Out-Law News 1 min. read
31 Jan 2014, 5:10 pm
In a statement, the agency responsible for the investigation and prosecution of serious or complex cases of fraud and corruption said that additional funding was necessary for its "investigation and prosecution work in the remainder of this financial year". This included "three large, resource intensive cases, ie Libor, Barclays Qatar and the Rolls-Royce investigation; costs in connection with Tchenguiz litigation; and a number of other casework costs", it said.
In a written ministerial statement to the House of Commons on Thursday Oliver Heald, the Solicitor-General, said that an estimated £11m for "urgent expenditure" would be made available from the Treasury pending Parliamentary approval for the £19m blockbuster funding.
"Penny wise, pound foolish – this comes as no surprise," said white collar crime expert Barry Vitou of Pinsent Masons, the law firm behind Out-Law.com.
"Serious fraud investigation and prosecution requires serious funding – instead, the SFO has been operating on a shoestring," he said. "Recent SFO setbacks are in part a product of this budget-cutting strategy. Let's hope this signals a proper debate on what funding the SFO needs."
The SFO's forecast budget was cut to £34.6 million this year from £40.8m in 2012/13. However, the Treasury has set aside additional funding that can be provided to the agency to support certain large investigations, such as the agency's ongoing criminal investigations in relation to alleged manipulation of the London Interbank Offered Rate (LIBOR) benchmark interest rate. However, this funding will only be granted on a case by case basis. In addition to central government funding, the SFO can also keep some assets seized as a result of its investigations.
Heald said that the additional money was needed to cover both "departmental expenditure" and "material liabilities". Businessmen Robert and Vincent Tchenguiz are currently pursuing the SFO for substantial damages related to its investigation into the collapse of Icelandic bank Kaupthing.