Tchenguiz win leaves fraud squad with £3m headache

Michael Bow
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THE UK’S beleaguered fraud squad yesterday paid the price for its botched raid on the offices of property magnates Robert and Vincent Tchenguiz after a High Court judge ordered it to cover the costs of a judicial review.

The figure that the Serious Fraud Office (SFO) is on the hook for is understood to be between £2.75m and £3m, nearly a tenth of the SFO’s £36.8m budget.

Vincent Tchenguiz yesterday said he would pursue more legal action against the SFO after the unit’s highly publicised raid on his business in March 2011.

“This is only the first financial manifestation of the folly of the former director of the SFO,” he warned.

The SFO declined to comment.

The botched investigation, which stemmed from the brothers’ dealings with failed Icelandic bank Kaupthing, was the subject of a costly judicial review earlier this year.

Tchenguiz has previously warned the SFO that he is going to sue them for upwards of £100m. Action is expected to begin before the end of the year.

It will be a further blow to the SFO, which had its budget slashed 30 per cent last year and is due to operate with a slim budget of just £30m next year.

Sir John Thomas, who led the judicial review, said the underfunding may have played a part in the muddled investigation, led by former SFO director Richard Alderman.

Tchenguiz personally attacked the “reckless” actions of Alderman yesterday and hit out at his generous pension. His brother, Robert, has already indicated he will also sue the SFO for damages.

In his judgment, Mr Justice Silber said the conduct of the former SFO director had taken this case “truly out of the norm”. Alderman could not be reached last night.