Extradition from the UK to the US—NatWest Three Fallout

Controversy continues to flourish in the United Kingdom as the House of Commons, led by the Liberal Democrats, is considering whether to pass emergency legislation “to prevent the threatened extradition of three former NatWest bankers to the US.”^[1] This is the first call from a politician to change extradition arrangements in time to affect the NatWest Three.^[2] A similar bill currently going through the House of Lords “could be amended to give British citizens greater protection against extradition requests”; that bill however, “would come too late the keep the NatWest Three in the UK.”^[3]

According to Sir Menzies Campbell, the Liberal Democrat party leader, the extradition agreement between the US and the UK is “’a constitutional disgrace’ that unequal extradition arrangements with the US were leaving British business-people vulnerable.”^[4] The outrage is refreshing and appropriate, but it would be nice if there was outrage for the non-business people who have been extradited under the framework as well.

The proposed legislation would consist of a single clause, “specifying that no extradition treaty would be honoured by the UK unless and until ratified by the partner nation.”^[5] In truth, however, even if the 2003 extradition treaty between the US and the UK were ratified by the US Senate, the extradition framework in the treaty is still heavily unbalanced in the United States’ favor, as we discussed in November.

In related news, one of the larger questions surrounding the extradition of the NatWest Three is why Royal Bank of Scotland didn’t “involve itself directly in the case.”^[6] After all, if it had, it would have been more likely that a criminal prosecution would have been opened in the UK, which would have precluded any extradition on the same charges based on double jeopardy considerations. There are finally hints of an explanation. “The reason for its reticence may be found in the fact that RBS’s headaches over Enron extend far beyond the potential reputational risk of its links to Messrs Bermingham, Darby and Mulgrew, who all left RBS in 2000.”^[7] A separate civil lawsuit, known as the Newby class action, accuses NatWest of fraud, and within that litigation, RBS is accused of aiding and abetting “certain Enron officers in breaching their fiduciary duties.”^[8] Furthermore, other transactions involving RBS implicate in the bank in fraudulent behavior.^[9] In other words, RBS has an enormous amount of exposure in the Enron collapse, and it seems that the bank was attempting to lay as low as possible in hopes that the storm would pass; it seems it hasn’t and the Newby class action is scheduled to get under way in earnest this Fall.^[10]

In other Enron-related news, Ken Lay has died of an apparent heart attack.^[11]

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[1] Miranda Green, Lib Dems Call for Law to Halt Bankers’ US Move, Fin. Times, Jul. 5, 2006.
[2] Id.
[3] Id.
[4] Id.
[5] Id.
[6] Jeff Randall, The Fog Lifts Over RBS’s Inaction on NatWest Three, The Telegraph (UK), Jul. 5, 2006.
[7] Katherine Griffiths, Enron Links Beyond the NatWest Three, The Telegraph (UK), Jul. 4, 2006.
[8] Id.
[9] Id.
[10] Id.
[11] Carrie Johnson et al., Enron Founder Ken Lay Dead of Heart Attack, Wash. Post, Jul. 5, 2006.