§ 3.15 p.m.
§ Order of the Day for the Second Reading read.
§ LORD DENHAM
My Lords, I realise that in moving the Second Reading of this Bill I am faced with the difficulty that few of your Lordships will know exactly what a mock auction is. A mock auction is a method of selling cheapjack goods, obtaining high prices for them by a travesty of usual auction procedure and under the pretence that they are genuine surplus stocks. To explain the provisions of this Bill it will be necessary for me first of all to explain to your Lordships as shortly and as clearly as possible the course of a mock auction sale. Unfortunately, 1122 the shortest description will by no means be the clearest.
I could describe the course of a mock auction sale in one sentence by using the jargon of the mock auctioneer: "The pitch-getter gets the pitch, and then hands over to the top man, who first nails the mugs, then runs out the Hinton lots and finally gazoomphs the sarkers." Perhaps I had better construe. The "pitch" is the audience to whom the goods are sold, and the only job of the "pitch-getter" is to collect an audience inside the shop where the sale is to take place. When he has done that he hands over to the "top man" or auctioneer, who then "nails the mugs"—that is, sorts out the "mugs" from the rest of the audience, and ensures (by a method which I shall explain later) that they stay in the shop until the sale is over. Then he "runs out," pretends to sell, the "Hinton lots", those lots which are never in fact sold, and finally "gazoomphs," or cheats, the "sarkers," those of the "mugs" who have enough money on them to be worth his while. This description may not make the matter very much clearer to your Lordships, but it should certainly show you the amount of good faith there is in this type of sale.
I think the easiest way to explain to your Lordships exactly what goes on at these sales is first to describe how a mock auction sale would appear to the "mug" who is tricked, and then explain how the trick is worked. The "mug" is on holiday; he has money in his pocket, and is walking down a shopping street in London or some other big holiday resort. He comes to a shop, outside which is displayed a notice saying "Grand Clearance Sale". At the door a man is standing behind a table on which are displayed cigarette lighters, alarum clocks, leather shaving sets, table lighters, a camera, electric razors, pairs of binoculars. The man beats on the table with a hammer, and explains that all these goods will be sold at give-away prices later on inside the shop: the clocks and lighters for a shilling each, shaving sets for half a crown each, cameras at 5s. each, et cetera.
The "mug" is interested, and he joins the crowd beginning to form round the shop entrance. As people collect, the man moves the table further and further back into the shop and so draws the 1123 crowd in after him. Then the articles are taken from the table and put on a high counter at the back of the shop, the table folded up and put away, and the second man, the auctioneer himself, takes over from behind the high counter. The auctioneer first of all produces one or two cheap articles not shown on the table—such things as penknives, screwdrivers, plastic sponges, which, to keep the interest of the people, he sells for a few pennies over the counter, or even gives away.
After he has done that he produces a sealed package and explains to the audience that he wants to find one among them who is sporting enough to make a bid for this sealed package without knowing what is inside it. He promises that whoever finally gets the sealed package will not be disappointed; if he is not satisfied he will not be allowed to take it out of the shop. He puts the sealed package up for auction and knocks it down for 10s. He then produces eleven more sealed packages, exactly similar to the first, and explains that there are exactly the same contents inside; and he then asks for eleven more people from the audience to pay 10s. each for one of these sealed packages. Then he says that only those people who show enough confidence in him, the auctioneer, to pay 10s. for a sealed package without knowing what is inside will be allowed to take part in the rest of the sale and buy such things as cigarette lighters, alarum clocks, and cameras.
The "mug", who has been watching this wants to take part in the rest of the sale—he wants to buy some of these things cheaply. He reasons to himself as follows: that if a cigarette lighter is going to be sold for 1s., how much more valuable a thing will he get for 10s., especially as he is to be rewarded for his confidence in buying the thing blind without knowing what is inside it; and so he hands over 10s. to the auctioneer's assistant. But he is not given his sealed parcel; instead, he is given a plastic token to show that he is eligible to take part in the rest of the sale.
The auctioneer then picks up one of these cigarette lighters and says, "Which of you people who are eligible to take part in the sale would like to buy one of these for 1s.?" Immediately all twelve 1124 of them hold up their hands and hold out their shillings, the "mug" among them. The auctioneer says, "Well, that puts me in rather a difficult position, because twelve of you want these cigarette lighters and I have only four of them. There is only one fair way to get round the problem. I am going to put this cigarette lighter up for auction, and whoever gets it I will reward." So he puts the cigarette lighter up for auction, and knocks it down for 20s.
As soon as it has been knocked down he says to his assistant, "Go and collect the money from the gentleman who has bought this", and he fills in the time while the assistant is collecting the money by distributing one or two other cheap give-away lots over the counter. When the assistant comes back with the money he says to the man who has bought the cigarette lighter, "You have paid 20s. for this cigarette lighter. I am not going to charge you 20s. or 15s., or 10s. or even 'five bob'. You can have it for 1s." He tells his assistant to take the cigarette lighter and wrap it up into a neat parcel, and hands back 19s. of the buyer's money with it. So that in fact the buyer will have got a cigarette lighter for 1s., which was the price the assistant, outside the shop, had originally stated it was going to be sold for before the sale started. The auctioneer then proceeds to sell off all the goods that were originally on the table outside the shop in this way. He sells an alarum clock—knocks it down for 25s. When the assistant comes back with the money he gives back all but 1s. He puts a clock and a lighter together and knocks them down for £2, and gives back all but 2s. He knocks the camera down for £2 10s., gives back all but 5s.
So it goes on. In that way all the things on the counter are sold. Each time, while the assistant is collecting the money from the highest bidder, the auctioneer gives away a few articles over the counter; each time the "mug" makes a bid, and each time the lot is knocked down to somebody else. The auctioneer then says that he is coming to his last lot. He takes four of the articles, which have not been seen before, either outside or inside the shop—they are a canteen of cutlery, a set of two canvas holdalls, a table lamp and a wristwatch. He explains that only one of these four lots is to be sold, and that 1125 that is only by way of advertisement. The highest bidder is to have his choice of the four lots for his money, and the rest of the articles will be put back into stock. The auctioneer puts this up for auction, and the "mug", who has watched all these cheap lots going at give-away prices, is by now desperately anxious and bids hard for this particular lot. It is knocked down to him. The "mug" is asked to hand over the money. He hands over £5 to the auctioneer's assistant, and is asked to make his choice, which of the four articles he will select. He chooses to have the canteen of cutlery. But at that moment the auctioneer stops the sale. He says that he has heard a suggestion among the audience that the "mug" was a friend of his, and that the whole sale was rigged. The auctioneer becomes very annoyed about this, and says to the "mug": "Have you ever seen me before?" The mug says "No". Then the auctioneer says: "There is only one way I can disprove this allegation that the sale is rigged. I am going to treat everybody who has bought one of my sealed packages the same way as I treat the highest bidder. If you each hand over £5, you can each have a similar lot to one of these four."
The auctioneer's assistants try to stop him doing this: they say it is much too generous. But the auctioneer is adamant: he is in charge, and he will do exactly what he likes. So he collects, or tells his assistants to collect £5 from each of the other men and women in the shop who, having bought one of the sealed packages, are eligible to take part in the sale; and he asks them to choose which of the four lots they will have. Then the auctioneer says, "You have each paid £5 for one of these lots. All of you have handed over your money. To show that yours was a genuine bid, are you quite certain that you want to pay £5 for this?" All of the audience then say "Yes"—thinking they are going to get their £5 back. Then the auctioneer asks, "If you walk out of this shop with any article that you have chosen for your £5, you will be quite satisfied, will you not?", and they all say "Yes". They still think that they are going to get their money back.
Then the auctioneer says "Right. You have trusted me and I am not going to let you down. Each of you has paid 1126 £5 for one of these articles, and I am going to give you something else for your £5 as well as the article you have chosen." He holds up a fountain pen, pencil and ball-point pen set in a smart little cardboard box, and says, "This is what I am going to give to each of the members of the audience who have spent £5 with me." At this stage he picks up one of the sealed packages that were sold at the beginning of the sale, unwraps it and shows that inside it was a bottle of scent. He explains to the audience that there is a bottle of scent inside each of the sealed packages, and that all are exactly the same.
The "mug" is then handed a carrier bag in which has been put the canteen of cutlery he has chosen, his pen and pencil set and his sealed package containing a bottle of scent. He does not get back any of the £5 that he bid. When he gets home he finds that all the articles in his carrier bag are worthless trash; and he realises that he has been cheated somehow, though he is not quite sure how. The object of this sale, of course, is to sell as many as possible of the canteens of cutlery, the canvas holdalls, the table lamps and wristwatches. The whole of the rest of the sale has just been leading up to that. All these articles have been made specially for the occasion. They look good; they look expensive; but actually they are of such poor quality that they are virtually worthless.
As well as stocks of canteens of cutlery, et cetera, which the auctioneer wants to sell, he needs two other types of goods in order to carry out a mock auction. He needs his alarum clocks, his shaving sets, cameras, electric razors and binoculars. These are all perfectly genuine goods, made by well-known manufacturers. They are never in fact sold; they never leave the shop and they are part of the mock autioneer's permanent equipment, appearing at sale after sale. The second thing he needs is a number of cheap articles that he can give away to distract the crowd's attention at difficult times and to encourage them to bid in the rest of the sale. These are such items as screwdrivers, bread knives, pen knives, pencils, plastic sponges and tooth brushes.
The sales are carried out by three men—the pitch-getter, who collects the crowds at the beginning of the sale; the floor man, who is the auctioneer's assistant, and who collects the money; 1127 and the auctioneer himself, who is known as the "top man" and is head of the outfit. The first part of the sale, the collecting of the crowd inside the shop is carried out by the pitch-getter, and on his table at the door of the shop are put the genuine articles which are not, in fact, sold. He lures the customers inside by leading them falsely to believe that if they come in to the shop they will be able to buy a lighter or alarm clock for 1s. When the crowd is inside the shop the auctioneer is faced with a number of people some of whom who are going to be "mugs" and some of whom are going to be clever and watch to see what goes on. Some of them will have money in their pocket, and some will not.
At this part of the sale it is the business of the auctioneer to find out which is which, and so he produces the sealed packages. The object of this is as follows. First, anyone who is gullible enough to buy a sealed packet for 10s., without knowing what is inside it, is gullible enough to be cheated later on. Since the money for the sealed packages is collected without the packages being given to the people who have bought them, unless those people forfeit their money they must stay in the shop until the end of the sale. Hence these sealed packages are known as "nailers", because they "nail" the crowd inside the shop. There is one point about the manner in which these sealed packages are sold. The mock auctioneer wants to sell twelve of them, or as many as he can; and in order to do so he puts the first one up for auction, gets for it as high a price as he thinks he can get—perhaps about 10s.—and does not bother to auction the rest. He sells those at the price at which the first package was knocked down.
Having now sorted out which are the "mugs" among the crowd the auctioneer has to persuade them that if they make a bid for any article they will be asked to pay only a fraction of the actual sum they bid. The genuine goods—cigarette lighters, clocks and so on—are produced, and the auctioneer pretends to auction them one after another. When the money has been collected and handed to him he then tells his assistants to hand back the money to those who have paid it. In fact, these particular articles are never sold. They are never knocked down to a genuine bid. The bids before the last 1128 are genuine, but if the auctioneer is putting up, say, a cigarette lighter, he will take bids up to perhaps 18s., 19s., or 20s., and if that is the last bid he will say, "Right, 21s., over there!" He then points to the back of the shop and tells an assistant, "Go and collect the money from that gentleman over there." Then he asks his audience to gather round his high counter and starts giving away the free lots. As a result, no one sees to whom the assistant goes to collect the money for the cigarette lighter. In fact, the assistant walks to the back of the crowd and at the right moment takes the money from his own pocket and comes back and hands it to the auctioneer; so none of those articles is ever, in fact, sold.
The "mugs" have now got definitely in their heads the idea that they will be asked to pay only a fraction of the amount they may bid and hand over, and they now have to be cheated of their money. So that they shall not be disillusioned it is necessary for them all to be cheated at once. If those in the crowd saw the first man hand over £5 for an article and not get back any of his £5, they would realise that something was wrong, and because of that the pretence is made by the auctioneer that only one of the lots is going to be sold to the highest bidder and that the rest of the articles will be put back into stock. Then the auctioneer pretends to hear somebody from the back of the crowd suggest that the sale is "rigged" and he has ready his excuse to "prove" his honesty by allowing everyone to have one of the lots for £5. In this way each of the "mugs" thinks he will get £5 worth of goods for about 10s., believing, of course, that they will get £4 10s. back. In fact the "mugs" will get about 25s. worth of goods for £5.
My Lords, that may not be a very clear description of a mock auction sale, but it is as clear a description as I can give in a short time. There seems always to be some doubt about whether or not the law is broken by mock auctions. On July 10, 1953, replying to a Motion for the Adjournment in another place by Mr. Norman Dodds, the Joint Undersecretary of State for the Home Department said [OFFICIAL REPORT, Commons, Vol. 517, col. 1682]:It is not a fact that law is deficient. There is ample power to prevent these abuses and punish them where they occur.1129 On July 4, 1957, in reply to a question by Mr. Norman Dodds, the Home Secretary said [OFFICIAL REPORT, Commons, Vol. 572, col. 1277]:The Metropolitan Police has given this matter much attention since 1953, but has not been able to find any evidence to justify the institution of criminal proceedings.These two statements seem to be slightly conflicting. I took counsel's opinion upon this point of whether the law was broken. I gave counsel a description of a mock auction sale, in much the same way as I have described it to your Lordships, and asked him whether any law was broken. His opinion says this:There are only three offences which I think could be considered as covering such transaction—cheating, larceny by a trick and obtaining money by false pretences. Cheating at Common Law has been confined to obtaining money by using false scales or false marks on spurious articles, and although everyone would agree that a mock auction was a clear instance in common parlance of cheating, yet I am firmly of opinion that a prosecution alleging cheating would fail.The real substance of the cheating is the conduct of the auctioneer and his cronies in the early stages of the mock auction whereby the members of the public are induced to believe that, whatever they may bid for a particular article, they will not be required to pay that sum or indeed even a substantial part of it.In larceny by a trick, possession of money or goods, but not the property in the money or goods, is obtained by some trick or artifice. Clearly, on the facts before me the members of the public are intending to buy goods and to pass the property in the money which they hand over, although they hope that some of it will be returned to them. Thus the field is narrowed to the offence of obtaining money by false pretences, for in this offence the property in the money is obtained by the false statement or false representation by conduct. The crux of the matter is as to whether what takes place involves a false statement or false representation by conduct.It has been laid down by the courts in innumerable authorities that the representation must be as to an existing fact. I have been unable to find any decision where the facts were in any degree similar to the facts before me, and I have come to the opinion, firstly, that the conduct complained of does not amount to a false representation, because there is no dear indication that part of the money bid will be returned to the bidder, although he has been led to hope that it will, and secondly, that even if the conduct did amount to a false representation, it would be a representation as to future conduct, namely, to repay part of the money. Accordingly I am of opinion that a prosecution would be doomed to failure and I am fortified in my opinion by the fact that, so far as I am aware, no prosecution has ever been launched or succeeded on such facts as are now before me.1130 I think it is fairly clear from this opinion that mock auctions are not against the law. There is, however, one law which mock auctioneers invariably break and which, if it were rigorously enforced, might prove a slight discouragement to them. The Auctions Act of 1845 lays down that every auctioneer must display prominently in the premises where the sale is taking place, and throughout the sale, a card clearly giving his true name and address for everybody to read. The mock auctioneers might not be quite so keen to cheat the public if the victims knew exactly who they were and where they lived. I should like to ask the noble Lord who will reply for Her Majesty's Government whether Her Majesty's Government will take the necessary steps to see that this law is enforced so far as mock auctions are concerned.
As to the issue of whether anything should be done about mock auctions, the question arises: how far should the law go to protect the fool from his folly? To answer that I should like to give just one or two facts and figures about mock auctioneers. First of all, a word about the value of the goods that are sold. I got a set of the cutlery that I mentioned in the description of the sale and had it valued. I was told that it was made of chromium plate and that the chromium plate would not last a year. The forks buckle when given any hard push. One of these sets can be bought at a cheapjack shop for 39s. 6d.—that is the retail price, and presumably allows for a certain amount of profit. The mock auctioneer sells these sets for £5 each. As to the numbers of these mock auction sales, there is one shop in Oxford Street which has about five sales a day on about six days a week. There are two mock auction shops in Petticoat Lane which are open on Sunday morning, and there are anything up to sixteen mock auction stalls in Petticoat Lane. There are mock auctions in twenty-six municipal boroughs and in eight urban districts. This may not seem a very large number, but when we consider that each of these shops has five sales a day and that at each sale at least ten people are cheated out of at least £5 each, we realise that the turnover of one single shop is, at the very minimum, £1,000 a week, of which about three-quarters is clear profit.
Next as to the victims of these auctions. Most of the people "caught" by them are holiday-makers with money in their 1131 pocket, housewives out with the housekeeping money who come across one of these places and get cheated, and, in London at any rate, a very large percentage of foreigners who come into one of these shops. They do not realise that they can be openly cheated in an English shop, and they must carry back a very bad impression of what goes on in an English shopping street. We cannot protect people from being cheated in every single way, but there are some ways where the odds against the "mugs" are too great, and then the law must protect them; and in this case there is added to the crookedness of the sale the excitement that people usually feel at a perfectly genuine auction sale. There is something about even a perfectly honest auction sale that makes people bid much more than they want to pay, and which makes people bid for things which they do not really want. If we add that to the crookedness of somebody who is going to get money by cheating, that makes it very difficult for people to see through.
My Lords, in 1929 my noble friend Lord Gorell introduced a Bill in your Lordships' House to deal with mock auctions. His Bill laid down that:No person conducting or assisting to conduct a public sale of goods by auction or otherwise shall knowingly misdescribe by word or implication the purposes of such sale, the origin of the goods to be sold, or the nature, quality, or substance of such goods.The noble Lord will be speaking later on and so I will not say any more about that Bill, except to say that, after getting a Second Reading in your Lordships' House, it was referred to a Select Committee, and the Select Committee came to the conclusion upon the evidence that the Bill was not required for the reason thatThe law as it stands is sufficient to deal with any cases which could be successfully alleged as infringing the provisions of this Bill were it to become law.There are left three methods by which laws could be made to control mock auctions. The first is to control auctioneers by licence; secondly, to control auction premises by registration; and thirdly, to make illegal certain of the individual practices of mock auctioneers. The first suggestion, licences for auctioneers, was suggested by a Select Committee of your Lordships' House on 1132 Auctioneers', House Agents' and Valuers' Licences in 1935. Up to the year 1948 it was necessary for every auctioneer to have a licence, but this cost £10 and was purely a matter of revenue. One did not need to have qualifications: one paid over the £10 and got the licence. The Select Committee on Auctioneers', House Agents' and Valuers' Licences of your Lordships' House suggested that licences should continue to be issued by the Commissioners of Customs and Excise, but only to the holder of a certificate granted by a petty sessional court, which should have power to refuse that certificate.
There are various objections against that method of control. The first is that there would be the difficulty and expense of setting up a whole new machinery, first to introduce auctioneers' licences, and secondly, machinery whereby only people who had special qualifications could be issued with licences. The second point is that mock auctions are not at the moment illegal. Therefore, if a mock auctioneer were to apply for a licence or certificate in order to get a licence from a court, I do not think that the court could refuse his application purely on the grounds of his being a mock auctioneer.
The second method is registration of premises. In 1956 Brighton Corporation introduced a clause in their Private Bill enacting that all premises used in the town for auction sales must be registered by the Corporation, and giving the Corporation power to refuse such registration in certain cases. The Corporation could refuse registration either because the premises were unsuitable or because they had been used other than in good faith or because the applicant had been convicted of fraud. Several other towns followed suit and introduced Private Bills to this effect. I feel that this is a matter which is so widespread that it should not be left to Private Bills to deal with. First of all, it would be a long time before the whole country was covered by Private Bills, and the moment one town introduced private legislation the mock auctioneers would just move down the coast to the next seaside resort and open up there. Then there are some towns which cannot afford the expense of introducing private legislation. It would be possible to have a public Bill on the lines of registration of premises, but how effective it 1133 would be I do not know. It certainly worked in the towns where these provisions have been in force under private legislation. But if the provisions covered the whole country, mock auction men would have nowhere else to go. Now, instead of having to trouble to stay and appeal against refusal to register their premises, it is much easier for them to move to another town. If there were not another town for them to move to, then they might well stay and appeal. As mock auctions are not against the law, if the premises are all right and if the man who applies has not been convicted of fraud, how are we going to justify refusal to register his premises should he appeal to the courts? It needs only one successful appeal of an auctioneer to make such a Bill ineffective.
That leaves the third method I have adopted in my Bill: to make illegal certain of the practices of mock auctioneers. The main practice of a mock auctioneer, whereby his sale differs from a normal auction, is that he gives back a large part of the money bid for some of his lots so as to lead people to think that he is going to do that every time. Clause 1, subsection (1), of my Bill makes it illegal for a person who conducts or assists in conducting a sale at which an assembly of persons or any of them are invited to acquire prescribed articles by competitive bidding toaccept or offer to accept from the highest bidder for any prescribed article less than the amount of his highest bid; or(b) during the proceedings of the sale sell any prescribed article otherwise than by competitive bidding …That is to stop the practice of mock auctioneers of putting the first of a number of lots up for auction, knocking it down at a high price, and then selling the rest of the lots, not by auction, but at the price fetched by the first.
Then, in paragraph (c), it is made illegal toimpose as a condition of the sale that no bid shall be accepted from any person who has not first bought some specified article; …The purpose of that is to stop the "nailer", the sealed packages. That is when the auctioneer lays it down as a condition that nobody can bid in the rest of the sale who has not first bought one of those. Then: 1134(d) during the proceedings of the sale make or promise or offer in connection with the sale any gift to any person in or about the premises used for the sale; …My Lords, there are certain safeguards in this Bill. Clause 1, subsection (1), paragraph (b), sub-paragraphs (i) and (ii), are safeguards in order not to make illegal certain legitimate practices of bona-fide auctioneers; and also Clause 1, subsection (2).
With a Bill of this kind it is a most important consideration to consider how its provisions might affect the bona-fide auctioneer, and with this in view I have consulted three of the main professional bodies: the Chartered Auctioneers' and Estate Agents' Institute, the Incorporated Society of Auctioneers, and the Royal Institution of Chartered Surveyors. They have given me a great deal of help in the phrasing of the Bill. The first two of those bodies have discussed the Bill with their councils and have decided that the activities of their members are outside the sphere of this Bill. They have therefore decided not to oppose it in its present form. This Bill is supported by the Association of Municipal Corporations, the Association of Urban District Councils, and the National Chamber of Trade.
Finally, I should like to quote from a speech delivered on the Second Reading of the Bill introduced by my noble friend Lord Gorell. It is the speech of the noble and learned Viscount, the late Lord Hail-sham, who sat on the Woolsack at the time. The noble Viscount said:I do not think that any one of your Lordships would attempt to justify or other than reprobate such practices as were described by the noble Lord who moved the Second Reading. The methods of the persons at whom he aims his Bill are as discreditable as their language appears to be obscure. But it is not enough to say that there are people who are doing discreditable things. You have to ascertain, I think, first of all, exactly what is the gap in the law through which they are at present enabled to escape punishment, and, secondly, you have to be sure that that gap is effectively closed, and no more than closed, by the Bill which is submitted to the House.My Lords, that gap has been open for thirty years since then, and I would submit to your Lordships that this Bill closes it, and no more than closes it. I beg to move.
§ Moved, That the Bill be now read 2a.—(Lord Denham.)1135
§ 3.55 p.m.
§ LORD CHESHAM
My Lords, the noble Lord, Lord Denham, is, I think, to be congratulated on his introduction of this Bill, and on the manner in which he has introduced it. I think he has demonstrated most ably his understanding of quite a complex subject; and his demonstration of his understanding has had the merit not only of being able, but, I venture to think, of being diverting to your Lordships. Clearly he has made a very extensive personal study of this problem, and I am sure your Lordships will join with me in hoping that it has not been at any great personal loss. If he will also allow me to say so, his complete mastery of this procedure and technique—and, indeed, of the jargon—leads me to feel very thankful that it is only a Dispatch Box that I am standing before, and not a rostrum. I think all your Lordships, as I do, will appreciate the painstaking interest and resourcefulness which the noble Lord has shown in bringing forward this very ingenious measure; and, whatever may be the outcome, I consider he has performed a very valuable service in giving publicity to this subject.
A well-known old proverb says, "A fool and his money are soon parted," and to-day we are all, I think, constantly submitted to high-pressure salesmanship and advertising of one sort or another designed to convince us of the merits of some particular product or service or entertainment—and, in general, parting with our money is made as attractive and painless as it can be. Sometimes, perhaps, we even go so far as to ignore Mr. Micawber's advice, and we spend more than we can afford: but that, my Lords, is a hazard which is common to everybody, and we do not expect the law to protect us from that. This afternoon, however, we are considering a practice which I think we should all agree goes further than that; it is deliberately designed to exploit the more gullible members of the community by unscrupulous and by deceitful methods. It must be distressing to everyone to see people being tricked by sharp practices, particularly when they are elderly people who cannot afford it; and I completely agree with the noble Lord when he draws attention to the undesirability of giving a very bad impression to visitors from overseas who may be caught in this way.
1136 My Lords, if, after analysing the noble Lord's Bill, the Government do not feel able to commend it to your Lordships' approval wholeheartedly, it is not from any desire to condone or encourage the activities of mock auctioneers, or from any lack of concern for those who may fall victims. What we have to decide is whether it is practicable or desirable to deal with the problem by means of the sanctions which the noble Lord has proposed in his Bill. It must be a serious matter to add to the general criminal law—and the criminal law is not perhaps always the most effective weapon in a matter of this sort.
Lord Denham correctly drew attention to the position of mock auctions and the existing law, making it clear that we are not really concerned with a breach of existing provisions. Basically, the evil we are concerned with is that goods are sold at prices much higher than their generally accepted value. That is not an offence in itself. Various devices are used, as we have heard, to induce people to buy the goods; but, generally speaking, the noble Lord was right when he said that there was nothing in the practices which constitutes a conspiracy to defraud or false pretences, or anything like that. It can be said that mock auctioneers are careful to keep within the law as it stands.
Talking of the law, the noble Lord mentioned the requirement under the Act of 1845 that all auctioneers should put up a signboard of some sort with their true and full Christian and surnames and residence in large letters, and he asked that that requirement should be complied with. The position about that is that it is a hangover from a very old Act and the requirement was originally made in connection with Customs and Excise duties which were charged at the time. They have since been abolished, but the noble Lord is perfectly correct, so far as I can see, in saying that the necessity for an auctioneer to put up his name and address is still valid. For the reasons I have mentioned, it is not a requirement which is enforced by the police at the present time. I may say that I had someone go round to a mock auction yesterday to see whether they knew anything about it and had put up a board. A Home Office official went round and there was no sign of any board, and, 1137 apart from a pair of shoddy free curl links, he had no other progress to report. I would say to the noble Lord on that point that if there is a breach of the law it is a matter not for Government action but for the police—for the local police of the area in which the infringement may take place. If the noble Lord wishes, I will certainly ask my right honourable friend to ask the Commissioner to look into the matter in the Metropolitan area, but further than that I cannot go. I should think, however, that the publicity the noble Lord has given to this matter may possibly spread about and local chief constables will decide to do something about it.
May I go back to the Bill? Clause 1 prohibits certain specific practices. The noble Lord has told us about them, and he has taken care not to interfere with the methods used by legitimate auctioneers. I do not think I should examine these restrictions in detail; they would be more a matter for the Committee stage if it was decided to give the Bill a Second Reading. I would ask your Lordships to consider a few general observations. Mock auctioneers have operated in various ways for a considerable number of years, and no doubt they improve and perfect their technique. The present form is the one they consider to be the most successful. The successful perpetration depends on two or three practices, descriptions or blandishments whatever you choose to call them, which create the "get-something-for-nothing" atmosphere, about which we have heard. It is unnecessary for me to repeat the kind of thing that goes on—Lord Denham was very lucid about it.
The Bill seeks to prohibit the practices he described, but there must be always a risk that mock auctioneers will not have much difficulty in devising new practices that will evade this and other precise prohibitions which are in the Bill. They world no doubt be restricted in their methods by this Bill and perhaps temporarily inconvenienced, but I feel that the final result may turn out to be the same problem in some new form. I cannot myself suggest any specific ways whereby they could get round the provisions of this Bill. Probably, if I possessed that degree of distorted ingenuity I should be busy operating a mock auction instead 1138 of talking to your Lordships. But no one who has seen mock auctioneers in operation would underestimate their capacity for devising ways and means to relieve an unsuspecting person of his cash.
On the question of infringement, I should think that the offences created by the Bill are complicated, and proof of suspected breaches would be somewhat difficult and certainly highly technical. For another reason, it is a well-known fact that people who have been caught by sharp practices are usually very reluctant to admit it and help the police by giving the necessary evidence. The noble Lord drew attention to the extent of these activities and I feel I must briefly do the same. They obviously depend for their victims on a changing population, people who have little opportunity to come back and complain and warn others, and thus holiday resorts and large towns are the obvious choice. Since 1954 eight local authorities have sought to control mock auctions by local legislation which requires registration of the premises used for auctions, and a few more authorities are seeking similar powers. But I do not think—and I listened carefully to what Lord Denham said as to the extent of these activities—that there is evidence that they are very widespread, or that they are increasing. I think we must consider very carefully whether the problem is, in fact, large enough to justify general legislation.
If general legislation is thought to be needed, it is then for consideration whether the method proposed by the noble Lord is likely to be the most effective that can be devised. I have mentioned local legislation on this subject, and Lord Denham himself told us the form that it takes. I will therefore only say that although most of the local Acts in existence are fairly recent and it is a little early to claim that they are a complete solution, from inquiries that have been made there is certainly reason to believe that they have had some deterrent effect. Mock auctioneers have apparently judged it wiser not to apply for registration and therefore have had to cease operating in the areas concerned. It may be that local legislation on these lines is the best way to deal with a local problem. If it is said, as Lord Denham did say, that local authorities cannot all afford the expense of promoting Private 1139 Bills, then the possibility should be considered by those who feel, as Lord Denham does, that this problem is big enough, as to whether it would justify legislation in a Public Bill giving similar powers to all local authorities who wish to adopt them.
I have laid before the House some considerations which I think your Lordships should bear in mind when deciding your attitude to the Bill. To sum up, mock auctions undoubtedly exist and no one would wish to defend them. The question for the House to consider is whether the nuisance is such as to justify general rather than local legislation; and if the answer to that is "Yes", then what form the legislation should take. I have had to suggest some doubts about the efficacy of this Bill. It is for the House to consider these doubts and the alternative that I have mentioned of an adoptive Bill giving local powers to require the registration of premises. I think that the House should consider the Bill entirely on its merits as they may be put forward in argument during the debate.
§ 4.11 p.m.
§ LORD CROOK
My Lords, I rise, perhaps with some trepidation to support the Bill, if only because in his speech the noble Lord, Lord Denham, dealt so comprehensively with the way in which crooks are running these mock auctions. I rise not only to support the Bill but also to congratulate the noble Lord on all the work he has put into it. It is now eleven months since he first put on the Order Paper here what was then a Motion, which he subsequently turned into a Bill, and it is within my knowledge that in the intervening period he has busied himself with consultations with all the various authorities dealing with trade and industry, and with local control, as well as with those responsible for genuine auctioneers. And now he comes to us with a Bill which, if not perfect, at least represents something which the people who have looked into this have tried to do but which successive Governments have failed to deal with since I was first in politics in 1921.
I think that part of the ingenuity of the Bill is the fact that the only place in which the word "auctions" appears is in the Title. The noble Lord has thus managed to draft a Bill which avoids all the difficulties that might have occurred 1140 with genuine auctioneers and those holding auctions. I am not going to say that I know enough about legal draftsmanship to say that this is necessarily the particular form of Bill which should commend itself to your Lordships' House for final adoption as an Act of Parliament, but it is certainly, in my view, a Bill which should be given a Second Reading, and should move through to a Committee stage, where we ought to have the benefit of advice and consultation between the mover of the Bill and the representatives of the Home Office.
I first came into this matter as long ago as 1923, as Chairman of the North Islington Labour Party, on complaints about mock auctions in the Holloway Road. I have since seen this problem on complaints from working people again and again, and in more recent years I have seen it on complaints by local authorities and the manufacturers of goods who were concerned about the way in which this subject was dealt with. I was interested in the Bill of the noble Lord, Lord Gorell, in 1929; and more recently my colleagues of the Labour Party in the other place played some part in a campaign in 1953, when there was considerable publicity, started by the Daily Herald, involving posters outside mock auction shops in many seaside towns during 1953 and 1954. Without doubt the weapon of publicity is one of the vital weapons to use, apart from legislation—indeed, in some ways, if it is possible to use it, it is the best weapon.
The truth is, however, that this gets beyond merely the stage of talking about fools who are parted from their money. I know that it can well be argued that this House cannot always bother itself to make certain that fools are looked after—although it is a fact that Parliament has to spend much time in protecting fools. If that were not so, we should not be dealing with police cases about confidence tricksters in hotels in London and the like. The mock auction is, in fact, in many cases, only a form of confidence trick carried out in a different way. But this problem goes beyond the suggestion of fools being parted from their money: it runs into the serious suggestion of what is happening to certain aspects of British trade.
I appreciate the importance of the reference by the noble Lord when he 1141 moved the Second Reading, to the support he had had from the National Chamber of Trade. Not only the Chamber of Trade, as such, but various manufacturing firms also are concerned about what is going on. While it is perfectly true that if you took a census in the month of February of the shops and establishments where mock auctions are being carried out you might get the low kind of figure to which the noble Lord referred in his speech, on the information in the possession of some of us in the Labour Party in 1924 there were operating at one given moment in the summer 1,500 of these establishments: indeed, that is the reason for the legislation which was sought by a number of local authorities. The best estimate by those concerned with the trade protection at that time was that in the course of a year £8 million worth of good; were being distributed by this method.
The goods themselves are especially shoddily made, and they are packaged artificially. There are four main firms in this country specialising in the production of the goods, and there are certain printing works specialising in the production of fake containers and cartons; so that when you do, in fact, finally get a clock knocked down to you at 30s., you get it in a case which shows a price of two guineas, thus proving what a bargain you have got because you do not see the invoice which shows that it was sold to the people at 12s. 11d.
This practice is doing a lot of harm to a number of genuine trades and industries in this country, and one of the latest to erupt on the matter and send letters to the Prime Minister, to other members of the Government and to Parliament, is the Sheffield cutlery industry, which has caused the Sheffield people to make considerable representations in the last four or five weeks. Indeed, in January the City Council of Sheffield passed a resolution, about which the noble Lord who spoke for the Government must know, since it was sent to the Home Secretary and the Prime Minister, to this effect:That this Council deplores the growth of mock auctions within the City and the exploitation of the public which takes place thereat. They strongly urge Her Majesty's Government to introduce or facilitate the introduction of legislation designed to control, and protect the public from, the activities of those persons responsible for these auctions.1142 Why the Council and the cutlery industry there are concerned is because Sheffield is the major producing city of high-quality cutlery in the world, and they know that stamped-out cheap cutlery material is being foisted on the market allegedly coming from Sheffield. It is useless for us to stand here and denounce, as some of us have in the past, the productions which come from Japan marked "Made in Sheffield" as being a terrible infringement of our rights and something to be condemned as an attack on our industry if, at the same time, we are prepared to sit idly by and allow in this country four firms to produce material like that—and in Sheffield, in one case—so as to put on the world (and I say, "the world" by way of reference to foreign visitors who come here and buy "Made in Sheffield" goods) goods which let down the high quality for which Britain stands in the normality of its production. As I say, I think this matter goes beyond the separation of fools from their money and into the realms of the trade and standing of this country.
I do not want to keep the House by going into great detail, although there are many sides to this fraud. One part of it is a glib tongue. I have myself seen that shocking sale of a pen supposed to be the one which holds the Royal Warrant of Her Majesty. They merely hold up a box with a pen in it. It is apparently of red plush, marked in gold, with a crown on the top. They say: "What am I bid for this? What is good enough for her is good enough for you". All the emphasis is on the crown which is being flourished. That is the kind of thing that is going on all the time.
Whenever the matter is raised in another place or here—whether by the right honourable gentleman moving it in another place or the noble Lord, Lord Gorell, here in 1929—nobody from the Home Office ever does anything. I may remind the noble and learned Viscount on the Woolsack that one of the jobs he had to do when Home Secretary was to get up in another place and to express regret that there was no time for legislation on this matter. Apparently there has been no time since I have been connected with Parliament—that is from 1921 until now. I am not an expert who is able to say what is the right form the legislation should take. But I am the critic who can see that the Home Office 1143 never seem to be certain which leg they are standing on. The leg which the noble Lord, Lord Chesham, stood on this afternoon is a different one from that which was stood on a year ago. It was different again from the one three years ago. As I see it, we are told a different story each time.
We were told by the Under-Secretary of State for the Home Department in another place on July 10, 1953, that the existing laws contained very substantial powers to deal with these matters. We are told this afternoon that it is doubtful whether anything would be done which was likely to break the law. We were also promised that, if we wanted it, the Home Secretary would cause the Commissioner of Police to have a look at the matter to see what the position was. He has been doing that and reporting to the Home Secretary; and the Home Secretary has been busy making statements. But the Commissioner found that he could do nothing about it, notwithstanding all the provisions in the law—and there are plenty of provisions if anybody knows how to deal with them.
For example, there is the Sale of Goods Act, 1893, which makes it unlawful for the seller of goods being auctioned to bid or employ persons to bid on his behalf. That law is broken. There is the Betting and Lotteries Act, 1934, which deals with the question of the boxes to which the noble Lord referred, because if it is suggested that one has a valuable content and the other a less valuable content, there is a technical breach. There are also the offences of obtaining money by false pretences, conspiracy to defraud, larceny by intimidation, larceny by means of a trick and fraudulent conversion—all things which could be put up as breaches of the law if the evidence could be obtained. As has been pointed out, the difficulty is to produce the facts and prove them so as to make prosecution effective.
Unless anyone should think that the House to-day is better educated in its glossary of the terms used in mock auctions, may I in this connection, refer to a speech made by the late Lord Hailsham, in which he said:A person who has unwittingly become a 'sarker' and has been 'gazoomphed' is not anxious to advertise his own gullibility and to give evidence in a court of law, or even to make a complaint to the police.1144 I might say to your Lordships, in passing, that that shows what heredity is: the great knowledge of words which was possessed by the late Lord Hailsham is also possessed by his distinguished son, our revered Deputy Leader of the House at the moment. But let me say straight away that his Lordship was right: it is difficult to get people to make complaints; and if they do they know what it means. A working man who makes a complaint and ties himself up to be party to a prosecution is tying himself up to be brought from his place of employment and to lose his work in order to spend a day or days in police courts, or in higher courts in due course, in order that the case may be proved.
The present law is useless as a safeguard. When two well-known operators were caught in 1953, one got two years' imprisonment and the other one year. They managed to go to the Court of Criminal Appeal, and the Lord Chief Justice, regrettably, had to quash the convictions; and so the only two the Metropolitan Police did think they had caught got away. The local authorities who have suffered from this have committed themselves again and again to statements, both to the Home Office and to newspapers, of their complete inability to deal with these matters. For instance, at the time of the last trouble in Scarborough, the town clerk said in a statement:The Home Secretary says we have adequate powers. I will tell him, with some emphasis, that the powers are not worth printing on paper. If he gives us the weapon—a short Bill—we will kill mock auctions stone dead.In the nearby town of Bridlington, suffering at the same time, the chairman of the committee dealing with this matter said:We have tried all methods—town planning, foot path obstruction laws and the Shops Acts. We get nowhere. We need a Bill.I say, therefore, that I am sure the noble Lord is right in coming to this House and saying that a new law is needed—something more than we have at the moment. He has selected one of the three methods available, and I believe that he has selected the only one that was possible. A few local authorities have sought special powers, the original case being that of Brighton. They have had to spend a lot of money and go to a lot of trouble to get it. I believe that Brighton Corporation spent £2,000 on costs in trying to promote a Bill in this House. Once they have powers for 1145 registration and direction of premises, they must run a costly machine inside their own local authority in order to deal with the matter.
However, I am not here to say that every phrase and every clause in the noble Lord's Bill is right, because I do not know. What I do know is that it is the first attempt to deal with this matter, and it is an attempt which, in my view should now receive the support of the Government. What we should expect is not that the noble Lord should come to the Committee stage and fight this through on his own, but that from now, after the Second Reading is given, as I hope it will be, there should be such co-operation from the noble Lord, Lord Chesham, and the Department he represents that the noble Lord presenting the Bill, who has spent so much of his valuable time on this, should have the backing of all of us, so that the House may get its teeth into the subject.
§ LORD CHESHAM
My Lords, before the noble Lord sits down, may I put him straight about one thing? I am sure he would not willingly be guilty of misquoting me, and perhaps he did not quite understand what I said about asking the Home Secretary to pass the matter on to the Commissioner of the Metropolitan Police. I was talking about the specific instance of this ancient law requiring auctioneers to display their names and addresses and not about the whole problem. Because, quite honestly, if the noble Lord said, as I understood him to say, that I should ask for the law to be looked at when we knew there was nothing wrong with it, I do not think that would be quite right.
§ LORD CROOK
My Lords, I apologise to the noble Lord—I did misunderstand him. The reference I was making was to the statement which the Home Secretary made in the last two years, that, having gone to the Commissioner of Police, he felt that nothing could be done. If I said anything to criticise the noble Lord with his charming personality I should wish to withdraw it.
§ 4.30 p.m.
My Lords, I am sure we all agree with the opening remarks of the noble Lord who spoke for the Government in congratulating the mover of this Bill on the clarity with which 1146 he presented his case and the immense amount of trouble which he has taken to prepare it. So far as I know, and I have been at some pains to try to find out, he has taken the views of every single person or institution concerned and has been into this matter with extreme thoroughness. I take almost a parental interest in it because it is just over thirty years ago since I moved the Bill to which reference has been made. That was passed by your Lordships without a dissentient voice. The only noble Lord who spoke doubtfully on that occasion was the noble Lord, Lord Darling, who was not quite sure whether the form of my Bill was adequate to meet the injustices which had been revealed; but everybody, including the noble and learned Viscount then on the Woolsack, Lord Hailsham, admitted that there was a great deal of swindling going on, that the law as it then stood was not sufficiently elastic to allow prosecutions and that something ought to be done.
That was thirty years ago and nothing has been done, and I must say I am a little disappointed at the reply that we have had from the Home Office. They neither support nor oppose this Bill; they just throw it to your Lordships without really any clear guidance as to what they think should be done. They admit that there is a good deal of swindling going on and that the law is not sufficiently adequate to enable it to be remedied, but I think we should have had a little more positive guidance. I hope, at any rate, that as a result of this debate the Second Reacting will be given in order that any further examination may be made, if necessary, in a Select Committee. My Bill went to a Select Committee thirty years ago, and then it was held that the law was sufficient to deal with the grievances that had been shown, but I think the interval has proved that that is not so; the law is not sufficient.
We have been given a very clear explanation of the way in which these mock auctions are run, and it is not necessary for me to mention anything more about that. I almost wish the noble Lord had gone a little further into the strange language that these gentlemen use. I think I was the first to use the phrase in your Lordships' House "gazoomphing the sarker", which is fairly expressive and there are many others. We might 1147 have had some explanation perhaps this afternoon of what is meant by "smitzing the bogey to hinton to noise the edge". The point is that these gangs have a little code language among themselves so that they can call out terms from one to another, from the top man to the man going round, in such a way that nobody understands in the least what is being said, and the "sarker", of whom we are told one is born every minute, is gradually drawn nearer and nearer into the net.
I think the debate so far as it has gone, particularly that very expressive argument from Sheffield as to the excellence of our goods and the need for maintaining their excellence and standard, has shown conclusively that there is a need to hold an inquiry. It may be that in the opinion of the legal experts the present Bill does not entirely meet the case, but I think that that would not be in any way a sufficient reason why Second Reading should be refused. I hope very much, as the Government has no opposition to the Second Reading but merely leave it to your Lordships' House, that we may get the Second Reading (and the noble Lord who moved the Motion I think fully deserves that), and we should have, if necessary, further full examination in a Select Committee. I hope that that course will be taken by your Lordships.
§ 4.35 p.m.
VISCOUNT COLVILLE OF CULROSS
My Lords, I hope I did not hear my noble friend Lord Chesham say, when he intervened in the speech of the noble Lord, Lord Crook, a short time ago, that he thought the law was all right on this subject.
VISCOUNT COLVILLE OF CULROSS
I am glad to hear it. If he had said so I should have had to disagree strongly. I have had the great advantage of accompanying the noble Lord, Lord Denham, to a mock auction and I have also gone so far as to join Lord Chesham's friend from the Home Office in buying a small souvenir on that occasion, and very nasty it was too. One thing that impressed me when I went there was the two other 1148 "mugs" who stood beside me, one of whom was on holiday from Glasgow, and I was sorry to see a fellow countryman of mine so easily parted from £10; the other was a visitor from Iraq who did very nearly as badly. If those are the victims, I feel that we should be very far from satisfied with the present law.
I think it was a new admission, or a comparatively new one, that the noble Lord made, that at the moment the procedure described by the noble Lord, Lord Denham, this afternoon is not in any way a criminal offence. I am afraid I muss very respectfully differ from the noble Lord, Lord Crook, in some of the things he said about this. I went into it in great detail and I am also of the opinion, very humbly, that no criminal offence is committed by the perpetrators of the sort of mock auction which has been described to the House this afternoon, except—and this is one exception—that it might be possible that they could have committed the offence of conspiracy, because that is one offence which does not necessarily need a criminal ingredient apart from the actual conspiracy itself. The aim which is sought by the conspirators may be one which is highly immoral or most injurious to the public. There have been cases—there was one in 1928—when mock auctioneers have been convicted for conspiracy. Otherwise might I say that the Sale of Goods Act, Section 58, in my reading does not impose a criminal offence. For the rest of them the mock auctioneers are very clever; they know a great deal about the law—certainly a great deal more than I do—and they take the maximum amount of trouble to avoid breaking it. They know exactly how far they can go, and they go to that point and no further.
It may be that some mock auctioneers do break the law, but here the trouble is and always has been, with very few exceptions in the past, as the noble Lord, Lord Crook, said, that the victim is most unwilling to come forward and give evidence to say how silly he has been. I would add one other point from personal experience. Even were it a case for a criminal prosecution and I were the victim who came forward to give evidence, I should be entirely unable to remember what had happened or what had been said, because the business is so quick and 1149 so slick that one comes away with a recollection completely blurred. I should be of no use to the police whatsoever and should fall down at once on cross-examination.
The point has been put: is this the best method of dealing with this subject? I should have said that it is. First of all, the Bill as it stands is designed to do away with the very difficulty about which I have just spoken, because it is not the victim in this case who will be giving evidence but, as I believe the noble Lord, Lord Denham, hopes, it will be the police officer. He, being on the look out, on the alert, and writing down each particular point as it arises, will be able to give exact evidence and knowledgeable evidence as to what has gone on. The other point I would make is that if the alternative step is taken of a general registration Bill, it must be admitted that as the present law does not bestow any criminal offence upon the mock auctioneer there is no earthly reason to stop his being registered as a perfectly ordinary auctioneer. If we do not have this Bill his registration will go through; he will continue in exactly the same way as heretofore.
At present the limited number of registration Bills that have been passed by local authorities have had the effect of scaring mock auctioneers away, because they are not very brave when it comes to facing the law, and they would rather give up in that area and go elsewhere Suppose this were nation-wide registration, there would be nowhere else for them to go; they would stand upon their rights and fight the appeal, and I see no reason why they should not be registered and carry on as before. Therefore I feel sure that this Bill is the right way to do it. Even if it does need more examination in Committee, I hope that your Lordships will support it and give it a Second Reading.
§ 4.40 p.m.
VISCOUNT MASSEREENE AND FERRARD
My Lords, I shall speak for only an extremely short time. My object is to support my noble friend Lord Denham who has, I know, taken infinite pains over this Bill and has gone to tremendous trouble to obtain all his facts. Your Lordships have heard him explain most ably how these frauds are perpetrated on the public, and he has told you all the standard jargon which belongs 1150 to Flook and Bodger of the Daily Mail—I cannot repeat the words, because I have not in any way the knowledge of these matters which he has; but I have been to these auctions, and it is obvious that a very great fraud is perpetrated. Some people say that if a man is fool enough to be cheated by such an act he ought to be prepared to take the consequences. I do not agree with that view. Surely one of the objects of the law is to protect the weak and the ignorant.
We live to-day in an age of high-wage packets, but, unfortunately, wisdom does not necessarily increase hand in hand with income. To-day, we have thousands of people who have a lot of cash in their hands and who are extremely easy game for these unscrupulous racketeers. One of the more unsavoury aspects of this matter concerns tourists from overseas and visitors from the Commonwealth and Colonies. On the occasions I have attended these auctions, I should say that easily half, and sometimes two-thirds, of the audience are foreigners or visitors from the Colonies. If a foreigner or somebody from our Commonwealth leaves England having been cheated, it leaves a nasty taste in his mouth.
I understood my noble friend, Lord Chesham, to say that he thought that this matter was not very widespread—that these auctions were not carried on in great numbers. But we have heard my noble friend Lord Denham say that the average auction turns over £1,000 a week. If there are only 50 of them that means that £50,000 a week is being procured by fraud. The noble Lord, Lord Crook, said that £8 million worth of these shoddy goods—I presume for these auctions—are manufactured. If that is so, and they are sold at four times their true value, that is £24 million a year of which the public are being defrauded. One cannot call that a small matter. I cannot understand why the Home Office cannot get down to this problem, and try to do something about it. This Bill appears to be the answer. I only hope that the Government will really be serious and that they will allow legislation on this matter. I fully support the Bill.
§ 4.46 p.m.
§ LORD FERRIER
My Lords, I understand that the Bill applies to Scotland. Before the noble Lord who introduced the Bill replies, would he, in his final remarks, indicate the position in regard 1151 to Scotland? I may be wrong, but I think that an auctioneer in Scotland has to be licensed and that his licence must be either displayed or available for inspection. I may be wrong about that, but that is my impression.
§ 4.47 p.m.
§ LORD DENHAM
My Lords, may I answer that last point first? I am not sure about the state of the law in Scotland as to auctioneers' licences. I know that there are mock auctions in Scotland, but I have been unable to find out how large their numbers are. I have been in correspondence with the Royal Burghs Association about it, but I believe that they thought that they would leave it until after this Bill came up before they decided whether or not to support it. So at the moment Scotland is included, but it may not be necessary for Scotland to be included in the Bill.
I should like to thank all noble Lords who have supported me on this Bill. I am not going to say very much because I am afraid that I kept your Lordships rather a long time when I spoke first. I wish to say just two things. First, I firmly believe that a new law is necessary. The noble Lord, Lord Crook, said that perhaps one of the best methods of combating mock auctions was publicity. Well, there has been a great deal of publicity in the Press over the years about mock auctions. The trouble is that somebody reads about a mock auction in his paper, and one can only suppose that the next year he has already forgotten about it. You cannot expect the papers to publicise the matter the whole time. I believe that a new law is necessary, and I feel that the method which I have adopted with this Bill is the most satisfactory of the three.
The noble Lord, Lord Chesham, suggested that mock auctioneers might devise new tricks to get round the provisions of this Bill. The only way in which I have been able to find that they can get round the provisions of the Bill is by taking out from these sales all the elements of competitive bidding. If they do that as a result of this Bill, I shall be quite satisfied with that result, because it is the auction element which makes this particular form of fraud so virulent. This Bill is by no means perfect. It could do with a great deal of overhauling and 1152 alteration, but I feel that much of the alteration it needs could be done in Committee if your Lordships would give it a Second Reading. I therefore ask your Lordships to do so now.
§ On Question, Bill read 2a.