SFO makes strides on disclosure but funding crucial to fixing problems, report finds

The UK’s anti-fraud agency has made progress in reforming how it manages evidence disclosure in its high-profile cases, but more government funding is needed to help fix the problems, a report has found.

The Serious Fraud Office (SFO) has come under intense scrutiny for failures around disclosure, which is key criminal procedure in which prosecutors hand over any evidence to the defence that could help their case.

Issues with disclosure have appeared in a number of its prosecutions, sometimes with huge consequences. The fraud trial of two former Serco executives collapsed in April 2021 after the SFO failed to disclose evidence to the defendants’ lawyers.

But a report by the HM Crown Prosecution Service Inspectorate (HMCPSI) published today found that the agency had made progress in reforming its disclosure regime.

HMCPSI chief inspector Anthony Rogers said that delivering their disclosure obligations “is a significant undertaking” for the agency. The report said that disclosure alone amounts to 25 per cent of the SFO’s operational budget and takes up 40 per cent of its staff capacity.

Another recent review found that if the average volume of material in an SFO case was printed it would stack considerably higher than the Shard.

“Our inspection shows that while they have had successes, their disclosure regime has also led to some high-profile failures which has caused reputational damage,” he said.

But, Rogers added: “I am pleased that SFO has already taken action to improve their disclosure regime.”

The report said the SFO has promoted incentives to encourage staff to take on the role of disclosure officers and has introduced changes to both its operational handbook and assurance processes.

While the report made a number of further recommendations to help the prosecutor improve in this area, City lawyers and anti-corruption campaigners highlighted the report’s finding that the agency ultimately needs more funding.

The report said “the SFO must be supported by more government funding”, adding that the state must develop a long-term funding strategy by October to help support the SFO in discharging its disclosure obligations.

“It is hardly a surprise that funding is viewed as an issue,” Richard Burger, a partner in the investigations group at WilmerHale, told City A.M. “If the government views the SFO as one of the most effective tools to combat the financial crime crisis, then it must properly fund and support the SFO.”

Peter Binning, a partner at Corker Binning, agreed, stating that report “does not shy away from the urgent need for more government funding.”

“The SFO cannot possibly be expected to improve without increased resources being made available for properly trained staff with the right technology and equipment,” he told City A.M. “The government alone is responsible for this funding failure.”

Sue Hawley, executive director of campaign group Spotlight on Corruption, told City A.M. that disclosure is “not just the SFO’s problem, however, but rather an achilles heel of the justice system as a whole, particularly prosecutions of complex economic crime.”

“The government urgently needs to take heed of the HMCPSI’s recommendation that it come forward with a long-term funding plan for the SFO to ensure it has the resources to tackle disclosure issues.”

A SFO spokesperson said: “We welcome the inspectorate’s report into our disclosure handling and will take its findings forward alongside our new five-year strategy. We continue to support a disclosure reform that works for the digital age and speeds up case outcomes for victims.”