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On 1 September 2016, the Thomson Reuters Legal Debate Series will contest the motion that the judiciary, not just parliament, must address breached election promises. This is an interesting motion with a number of sub-questions, primarily the extent to which promises and commitments made during the course of an election campaign can be enforced, and how far those who make the commitments can be held accountable. Continue reading

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Join leading minds from the law and politics on 1 September for an intelligent debate on electoral law and accountability in campaigning

Arguing FOR the motion:

Rt Hon David Lammy MP, Member of Parliament for Tottenham
Robert Palmer, Barrister, Monckton Chambers

Arguing AGAINST the motion:

Polly Toynbee, Journalist, Guardian
Dan Neidle, Partner, Clifford Chance

Chaired by:

Axel Threlfall, Editor at Large, Reuters Continue reading

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Lawyers understand the role that the private sector can play in the fight against slavery. The Modern Slavery Act 2015 contains a provision requiring large companies to disclose action they are taking to ensure their UK and global supply chains are slavery free. For more information see Legal update, Modern Slavery (Transparency in Supply Chains) Bill 2016 first reading in House of Lords. 

This collaboration between the private sector and enforcement agencies is replicated in the approach to tackling cybercrime and indicates a shift in the way serious offences are investigated. On 6 July 2016 the European Commission published the Directive on security of network and information systems. The Directive will enter into force this month. Member States will have 21 months to transpose the Directive into their national laws and 6 months more to identify operators of essential services. The National Crime Agency  (NCA) published a Cyber Crime Assessment for 2016. Both this and the directive call for a collaborative approach between business and law enforcement to tackle cyber crime. For more information see Blog: A focus on cybercrime.

The NCA is to lead, support and coordinate the law enforcement response to modern slavery and works in collaboration with other authorities. The Gangmasters Licensing Authority (GLA) (soon to be the GLAA) investigates labour exploitation in the UK, working in collaboration with other agencies, such as HM Revenue and Customs on National Minimum Wage enforcement, and is responsible for regulating the activities of gangmasters in the agriculture, horticulture, shellfish gathering, food and drink processing and packaging sectors.

What may not be clear is the crucial role played by NGOs and civil society organisations.

The Prime Minister, Theresa May emphasised the dependence on NGO’s and Civil Society organisations in tackling slavery.

“Working with a wide-range of partners, we must step up the fight against modern slavery in this country, and internationally, to put an end to the misery suffered by innocent people around the world. “

Civil society organisations and charities dedicated to ensuring victims receive the support and help they need have an essential role to play. Success in tackling modern slavery depends upon improving the way in which public authorities work with their NGO partners.

This was echoed by Kevin Hyland OBE, Independent Anti-Slavery Commissioner, in his strategic report :

“Effective partnerships between statutory agencies, civil society organisations and the private sector are an essential factor in implementing a comprehensive response to modern slavery within and beyond UK borders. Combating modern slavery requires the expertise, resources and efforts of many different individuals and entities, and the role of civil society organisations in particular is crucial.”

His priorities as set out are:

  • Victim Identification & Care: To drive improved identification of victims of modern slavery and enhanced levels of immediate and sustained support for victims and survivors across the UK .
  • Private Sector Engagement: To engage with the private sector to promote policies to ensure that supply chains are free from slavery and to encourage effectual transparency reporting .
  • Partnerships: To identify, promote and facilitate best practice in partnership working, and to encourage improved data sharing and high quality research into key issues.
  • International collaboration: To encourage effective and targeted international collaboration to combat modern slavery .
  • Law Enforcement Evaluation: To promote an improved law enforcement and criminal justice response across the UK, to support development and adoption of effective training, and to increase awareness of modern slavery across relevant statutory agencies.

The strategy for tackling slavery set out in the Modern Slavery Act 2015 policy and statement has 4 strands:

  • Pursue: Prosecuting and disrupting individuals and groups responsible for modern slavery.
  • Prevent: Preventing people from engaging in modern slavery.
  • Prepare: Reducing the harm caused by modern slavery through improved victim identification and enhanced support and protection for victims.
  • Protect: Strengthening safeguards against modern slavery.

This policy emphasises the necessity for forces to use structures to support close working with NGOs. The role of protecting victims is identified as a job for civil society organisations.

Evidence from around the world also makes clear that without effective support for victims it is very difficult to increase the number of prosecutions. Victims must be made to feel safe and confident enough to come forward and share their accounts. Evidence suggests that unless appropriate support is provided to victims, together with a parallel investigation into the crime, vulnerable people will not receive justice, offences will go unpunished and offenders will continue to view modern slavery as a low risk and high profit crime. At present, the burden of supporting these victims falls largely on charities.

Practical Law Morag Rea
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The House of Commons Home Affairs Committee has published a report on money laundering and the proceeds of crime. The report is brutal, making it clear the systems in place are not fit for purpose and radical reform is needed.

The report made the following observations and recommendations: Continue reading

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A focus on cybercrime

Two significant cybercrime developments occurred this week. On 6 July 2016 the European Commission published the Directive on security of network and information systems. The Directive will enter into force in August 2016. Member States will have 21 months to transpose the Directive into their national laws and 6 months more to identify operators of essential services. The following day the National Crime Agency published a Cyber Crime Assessment for 2016. Both call for a collaborative approach between business and law enforcement to tackle cyber crime. Continue reading

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Just a few days have passed since the news of the outcome of the referendum on the UK’s membership of the EU. The immediate political and economic effects are both significant and well documented, becoming one of the few topics of conversation at the current time. There is also a great deal of uncertainty while we wait for decisions to be made on political leadership and the timing and process for exit, and for the eventual exit plan itself to be negotiated.

Companies and their advisers will be reviewing what areas of their businesses are subject to EU law and to what extent UK and EU laws are set to diverge. In this context, it is helpful to consider how far EU law affects business crime, and what might change. Continue reading

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On 11 February 2016 the Sentencing Council issued new draft guidelines concerning the reduction that should be applied to a sentence after a guilty plea. The new guideline is broadly designed to provide an incentive to defendants who are going to plead guilty to do so as early as possible in the court process, without creating any unfair pressure on innocent people to plead guilty. Early pleas of guilty are of course of considerable benefit to investigatory and prosecution authorities.

The new guidelines are designed to replace the existing guidance first published in July 2007 (For more information on the current position, see Practice note, Sentencing in the Crown Court). The draft guidelines propose three broad changes to the existing system:

  • The point at which an offender can benefit from the maximum (one-third) reduction will be more tightly defined. To qualify, they must plead guilty at the first stage of proceedings, defined as the first time they are asked for their plea in court. In contrast, the existing guideline requires the offender to plead guilty at the first reasonable opportunity, which is open to judicial interpretation and provides greater flexibility.
  • For offenders who plead guilty after that first stage, the maximum reduction they can be given will be one-fifth, rather than one-quarter as under the current guideline. Offenders who plead guilty later will consequently serve longer sentences than those who plead guilty at an early stage.
  • The draft guideline proposes that the maximum reduction in sentence for a guilty plea should be applied regardless of the strength of the prosecution case. This is a departure from the current guideline, which states that the full reduction may not be appropriate if the prosecution’s case is overwhelming.

The draft guidelines set down two exceptions to the general rule:

  • Where a defendant admits what they have done, but needs either legal advice or access to evidence to determine whether a criminal offence has been committed.
  • Circumstances where the initial details of the prosecution case have not been served before the first hearing in either-way and indictable only cases.

A number of responses to the consultation were received. The London Criminal Courts Solicitor’s Association (LCCSA) raised concerns about the difficulties caused by either late or incomplete service of materials by the CPS, making it impossible to adequately advise a client on their plea, and risking an adverse effect. The LCCSA deemed the comment “the defendant must know whether he has done it” inappropriate, as it overlooks both the role of solicitors in advising clients and that it is for the prosecution to prove their case.

Similarly, although accepting the benefits of greater certainty and consistency, the Law Society recognised the need for flexibility to accommodate circumstances where prosecution material has not been presented in a timely manner.

The House of Commons Justice Committee has published a session report on the consultation, broadly supportive of the proposals, but raising concerns on the impact on the prison system and the pressures that might be applied to individuals to plead guilty. Importantly for business crime practitioners, the committee proposed a third exception to the general rule, in respect of corporate defendants who may need to conduct detailed investigations before deciding how to plead. For more information on the session report, see Legal update, House of Commons Justice Committee publishes session report on reduction in sentence for a guilty plea guideline

The guidelines are designed to deal with the very difficult balance of trying to provide an incentive for individuals who are guilty to enter a guilty plea at the earliest opportunity, with the need to prevent those who are not guilty feeling pressured to enter a plea. This is an obvious problem for “US-style” sentencing, where the difference between a plea and being found guilty can be measured in multiples.

There must be a concern that the removal of a discount, or significant discount late in the proceedings will ultimately lead to fewer people pleading guilty, after reaching the point in proceedings where there is nothing to be gained. In such circumstances, the use of Newton hearings are likely to be more important. For more information see Practice note, Newton hearings.

It is also vital that nothing in the guidelines should in any way “pressure” a defendant into pleading guilty, which would be a clear breach of an individual’s rights under article 6 of the ECHR. The best way of dealing with this is to extend the second option to all cases, permitting any individual charged to seek legal advice before entering a plea if they have been unable to do so before the first stage of proceedings, and to ensure it is properly enforced by the courts. This does of course raise the long standing issue of Crown Prosecution Service resources and funding.

A most welcome aspect will be the removal of the notion of “overwhelming” when considering the strength of the prosecution case. This is a very subjective term and is almost indeterminable in business crime cases.

The new draft guidelines should therefore be given a cautious welcome, but the overriding priority must be to ensure justice is done, rather than expediency. Steps must be taken to ensure that all those charged with criminal offences are not penalised before they are in a position to enter a properly informed plea.

 

Practical Law David Bacon
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The Serious Fraud Office has been in the news this week after the publication of the HM Crown Prosecution Service Inspectorate’s recent report, Inspection of the SFO’s governance arrangements. The report is considered in detail at Legal update, HMCPSI publishes Inspection of the Serious Fraud Office governance arrangements report.

The headline of the report focuses on the perennial problem of funding, that the SFO is over-reliant on “blockbuster” funding, allocated on a case by case basis, rather than regular funding to be spent as the senior management see appropriate.

A more interesting comment emerged in the middle of the document:

“During our inspection it was proposed that the SFO calculate its conviction rate per case rather than per defendant”.

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The first reading of the Modern Slavery (Transparency in Supply Chains) Bill 2016 took place on 23 May 2016 in the House of Lords. The Bill requires commercial organisations and public bodies to include a statement on slavery and human trafficking in their annual report and accounts. For more information see Legal update, Modern Slavery (Transparency in Supply Chains) Bill 2016 first reading in House of Lords.

This is in addition to the requirements of Companies Act 2006 (Breach of the requirement to make a human rights disclosure under section 414C(7) Companies Act 2006 is a criminal offence ) and the EU Non-Financial Reporting Directive 2014.

Domestic legislation is shifting towards public reporting, in step with global changes. In the US for example, California Transparency in Supply Chains Act (TISCA) is in force and Congress is currently considering the Business Supply Chain Transparency on Trafficking and Slavery Act (2015), a bill amending the Securities Exchange Act of 1934.

Continue reading