Fraud Bill [HL]

My Lords, I spoke on this matter, at inordinate length, during the Second Reading debate on 22 June 2005 and in Committee on 19 July 2005. As your Lordships are aware, under the offence of conspiracy to defraud, it can be a criminal offence for two people to agree to do something that would otherwise be lawful. That poses the following problem to our legal system. The jury’s decision on dishonesty determines whether a particular set of facts is a crime. In more technical language, the decision on the mens rea of a crime in a court determines the constitution of the actus reus of a crime, so an activity can be made fraudulent simply because of the jury’s decision on dishonesty. The consequence of this is that it delegates to the jury the responsibility for defining what activity is fraudulent, and that is really the task of Parliament and not the jury. It also enables the prosecutor to prosecute in a criminal court for an activity which the prosecutor thinks ought to be a crime but is not defined as a crime on the statute book. It is because of this underlying defect—I would say a constitutional defect—in the definition of conspiracy to defraud that the Law Commission in its latest report stated, unequivocally, that the offence ought to be abolished. It also established—in my view, beyond peradventure—that the new definition of fraud is so comprehensive that it covers all the circumstances in which, previously, the offence of conspiracy to defraud had been deployed. There are, however, circumstances that the new offence might not cover, and the example given by the noble Lord, Lord Goodhart, is one of the more important ones. I submit, however, that if the Government want to make the offence raised by the noble Lord, Lord Goodhart, an offence in criminal law—which they ultimately did, in 1998—they should do so in terms and not retain an ill-defined discretion to pick and choose what particular set of facts will be a crime in particular circumstances. In principle, I would be for following the recommendation from the Law Commission today. However, I recognise—as did the noble Lord, Lord Goodhart—that a number of authoritative bodies have suggested that there may yet be a role for the offence of conspiracy to defraud. I have said, both openly and in private to the noble and learned Lord, Lord Goldsmith, that I have been particularly influenced by the views of the committee chaired by Lord Justice Rose—the finest criminal judge in the country. Therefore, the proposal made in the amendments gets the balance right. Let us see what happens—and whether there is still a need for the offence—then review the whole matter in three years’ time. I hope that the noble and learned Lord the Attorney-General will respond constructively to the debate that has just taken place, as I would not want the Government and the Opposition to be confrontational on all this. In my submission, the offence ought not to be on the statute book. If the Attorney-General still doubts that—since he is not only leader of the criminal Bar, but the Government’s adviser on all these matters—then his views should be given real weight. Yet the Law Commission has looked into it in intimate detail and its view should equally be given great weight. In my view, it should prevail after a period of three years.