Serious Crime Bill [Lords]

In his report, ““Regulatory Justice: Making Sanctions Effective””, Professor McCrory advocated that"““regulatory sanctions were consistent with, and appropriate for, a risk based approach to regulation, as set out in recommendation eight of the Hampton Review. The Hampton Review recommended that the penalty regime should be based on the risk of re-offending and the impact of the offence…with tougher penalties for rogue businesses that persistently break the rules.””" There is a significant read-across between the approach that he advocates and the innovative and targeted approach to involvement in serious crime that we are proposing in the amendments. We have already discussed the fact that businesses are increasingly used by serious criminals as the means by which they, for example, launder money or attempt to disguise activities such as people-trafficking or drug-trafficking. Businesses can be in more than one place at a time, they can have complicated legal structures and they can carry out exceedingly complex business and large amounts of transactions on a daily basis. All those things make them very difficult to interdict for their involvement or use in serious criminal enterprises. The Serious Organised Crime Agency, the Serious Fraud Office, Her Majesty's Revenue and Customs and the rest of the law enforcement community are constantly developing and using innovative approaches to dealing with this problem. They are having significant successes and should be commended. However, the inexhaustible potential for using businesses in different ways to further serious criminal ends means that that work is not always enough. The amendments will mean that, for example, where a business has been proved to be involved in serious crime, an order can require it to provide its accounts or other information to an authorised monitor, to ensure that it complies with a requirement not to conduct its business in a particular way. That will be effective where the information is particularly complex and where someone such as a forensic accountant will be able to make a far better assessment than a law enforcement agency of the way in which the business is conducting itself. If the court authorises a law enforcement agency to employ a monitor, it can go on to provide, as a term of the order, that the organisation that is the subject of the order must pay the costs that the law enforcement agency incurs in employing the authorised monitor. That effectively increases the regulatory burden on a business because it has been proved to be involved in serious crime. The provisions target regulation in a risk-based manner, and mean that burdensome regulatory approaches do not have to be taken to deal with the few bad apples in any business area. Regulation does impose a cost on business, but we can all agree that this is better than the results of no regulation at all.