Issue link: https://digital.shearman.com/i/1389983
27 SERIOUS FRAUD OFFICE In keeping with the focus of this publication, this section will focus on the Serious Fraud Office's efforts to tackle bribery and corruption. Full details of the U.K.'s efforts to tackle white collar crime more generally are available in another Shearman & Sterling publication - U.K. Business Crime Review. 14 In recent editions of Trends and Patterns, we have highlighted the reduction in bribery and corruption investigations commenced by the Serious Fraud Office (SFO). That trend continued over the past six months. The SFO has not publicly announced the opening of an investigation into alleged bribery and corruption since November 2020. In the same period, no charges have been brought against an individual or corporate for alleged bribery. That said, on July 1, 2021, Lord Justice Edis approved the SFO's DPA with Amec Foster Wheeler Energy Limited (AFWEL) under which the company will pay a financial penalty, compensation and costs totalling £103 million as part of a $177 million settlement with U.K., U.S. and Brazilian authorities. In entering into the agreement, AFWEL has taken responsibility for ten offences of bribery relating to the use of corrupt agents in the oil and gas sector. The offences span almost two decades and relate to conduct in Nigeria, Saudi Arabia, Malaysia, India and Brazil. It is the latest "joined up" outcome with overseas authorities and is further evidence of the growing trend. The SFO has secured some other notable outcomes since the beginning of the year, such as the conviction of a fourth individual in the prosecutions connected to Unaoil and the guilty plea of GPT Special Project Management Ltd. However, a sizeable reduction in the number of open investigations means that we may see fewer significant outcomes for some time to come. Conversely, in the past six months, the SFO has announced two separate investigations into allegations of serious fraud and related misconduct, and the majority of trials scheduled to commence in 2021 and 2022 concern similar allegations. Whether these developments are a sign of a renewed focus on serious fraud or merely the result of the pandemic and other prevailing events making international investigations more difficult remains to be seen, but there are indications that the SFO may be re-balancing its investigative portfolio. The SFO has also suffered some notable setbacks since the beginning of the year. First, the Supreme Court ruled that the organization cannot use its investigation powers under section 2(3) of the Criminal Justice Act 1987 to compel a foreign company to produce documents it holds outside the U.K. Second, the SFO was forced to offer no 14 See the 2021 U.K. Business Review. evidence during the trial of two former Serco executives as a result of disclosure failings. Both decisions, discussed below, have ensured that the SFO and its work remains in the spotlight and under increasing scrutiny. In August 2021, it will be three years since Lisa Osofsky – the SFO's Director – took the helm. In that time, she has spearheaded a number of initiatives designed to make the SFO more effective. She continues to push for greater incentives for individuals and organizations to co-operate with her agency, and she is a vocal proponent of legislative change to make it easier to secure DPAs and convictions against corporate wrongdoers. However, her tenure has also seen a decrease in the number of investigations opened each year, and the SFO is yet to secure a conviction against an individual in a case involving a corporate DPA concerning allegations of bribery or serious fraud. In recent months, Ms. Osofsky has also faced a number of unwelcome distractions. First, there is to be a review into her contact with David Tinsley, a U.S. private investigator acting for the Ahsani family – the prominent entrepreneurs who once ran Unaoil. The contact was revealed following a failed abuse of process application by defendants during a trial arising from the SFO's investigation into the Monaco-based oil consultancy. Commenting on the contact, Judge Beddoe said Mr. Tinsley was "not hesitant in flattering Osofsky and talking up her talents, and unfortunately Osofsky made herself vulnerable to them." He stated that the SFO should "have been engaging only with the legal representatives of [Al Jarah and Akle] and should have had nothing to do with [Tinsley]." In response, the SFO said "we accept [the Judge's] criticisms of the way a contact was handled. In a further development, during a hearing on July 1, 2021, the Court of Appeal ordered the SFO to hand over private texts and other evidence of contacts between the Director and Mr. Tinsley. The Court is considering an appeal brought by Ziad Akle – one of the defendants convicted in 2020. The SFO is also embroiled in an ongoing employment dispute with a former case controller in charge of the Unaoil investigation who was suspended in July 2018 and fired months later over allegations that he used expletives to describe a FBI officer during a meeting in 2016. However, in February 2021, an employment tribunal ruled that the case controller had been unfairly dismissed, finding that the U.S. agency "clearly" wanted him removed from the case. It is understood the SFO is seeking to appeal the decision. Finally, the long-running civil claim brought by ENRC against the SFO, Dechert and one of its former partners has reached a major milestone. The High Court is currently hearing testimony concerning whether the law