Lord Clement-Jones (LD)

My Lords, we strongly support Amendment 358 in the names of the noble Lords, Lord Vaux, Lord Young of Cookham and Lord Holmes of Richmond, and the noble Baroness, Lady Morgan of Cotes, who have made the case extremely well today. I pay tribute to the Fraud Act committee chaired by the noble Baroness, Lady Morgan, and I shall quote from it extensively in the next group. This amendment would rightly ensure that the definition of a specified article included devices capable of using virtual subscriber identity modules, not just physical SIM cards. As we have heard, the criminal landscape evolves rapidly. If we legislate only for plastic SIMs, criminals will simply pivot to readily available virtual SIM technology. By incorporating virtual SIMs into the definition now, we will help to future-proof these provisions and make them genuinely effective against highly scalable, technology-enabled fraud. Clauses 112 to 117 quite rightly seek to address the serious and growing problem of SIM farms being used at scale to perpetrate fraud and other abuses—it was very interesting to hear the quotes of the noble Lord, Lord Young, from the Select Committee’s report, which demonstrates that the problem has been with us for several years now—but, as drafted, Clause 114 risks being a technological step behind the criminals. As we have heard, it refers to devices capable of using physical SIM cards, but the market is already rapidly moving towards virtual or embedded SIMs. Indeed, I have an iPad in my hand that has a virtual SIM inside it—no physical SIM card at all. If the Bill focuses only on the plastic card and not the underlying functionality, it will leave an obvious loophole that organised criminals will quickly exploit. The noble Baroness, Lady Morgan, spoke of “entrepreneurial” but not in a good way. We know that fraudsters are highly adaptive. As mobile operators deploy more robust controls on physical SIMs—I suspect not enough for the noble Lord, Lord Vaux—and as handsets and routers increasingly use eSIMs or other virtual identities, those intent on running industrial-scale smishing and scam operations will migrate to those platforms. If we legislate today for yesterday’s technology, we will simply displace the problem from one category of device to another and be back here in a few years’ time having the same debate. I hope the Minister will be able either to accept the amendment or to confirm that the Government will bring forward their own wording—there is always a bit of “not invented here” with these things. Without that assurance, there is a real risk that this part of the Bill will be lacking in force from the day it comes into effect.