The unbalancing act

The UK’s extradition laws are designed to fight terrorism. But the cases of the ‘NatWest Three’ and Ian Norris have highlighted how these laws are being used against white-collar criminals.

On 21 February this year, three former National Westminster Bank (NatWest) bankers lost their High Court appeal against their extradition to the US on fraud charges.

The ‘NatWest Three’ are among 44 individuals who have faced extradition to the US during the past two years. Half of them have been sent across the Atlantic to be tried on criminal charges, while others are still waiting to hear if they will suffer the same fate.

But there is a rising tide of anger in the UK over the way that the Government handles extradition requests from the US and the fact that laws designed to combat terrorism are being used against businesses.

As several prominent cases head for the House of Lords, what is being done to change a situation that many see as unfair and biased against UK citizens?

Following the tragic events in New York and Washington DC on 11 September 2001, the world’s attention was drawn to a new threat of global terrorism. In the wake of the 9/11 attacks, the UK introduced new extradition legislation and, in January 2004, the Extradition Act 2003 came into force. The act divided the world into two halves: ‘Part 1’ territories, including European countries, and ‘Part 2’ nations, including the US, Albania, Turkey and Russia.

Under the terms of the act, Part 2 countries do not have to produce evidence of the alleged crime before an extradition request is granted by the Home Secretary. The UK’s relations with the US are also governed by a 2003 treaty – or ought to be. The UK has ratified the treaty, but the US has not yet signed up to it. This means that if the UK wants to extradite someone from the US, a prosecutor must produce proof of the crime, but not the other way around.

This state of affairs has caused much controversy, with claims that suspects’ human rights are being breached. But concerns go deeper than that. Extradition is increasingly becoming a tool used to combat white-collar crime as well as terrorism, murder and the like – and the business community in the UK is not happy.

Mark Harding, general counsel for banking giant Barclays and chairman of the GC100 group, which represents legal heads of FTSE100 companies, told the Financial Times in February: “Fifty per cent of the uses of [the Extradition Treaty] have been for alleged white-collar crime, which I don’t think anybody expected.

“We do believe that the current law goes too far in terms of allowing extradition without the establishment of a prima facie case, especially when the whole offence is committed here [in the UK].”

Alistair Graham, London head of litigation at US firm White & Case, is acting for retired businessman Ian Norris, who is also fighting his extradition from the UK. Graham says: “The US is seeking to stretch its tentacles across the globe even when there’s only a slight connection with the US. There’s a lot of macho talk coming out of the Department of Justice about policing the world.”

Any large UK corporate has some sort of link with the US, whether through subsidiaries or joint venture partners. This exposes employees, executives or partners to the risk of prosecution for crimes that may have only a small connection with the US.

Graham says the use of the Extradition Act to fight white-collar crime was not entirely unexpected. “When it was going through Parliament, some clever people stood up and said it would apply to financial crime,” he explains.

The Government, however, disagreed. Spokesperson Caroline Flint MP told a Commons debate on the Extradition Bill in December 2003: “We do not have such a range of offences involving financial crime. The cases mentioned by the Financial Times – such as price-fixing – would not apply. Dual criminality would have to exist.”

Flint’s words proved scant comfort for Norris, who was arrested in early 2005 after the US requested his extradition on price-fixing charges. Like the NatWest Three, Norris has appealed the Home Secretary’s agreement to have him extradited. Norris has also recently lost his appeal, but the High Court judgment of Lord Justice Judge, president of the Queen’s Bench Division, gave some cause for optimism.

Judge LJ agreed with the argument submitted by Alun Jones QC on behalf of Norris that there is a “lack of symmetry” in the way the US and the UK treat extradition requests. But the judge also said that the order to extradite Norris had been made in accordance with correctly implemented legislation.

Graham and his associate Liz Clay have joined forces with the Conservative Party to propose amendments to the Extradition Act. The Tory MP for Henley-on-Thames, Boris Johnson, spoke out against the current legislation in Parliament on 6 March, denouncing the way the NatWest Three were being “electromagnetically sucked – hoovered, even” to the US.

The Conservatives want to amend the act so that alleged offences committed partly in the UK are tried here. The campaign has some powerful supporters, including Sir Digby Jones, the director-general of employers’ association the Confederation of British Industry. Earlier this year Jones was widely quoted in the national press pouring scorn on the legislation and sympathising with Norris’s plight.

“This is totally unacceptable,” he said. “It might be acceptable for the bloke who wraps semtex around his body, but not for a 62-year-old executive with prostate cancer.

“The process of justice is being abused. The US is being an ignorant bully. This is just wrong.”

Critics of the act say it needs to be amended now, and also that the US needs to ratify the treaty as soon as possible. In 1972, when the last Extradition Treaty was signed, it took four years to be ratified by the US. They stress that the aim is to make sure that those accused of a crime are tried for it in the appropriate jurisdiction, not to evade justice. It is clear that white-collar crime will continue to be affected by extradition requests.

As extradition specialist Steven Powles of Doughty Street Chambers explains: “White-collar crime is by its very nature in many cases international, so it will give rise to a growing number of extradition requests as the international community becomes more resolute in combating it.”

For the moment, appellants such as Norris and the NatWest Three will have to await decisions of the House of Lords concerning their cases before their futures are certain.

“I’ve every confidence that the House of Lords will see the inequities in the present system,” says Graham confidently. In the meantime, he says, the stress is painful for his client. “The last thing he wants to be doing,” emphasises Graham, “is to be fighting for his freedom.”

Norris and the NatWest Three

Bermingham & Ors v The Government of the United States and the Secretary of State for the Home Department

Jeffrey Green Russell partner Mark Spragg is representing David Bermingham, Gary Mulgrew and Giles Darby in their fight against extradition to the US. The three former NatWest bankers are accused of conspiracy to defraud over the sale of part of US energy giant Enron, which collapsed sensationally in 2001.

In 2004, a district judge sitting at Bow Street Magistrates’ Court agreed to the group’s extradition, and in early 2005 the Home Secretary granted the extradition order. In 2005, Lord Justice Laws and Mr Justice Ousley heard their appeal to the High Court, in which they attempted to have the extradition request overturned and also sought judicial review of the Serious Fraud Office’s decision not to investigate the case.

Laws LJ and Ousley J dismissed the appeal on 21 February 2006. The NatWest Three will now be appealing to the House of Lords in a last effort to remain in the UK.

The Queen on the application of Ian Norris v The Secretary of State for the Home Department

White & Case’s London litigation head Alistair Graham is representing the former chief executive of industrial giant Morgan Crucible, accused by the US of price-fixing offences. Ian Norris was charged in early 2005 and his case was heard at Bow Street later that year. In October 2005 the Home Secretary agreed to the extradition.

Norris’s appeal was heard by Mr Justice Judge and Mr Justice Cresswell in January 2006. The court upheld the extradition order, but noted the “lack of symmetry” between the US and UK when it came to extradition.

Like the NatWest Three, Norris is also appealing to the House of Lords.

Extradition Legislation

1870 Extradition Act

The 1870 Extradition Act provided protection for UK citizens whose extradition had been requested by a foreign state. There was a defined list of ‘extraditable crimes’, and if the crime could be tried here then the accused would be tried here.1972 Treaty

1972 Treaty
In 1972, the US and UK signed a treaty which is widely seen as a ‘halfway house’ between the 1870 act and current legislation. It took four years for the US to ratify the treaty and five for it to come into force. The treaty requires sufficient evidence to be presented by the requesting nation of the alleged crime before the extradition request is granted.2003 UK-US Treaty

2003 UK-US Treaty
The 2003 treaty between the UK and US places different requirements on the two countries. The UK must supply proof of ‘probable cause’ to suspect that the accused has committed the crime for which they should be extradited. The US does not have to supply any evidence. The UK signed the treaty in early 2003, but it has not yet been signed by the US. Currently there appear to be no plans in Washington DC to ratify the treaty. Critics say this means the 1972 treaty is still in force.2003 Extradition Act

2003 Extradition Act
On 1 January 2004, the Extradition Act 2003 came into force, effectively ratifying the clauses of the 2003 treaty between the UK and the US, as well as designating states into two groups. In ‘Part 1’ territories, which includes Europe, there is a guarantee that nobody will be extradited from the UK for conduct committed in the UK that does not break UK law. ‘Part 2’ countries, which includes the US, do not have this guarantee.