HL Deb 03 December 1986 vol 482 cc819-20

2.56 p.m.

Lord Williams of Elvel

My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government whether they intend to take further action to prevent insider dealing and similar malpractices in the securities markets.

Lord Beaverbrook

My Lords, the Government are committed to vigorous enforcement of the law against insider dealing. My right honourable friend the Secretary of State for Trade and Industry is always ready to appoint inspectors under Section 177 of the Financial Services Act, whenever there is reason to do so.

Lord Williams of Elvel

My Lords, I am grateful to the noble Lord for his Answer. Will the noble Lord agree that the Guinness affair is only the tip of a very large iceberg? Are the Government aware that Mr. Ivan Boesky is not alone in his activities and that a number of other people and other organisations are engaged in similar activities? Are the Government going to act against these people as well? Finally, when will the Government activate in full the Financial Services Act so that these and other malpractices may be rooted out once and for all?

Lord Beaverbrook

My Lords, I think that the House will understand if I do not comment on individual cases. However, the Government, the Stock Exchange and the City firms are alert to the pernicious abuse of inside information and have not hesitated to act vigorously against it. We believe in the effectiveness of self-regulation. One of the merits of self-regulation is that practitioners are often those best placed to detect malpractice by other practitioners.

Lord Grimond

My Lords, will the Minister accept that there is wide agreement about what has been said by the noble Lord, Lord Williams of Elvel, when he commented on the anxiety about insider dealing? Will the Government undertake that no City firm of which a member is convicted of insider dealing will receive any contract from the Government or any public authority under its control?

Lord Beaverbrook

No, my Lords.

Lord Harmar-Nicholls

My Lords, is not the fact that these things are coming to light some confirmation that self-regulation is working? Are these not early days to be critical in the sense of the words in this Question?

Lord Beaverbrook

Yes, my Lords. We believe that the Financial Services Act will work very well, and we believe that the parts of it already in force are working very well.

Lord Jenkins of Putney

My Lords, is the noble Lord aware that while we can perhaps appreciate that he was unable to give an affirmative answer to the question posed by the noble Lord, Lord Grimond, he should at least not have given an absolutely negative answer? Might he not have said that the Government will look into the question, or some such thing?

Lord Beaverbrook

My Lords, I am afraid not.

Lord Jenkins of Putney

My Lords, is this not utterly useless?

Noble Lords

Order!

Lord Taylor of Gryfe

My Lords, will the Minister agree that since the provisions of the Financial Services Act which have recently been brought forward to deal with a specific case are in operation, it is too early to condemn self-regulation as a means of supervising these affairs? May I congratulate the Government on the steps that they have taken to implement immediately the provisions in the Financial Services Act covering insider dealing?

Lord Beaverbrook

My Lords, I agree.