Fraud Bill [HL]

The Government have accepted the logic of the argument that one would want to move towards a position where everything was covered and where the practical conditions that I have identified had been met. That is stated in the Government’s response. But we are nowhere near that position at the moment. I have met two different arguments this evening. The first is for immediate repeal, which I respectfully but firmly would reject as an irresponsible approach given what is said. I do not say that in any critical sense, but in the sense that it would be irresponsible of the Government to repeal it now in the light of the fact that judges, prosecutors and people engaged in this industry have said that it could be an important way of protecting the public. The second argument, put forward by the noble Lord, Lord Goodhart, and, to some extent, by noble and learned Lord, Lord Lloyd, at Second Reading, was that we should look forward to a position where that could take place. Before I conclude on that aspect, I shall quote one or two more submissions that may be of assistance to your Lordships. The North of England Trading Standards Group stated—and your Lordships may think this shows great wisdom:"““In the past the Theft Acts 1968 and 1978 were hailed as major breakthroughs in controlling fraud but the passage of time subsequently exposed inadequacies in both. We may encounter the same experience with the new fraud law and it is strongly suggested that a more responsible course would be to leave conspiracy to defraud as effective law whilst awaiting the ramifications of Court interpretations of the legislation. When we have experienced the results of High Court decisions on the new law we will be better equipped to assess the value or otherwise of repealing conspiracy to defraud””." As I have said, I have a number of other representations. Given that I have referred to the Law Society, I should quote from its submission. It states:"““The offence should not be abolished until there has been time for a complete review of the law of dishonesty by the Law Commission and the Government””." I referred to the Association for Payment Clearing Services. It stated:"““APACS has serious concerns about repealing the current conspiracy to defraud offence . . .  The banking industry is concerned that repeal of the conspiracy to defraud offence would limit the scope for prosecuting all the parties involved in such cases. In our view, defence counsel would seek to compartmentalise defendants’ cases, which could be seen by the jury as isolated specific offences of fraud, when in fact the conspiracy is the crucial element””." I have taken some time to deal with those responses because I wanted noble Lords to have a flavour of what the Government received when they asked this very important question. If one looks to the future, what needs to be seen before one could be confident that one could responsibly repeal common law conspiracy to defraud? On page 103 of its report, the Law Commission, having referred in footnote 15 to certain practical considerations, stated that this issue is more appropriately dealt with in the context of its work on assisting and encouraging crime prevention generally rather than as a problem peculiar to fraud. In other words, it recognised that work is still to be done in relation to the element of participation before one can form a judgment. I referred to this at Second Reading. We need to know whether the multiple offending provisions in the Domestic Violence, Crime and Victims Act 2004 work. We do not know whether they will work. We hope that they will, but we do not know. We certainly do not know how the substantive offences introduced by the Fraud Bill will be interpreted by the courts. We do not know whether we will succeed in implementing Section 43 of the Criminal Justice Act and, if we do, what its consequence will be. We do not yet know what the impact of the Lord Chief Justice’s protocol on managing heavy fraud cases is going to be. We do not know any of the changes that might follow the Law Commission’s forthcoming report on participation in crimes. There is a lot to be done before the backdrop would be settled. The Government’s clear view is that, without being certain about those matters, it would be irresponsible to abolish the common law conspiracy to defraud, particularly in the light of the strong and well reasoned arguments put forward by so many well placed respondents. Our approach would be to reassess the position once there has been an opportunity to consider the operation of the new fraud offences in light of the changing backdrop. I shall ensure that the continuing need for the retention of the common law offence is addressed in the Home Office review of the operation of the Fraud Act, and the Government commit to review the operation of the Act three years after its implementation. That is to be found in the regulatory impact assessment. So there is a commitment already to look at that—and a very good reason why one could not be in a position to deal with it now. I need to respond to some points that have been made. The noble and learned Lord, Lord Lloyd, attached importance to the weight that he believed was in favour of abolition. I have sought to respond to that by pointing out the weight that was thrown against abolition in the consultation. The noble Lord, Lord Kingsland, asked me about the statistics in the letter that I wrote. I cannot break them down any further than they are at the moment; my interpretation is that there were 14,000 or so defendants, of whom only just over 1,000 were proceeded against for common law conspiracy to defraud. I do not read from that that the others could have been proceeded against in that way; I interpret it as meaning that generally they were crimes of fraud. I have a little difficulty following the noble Lord’s mathematics, and that may be my fault, but it is a small proportion and there is no reason to believe that it will grow. If anything, there is every reason to believe that it may dwindle if the substantive offences work as they are intended to.