The Serious Fraud Office has come in for strong criticism from the High Court over its conduct regarding the build up to its second deferred prosecution agreement (DPA), despite successfully defending a judicial review (JR) application.
Jessica Parker, partner at criminal law defence Corker Binning, commented “On David Green QC’s last day in the job, the Administrative Court handed down a decision heavily criticising the SFO’s approach to an investigation which resulted in the second deferred prosecution agreement (DPA) secured under the Crime and Courts Act 2013. The DPA in question was agreed with XYZ, an SME which was not named due to the ongoing proceedings and resulted in financial orders of £6.5million in July 2016. While this and other headline grabbing fines achieved via the settlement of cases with Rolls Royce and Tesco using the DPA mechanism have won plaudits for David Green, there remain some very live questions about the SFO’s approach to investigating large corporate defendants and the individuals who work for them.
“In R (on the application of AL) v SFO and others  EWHC 856 the applicant sought to judicially review the SFO’s decision not to obtain interview notes from lawyers acting for XYZ. While the applicant was unsuccessful, because remedies in the Crown Court had not been exhausted, Green J went on to explain that the Court had “real reservations as to the position adopted by the SFO.”
“The SFO’s decision not to require XYZ to provide copies of the notes of its lawyer’s interviews, because those lawyers claimed that those notes were privileged, will be a surprise to those who have listened to David Green’s speeches, some of which were cited in the Administrative Court’s decision. Firstly, the SFO’s stated position has been that provision of first account interviews is an obvious sign of cooperation. A quality required of those entities who wish to settle their wrong doing via a DPA. Secondly, those same speeches also claim that privilege is “often claimed, dubiously, over accounts given by witnesses in internal investigations”. With these principles in mind the SFO litigated with ENRC last year and achieved judicial support for the view that the lawyer’s interview notes were not, in some circumstances, privileged and so should be handed over.
“With this background and the complaint of the applicant, who believed that the interview notes contained exculpatory material, the Administrative Court were left baffled. “In short, the SFO: failed to address relevant considerations, took into account irrelevant matters, provided inconsistent and inadequate reasons for its decision, and applied an incorrect approach to the law.”
“The DPA regime is still relatively new and to date, despite the handful of high profile corporate fines, the SFO has not secured the conviction of any individual defendants involved in the conduct complained of. This case indicates that the SFO is yet to find its feet. The new permanent director, whoever that may be, has a substantial task ahead of him or her.”
Read the full article in The Law Society Gazette here.