When Legal Business queried in September whether the Serious Fraud Office (SFO) was finally turning a corner after a year of embarrassing lows – including misplacing investigation documents and the chaotic collapse of the Victor Dahdaleh trial – the agency appeared to still be mired in controversy and questions over its future. Last month, the Home Secretary Theresa May appeared to provide an answer, as it was revealed she was considering abolishing the SFO and rolling it into the National Crime Agency (NCA), a move that some consider will ultimately dilute the attempts by the body to project a tougher image.
‘It’s not a good idea,’ said Stephenson Harwood commercial litigation partner Tony Woodcock. ‘The focus has got to be on serious and complex fraud, and properly resourcing that. I fear putting it into a far bigger organisation with a number of different responsibilities could dilute that, both as a matter of perception and as a matter of resourcing.’
The perception of the SFO has improved in recent months, as its director David Green QC looks to make the body more of a prosecutor and less of a dealmaker. Indeed, around 60 staff have been allocated to work on Libor investigations, with the team obtaining its first successful criminal conviction last month when a senior banker pleaded guilty to conspiracy to defraud. A further 11 await trial.
Embedding the SFO into the NCA, which essentially acts as a policing outfit, could inevitably mean more scrambling for crucial resources. This is hardly good news for an agency that requested £19m emergency capital from the Government in January, a form of ‘blockbuster funding’, to help bankroll large international investigations and is looking for a further £26.5m in 2015 for its inquiries. ‘As an organisation that stands outside the NCA, it is able to clamour in its own right for proper resources to match what the Americans pile into fraud cases like Libor,’ said Woodcock. ‘There’s a better chance they’ll be properly handled and they’ll have people you wouldn’t deploy elsewhere.’
Another pressing issue for the body is recruiting and retaining experienced staff to pursue its ambition as a prosecutor of complex corporate crime. Clifford Chance regulatory enforcement and white-collar partner Roger Best says the latest proposals could derail potential candidates. ‘They’ve got to find a long-term solution to bringing in and keeping good talent,’ he said. ‘The uncertainty over the SFO’s future makes it even more difficult to recruit – wrapping it into a much less specialist agency is a step backwards.’
sarah.downey@legalease.co.uk