's new clause, I hope that he will not press it and that the Committee will approve the clause.

Photo of Dominic Grieve Dominic Grieve Shadow Attorney General

On the latter point, I am grateful to the Minister for clarifying what the clause is intended to achieve. It is undoubtedly necessary and important, and I am grateful to the Government for considering the matter and accepting representations on it from various professions.

My new clause was probably taken with this clause stand part debate because it is the only place that it can be taken, but they do not marry together particularly well. I understand the Minister's point perfectly. It was not my intention to criminalise the solicitor in the circumstances that she described. I was concerned about a situation in which it is known in an office that an employee has decided to make a disclosure the following day about a client, but prior to the disclosure taking place, another person in the office tips off the client. That was the circumstance that interested me and that we could try to catch with my new clause if we so wanted. However, as always, there is a law of unintended consequences with the drafting of all legislation, and it may be that what I proposed is unworkable.

Question put and agreed to.

Clause 98 ordered to stand part of the Bill.