Extracts from Committee stage (Commons) of the Economic Crime and Corporate Transparency Bill - Nov 3
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Economic Crime and Corporate Transparency Bill Clause 32
Disqualification of persons designated under sanctions legislation:
GB 11.30am The Parliamentary Under-Secretary of State for Business,
Energy and Industrial Strategy (Kevin Hollinrake) I beg to move
amendment 1, in clause 32, page 22, leave out lines 8 to 12 and
insert— “(1) This section applies in relation to a person who has,
at any time on or after the day on which section 32(2) of
the...Request free trial
Economic Crime and
Corporate Transparency Bill Dame Margaret Hodge (Barking) (Lab):...All the amendment would do—it is very simple—is put a duty on Companies House to tell the enforcement authority, whether that is the Foreign, Commonwealth and Development Office, the Office of Financial Sanctions Implementation, the National Crime Agency or whoever, about any changes that may have occurred in the accounts held by Companies House of individuals who have been sanctioned and whose assets have been frozen in the three months prior to those sanctions being put in place. That is crucial, but why? ...The seriousness with which the authorities take this issue was demonstrated in July, when the National Crime Agency arrested 10 or 12 individuals—my research is a bit unclear—suspected of enabling corrupt elites. My understanding is that they were accountants, company service providers, lawyers and, indeed, auctioneers—a lot of those who are sanctioned undertake another little wheeze to secure money legally: they loan high-value artwork for fees far in excess of its value. I say again to the Minister that a failure to prevent offence might have prevented such activity.
The difficulties in the current regime are demonstrated by the
case of Petr Aven, who my right hon. Friend the Member for
Birmingham, Hodge Hill has mentioned. Aven—a Russian billionaire
worth £5.3 billion, including a £300 million art collection—was
sanctioned by the NCA. However, the
NCA did not know that OFSI had come to an
agreement with Aven that he could use part of his assets to meet
his so-called living standards. The manner in which he is
accustomed to existing means that, to fund his daily life, he is
getting something in the region of £600,000 a year cash from the
assets that are supposed to be frozen. There is real fear within
the NCA that he will get through most of the
frozen assets over time, leaving us with little to take away from
him... Seema Malhotra (Feltham and Heston) (Lab/Co-op):...I understand that the Minister may be wondering whether a huge scope of things have happened in the three months prior to a person becoming a designated person. Does he agree that proposed new section 11B(2) could be tighter so that where it says, “If the person changes”, it specifies changes to owners, directors or other information relating to the company on the register in the three months prior to the person becoming a designated person? There should be a way, through the design of the computer systems, which is being undertaken as part of the transformation in Companies House, for the registrar to trigger an automatic alert when somebody becomes a designated person to inform the Office of Financial Sanctions Implementation and the National Crime Agency that something had happened on the record in the previous three months. That would therefore not require a huge amount of resource and labour, but there would be a useful report and trigger if the Bill required the registrar to do that... ...I will just finish my point. Should the registrar be watching this debate and decide that an automatic alert is a good idea, does the Minister agree that the power of information sharing would enable the registrar to consult the Office of Financial Sanctions Implementation and the National Crime Agency should a relevant change have occurred in the previous three months? The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Kevin Hollinrake):...Some valid concerns have been expressed about company formation agents. I am happy to write to the National Crime Agency to ask what it has done about them. However, not all company service providers are company formation agents; there is a distinction. A company service provider may well be a large accountancy practice, such as Deloitte, PwC or KPMG. The hon. Member for Aberavon stated that such organisations know very little about their clients and offer a blanket service, but I do not think that is fair. My accountants can verify my ID and they know a great deal about me, I can promise the hon. Gentleman... ...The power in the Bill would facilitate such an agreement and remove the need for primary legislation to implement it. I draw Members’ attention to the wording already in the Bill, in proposed new section 1098I(2), introduced by clause 63. The UK would only become a party to an agreement if it could be assured that the regime was no less effective than its own. To be confident of that parity, the Secretary of State would need to establish that a regime was the equivalent of the UK’s by considering evidence and advice from a range of sources, including the National Crime Agency That would include the consideration for whether prospective authorised corporate service providers are disqualified under the relevant legislation... Economic Crime and Corporate Transparency Bill - seventh sitting Economic Crime and Corporate Transparency Bill - eighth sitting |