15 November 2004
20 June 2014
21 February 2014
M&A Weekly Update: fraud, bribery and money laundering sentencing guidelines; limited liability partners as workers; and more
2 June 2014
Choice of lawyer critical in health and safety investigations — further clarification now provided by the European court
12 June 2014
9 July 2014
The White Paper ‘One Step Ahead: A 21st Century Strategy to Defeat Organised Crime’ is a strange document. It announces the creation of the Serious Organised Crime Agency (Soca), which has been “tasked with defeating organised crime” and given commensurate powers, yet it seeks views on these apparently settled proposals. The proposed changes are highly relevant to commercial/white collar crime, since the definition of organised criminals is: “Those involved, normally working with others, in continuing serious criminal activities for substantial profit, whether based in the UK or elsewhere.” There is no discussion of whether this definition is unduly wide.
The creation of the Soca, unifying the National Crime Squad, the National Criminal Intelligence Service, the drug trafficking and related criminal asset recovery functions of Customs & Excise and the Immigration Service’s organised immigration crime work, seems a sensible consolidation. A cohesive national organisation with specialist independent prosecutors has the potential to engage in effective, intelligence-led detection and prevention of serious crime. It is disappointing, however, that there is no discussion at all as to the impact of the SOCA on existing agencies and police forces, nor of its accountability or independence.
Worryingly, many of the specific proposals concerning organised crime in the White Paper reflect the Government’s openly stated desire of shifting the balance of the criminal law away from defendants – apparently with the aim of securing more convictions by further eroding fundamental rights. As the Government sees it: “There has been a growing belief over recent years that the law has emerged in a way that has tilted the balance excessively towards the defence. No category of defendant is able to make better use of this than organised criminals, with access often to the best legal advice.”
The White Paper proposes that the compulsory questioning/production powers of the Serious Fraud Office (SFO), the Department of Trade and Industry (DTI), the Financial Services Authority (FSA), the Inland Revenue and the Office of Fair Trading (OFT) be enhanced and made generally available in organised crime cases. Lip service is paid to “rulings of the European Court of Human Rights [which] have established that evidence gained under compulsion may not be used in criminal proceedings against the individual who provided that evidence”. There is no analysis of the case law in the White Paper, which would have been especially welcome given, for example, the current unsatisfactory distinction relied upon where the “material has an existence independent of the will of the accused” (Saunders v UK (1996)). The Government’s intention is to use compulsory obtained evidence against co-defendants.
In October 2003, the Home Office consultation paper ‘Securing the Attendance of Witnesses in Court’ sought views on proposals to introduce a greater degree of compulsion in securing witnesses’ attendance at court. The combination of such changes would alter fundamentally the relationship between the state and the citizen (currently, cooperation with the authorities in the prevention and detection of crime is entirely voluntary). Moreover, there is no evidence of the need for more coercive powers to question suspects (or putative prosecution witnesses) outside the regulatory sphere. The rationale for compulsory questioning powers in regulated areas is that the suspect has chosen to operate within that area.
The White Paper rejects the possibility of introducing anti-racketeering legislation (such as the US Racketeer Influenced Corrupt Organizations (RICO)), but concludes that changes to the substantive law are required, because “existing conspiracy legislation may not always reach the real ‘Godfather’ figures, does not provide a practical means of addressing more peripheral involvement in serious crime and does not allow sentencing courts to assess the real seriousness of individual offences by taking into account the wider pattern of the accused’s criminal activities.” Vague but radical changes are suggested to the law of conspiracy and secondary liability: less focus on proving specific acts of commodity supply in organised crime; creating proscription offences for membership of an organised crime group; changing the link between conspiracy and specific predicate offences; relaxing the mens rea requirement for secondary party liability; and ways of admitting evidence of wider criminality to inform the sentence. A particular focus is a widening of secondary liability, where a defendant is aware that they are engaging in organised crime but are unaware of the precise nature of the criminality. There is no detailed justification advanced for a piecemeal relaxation of a fundamental principle of criminal law in one particular area of crime. There is no explanation of how the proposals would dovetail with the Home Office’s consultation proposals on fraud law reform, the Law Commission having previously recommended that the eight deception offences in the Theft Acts 1968-96 be repealed along with conspiracy to defraud, and replaced with two statutory offences of fraud and obtaining services dishonestly.
Perhaps most controversial is the suggested increased use of plea-bargaining and further encouragement of defendants to turn Queen’s evidence. Certainly, it is unclear why the proportion of defendants giving evidence for the prosecution in the UK is so much lower than in the US, for example. The White Paper suggests the primary reasons for a recent increased reluctance by defendants to cooperate with the police are juries’ suspicions of cooperating defendants’ motives and defendants’ perceived lack of incentives to cooperate. The White Paper claims that cooperation in UK courts used to be commonplace, although no evidence is offered to support this. The proposed use of statutory, binding cooperations agreements between prosecution and defendants, with greater sentencing transparency (including a power to refer the case back to the original judge where a convicted criminal provides material assistance after conviction, or a reduction in sentence discount if the testimony of the cooperating defendant is proved to be false or misleading) are worthy of detailed consideration, but there needs to be a much more careful review than that undertaken by the White Paper. There is no consideration of the increased possibility of miscarriages of justice associated with defendants who cooperate with the prosecution, and a comparison with the many recent successful appeals based on inadequate disclosure where participating informants were involved is notably absent. Plea-bargaining has associated risks – a defendant is under even greater pressure to plead guilty when an unsuccessful not-guilty plea will result in a necessarily harsher sentence than otherwise. The dividing line between encouragement and undue pressure is not as clear as the White Paper suggests. There is a real danger that culpability lines become predetermined by the prosecution rather than the jury and/or judge.
Finally, the White Paper singles out the defence tactics as an aggravating feature of organised crime: “Organised criminals become particularly adept at frustrating the trial process in their attempts to evade justice. Examples include the systematic use of the pre-trial process to seek to undermine prosecution evidence and ideally have it rendered inadmissible. Tactics here have included extensive voire dire hearings, challenging every aspect of the prosecution case, and looking for every reason to exclude prosecution evidence.” There is no evidence given to support these assertions. Even assuming there is, there are also examples of badly prepared prosecutions which collapse at great cost to the taxpayer when evidence is rightly ruled inadmissible. The suggestion appears to be that sentences should be heavier where there have been extensive but unsuccessful defence-instigated legal arguments. No doubt we could all think of appropriate sanctions against prolix lawyers who take unarguable points, but punishing their clients does not immediately spring to mind.
On the positive front, there is an evident willingness (despite the intelligence services’ opposition) to repeal the self-imposed ban on the admissibility of intercept material – a move supported by civil liberties groups, particularly given that the prohibition has been used partly to justify the detention without trial of foreign suspected terrorists.
The raft of proposals outlined in the White Paper would have far-reaching consequences for organised crime and serious implications for white collar crime. Some merit detailed consideration and it is therefore particularly disappointing that a more careful review was not undertaken in the White Paper and that no detailed justification is advanced for the need to substantially increase prosecution powers in one particular area of crime. The self-professed desire to tilt the balance away from defendants does not suggest that an objective assessment of the needs has been carried out. Should not a White Paper that is genuinely interested in views concerning the need for special prosecutorial powers to tackle organised crime be a Green Paper? Maybe the answer is in the question.