Here John Burgar, Head of Investigations at RGL Forensics, talks to Lawyer Monthly about the current work of the Serious Fraud Office (SFO) in the UK, and the current government agendas for confronting fraud crimes across the nation.
The Conservative Party’s election manifesto unveiled their plans, if successful on 8th June, to incorporate the Serious Fraud Office (SFO) into the National Crime Agency (NCA). The stated aim is to ‘strengthen Britain’s response to white collar crime’ and ‘bolster the investigation of serious fraud, money laundering and financial crime’. Other than citing an improvement in intelligence sharing, no additional perceived benefits are evident.
So is this a good idea? The Conservative Party thinks so. The Prime Minister has form of course: in 2011, when she was Home Secretary, she tried to dismantle the SFO, but was thwarted by her cabinet colleagues, most notably Ken Clarke, who was the then Justice Secretary – and reportedly tried to revive the plan in 2014. If she is re-elected to the top job this summer, with a manifesto commitment, the SFO as it stands will be history.
I will readily admit that the SFO is not perfect. It certainly has a public image problem with its fair share of well-publicised failures. It reached rock bottom in 2014, when its ill-starred pursuit of the Tchenguiz brothers resulted in an embarrassing failure followed by the need to pay £3m in compensation (plus a further £3m in costs) to make it go away. It was at this low point that the SFO seemed to deserve the ‘Serious Farce Office’ moniker by which Private Eye affectionately referred to it. To put the SFO out of its misery then would have looked like an act of kindness.
But of late, the SFO has been on a roll. It has been enjoying some notable successes and pulling in some serious fines; Rolls Royce (£500m) and Tesco (£129m). It finally seems to be getting into its stride and showing what it is capable of. To put it down now, when its star is in the ascendency, makes no sense.
The SFO undertakes some large and complex cases and they are getting more so, requiring skilled and well-trained investigators, sharp accountants and keen, intelligent lawyers. It also needs strong management who are independent of the government. Yet, because of the way the SFO is funded (a mixture of ‘core’ and ‘blockbuster’ funding), many SFO staff are temporary, brought in for a particular case and laid off when the case is over. This makes it very difficult to attract and retain the high calibre, committed staff required to work on these long, difficult cases.
I work in the private sector and have been investigating fraud for some 20 years, much of it overseas. I have seen first-hand how fraud and corruption can flourish unchecked in the absence of well-funded, properly trained and independent law enforcement to bring wrongdoers before the courts. You can have the best laws in the world but they are worthless without an effective means to enforce them. We are fortunate in the UK that we have good laws and an excellent legal system that is the envy of many countries. Our independent judiciary is respected internationally for their impartiality, skill and experience in dealing with complex cases. We should capitalise on this by ensuring that our flagship anti-fraud agency is equally well respected, both here and abroad.
Does anyone else think incorporating the SFO into the NCA is a good idea? Not many it would seem - since the manifesto was launched, there has been almost universal condemnation among the legal cognoscenti who think that the move would be a retrograde step. There is nothing in the manifesto about how the SFO or its successor department within the NCA will be managed or funded. In the absence of this essential detail, there is suspicion that this can only be a cost saving measure.
At present, the NCA’s focus appears to be on tackling paedophilia and organised crime, the eradication of which will always play better to voters than locking up a few businessmen suspected of having their fingers in the till. Therefore the role of the SFO will be diminished within the enlarged NCA and the ability to take on complex white collar crime could be damaged for years.
It will not be forever, though. Inevitably, at some point in the future, the government of the day will decide to reorganise the NCA and it will go the same way of its predecessors (SOCA, NCS and Regional Crime Squads). This will probably be triggered by a collapse in public confidence after a massive failure in a particularly newsworthy case and then someone will have a bright idea: ‘Let’s have a dedicated, well-resourced agency that specialises in combatting serious fraud. Now, what shall we call it?
