The target of US / UK extradition policies? It's the white collar criminals stupid!

A nagging question for all UK businesses has been how the the lopsided extradition treaty between the USA and the UK, signed in secret back in 2003 by David Blunkett, would be used.

For those not familiar with the issues, it is that the US don't have to produce a prima facia case to achieve extradition of a British subject, whereas the Brits have to produce evidence for a US court to consider extradition of one of its citizens to the UK. Secondly, British subjects can be extradited for committing crimes that are not even unlawful in their own country. For example, type Brian Howes into Google to follow an example of this risk or Ian Norris formerly of Morgan Crucible. Finally, of course, the trifling matter that the treaty has not been ratified / enacted by the Americans.

When the obvious disparity and unfairness of such a system was pointed out to the Labour Government / Labour Parliamentary Party and the Home Office, the justification was given that it would be used on terrorists who needed to be extradited to the US.

Anyway such obvious inequalities were not going to stop a Labour dominated House of Commons ramming the legislation through in order to appease one Mr Tony Blair, especially the light of the then recent horror of 9/11.

So from 1st January 2004, all UK businesses and individuals that use US$ and or deal with countries or persons are subject to the US sanctions regime (subtly different from the UK sanctions regime) are open to extradition to the US without any legal protection from the UK Courts or Parliament. Oh and just make sure that none of those tricksy business people stood a chance, legal aid for this type of case was also withdrawn!

However the issue has refused to go away. The Ian Norris case is still going through the courts with some coverage in the media, with possible resolution early in August 2009.


However, four things have happened this week should act as a warning to all those theoretically at risk from this appallingly drafted piece of legislation.


1. The Daily Telegraph used the Freedom of Information Act on the City of London police show and, low and behold, that there are currently 18 people living in Britain who have been arrested and are waiting to be extradited. 11 of them are being pursued by the Department of Justice for white collar crimes. The other 7 are wanted for crimes including rape, murder and sexual assault. Here is the link: http://www.telegraph.co.uk/news/worldnews/northamerica/usa/5941204/Nearly-a-dozen-people-accused-of-white-collar-crimes-living-in-Britain-waiting-to-be-extradited.html
2. A Liberal Democrat report was picked up by the press (Daily Telegraph 28 July 2009) which stated that 89% of US Extradition requests have been agreed by UK judges vs. 70% by their US counterparts. Additionally, 56 people have been extradited from Britain to America whereas the figure for those sent from America to Britain was just 26 since 2004: http://www.telegraph.co.uk/news/newstopics/politics/lawandorder/5919576/British-judges-agree-to-more-extraditions-than-US-counterparts.html
3. Then the British Parliamentary Labour Party appeared to put party loyalty before conscience and voted down an opposition motion that attempted to review the treaty. Although 74 Labour MPs had signed motions in support of Gary McKinnon only 10 Labour MPs voted against the Government and the attempted review was defeated. Labour MP Andrew MacKinlay was quoted as saying "I was really frustrated by the vote last week. Many of my colleagues had expressed their sympathy for Gary McKinnon. But when the crunch came, they just went tribal and followed the diktats of the party."
http://www.telegraph.co.uk/news/newstopics/politics/5903494/Andrew-MacKinlay-MP-quits-over-hacker-Gary-McKinnons-extradition.html
4. Finally, Gary McKinnon’s extradition entered its end game. It started badly with him losing his High Court Extradition Case. http://www.telegraph.co.uk/news/worldnews/northamerica/usa/5946267/Gary-McKinnon-British-hacker-to-be-extradited.html

In my view, none of this is does not bodes well for UK based AML regulated businesses. The US Department of Justice is vigorously using its new weapon against UK citizens, the governing Labour MPs seem interest only in following orders and collecting as many pay checks as they can between now and their oblivion at the next General Election and the UK Judges will continue to interpret the law against the interest of British Subjects.

So far the number of people caught by this legislation remains small. Yet the impact on an individual of being subject to this process can be devastating.

Oh and the number of terrorists deported to the US since the Treaty was enacted? One!


I am sure that we will return to this subject in due course. In the meantime, watch this space.

Tipping Point?

One Saturday last year I was dropping the offspring off at school on what turned out to be a chilly bright English September morning. Having safely achieved the designated task I started back toward the horseless carriage when my flappy ear’s pick the following statement broadcast in clear across the rapidly emptying playground “What exactly made you report this suspicious transaction report (STR) to the authorities?”

Now I spend a good part of my life helping regulated professionals understand their personal obligations under international Anti-Money Laundering Laws and regulations, particularly Section 333a (as amended) the Proceeds of Crime Act, i.e. "tipping off" and section 342 "prejudicing an investigation".

I am also sure that I spend a fair amount of my time telling people to avoid “tipping off” suspects that they are the subject of an Suspicious Activity Report or SAR by keeping details of their activity restricted to the least number of authorised people possible. So discussing your SAR activity in a public playground does appear, at least to me, something of a high risk activity. But it did get me too thinking about what it is people take away from their AML training? Is it always the message that we think it is? Or do people just go through the motions?

One lesson you might take from today’s playground event “careless talk could cost you your reputation/childhood/life/freedom for 2 years.” [Please delete as appropriate]

Point made?

TTFN

Is all cash over £ 1,000 now dirty in the UK?

I've been doing a lot of Anti-Money Laundering (AML) work with accountancy service providers recently in the UK.

As a result I've joined a number of accounting fora in order to improve my understanding my client key concerns. So far so good.


Then the other day I responded to an initial thread about a bankrupt asking for a payment in cash. Before I knew it, I was contributing to the post and I came up with a rather unpleasant thought. I've posted an edited version of my post below. I'd welcome your thoughts.

Police can stop someone with £1000 (or equivalent in cash), police can almost automatically confiscate because:

1. It meets their targets for asset recovery (if set).



2. No "ordinary person" carries that much money around, ergo you must be up to something (therefore the officer could be said to be disrupting unidentified criminal activity).



3. You can always get it back from the Magistrate's (at your expense).
   

Its a no lose situation for the police and almost completely irrelevant to dealing with those who have got £500,000 stuffed in their car/spare tyre and no plausible explanation.

Of course, if you then link this power in with research demonstrating that all cash notes (90% +) are contaminated by illegal drugs then the cops can argue, on the balance of probabilities that this cash is iffy.

Should you be rash enough to film what the police are doing on your mobile phone they will detain you under the 2008 Counter Terrorism Act (see link: http://news.bbc.co.uk/1/hi/england/london/8163428.stm )! How interesting that the UK Governments mantra of "If you have nothing to hide, you have nothing to fear" does not seem to apply to uniformed officers, going about their business in public places!

I am beginning to wander if, in short, the government and the police get to ban cash without having to submit your plans to anything like that pesky Parliamentary scrutiny.

Of course if you really want to help illegal cash transactions / cross border money laundering then you increase the maximum value of your notes to say something like €500. Doh!

So what starts as a perfectly reasonable attempt to seize the proceeds of crime can (has?) becomes a shortcut for the police doing what they want when they want with no effective oversight.

My concern, as an AML specialist, is that police forces may try and police (arrest) the easy to catch low hanging fruit of any criminal activity, whilst using anti-terrorist legislation to curtail legitimate oversight and questioning as to what they are doing and why.

For those in the regulated AML sector, in short its much easier to nick an established businessman or woman who has made a mistake in trying to apply complex AML law and regulation than to send an officer to Bogota!

I'd welcome your thoughts/ feedback as I am off to take an anti-paranoia pill.