TODAY a damning warts and all picture is published of law enforcement within Customs and Excise. Judges, prosecution and defence lawyers and Whitehall staff from across law agencies in government were asked to give their views for an independent audit carried out by Fishburn Hedges, a communications consultancy. The findings show a consensus about the failings that have built up and permeated the service during the Eighties and Nineties: arrogant and insular management, a culture of secrecy and untrained staff lacking the legal knowledge to conduct a prosecution or prepare a case “with a view to a successful and procedurally watertight prosecution”.
It is the latest in a series of critical reports about Customs — which from April was merged into the new department of HM Customs and Revenue (HMCR). But the reports are the first to be commissioned and published by the department itself, in a move to restore its damaged reputation and demonstrate a new more open attitude.
Roy Clark, the new director of criminal investigation at HMCR, said: “The audit is a very brave but necessary thing. It marks a change of response from the historic Customs and Excise approach, to one of openness, accessibility, accountability.”
Unlike the police service, he said, one of the weaknesses in the way Customs has operated over the past 10 to 20 years was that it worked in isolation, without a customer base: “It has not been dealing with a crime in which there is an identifiable victim; it has operated in almost a secret silo.”
The police service had learnt — through such upheavals as those following the Scarman and Macpherson reports — that it had to operate within the community whose views on law enforcement might not be the same, he said. That lesson had to be taken on board by Customs.
It is Clark who has the task of ensuring that these lessons are learnt. His 2,300-strong criminal investigation branch is part of the total enforcement and compliance division of 31,500 people. Prosecution work has been hived off with the creation of the Revenue and Customs Prosecution Office. Coming from the police, where his 35-year career included chairing the Metropolitan Police anti-corruption group and his ultimate post as Deputy Assistant Commissioner, he see parallels between the problems endemic in the police two decades ago. “I think the phrase ‘noble cause corruption’ fits quite well. I’ve not seen the kind of corruption I saw in the police — people stealing money, stealing and recycling drugs . . . but there has been bending of the rules, failing to disclose the full facts of the case . . . prosecutors losing their way in the very complex legal and ethical problems of criminal investigation.”
Paradoxically, one of the difficulties, he says, has been the strong performance culture of achievement and success that dominates. There has been an “excitement” to achieve results and corners have been cut on the way. Judged by those results, the success rate of the department is high. Its conviction rate overall is 88 per cent — well above the normal law enforcement level. The conviction rate of contested cases is 63 per cent. But its reputation had been damaged by a “very small number of spectacular failures”. “When you get pressures on performance, you need to ensure there are enough safeguards to achieve them. Reputations are hard to gain but very easily lost and the high reputation of Customs and Excise has been lost within the wider criminal justice system.”
He accepts the failings, which came to a head in the collapse of the London City Bond case that led in turn to the critical report on Customs by Mr Justice Butterfield. The police investigation into the Bond case, which led to the suspensions of two senior Customs staff, is still going on.
Cases increasingly are complex, involving vast documentation, he says. Customs staff were undertrained and failed to keep up with the standards of criminal prosecution required. And managers had operated a “country house” style of management, sitting in their offices letting someone else “run the estate”.
Clark already detects change. The audit finds the staff committed, professional and determined to improve the service. “I have been saying: if there is ever a clash between performance and integrity then integrity wins every time. And people are signed up to that, they are ahead of me on that and appreciate that.” The two areas of focus are on dealing with informers (in the jargon, covert human intelligence sources) and on disclosure. Big training programmes are already under way for all the Customs staff.
The successes are continuing. Recently, the department — whose work ranges from fiscal crime through to terrorism and smuggling — achieved a conviction in a £40 million VAT fraud case after an 18-month investigation. Jail terms totalling 22 years were handed down. White-collar fraudsters, he says, are not just “accountants who have lost their way. They are often the same armed robbers and drug dealers who have turned to large-scale tax fraud and such money can fund drugs or terrorism.”
Clark is under no illusions, however. “The audit found that at all levels people accept that there is a need to change and that is very healthy. Nobody is in denial. But the spectacular failures, not the major successes, are the measure by which we are going to be judged.”
