Fast-track extradition treaty in the dock over 'imbalances'

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The Independent Online

The clock is ticking for the "NatWest three" bankers, who now have only six days in which to appeal to the European Court of Human Rights to ward off extradition to the United States, where they may be jailed for 23 years.

The House of Lords refused on Wednesday to hear two key challenges to the UK's extradition regime with the US, one from the three former NatWest bankers who are wanted in America to stand trial on Enron-related fraud charges. The other petition came from Ian Norris, the former Morgan Crucible boss, who is being sought by the US government to face price-fixing charges.

Nigel Potter, the former chief executive of the gambling group Wembley, who entered the US voluntarily because he wanted to clear his name, has been sentenced to three years in a US federal jail for conspiring to bribe a US official. He has lodged an appeal.

Lawyers for the NatWest trio and Mr Norris argue that the extradition regime is unfairly slanted in favour of the US because the country is yet to ratify the extradition treaty while it is already being implemented in Britain. The Government has dismissed this criticism and has called the US "one of our longest and most trusted extradition partners".

The two cases are the first major tests of how the new extradition laws, originally designed to fast-track terrorism cases, are applied to those accused of white-collar crimes.

In an unusual coalition, the civil rights campaigners Liberty and human rights lawyers have joined forces with business lobby groups and the Tories to fight against the 2003 Extradition Act. They fear the US is abusing the treaty to target UK businessmen as part of a crackdown on white-collar crime in the US in the wake of the Enron collapse, and claim that could deter British executives from doing business in the UK.

The Conservative Party recently tried (and failed) to amend the Extradition Act and get the US struck off the list of countries with which Britain has fast-track extradition arrangements. In a Commons debate, the former party leader, Michael Howard, said that would "give the US Senate the incentive it needs" to ratify the extradition treaty.

Dominic Grieve, Mr Norris's MP and the shadow Attorney General, reminded the Government that it had previously given assurances that the Extradition Act would not extend to financial crime such as price-fixing.

The Government has resolutely rejected any suggestion that the fast-track extradition laws should not apply to businessmen. Joan Ryan, a Home Office minister, said: "The 2003 Act aims to speed up and simplify the process, but it has never applied only to terrorist acts. It applies to any crime that attracts a 12-month sentence."

She denied there was an imbalance in the arrangements, and argued that the standard of proof required for an extradition request was now similar in the US and Britain while admitting "there is never 100 per cent reciprocity".

Under the new legislation, US authorities are not required to present a prima facie case as before. Lawyers say the key difference is that the US may weigh up or challenge the evidence put forward in requests, whereas UK citizens whose extradition is being sought have no such right to challenge the evidence.

The legislation has speeded up proceedings: the time it takes the US to extradite people from the UK has been cut from 30 to six months, while in reverse it has always taken Britain only five months. (The UK also makes far fewer extradition requests than the US.)

Lawyers point out that Britain has a different legal culture when it comes to white-collar crime and fines are far more common here than jail sentences. The highest corporate sentence of 14 years in prison went to Abbas Gokal, who was found guilty in 1997 for his role in the collapse of BCCI. In the US, sentences of 164 years are possible in theory (though 35 years would be served).

The former WorldCom boss, Bernie Ebbers, is appealing against his 25-year sentence for his role in the accounting scandal that led to the largest bankruptcy in the US. The former Enron bosses, Kenneth Lay and Jeffrey Skilling, have also been found guilty of fraud and conspiracy and could spend the rest of their lives behind bars.

Douglas McNabb, a US extradition specialist, said the NatWest trio could face 23 years in jail if their final appeal fails and they are extradited to Houston, and even if they were found not guilty on fraud charges, they could be tried on related money-laundering charges.

Peter Kiernan, a partner at Eversheds LLP and a former deputy director of the Serious Fraud Office, said: "There can be no doubt, because financial crime is now transnational, that this move by the UK Government to make it easier for us and other governments to be able to deal with cross-border criminals is a good thing."

But he stressed that the extradition arrangements needed to be balanced, and saw little chance of the US ratifying its side of the treaty any time soon. "If England continues to extradite, what's in it for them [the US]?"

The sentencing gap - how punishments differ


* 14 years - Abbas Gokal was convicted in 1997 for fraud in the BCCI case

* 10 years - British financier Peter Clowes, whose Barlow Clowes investment group collapsed in 1988, was convicted of theft in 1992

* Six years - Carl Cushnie, founder of collapsed trade finance firm Versailles, and his finance chief Frederick Clough were found guilty of fraud

* Five years - The former Guinness chairman Ernest Saunders was convicted of false accounting and theft in 1990 (he served 10 months)

* 18 months - In the Brent Walker fraud trial, the former finance director Wilfred Aquilina was found guilty of false accounting in 1994 while his boss, former boxer George Walker, was cleared

United States

* 25 years - Former WorldCom boss Bernie Ebbers found guilty in 2005 for his role in the accounting scandal that led to the largest bankruptcy in the US

* Former Enron bosses Kenneth Lay and Jeffrey Skilling were found guilty of fraud and conspiracy and are due to be sentenced in October

* 10 years - Star junk bond trader Michael Milken, at Wall Street firm Drexel Burnham Lambert, was convicted of insider trading in 1990

* 18 months - The former dotcom dealmaker, CSFB banker Frank Quattrone, was convicted on charges of obstructing justice

* Five months - Stockbroker turned style-setter Martha Stewart was found guilty of lying to investigators about a stock sale