Jean-Yves Gilg

Editor, Solicitors Journal

SFO's 'blockbuster funding' called into question

SFO's 'blockbuster funding' called into question


White collar crime agency could provide better value for money, report finds

A new report from HM Crown Prosecution Service Inspectorate (HMCPSI) has called into question the Serious Fraud Office's (SFO) dependence on 'blockbuster funding'.

The report, released this week, looked at whether SFO structures, procedures, leadership, accountability, and direction are efficient.

The report found that the SFO could be more effective and provide better value for money if its core funding was raised and dependence on blockbuster funding reduced.

In January, the prosecuting authority had to request £21m in additional funding, the fourth such request in as many years.

Inspectors found that the nature of the funding was leading to gaps in staffing and skills, with more than one in five employees non-permanent.

Kevin McGinty, the chief inspector of HMCPSI, said that serious consideration should be given to pursuing a change to the funding model to provide better value for money.

'Whilst blockbuster funding has allowed the SFO to pursue cases it would not otherwise have had the resources to take on, increasing core funding would provide the SFO with the ability to build more capacity and capability in-house,' he said.

Jonathan Pickworth, a partner and white collar crime expert at White & Case, explained that the report identified a number of reasons why the blockbuster funding approach was not working.

'For the agency to maintain this crucial role it needs to be objective in its decision making without government interference,' said Pickworth. 'The risk of such interference will only be heightened if the SFO is rolled into the [National Crime Agency].

'In reality, funding will always be an issue to some degree, there needs to be greater encouragement for companies to self-report - shifting the cost of the investigation to the companies and away from burdening the tax payer.

'There also needs to be better guidance given to - and less criticism of - those that conduct their own investigation. Such an approach would enable the SFO to focus its limited resources on the cases that really need its attention - and where public interest in prosecuting is greatest.'

The report also found that there had been a positive change to the past poor organisational culture since the appointment of the new director David Green in 2012.

However, while the current governance structure had served the SFO well in addressing legacy issues, it recommended the appointment of a smaller management board and a chief executive officer to streamline strategic decision making.

'SFO cases are complex, lengthy, and difficult, with huge amounts of information to analyse and there are often multiple paths that could be taken,' added McGinty.

'The current director recognised that challenge to the decision making processes is vital and built this function into the organisation's structure.'

The report did, however, highlight positive developments at the SFO, including: better inclusivity of senior managers; significant turnaround of staff engagement and morale; better engagement with stakeholders; and more effective layers of quality control and risk assessment, which provided improved governance arrangements.