SFO: Serious Fiasco Office

The investigation and prosecution of serious fraud is clearly vital. The Serious Fraud Office does not have a compelling track record of success in identifying and pursuing such matters. However it now threatens to become involved in a fiasco which is not entirely of its making.

Since November 2004 it has been investigating allegations that during the 1990s BAE Systems paid bribes to certain members of the Saudi royal family to obtain/retain Saudi business. This is pursuant to the Anti-terrorism, Crime and Security Act 2001, which as the explanatory notes (not part of the act) state, "brings in provisions to strengthen the law on international corruption. The sections put beyond doubt that the law of bribery applies to acts involving officials of foreign public bodies, Ministers, MPs and judges". This Act was brought in in the aftermath of 9/11 and deals with other matters such as terrorism etc. It must have been obvious then that intelligence and assistance from Saudi Arabia would be required in combating terror. Also that, aside from the desirability of laying down agreed procedures for future contracts, any attempt to investigate and prosecute past dealings would throw up an entirely different set of problems. Such investigations involving the Saudis would inevitably involve raising questions against members of the Saudi Royal family, with the likely consequence of a falling out. It is one thing to lay down a marker for the future. (i.e. making it clear that if future deals do not pass scrutiny those involved in them can hardly complain if they are pursued). Quite another to expressly lay down, or as the explanatory notes put it "put beyond doubt", that the courts have jurisdiction over potential bribes abroad which would involve analysing past deals.

Chasing the Saudis

SFO attempts to access Saudi bank accounts in Switzerland have met with a predictable response. A new contract (which is not under inquiry) is now under threat. It is a contract for 72 Eurofighters, with the cost of loss of the order being estimated between £6 billion and £15 billion with the loss of 50,000 jobs. Even before one considers the impact on relations between the two countries and potential flow of intelligence etc. that would be a catastrophic consequence. If an SFO inquiry of this sort were to be pursued, it clearly had to be pursued swiftly because of the potential damage that the inquiry itself could cause. Many a person is spared prison when coming before the courts because of the threat of losing their job. Thousands could lose their jobs for something nothing to do with them. Likewise whilst BAE Systems protest its innocence, catastrophic consequences could follow for the company and yet no prosecution end up even being pursued. It would be worth comparing the potential economic loss to that company of losing this order, with the fines levied on companies for corporate manslaughter for criminal negligence leading to death of employees. BAE Systems threatens to be much worse off financially when it might not even be prosecuted, still less be prosecuted for something so serious.

Protecting the rule of law

There are occasions when the rule of law has to be protected whatever the consequences. If for example there was a murder inquiry involving senior officials of another government, that could not be abandoned due to threats. However likewise the attorney general has to take a view as to what is in the public interest. If there is cogent and compelling evidence that already exists showing a substantial prospect of a conviction then even then the nature of the offences may not make pursuing the matter worthwhile, but at least one could see why there was a reason for continuing. If the evidence does not exist now it is difficult to justify pursuing this further in the hope sufficient evidence will turn up.

Political pressure

Ironic indeed if the attorney general felt unable to take such steps because of entirely unrelated matters. The attorney has come in for considerable criticism in the press regarding the legal advice underpinning the Iraq war. He of course was not responsible for how that advice was used, nor for any issue regarding the merits or otherwise of deciding to go to war. He may understandably given press comment feel sensitive about an accusation of being susceptible to political pressure. That has been exacerbated by the "cash for honours" inquiry. I suspect there will be no prosecution in that inquiry because the evidence is simply lacking. If there is a prosecution of the Prime Minister I would not expect there to be a conviction. Setting that aside however, some press comment would have led one to suppose that the attorney's principal concern regarding potential prosecution would have been to protect the Prime Minister rather than consider whether a prosecution was justified or desirable. Notwithstanding that there is no basis in fact for such a suggestion. Again the attorney has come under criticism for a situation not of his making.

Public Interest

Ironically therefore at a time when it would be plainly in the public interest for the attorney to decide that this SFO prosecution should not proceed, he may feel hampered from doing so because of a furore regarding the other matters. Nonetheless he should do the right thing, regardless of ill informed sniping, and stop this potential prosecution. Just because some parts of the press may suggest the decision is a result of political pressure does not stop it being the right thing to do, any more than it proves that there was any pressure. After all, those making such criticisms could easily be suggesting it was ridiculous not to save the order if the prosecution were not stopped.

Losing credibility

It is not just a question of the important economic and foreign policy benefits which massively outweigh any potential benefit from this investigation. The SFO itself has a great deal to lose from this. Should the deal be lost, and should various appalling financial and diplomatic consequences follow, if the SFO fails to produce sufficient evidence to justify convictions for serious offences, let alone merely to justify prosecution, its credibility will be irreparably damaged. The SFO has an important role. If it chooses to pursue this investigation, then if the investigation comes to nothing, or if indications are that were it to have been investigated it should have been pursued more speedily, the SFO's reputation may never recover.

Michael J. Booth QC