The Serious Fraud Office’s desire to pursue so-called ‘blockbuster’ cases against multinationals is taking its focus away from targeting other fraudsters – some of which may have caused greater damages to businesses, City lawyers have claimed.
The number of restraint orders, which allow the SFO to confiscate assets suspected to be the result of fraud, halved from eight in the year ending 31 March 2017 to four in the past year. At the same time, the SFO has embarked on high profile cases against major companies including Barclays and reached a record deferred prosecution agreement with Rolls Royce.
Alan Sheeley, head of the civil fraud and asset recovery team at Pinsent Masons, said businesses are keen to see [the SFO] focus on cases where businesses have lost significant amounts of money and not just a select few cases that are important from a public policy standpoint. ’Restraint orders are a vital tool to help victims of fraud recover stolen assets. It is worrying to see the SFO doing less of this critical work,’ he added.
The figures relate to the tenure under previous director David Green, who was replaced by Lisa Osofsky, a former FBI lawyer, earlier this year.
Even when the office opens an investigation it is unlikely to result in a quick order. It has not issued an order within two months of opening an investigation in any of the past three years, Pinsent Masons said.
Sheeley said: ‘If the authorities do not issue restraint orders within the first two months of their investigations then there is a high likelihood that fraudsters will successfully dissipate the assets they have stolen.’
Further, the SFO did not issue any compensation orders last year, down from ten in 2016/17. In 2016/17, £14 million was obtained through compensation orders, falling to zero last year.
An SFO spokesperson said: ’As an independent prosecuting authority any decision to investigate a case is based on the available evidence and the specific criteria set out in the director’s statement of principle. The SFO’s caseload consists of a small number of large cases. Therefore comparatively large statistical variation from one year to the next is inevitable.’
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