“Piffle”. That was the round response of the new SFO Director, David Green, to adverse press speculation about the future of the SFO, linked to the visit by the CPS Inspectorate and current High Court litigation.
Today at the Corporate Accountability conference in London, sponsored by the Institute of Advanced Legal Studies, the new SFO Director set out his stall for the first time in a public speech. The SFO’s “fuzzy” role is to be refocused on “top drawer” fraud, cases which undermine confidence in UK PLC and serious corruption. It will also tackle, in the public interest, cases which other bodies are not set up to handle including those relating to new species of fraud but out go the “boiler room” frauds and other cases of less public interest significance.
There will be four revamped divisions and a new General Counsel with greater concentration on quality control, particularly between charge and trial. There will be advice on civil settlements and the use of Deferred Prosecution Agreements – a proposed new tool which the Director certainly wanted to have in his armoury. There will be an enhanced intelligence function using open source material, SARs and other intelligence. Revolving door recruitment from the private sector will be encouraged and secondments welcomed. There will be a renewed focus on training, a foundation course for all investigators and an advanced course under the aegis of a new Chief Investigator, to be appointed soon.
International relations are an important feature of the SFO’s work, particularly with the Department of Justice in the USA, and work is needed to develop the mutual assistance aspect of the SFO’s work.
Proceeds of Crime will have a renewed focus with confiscation inquiries starting at the same time as criminal investigations, as is often the case now, but with an enhanced team dealing with asset forfeiture using all available powers. In the financial year to April 2012 the SFO collected £20 million in assets and a significant default sentence has been obtained in the Allied Deals case. Shareholders, who ought to have known or suspected that they were receiving dividends that represented the proceeds of crime, are being targeted. All this new asset forfeiture activity will be funded partly by asset recoveries, again as happens now, in what many still see as a controversial potential conflict of interest.
The judicial barrier erected by Lord Justice Thomas in the Innospec case remains a substantial problem for corporates wanting to have certainty in negotiation following a self report. It seems that the Director is keen to adopt DPAs as a pragmatic solution to pave the way for an increase in corporate self reporting and for criminal cases to be “settled” more easily than now, particularly when other countries, notably the United States, are involved.
However, the Director offered no leniency of approach either for corporates or individuals: if the evidence is there and it is in the public interest, there will be prosecutions. If there are DPAs, there may be requirements for disclosure to overseas regulators as well as the risk of significant publicity from a public court appearance.
Corker Binning is a law firm specialising in business crime and fraud, regulatory and general criminal work of all types. For more information visit Business crime and fraud or call us on 020 7353 6000.
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