Wednesday 3 April 2019 7:36 pm

Fraud squad boss will favour firms who keep hold of incriminating evidence


Reporter at City A.M. covering City politics, transport and law. Get in touch: alexandra.rogers@cityam.com

Reporter at City A.M. covering City politics, transport and law. Get in touch: alexandra.rogers@cityam.com

Companies should be prepared to keep hold of evidence of fraud and corruption in their ranks if they want to co-operate with the authorities, the boss of the UK fraud office has said.

Lisa Osofsky, the recently appointed director of the Serious Fraud Office (SFO), said companies not only needed to be "brave enough" to report fraud and corruption, they needed to go further by preserving "vital evidence" such as first-hand accounts and witness testimonies.

She said it was not enough for a company to "call in a team of lawyers", only for them to cover incriminating material with legal privilege, a device that protects information from being disclosed without the permission of a client. 


"That is not co-operation: courts do not like it, it does not help law enforcement, it does not make the job of dispensing justice fairly any easier," she said.

Osofsky, a former FBI lawyer, said the agency would soon be issuing guidance on what companies could expect if they decided to waive their privilege rights and report themselves to the SFO.

She said her office would regard the waiving of privilege as a "strong indicator" of co-operation that may enable the comapny to enter into a Deferred Prosecution Agreement (DPA) with the SFO, in which they can avoid trial if they fulfill certain requirements.

A spotlight was thrown on the issue of privilege in a landmark ruling between the SFO and mining giant Eurasian Natural Resources Corporation (ENRC), in which a judge originally ruled that the documents the company offered to the SFO for its investigation were not covered by privilege.

ENRC later appealed the decision and won.

Elsehwere in Osofsky's speech, which she gave to the Royal United Services Institute, the SFO boss said she acknowledged complaints that the SFO took "too long" to prosecute cases. She said this was due to the nature of the cases, if there were multiple cases and the difficulty in securing the necessary court time.

She said the SFO could cut delays through better co-operation with agencies abroad and better technology in disclosure. 

Share


Tags: