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29 March 2012

Clamping down on scrap metal thieves

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By Sangeeta Bedi

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Following a dramatic rise in prices and a spate of incidents which have seen rail networks disrupted, church roofs pillaged and towns plunged into darkness, the scrap metal theft “epidemic” has been thrust into the spotlight. The issue has even made it into an episode of Eastenders – a sure sign of topicality! But why scrap metal?

Simply put, scrap metal is hard to identify and can be sold for cash (at ever-increasing prices), making it an attractive category of stolen merchandise. It may seem like a niche offence but metal theft is estimated to cost the country £1 billion annually, with more than 1,000 offences taking place every week.

The current law

The UK industry is currently regulated by the Scrap Metal Dealers Act 1964. All scrap metal dealers must be registered with their local authority and maintain records of all metal bought, sold or processed, with a particular emphasis on recording the source of scrap metal. Section 5(ii) even makes it an offence to give a false name or address to a scrap metal dealer. Any contravention under the act constitutes a summary offence punishable by a fine. But given the scale of the “epidemic”, is a £1,000 fine enough of a deterrent against the scrap metal menaces?

The reality is that the onus is placed on the sellers of scrap metal to adhere to legislation that is in need of modernisation. At present, thieves and handlers are prosecuted for burglary or criminal damage and the specific deterrent message as regards scrap metal is lost in the legal translation. However, there have been recent ripples of change. In March 2012, scrap metal dealer Michael Storey was sentenced to 12 months in jail by Lancaster Crown Court for the handling of copper piping stolen from a United Utilities pumping station (http://www.nwemail.co.uk/news/man-jailed-over-theft-of-copper-from-pump-site-1.931719?referrerPath=home). The theft had caused localised floods, disrupting 70 homes and costing £174,000 to replace the piping. In sentencing, Judge Paul Batty QC sounded a warning shot on future deterrent sentences, commenting that “theft of scrap and its subsequent utilisation by handlers has become nothing short of a national scandal.”

What’s on the horizon?

The Home Secretary has confirmed that further measures for illegal trading of stolen scrap metal will be introduced. The first significant change is the amendment to the SMDA 1964 via the Legal Aid, Sentencing and Punishment of Offenders Bill (currently in the Report Stage in the House of Lords). The Bill proposes significant increases in fines imposed and a prohibition on cash transactions which lead to “anonymous, low-risk transactions” and “poor record keeping” within the industry. Some commentators have noted that a ban on cash transactions might only serve to force deals underground.

The Government has also allocated £5 million for the creation of a dedicated metal theft taskforce, whilst the Metropolitan Police have already set up such an operation in Bexley, an area plagued by rail network metal thefts.

Metal Theft (Prevention) Bill

Furthermore, the Government has honed in on the prevention of metal theft itself. The Metal Theft (Prevention) Private Member’s Bill, introduced in November 2011, advances a series of measures. These include: a licensing scheme for scrap metal dealers; giving magistrates’ courts the power to impose restrictions on licenses; creating a specific criminal offence for the theft of scrap metal; and restricting the trade to cashless transactions (a requirement already applicable in many European countries). Police officers would also be given powers to search properties owned by scrap metal dealerships. The second reading of the Bill is due at the end of March 2012.

Notably, the Bill also proposes the classification of scrap metal proven to have been obtained by theft as a criminal asset, thus engaging the Proceeds of Crime Act 2002 and enabling police forces to recover monies obtained by selling stolen metal for scrap.

Advice for scrap metal dealers

In addition to adhering to the licensing and record keeping requirements of the 1964 Act, scrap metal dealers are encouraged to be proactive in preparing for any legislative changes. Self-regulation and the introduction of voluntary codes of practice, comprehensive records, more robust methods of verifying metal sources, and enhanced scrutiny of cash deals will all help to ensure that a dealer is operating within the legal framework.

Corker Binning is a law firm specialising in general criminal work of all kinds. Visit our website for more information about how we can help you or call us on 0207 353 6000.

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