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The jail from which terror suspect Daniel Abed Khalife escaped “really needs closing ultimately”, the chief inspector of prisons has said.

Speaking to Sky News’ Politics Hub with Sophy Ridge, Charlie Taylor said there was a “crisis” in large institutions like Wandsworth prison in south London due to a lack of places and staff, and the “churn” of inmates “adds to the general complications and sometimes what feels like chaos”.

His remarks come as the manhunt continues for 21-year-old Khalife, who broke out of the Category B prison by holding on to straps underneath a food truck.

Politics Hub: Follow the show with live updates here

There have still been no confirmed sightings of the former soldier and police have said it is possible he has already left the country – though more than 150 counterterrorism officers and staff are focusing their search efforts in the Kingston and Staffordshire areas.

The incident soon turned into a political row, with Labour attacking the government for a lack of investment into public services – a hot topic in Westminster following the concrete crisis in schools.

But ministers have accused the opposition of playing politics, and promised to open formal inquiries into the escape.

Daniel Abed Khalife and Wandsworth Prison
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Daniel Abed Khalife escaped Wandsworth Prison on Wednesday

Mr Taylor – who is appointed by the justice secretary to inspect prisons in both England and Wales – said the situation with Khalife was “enormously concerning”.

“When you find a prison like Wandsworth, it really needs closing ultimately, it is not a suitable prison,” he told Politics Hub.

“In an ideal world one would [close it], but of course you need jails because you need to service the courts.

“We’ve actually got a crisis at the moment in prisons just in terms of population and places, so there are only just enough prison places available at the moment for the number of prisoners who are coming in, but of course that puts a huge strain on the system.”

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How prisoner’s escape unfolded

Speaking specifically about Wandsworth, the chief inspector added: “You are getting people in, you are getting them to court, you are getting them back from court and then as soon as they’ve been sentenced, they are being moved on to another jail as quickly as possible.

“And it is something about that churn that also adds to the general complications and sometimes what feels like chaos in some of those big local prisons like Wandsworth.”

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’10 times more escapes under Labour’

Mr Taylor also pointed to issues around staffing levels at the prison, which he said had been a “huge concern” in recent inspections – with 30% of employees unavailable for full duties.

He claimed it led to a “danger of losing control”, adding: “If you haven’t got enough staff to get the basics right, there is always a danger that people will drop the ball and make a mistake.

“If there aren’t enough staff in place – and that is something we flag up a lot – things just can begin to go a bit wrong.”

Read more:
No confirmed sightings of prison fugitive despite dozens of calls from public
What life is like at HMP Wandsworth
What we know about terror suspect

The chief inspector also claimed Wandsworth, which was built 170 years ago, was in a “real state” and was not designed to hold “nearly as many men who are locked up there as there are now”.

He added: “The issue is these people are coming out one day and the idea that you are rehabilitating people by banging them up behind a door for 22 hours a day is simply fanciful.”

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Wandsworth: ‘There were already damning reports’

Mr Taylor appealed to the government to look into funding to improve prisons – although he accepted it may not be the first priority for the public.

“If you ask people if they would like more money spent on the NHS or on schools or on roads, or money to be spent on prisons, I think it is fairly obvious what the answer would be,” he added. “People don’t like prisoners so much and they are frightened of crime.

“[But] if we want people to come out from prison and to stop offending, then we need to do more for them when they are locked up, which means giving them the skills they need, it means putting them on the right sort of programmes, it means getting them into the good habits of work so when they come out they don’t create more victims, they don’t cause trouble in their communities and they take their place back in society as hard working tax working people.

“At the moment what we are seeing is just that churn, that revolving door of those people in and out of prison often for many many years.”

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Germany seizes $38M in crypto from Bybit hack-linked eXch exchange

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Germany seizes M in crypto from Bybit hack-linked eXch exchange

Germany seizes M in crypto from Bybit hack-linked eXch exchange

German law enforcement seized 34 million euros ($38 million) in cryptocurrency from eXch, a cryptocurrency platform allegedly used to launder funds stolen after Bybit’s record-breaking $1.4 billion hack.

The seizure, announced on May 9 by Germany’s Federal Criminal Police Office (BKA) and Frankfurt’s main prosecutor’s office, involved multiple crypto assets, including Bitcoin (BTC), Ether (ETH), Litecoin (LTC) and Dash (DASH). The move marks the third-largest crypto confiscation in the BKA’s history.

The authorities also seized eXch’s German server infrastructure with over eight terabytes of data and shut down the platform, the announcement added.

eXch exchanged crypto without AML

In the statement, the BKA described eXch as a “swapping” service that allowed users to exchange various crypto assets without implementing Anti-Money Laundering (AML) measures.

The platform had operated since 2014 and reportedly facilitated about $1.9 billion in crypto transfers, some of which were believed to be of “criminal origin,” including assets laundered during the Bybit hack.

Germany seizes $38M in crypto from Bybit hack-linked eXch exchange
Example of flow of Bybit exploit funds moving through eXch and bridging back and forth between Ether and Bitcoin. Source: TRM Labs

“Among other things, a portion of the $1.5 billion stolen from the Bybit crypto exchange, which was hacked on Feb. 21, 2025, is said to have been exchanged via eXch,” the authorities wrote.

Multisig, FixedFloat among laundering cases

According to a post by crypto sleuth ZachXBT, eXch was also involved in laundering millions of funds from other crypto thefts and exploits, including Multisig, FixedFloat and the $243 million Genesis creditor theft.

Those were in addition to “countless phishing drainer services over the past few years with refusal to block addresses and freeze orders,” ZachXBT said.

Germany, AML, Crimes, Hacks, Policy, Bybit
Source: ZachXBT

ZachXBT was among the first security analysts to report on eXch’s links to laundering $35 million of crypto assets stolen from Bybit soon after the hack was confirmed.

Related: Hacken CEO sees ‘no shift’ in crypto security as April hacks hit $357M

“Lazarus Group transferred 5K ETH from the Bybit Hack to a new address and began laundering funds via eXch (a centralized mixer) and bridging funds to Bitcoin via Chainflip,” ZachXBT wrote in a Telegram post on Feb. 22.

eXch announced termination of services by May 1

After initially denying involvement in laundering funds from the Bybit hack, eXch eventually announced it would cease operations by May 1 in a Bitcoin Talk post published in mid-April.

“Even though we have been able to operate despite some failed attempts to shut down our infrastructure […], we don’t see any point in operating in a hostile environment where we are the target of SIGINT [Signals Intelligence] simply because some people misinterpret our goals,” it wrote.

Addressing the seizure, senior public prosecutor Benjamin Krause stressed the importance of action against “quick and anonymous opportunities for money laundering for any amount.”

“Crypto swapping is an essential component of the underground economy, used to conceal incriminated funds from illegal activities such as hacking or trading in stolen payment card data, thus making them available to perpetrators,” he said.

Magazine: Finally blast into space with Justin Sun, Vietnam’s new national blockchain: Asia Express

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Can a trade deal with Trump save Starmer?

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Can a trade deal with Trump save Starmer?

👉 Click here to listen to Electoral Dysfunction on your podcast app 👈

With Ruth away, Beth and Harriet are joined by Salma Shah, a former Conservative special adviser from 2014-2018 and now a political commentator.

They unpack Donald Trump’s surprise UK trade deal announcement and what it means for Sir Keir Starmer, who’s also landed a deal with India and is gearing up for key EU negotiations.

But while the global optics look strong, the domestic mood is tense. Harriet has some advice for the Labour backbenchers who are unhappy over welfare cuts and the winter fuel allowance policy.

Also – does Sir Keir need a hand with his comms?

Come and join us live on Tuesday 20 May at Cadogan Hall in London, tickets available now: https://www.aegpresents.co.uk/event/electoral-dysfunction-live/

Remember you can also watch us on YouTube!

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Red Wall MPs should focus on two-child benefit cap rather than winter fuel, Harriet Harman says

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Red Wall MPs should focus on two-child benefit cap rather than winter fuel, Harriet Harman says

Red Wall MPs should push for the two-child benefit cap to be lifted rather than a reversal of the winter fuel payment policy, Baroness Harriet Harman has said.

Baroness Harman, the former Labour Party chair, told Sky’s Electoral Dysfunction podcast that this would hand the group a “progressive win” rather than simply “protesting and annoying Sir Keir Starmer” over winter fuel.

Earlier this week, a number of MPs in the Red Wall – Labour’s traditional heartlands in the north of England – reposted a statement on social media in which they said the leadership’s response to the local elections had “fallen on deaf ears”.

Follow live: UK-US trade deal

They singled out the cut to the winter fuel allowance as an issue that was raised on the doorstep and urged the government to rethink the policy, arguing doing so “isn’t weak, it takes us to a position of strength”.

Labour’s decision to means test the policy has snatched the benefit away from millions of pensioners.

But Baroness Harman said a better target for the group could be an overhaul of George Osborne’s two-child benefit cap.

More on Harriet Harman

The cap, announced in 2015 as part of Lord David Cameron’s austerity measures, means while parents can claim child tax credit or Universal Credit payments for their first and second child, they can’t make claims for any further children they have.

Labour faced pressure to remove the cap in the early months of government, with ministers suggesting in February that they were considering relaxing the limit.

Baroness Harman told Beth Rigby that this could be a sensible pressure point for Red Wall MPs to target.

She said: “It could be that they have a kind of progressive win, and it might not be a bad thing to do in the context of an overall strategy on child poverty.

“Let’s see whether instead of just protesting and annoying Sir Keir Starmer, they can build a bridge to a new progressive set of policies.”

Jo White, the Labour MP for Bassetlaw and a member of the Red Wall group, suggested that her party’s “connection” to a core group of voters “died” with the decision to means test the winter fuel payment for pensioners.

“We need to reset the government,” she told Electoral Dysfunction. “The biggest way to do that is by tackling issues such as winter fuel payments.

“I think we should raise the thresholds so that people perhaps who are paying a higher level of tax are the only people who are exempt from getting it.”

Pic: AP
Image:
Pic: AP

A group of MPs in the Red Wall, thought to number about 40, met on Tuesday night following the fallout of local election results in England, which saw Labour lose the Runcorn by-election and control of Doncaster Council to Reform UK.

Following the results, Sir Keir said “we must deliver that change even more quickly – we must go even further”.

Some Labour MPs believe it amounted to ignoring voters’ concerns.

Read more:
UK and US trade deal will save thousands of UK jobs – Starmer
Starmer faces rebellion from Labour MPs over welfare reforms

One of the MPs who was present at the meeting told Sky News there was “lots of anger at the government’s response to the results”.

“People acknowledged the winter fuel allowance was the main issue for us on the doorstep,” they said.

“There is a lack of vision from this government.”

Another added: “Everyone was furious.”

Downing Street has ruled out a U-turn on means testing the winter fuel payment, following newspaper reports earlier this week that one might be on the cards.

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