Demand for crackdown on crime's Mr Bigs who owe £920m

 
Debt to society: by last year fraudster Gerald Smith had repaid just £1.3 million of £41 million
6 January 2014
WEST END FINAL

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A “root and branch” overhaul of the way that criminal “Mr Bigs” are punished has been demanded after an official report warned of major flaws in the system for seizing their illegal profits.

London MP Sadiq Khan, the shadow justice secretary, said that urgent reforms were needed to eliminate the “incompetence” that allows serious offenders to enjoy the “financial fruits” of their crimes.

His call follows a report from the Governnment’s spending watchdog, the National Audit Office, warning that more than 80 per cent of the money owed by convicted millionaire criminals has yet to be repaid — even though some were first ordered to hand back the money as long ago as 1987.

The report — which examines the effectiveness of confiscation orders imposed on criminals by the courts —puts the total owed by millionaire convicts at more than £920 million. Nearly £500 million more is owed by other offenders.

It says that a key reason for the failure to recoup the cash is that sanctions for non-payment “do not work”, with offenders who have large outstanding debts still given early release from prison.

It also blames a lack of expertise among law enforcement staff, poor computer systems and the failure to apply swift “restraint orders” to stop criminals disposing of their assets.

The watchdog says the Home Office should respond by introducing tougher powers. It warns that a minimum of nearly £500 million out of the £1.4 billion still owed by offenders given confiscation orders will never be “collectable” — despite more than £100 million being spent each year on enforcement.

Mr Khan, the MP for Tooting and the shadow minister for London, said it was “simply wrong” that criminals were “getting away with not paying the full price for their crimes” and called for widespread reforms.

He added: “The Government needs to act swiftly, and order a root-and-branch review across key departments and agencies involved.

“Unless they get a grip, criminals will continue to live off the financial fruits of their illegal actions.”

Mr Khan’s warning follows a series of disclosures by the Evening Standard about the way in which many of Britain’s most serious criminals are failing to pay back their illicit gains.

The biggest debtors include fraudster Gerald Smith, who bought a £3 million house overlooking Wentworth golf course, another home in Jersey, a yacht and an art collection as he funded an extravagant lifestyle through a dotcom swindle.

Smith was ordered to repay almost £41 million after being convicted at Blackfriars crown court in 2006, but was revealed in a Freedom of Information response last year to have handed over less than £1.3 million, taking his debt to £54.1 million.

Home Secretary Theresa May has promised to introduce longer “default” sentences for non-payers and other changes as part of a new organised crime strategy.

No further details have been revealed so far but the Home Office said it was working “to further strengthen our response” and was already achieving better results against organised crime masterminds.

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