Queen's speech: George Osborne to outline banking reform plans

Government to press ahead with banking reform and Vickers recommendations – with further details released next month

The queen prepares to deliver her speech to parliament. Photograph: Oli Scarff/Getty

The government signalled its determination to press ahead with banking reform in the Queen's speech but intends to provide more details on 14 June when George Osborne delivers his Mansion House speech.

The white paper outlining how the government intends to force banks to erect a ringfence between their high street and investment divisions will be published alongside the chancellor's set-piece speech next month.

Kevin Burrowes, UK financial services leader at PwC, said: "Formally signalling intent to pursue ringfencing helps eliminate uncertainty but, in reality, the banks are already well aware this would be pursued by the government. All banks are already undertaking enormous changes to their business models in light of trading outlook and pressure to generate acceptable returns for investors for the increasing capital that has to be invested."

In the speech, the Queen said that "measures will be brought forward to further strengthen regulation of the financial services sector andimplement the recommendations of the independent commission on banking".

The commission, chaired by Sir John Vickers, also included recommendations on bolstering competition among high street banks by making it easier to move bank accounts. There were also proposals about "depositor preference", which would allow savers to get their money back when a bank goes bust before other creditors – a move that is intended to reduce the need for taxpayer bailouts. Despite lobbying by the banks for this to be avoided, the government is expected to press ahead with change.

While the Vickers legislation is expected to be passed by 2015, the banks are likely to have until 2019 to implement the artificial ringfences.

David Wootton, lord mayor of the City of London, said the City would work with the government on implementing bank reform: "The City looks forward to working closely with government to ensure that these reforms – particularly ringfencing – are sensibly implemented in a way that delivers a stable and secure banking system, but does not hinder economic growth.

"Clearly, the taxpayer should not be asked to underwrite bank bailouts again but we must also guard against hindering the UK's capacity for future growth."

Clinton Cards goes into administration

More than 8,000 jobs on the line as embattled retailer becomes latest high street chain to be hit by spending slump

Clinton Cards operates 628 Clinton and 139 Birthdays stores. Photograph: Alamy

More than 8,000 jobs at Clinton Cards were on the line after the group became the latest casualty of the high street spending slump.

Earlier its biggest supplier had said it planned to push the British retail chain into administration.

The aggressive move by American Greetings (AG) wrongfooted Clinton's chief executive, Darcy Willson-Rymer, who had hoped to work closely with the New York-listed group as part of a turnaround of the loss-making retailer.

But AG took action on Tuesday night, buying up Clinton's £35m debts from Barclays and taxpayer-backed Royal Bank of Scotland and then calling in the loans.

Nick Hood, the restructuring expert who runs analyst group Company Watch, told the BBC this was a popular tactic in the US called "loan to own". "This is a very American way of doing insolvency," he said. "You buy the loans as a way of taking control of the company."

The move puts AG in pole position ahead of any restructuring. Unlike banks, suppliers are unsecured creditors and usually lose out when a company goes under. "AG may not get all their money back this way, but they will get a lot more back than if they had not employed this strategy," said Hood.

Whereas the banks had waived certain conditions on the loans, AG has said it will push the company into administration. The Ohio-based company, which has annual sales of $1.6bn (£990m) and manufactures cards under brands such as Carlton Cards, is expected to make a statement later on Wednesday.

Clinton Cards, which operates 628 Clinton and 139 Birthdays stores, earlier requested that its shares be suspended on the London Stock Exchange. It is the country's biggest card retailer and according to its website has 8,350 employees, mostly working in store, many on a part-time basis.

Staff have been told to turn up for work and it is thought the administrators will continue to run the stores as normal while seeking a buyer – although a substantial number of the shops are ultimately expected to close.

Clinton's problems are another blow to the high street following recent high-profile casualties, including video games retailer Game, fashion chain Peacocks and outdoor specialist Blacks Leisure.

Clinton has suffered dire trading in recent months as it comes up against stiff competition from supermarkets and online retailers such as Funky Pigeon and Moonpig, which sell personalised cards. It made a pre-tax loss of £3.7m in the 26 weeks to 29 January, compared with a profit of £11.7m in the previous year, and warned that the second half of the year would be below expectations.

Willson-Rymer has been working on a strategic review for six months, which is understood to have included a fruitless search for a buyer for all of the business or its Birthdays chain. Clinton revealed more poor trading for the 14 weeks since 29 January, with same-store sales down 3.5%.

Clinton said that it was not in breach of any financial covenant or repayment obligation, but that the banks had waived "technical breaches of default" related to management changes and supplier-related discussions. It had believed that AG would have extended that support if it bought the loans, and had been caught off guard by the decision the US company made.

The crisis is a dark day for founder Don Lewin, who started the retailer in 1968 from a shop in Epping, Essex. In 1988 it had 77 stores when it floated on the stock market. Its store numbers were swelled by numerous acquisitions, including Hallmark Cards and the ill-fated Birthdays Group, which had 170 stores, in 2004.

Spain prepares to nationalise Bankia amid market turmoil

Bankia's board was meeting on Wednesday night, with reports that new chairman José Ignacio Goirigolzarri would ask the government to take control of the troubled bank

Bankia is on the verge of being nationalised. Photograph: Paul White/AP

Spain's government is poised to partly nationalise the country's fourth-largest bank, Bankia, according to reports in the Madrid press, as investors dumped Spanish bonds and stocks amid increasing worries about the country's banking sector.

Bankia's board was meeting on Wednesday night, with reports that new chairman José Ignacio Goirigolzarri would ask the government to take control of the troubled bank as it sinks under a mountain of toxic real estate assets.

It was unclear how that would happen, however, with reports that the government would convert a €4.5bn (£3.6bn) loan to the banking group's parent company, BFA, into shares. Other estimates see the bank needing €10bn.

Jitters about banks drove the Madrid stock market to an eight year low, while yields on benchmark 10-year Spanish sovereign bonds soared back over the key 6% level.

The selloff was further proof that Spain has become the main worry in the troubled eurozone as the country suffers a second recession in three years and unemployment hits 24%.

The Bankia debacle showed how Spain's banking sector has failed to digest the pile of toxic assets and debt left over by a property bubble that burst four years ago. There have been suggestions that it will need help from the eurozone's rescue fund to tackle the problem.

Prime minister Mariano Rajoy dodged questions on Bankia saying only that reforms to be announced by Friday will "will help solve a lot of Spain's economic problems".

Those reforms will include yet another round of provisioning against toxic real estate with banks ordered to set aside a further €35bn on top of the €54bn they are already provisioning, financial sources told Reuters.

Bankia was created just 17 months ago by the merger of seven regional savings banks in an attempt to shore up their combined defences against the bad real estate loans, worthless building land and unsold apartment blocks they had accumulated.

Saving banks, many controlled by local politicians, were the most reckless lenders to developers, land speculators and building companies, which have left Spanish banks burdened with €184bn of problem loans and assets.

Alberto Garzón, a deputy for the communist-led United Left party, warned Rajoy against using public money to nationalise only the Bankia group's separate "bad bank" — where many of its toxic assets are parked – while leaving the healthier part of the bank in private hands.

Milly Dowler: truth about deletion of messages may never be known

Police inquiry confirms murdered teenager's phone was hacked but says key evidence has been lost

Milly Dowler: police said because the full technical call data was missing, reaching a definitive conclusion may never be possible. Photograph: Surrey police/PA

The full truth about the extent of hacking into Milly Dowler's phone may never be known, police have admitted. Their report to the Leveson inquiry followed an investigation lasting five months into the hacking of the murdered teenager's phone.

"It is not possible to state with any certainty whether Milly's voicemails were or were not deleted," says the report, which was written by Detective Chief Inspector John Macdonald from the Metropolitan police's Operation Weeting, which is investigating phone hacking.

He said two voicemail messages appeared to have been removed at the time, but because the full technical call data was missing, "reaching a definitive conclusion is not and may never be possible".

The police said last year that a Guardian report might have mistakenly blamed the News of the World private detective Glenn Mulcaire for deleting Milly's voicemails and giving her family "false hope" that she was still alive because new evidence had emerged about the dates of calls.

Wednesday's report does not seek to exonerate Mulcaire over the deletions but refers only to NoW reporters.

It says: "There is no evidence at present to support a suggestion that any journalist attempted to hack into Milly's phone prior to 26th March 2002."

It is believed the "false hope" moment when Sally Dowler found that messages had been deleted on Milly's phone was on 24 March.

The report confirms, however, that NoW hacking did subsequently take place.

Gill Phillips, the lawyer for the Guardian, which originally revealed the hacking of Milly's phone, told the inquiry: "The Guardian welcomes the fact that the Metropolitan police has modified its statement from last December.

"The Guardian has no wish to cause any distress to the Dowler family. We also recognise the continuing need for care in reporting this matter given the ongoing criminal investigation."

She said the statement made clear that "the News of the World hacked into the voice messages of Milly Dowler after she disappeared in March 2002. The police have found evidence to suggest that somebody may have manually deleted two of Milly's messages but they have been unable to identify the person responsible. They have also found evidence which suggests automatic deletion.

"In April 2002. Surrey police made a connection between the apparent deletion of Milly's messages and the News of the World. The manual deletion of the messages was discussed by Sally and Bob Dowler and the police during meetings in 2011. The Dowlers speculated to the police that their 'false hope moment' was due to such manual deletion. Surrey police continued to regard this link as 'completely reasonable and absolutely possible' and the Metropolitan police did not seek to dissuade Mr and Mrs Dowler from this belief. The Guardian's story of 4 July 2011 was based on multiple sources and their state of knowledge at the time. Our error – as we acknowledged and corrected last December – was to have written about the cause of the deletions as a fact rather than as the belief of several people involved in the case. We regret that.

"After five more months of intensive inquiry, the police have found that the passage of time and the loss of evidence means that 'reaching a definitive conclusion is not and may never be possible'."

The NoW lawyer, Antony White QC, said repeated an apology for the NoW's behaviour. He said that nevertheless the false hope moment was likely to have been caused by automatic dropping-off of voicemails after 72 hours.

The Guardian submitted to the inquiry a timeline detailing the paper's understanding of the sequence of events surrounding the hacking of Milly's phone.

David Sherborne, for the Dowlers and other hacking victims, said important questions remained unanswered and that the NoW was "rotten to its core".

He read out a statement from the Dowler family. They thanked the police team for their efforts, but said "neglect and deference" by Surrey police in 2002 had caused the original failure to investigate and prosecute the NoW for hacking. Praising the Guardian's reporter, Nick Davies, they said the scandal had only come to light thanks to the "relentless efforts of one journalist".

Sherborne said: "If Surrey police had prosecuted this activity in 2002 then the position would have been very different and perhaps countless others might also have been avoided having their private messages hacked into by the News of the World. Police neglect and deference meant that it took the relentless efforts of one journalist to uncover what the police knew had gone on, and whilst we would never have wished to have been thrust into the middle of this extraordinary scandal on top of what we have already had to deal with as a family, we continue to have faith that his efforts and the efforts of the inquiry and Operation Weeting will have a lasting positive impact."

Later Mark Lewis, the solicitor acting for the Dowler family, said Rupert Murdoch's decision to pay Milly Dowler's parents £3m in an out-of-court settlement for phone hacking had nothing to do with allegations that the News of the World had deleted her voicemails.

He said demands that some of the Dowler money be refunded, because it was impossible to say whether or not the News of the World deleted a voicemail that led to the "false hope" that the teenager might be alive, were misplaced.

"I cannot recall ever discussing the concept of false hope in any negotiations between the Dowlers through me and News Corporation through their lawyers," he said.

Met police officer to be charged over assault allegations

CPS to charge PC Joe Harrington with assault 'occasioning actual bodily harm' over allegations he attacked black teenager

The decision to prosecute PC Joe Harrington is the second time in a month the CPS has reversed an earlier decision not to prosecute a police officer. Photograph: Dominic Lipinski/PA

A police officer will face prosecution over allegations he assaulted a 15-year-old black teenager who was handcuffed in the custody area of aLondon police station shortly after last summer's riots.

Metropolitan police constable Joe Harrington is to be charged with assault "occasioning actual bodily harm" over allegations he attacked Terelle Ferguson, now 16, at Forest Gate police station.

The decision to charge the officer was announced by the Crown Prosecution Service, which had previously decided there was no realistic prospect of prosecution in the case. Alison Saunders, the chief crown prosecutor for London, said it was "regrettable" that prosecutors previously came to the wrong conclusion in the case.

"I hope the seriousness with which the CPS has taken this matter gives the public confidence that we are an organisation which will review our decisions, openly accept when we've got them wrong and then take the correct course of action," she said.

The complaint against Harrington, first reported in the Guardian, was one of 13 alleged racism cases identified by the Met in recent weeks. However, there was no suggestion in the CPS announcement that there was any racial dimension to Harrington's prosecution.

The decision to prosecute Harrington is the second time in the space of a month the CPS has reversed an earlier decision not to prosecute a police officer. Both cases involved alleged mistreatment of young black males by officers at Newham police station.

Saunders said: "In February this year the Crown Prosecution Service decided there was insufficient evidence to charge PC Joseph Harrington in relation to an alleged assault on a young man in custody in August 2011.

"The incident was investigated by the Independent Police Complaints Commission, with CPS involvement beginning in November 2011. The IPCC gave summaries of interviews to the CPS in February, and in the same month the CPS decided that there was no realistic prospect of conviction in the matter.

"Grace Ononiwu, deputy chief crown prosecutor for CPS London, directed in April that there should be a new review of this case after concerns were raised with CPS London. That review is now complete and I have decided that there is sufficient evidence for a realistic prospect of conviction to charge PC Harrington with assault occasioning actual bodily harm contrary to section 47 of the Offences Against the Person Act 1861.

She added: "Occasionally, a new look at a prosecution decision shows that the wrong view of the evidence was taken. That is regrettable. In this case, the conclusion originally reached was not tenable on the available evidence.

"When a review shows a previous decision not to prosecute is clearly wrong, it is open to the CPS to rectify that error by reconsidering the prosecution decision at chief crown prosecutor level. As chief crown prosecutor for London, I have taken the decision in this case that not only is there sufficient evidence to provide for a realistic prospect of conviction, and that a prosecution is required in the public interest, but that a prosecution is necessary in order to maintain confidence in the criminal justice system.

"That is the test I must apply under the code for crown prosecutors when reinstituting a prosecution. It is clear that the allegation of using excessive force on a handcuffed 15-year-old in custody is a serious matter."

Saunders said she had advised the IPCC to summons Harrington. She added: "All parties have now been informed. Can I please remind all concerned that PC Harrington is to be prosecuted for a criminal offence and has a right to a fair trial. It is very important that nothing is said, or reported, which could prejudice his trial. Proceedings are now active."

Victim of Rochdale child sex ring: 'they ripped away all my dignity'

Victim whose 2008 complaint to police eventually led to conviction of nine men tells how grooming began




Rochdale grooming victim talks about her ordeal. Link to this video

The girl whose complaint to police in 2008 led to the conviction on Tuesday of nine men for running a child sex ring said the grooming began when a friend introduced her to men who promised her "free alcohol and cigarettes, food and taxis and things".

She thought it was "great" at first because there were no sexual strings attached.

"I just thought: 'I can get all this stuff for free.' And then I ended up living pretty much with this girl because I thought how good it was and I could do what I want. That's when the relationship turned bad with my mum and dad because of the way I was acting."

She said the first time she was attacked, "you don't expect anything like that to happen. I just thought I was having a good time with this getting drunk and stuff. I was young and I didn't think they'd want me."

The men did not talk to the girls much. "We'd be upstairs [above a takeaway] and they'd be downstairs … and they'd come up now and then and have a chat to us for five minutes. It made me feel like I was pretty. I never thought they'd do what they did to me because you don't think that, do you? That that will happen."

She said of one man: "He asked me to come upstairs and I didn't really think anything of it. Then he was basically saying about all the things he's bought for me and he wants something back for it. Then I was saying no, like, I was kind of saying it in a giggly way. I felt like if I'd said it nastily to him he could have hurt me. I tried to say no in a nice way but he just weren't having it."

She said her friend had changed her. "At that time I was scared of her and I was scared of them as well. At first I felt really bad and dirty and ashamed, but after a while it had been going on for so long and so many different men that it just became … I didn't feel anything. It weren't like me any more."

The girl said it just became something she had to do "and I couldn't get out of it. Like once you're in it, you're trapped. It just became like a daily life." She said this could mean having sex with up to five different men in a day, sometimes every day, but at least four or five times a week.

"They'd arrange a time and they'd come and pick me and her up and we'd go to the place, a flat or a house, and there would be different men waiting. There were quite a few men who would be there and there's other men who would pick us up and take us to different places for the other men waiting. But there was a lot of men that I'd only seen once or twice."

She said that on one occasion she had got drunk and angry and smashed the counter in the takeaway, and the men rang the police and she was arrested. She said she was scared to tell her parents "because I didn't know what the consequences would be from the men. Because I knew what they were capable of, because they'd threatened me."

During the 2008 interview, she told police what had happened, gave them her underwear and described the places where it had happened. When the Crown Prosecution Service decided not to prosecute, she said the abuse just carried on.

"I was back in the same position and she [the other girl] was introducing other men to me again. It just started again with different men and more men this time. And that's when it started becoming like up to five men a day."

She said: "I felt let down. But I know that they believed me … then in 2008 it weren't really heard of … Asian men with white girls. Nobody like … it was just unheard of. You think of Muslim men as religious and family-minded and just nice people. You just don't think they'd do things like that."

The girl said social services intervened because different men were picking her up and dropping her off from school, and she was arriving dirty and smelling of alcohol.

"Then I got pregnant and social services said to me that if I don't leave that house [the house she was sharing with the other girl] they'll remove my baby at birth and I were frightened to go because I didn't know what they'd do … the men."

When she moved back in with her parents, she was getting phone calls and taxi drivers were parked outside the house, watching it.

"I'd be getting phone calls off the girl and the men and that went on for months. I would not go out of the house on my own for nine months or something without my mum or dad because I was frightened what could happen." She said she eventually moved out of the area.

"I just hope now people realise it does happen and how it happens and how they do something about it … and justice will be done."

She added: "There are so many different men and you're being forced to sleep with these other men for them to gain money for selling you out. They frighten you and you're scared of them and obviously that's how they make you do it. The girls are too frightened to get out of it in the first place – to tell somebody."

The girl she was staying with and her sister thought they were in a relationship with the perpetrators, but "it's not a relationship. They're just brainwashing you so you think that they love you so you'll do what they say.

"I think what they did to me was evil. They ripped away all my dignity and my last bit of self-esteem and by the end of it I had no emotion whatsoever because I was used to being used and abused daily.."

She said she regarded the defendants' testimony describing the victims as prostitutes running a business empire as "ridiculous".

"How could I make it up? It was too big to lie about. How can 13, 14, 15-year-olds run a business empire of prostitutes? It's just stupid."

Louise Mensch 'troll' is told he could face jail

Frank Zimmerman, 60, tried to drive the Conservative MP off Twitter by saying one of her children would be killed

Louise Mensch said the abusive email from Frank Zimmerman had left her feeling 'powerless and scared'. Photograph: Olivia Harris/Reuters

An internet "troll" who tried to drive the Conservative MP Louise Mensch off Twitter by sending her an email threatening the lives of her children has been warned he could be jailed for six months.

Frank Zimmerman, 60, told Mensch she faced "Sophie's choice", meaning she would have to decide which of her children lived and which died. Zimmerman, from Gloucester, told Mensch her phones and computer had been hacked and images of her family would be posted online.

At a hearing in Gloucester on Tuesday, Zimmerman said he had no recollection of having sent the message and claimed his own email account had been hacked and the offensive messages sent from it by someone else.

But Judge Martin Brown said he was satisfied the case against Zimmerman had been proven. The judge said he would sentence him on 7 June at Cheltenham and warned him that he could be imprisoned for up to six months.

Zimmerman said he had no means of getting to Cheltenham and told the judge he did not even have enough money to eat. But the judge told him he would have to find a way of getting there.

Zimmerman targeted Mensch following last summer's riots when the MP suggested that sites such as Twitter ought to be closed down if the police thought it necessary. Mensch was also in the public eye as part of the Commons culture, media and sport committee, which questioned Rupert and James Murdoch.

Addressing the Corby MP as the "slut of Twitter", Zimmerman said: "We are Anonymous and we do not like rude cunts like you and your nouveau riche husband Peter Mensch. We are inside your computer, all your phones everywhere and inside your homes.

"So get off Twitter. We see you are still on Twitter. We have sent a camera crew to photograph you and your kids and we will post it over the net including Twitter, cuntface. You now have Sophie's Choice: which kid is to go. One will. Count on it cunt. Have a nice day."

Mensch was in New York when she received the abusive email in August last year.

In a victim statement she said: "It was abusive and threatening, making threats to my children and saying I would have to choose which one would die. I felt powerless and scared that my children had been targeted."

The police tracked Zimmerman down to his run-down, rubbish-filled home and he was charged with "sending Mrs Mensch an electronic message that was grossly offensive or of an indecent, offensive or menacing character".

Zimmerman claimed he could not come to court for his trial because he suffered from agoraphobia. Arrangements were made for him to appear via video link but he failed to take part and was convicted in his absence.

The "Sophie's choice" phrase is a reference to the film of that name in which Meryl Streep plays a mother who has to choose which child to save and which to send to a Nazi gas chamber.

Rochdale child sex ring: nine men jailed

Judge imposes prison sentences of between four and 19 years and says gang was driven by lust and greed

Abdul Aziz, 41, of Rochdale, who took over as the main trafficker of the victims, was jailed for nine years. Photograph: PA

A gang of nine Asian men who groomed white girls as young as 13 with drink and drugs were driven by lust and greed, a judge has said.

The men, from Rochdale, were sentenced at Liverpool crown court after being convicted on Tuesday of conspiracy to engage in sexual activity with children under the age of 16, and other offences.

Police stood guard in the courtroom and around the building amid fears of a large demonstration or disruption by far-right groups. In the event fewer than a dozen BNP members gathered outside, holding placards and shouting towards television crews and press photographers.

Opening his sentencing remarks, the judge, Gerald Clifton, told the guilty men: "All of you treated [the victims] as though they were worthless and beyond respect."

The man seen as the ringleader, a 59-year-old who cannot be named for legal reasons, was jailed for a total of 19 years for conspiracy, two counts of rape, aiding and abetting a rape, sexual assault and a count of trafficking within the UK for sexual exploitation.

The defendant was previously banned from court because of his threatening behaviour and for calling the judge a "racist bastard". Simon Nichol, defending, said his client did not wish to attend the sentencing hearing and had ordered him not to put any mitigation before the judge.

"He has objected from the start for being tried by an all-white jury and subsequent events have confirmed his fears," Nichol said. "He does not take back any of the comments he has made to your honour, to the jury, or to anyone else in the court during the course of the trial.

"He believes his convictions have nothing to do with justice but result from the faith and the race of the defendants. He further believes that society failed the girls in this case before the girls even met them and now that failure is being blamed on a weak minority group."

The judge called the defendant an "unpleasant and hypocritical bully".

Kabeer Hassan, 25, of Oldham, was jailed for nine years for rape and three years concurrently for the conspiracy conviction. The trial heard that the 59-year-old ordered the first victim to have sex with Hassan as a "treat" for his birthday. Hassan raped the girl, who was then aged 15.

Abdul Aziz, 41, was sentenced to nine years for conspiracy and nine years concurrently for trafficking for sexual exploitation. The married father of three took over from the 59-year-old as the main trafficker of the victims and was paid by various men to supply girls for sex. Ahmed Nadim, in mitigation, said the defendant had led "thus far an industrious and socially responsible life".

Abdul Rauf, 43, was jailed for six years for conspiracy and six years concurrently for trafficking for sexual exploitation. He asked a 15-year-victim if she had any younger friends, and would drive some of the girls to other men who would use them for sex despite knowing they were underage. Zarif Khan, in mitigation, told the judge Rauf's fall from grace was "particularly significant".

Mohammed Sajid, 35, was sentenced to 12 years for rape, six years for conspiracy, one year for trafficking and six years, all concurrent, for sexual activity with a child. Known as "Saj", he would regularly ply victims with alcohol before having sex with them at his flat, where groups of men would gather and "pass around" the girls.

Gerard Doran, defending, said in mitigation that each of the three victims "maintained that there was no violence used against them" by Sajid. The defendant will be deported back to Pakistan after serving his sentence.

Adil Khan, 42, was given eight years for conspiracy and eight years concurrently for trafficking for sexual exploitation. Khan fathered the child of a 13-year-old victim who believed she was in love with him. Tina Landale, defending, said Khan had lost everything and that his family had been subjected to racist abuse since he was arrested.

Mohammed Amin, 45, was sentenced to five years for conspiracy and 12 months concurrently for sexual assault. Simeon Evans, in mitigation, said: "He has no previous convictions and no previous complaints about his character in 13 years of working as a taxi driver."

Abdul Qayyum, 44, was jailed for five years for conspiracy. Philip Boyd, defending, said of his client: "He is a hard-working man of significant character in his community. He has a young family and wife who will be placed under considerable pressure by this conviction."

Hamid Safi, 22, an illegal immigrant of no fixed address, was jailed for four years for conspiracy and one year concurrently for trafficking. He entered the UK on a lorry in 2008 and claimed to have fled Afghanistan because his uncle was murdered by the Taliban. He moved to Rochdale after he was released from a detention centre in Birmingham in March 2009.

Safi will be deported back to Afghanistan following his sentence. His barrister, Stuart Duke, told the court the offences were "not something he orchestrated or instigated".

Rochdale child sex ring case: respected men who preyed on the vulnerable

The conviction of nine men who exploited girls raises concerns about prosecutors' initial decision not to charge two of them

The Crown Prosecution Service decided in 2009 not to charge Kabeer Hassan. Photograph: Gmp/PA

One of the victims had sex with 20 men in one night when she was drunk, according to police. The girl was 15 and can barely recount events but her friend recalls men queueing up outside a bedroom. Another had drunk so much alcohol she was raped by two men while she was vomiting over the side of a bed. She then cried herself to sleep.

All the girls targeted by the gang of nine men convicted on Tuesday of sexually exploiting the girls were vulnerable and from broken homes, hanging around takeaway shops in Heywood, near Rochdale, late at night and befriending the staff there. They were plied with drugs, alcohol, food and gifts. Some of the men paid them to be introduced to younger girls and they were "shared" among the men.

Five girls were initially identified as victims of child sexual exploitation, but during the course of the police investigation involving the nine offenders – who were chiefly British Pakistani men with ordinary jobs, often married and well-respected within their community – the police identified a further 42 victims.

Greater Manchester police first heard about the grooming when one of the teenage girls made a complaint four years ago. Detectives took her case seriously and offered her support. But controversially, the Crown Prosecution Service took the decision in 2009 not to charge two of the men convicted on Tuesday, a 59-year-old who cannot be named for legal reasons, and Kabeer Hassan, despite one of the victims giving a lengthy videotaped interview to police. DNA evidence was collected from the girl's clothing that was crucial to the case.

The decision not to prosecute was hastily overturned in summer 2011 when the north-west's new chief crown prosecutor, Nazir Afzal, took up his post.

Afzal said the original prosecuting decision was based on the credibility of the victim, and the original lawyer felt there was "insufficient credibility" to secure a conviction.

"I formed the opinion she was entirely credible and the two suspects should be charged," he said. It is very rare for a chief prosecutor to overturn a decision in this way – it happens only once or twice a year.

The matter has voluntarily been referred to the Independent Police Complaints Commission, which is supervising a Greater Manchester police inquiry. It will report at a later date.

Greater Manchester police have publicly apologised to the victims, adding that "with hindsight" things would be done differently now, as more is much known about this type of criminality. "It's genuinely about vulnerability and demographics," Assistant Chief Constable Steve Heywood said. "This is about adults preying on the vulnerability of young members of society."

Coverage of the phenomenon of on-street grooming has often characterised the issue as being about gangs of Asian men preying on white girls, and the case has sparked concerns about racial tensions in the north-west and the input of far-right elements.

The Child Exploitation and Online Protection Centre (CEOP) carried out a study of on-street grooming that showed that of 753 offenders, nearly half were of Asian heritage. But the police say the phenomenon is not restricted to any one race – the vast majority of those on the sex offenders register in Greater Manchester are white (95%).

"Child sexual exploitation is not confined to one community, age demographic, social status or gender," said CEOP. It found that in one case the first contact had been a white British male who groomed the girls as girlfriends, then passed them on to an Asian gang.

CEOP's chief executive, Peter Davies, said sexual exploitation of childrenwas child abuse and often involved rape. He said it was "premeditated, carried out systematically and with a complete lack of respect or empathy for the victims. They are often singled out for their vulnerability."

A CEOP report published in 2011 spoke of the difficulties, with CPS solicitors "often reluctant to take up cases of child sexual exploitation because victims are often perceived as unreliable".

Detective Chief Superintendent Mary Doyle, of Greater Manchester police, said: "As long as there are adults willing to abuse vulnerable children and other adults, it will continue." On the issue of race, she said it was about vulnerability, not ethnicity. "I think if we start to get ourselves hung up on race and ethnicity issues, we take away the real issues," she said.

One of the victims, who was in the care of Rochdale local authority, wrote a note to a member of staff saying she needed to move out, but refused to elaborate.

The staff member told the trial: "She said she needed to be moved for her safety as well as our own but would not say what that actually involved."

Days later she handed him a second note. It said: "Asians pick me up, they get me drunk, they give me drugs, they have sex with me and pay me not to tell anyone. I want to move." The note was read to the jury.

Giving evidence, the 59-year-old defendant who cannot be identified claimed the girls were clever and ran a "business empire" that extended from Leeds to Nelson and Bradford.

One of the girls caused problems for him and "corrupted" the others, he said. But it was a version of events the jury rejected. The man lost his temper in the witness box, shouting: "It's all white lies. Shame on the police. You're looking for scapegoats. Where are the white people?"

The trial was beset by difficulties, as the far right stirred up unrest, picketing outside Liverpool crown court. A defence barrister was assaulted and refused to return to court, delaying the case as a new defence team took it on. As the first verdicts came in, the leader of the BNP, Nick Griffin, tweeted about it, a potential contempt of court.

The coverage of the case also had a knock-on effect on community tensions in Heywood. In February, concerns emerged over racial tensions after trouble broke out and 200 young people congregated in the centre of town. A car and three police vehicles were damaged and an officer suffered bruising to his arm and legs.

Greater Manchester police in effect issued a curfew when they warned all parents in the area to ensure their children were at home. Within an hour, the streets were clear. The chief constable, Peter Fahy, blamed outsiders who would "like to see groups turn against each other for their own ends". In the end, tensions calmed.

Mohammed Shafiq, director of the Ramadhan Foundation, said of the 68 recent convictions involving child sexual exploitation, 59 were of British Pakistani men, "so clearly we have got a problem when it comes to on-street grooming".

Shafiq said that a minority of Pakistani men thought white girls were worthless, a viewpoint he and he said the majority of the community found abhorrent.

Wet weather persists with no end in sight

Warning of localised flooding in Scotland and Cumbria, and Met Office forecasts unsettled weather for most of next 30 days

Spectators take shelter from the rain at a test event at the Olympic Stadium. Photograph: Eddie Keogh/Reuters

The brief return to widespread sunshine is set to end after less than 24 hours with forecasts of heavy rain and potential flooding during the rest of the week.

After the wettest April since 1910, a band of heavy rain is moving slowly north across the UK, with forecasts of up to 60mm (2.4in) in Scotland and Cumbria by Friday.

The pattern heralds a period of further unsettled weather, with no immediate prospect of darling buds or summer's days that often mark mid-May. Brendan Jones, a MeteoGroup forecaster, said: "Unfortunately there is no end in sight for the unsettled weather. Very few places south of Manchester will miss the wet weather today and the downpours will intensify as they move northwards and into Friday.

"There is the possibility of local flooding problems in southern Scotland and areas of northern England such as Cumbria. But most of the country will see substantial rain over the next few days."

The rain may be welcome in drought-affected areas of southern and western England, where hosepipe bans remain in place, in spite of soggy conditions and meteorological excitements such as the Oxfordshire tornado.

Between 20 and 40mm of rain is expected almost everywhere in England before the weekend, adding to the 126.5mm (5in) that fell in April. Last month's rain broke the previous April record set in 2000 by 6mm and came within sight of doubling the long-term average for the month of 69.6mm.

The Met Office forecasts unsettled weather for most of its maximum 30-day advance period, with only the most cautious hope of improvement. It says: "There are some indications that southern and eastern areas will become warmer, drier and sunnier by the end of May. Most evidence suggests that if we do get a more prolonged spell of relatively warm, dry weather, this is more likely to occur during the early part of June."

The cold and wet conditions have dampened summer fashion sales, adding to the economic gloom of the recession. The British Retail Consortium reported that April takings were down 3% on the same period last year and footwear trading was the worst since January 2008.

There was the usual slender silver lining associated with storm clouds: soup, porridge, hot drinks, warm bedding and other precautionary measures for dealing with the British summer have all sold reasonably well. The BRC's director general, Stephen Robertson, said hopes of a revival were pinned on the diamond jubilee, Olympics and Euro 2012 football championships.

Helen Dickinson, head of retail at accountants KPMG, said March's 1.3% rise in retail sales was fading into the past. She said: "Anything other than chilly winds and showers seems a distant memory for consumers and this sums up the mood of many retailers. While May will certainly be brighter than April, the health of the retail sector continues on a downward trajectory."

Grooming offences committed mostly by Asian men, says ex-Barnardo's chief

Martin Narey urges inquiry into why Pakistanis and Afghans are 'overrepresented' in child exploitation crimes in northern towns

Martin Narey, the former head of Barnardo's, said street trafficking of young girls in northern towns appeared to be overwhelmingly carried out by Asian men. Photograph: Graham Turner for the Guardian

The former head of Barnardo's has said that street grooming of teenage girls for sex in the north of England appears to be carried out "overwhelmingly" by men of Pakistani and Afghan origin and has called for an investigation into the issue.

Martin Narey's comments came as nine men – one from Afghanistan and the rest with Pakistani backgrounds – await sentencing for being part of a child exploitation gang that passed vulnerable girls around a group of men for sex in the Heywood area of Rochdale, Greater Manchester, in 2008 and 2009.

He said he was not stigmatising the Asian community as a whole, noting that during his time managing the prison service – prior to joining Barnardo's – sex offenders were "overwhelmingly white", but the Labour MP Keith Vaz warned the BNP was setting the agenda.

Narey told BBC Radio 4's Today programme: "For this particular type ofcrime, the street grooming of teenage girls in northern towns … there is very troubling evidence that Asians are overwhelmingly represented in the prosecutions for such offences."

Narey said he did not know the reason for the "over-representation" of men of Pakistani and Afghan origin and rejected the idea they were specifically targeting white girls. He suggested that vulnerable girls on the streets were more likely to be white, while Asian girls subjected to strict parenting were more likely to be at home and so less prone to fall victim to such crimes.

He added: "I'm not saying this is just Asian or Pakistani men … [but] street trafficking in the north does appear be overwhelmingly about Pakistani and Afghan men."

Vaz, chair of the home affairs select committee, warned against generalisations and said the criminal justice system "shouldn't dance to the tune of the BNP".

Security outside Liverpool crown court, where the nine men were tried, was stepped up after hundreds of English Defence League and BNP protesters picketed the court. The trial was almost derailed when the British National party leader, Nick Griffin, tweeted that seven verdicts had been reached in an alleged contempt of court. The beginning of the trial was also delayed for a fortnight in February when two Asian defence barristers were attacked outside the courtroom by far-right protesters.

Vaz told the Today programme that the police themselves had said it was not a race issue, citing Greater Manchester's assistant chief constable, Steve Heywood, who said: "It just happens that in the particular area and time the demographics were that these were Asian men."

Vaz, the MP for Leicester East, said: "It's quite wrong to stigmatise a whole community … This is where it all ends up. It's already extended from 'Pakistani men' into 'Asian men' – that's a very wide group." He added: "What the BNP is saying is that this is a crime committed by Pakistani men and Asian men - that's wrong."

Narey said the fact the BNP was trying to make political capital out of the case should not prevent discussion.

Abdul Aziz, 41, Abdul Rauf, 43, Mohammed Sajid, 35, Adil Khan, 42, Abdul Qayyum, 44, Mohammed Amin, 45, Hamid Safi, 22, Kabeer Hassan, 25, and a 59-year-old who cannot be named for legal reasons will be sentenced on Tuesday.