The Serious Fraud Office’s strategy for 2024 to 2029 indicates aspiration to be a more effective agency and to incentivise personnel.
On 18 April 2024, the UK’s Serious Fraud Office (SFO) published an ambitious, albeit high-level, five-year plan (the Plan), setting out its proposed framework to address the increasingly complex landscape of serious fraud, bribery, and corruption. The Plan indicates Nick Ephgrave’s ambitions as the new director, building on the themes set out in his inaugural speech (outlined here).
In this blog, we explore the key elements of the Plan, which the SFO will measure against four indicators in the coming years: (i) justice outcomes; (ii) operational delivery; (iii) organisational strength and resilience; and (iv) finance.
Key Elements of the Five-Year Plan
Cooperation, Reporting, and Prevention
The Plan states the SFO aims to increase reporting by exploring options to incentivise whistleblowers to report wrongdoing (such as financial rewards) and helping corporates to self-report more easily. Indeed, the SFO announced last week a refresh of its corporate cooperation guidance and that, in this regard, the SFO will encourage internal investigations and interviews as long as it is kept apprised of the investigation from an early stage. Increased cooperation may be met with alternatives to prosecution (see further below) and may mark a shift whereby the SFO seeks to place more of the cost burden of investigations onto corporates in order to more effectively deploy its limited funds.
The Plan also refers to a focus on prevention, with an opaque mention of a new “pilot programme” to cut off serious fraud, bribery, and corruption “at source”. Details are scarce at this stage, so it remains to be seen what shape this pilot programme may take.
Enforcement Strategy
The SFO’s enforcement strategy will centre on strengthening its intelligence-gathering and proactive enforcement capabilities to find ways to “build compelling cases in shorter timescales”. The focus on taking “swift, decisive” action is evident throughout the Plan and has been a primary concern for Ephgrave, who instigated dawn raids across numerous sites and closed two long-running investigations in the first few months of his tenure.
The Plan refers to pursuing innovative alternatives to formal prosecution when appropriate, with a nod to the previously successful use of Deferred Prosecution Agreements (DPAs). Separately, the SFO last week indicated that they are looking at the possibility of entering into non-prosecution agreements (NPAs) when appropriate, similar to the declinations issued by the US Department of Justice (DOJ) in an effort to further encourage corporate cooperation. We can expect to see continued SFO appetite to engage corporates to enter into DPAs (and potentially the novel use of NPAs) in an effort to avoid long and expensive trials.
Approach to Technology
The SFO’s strategy acknowledges the critical role of technology in modern law enforcement. A key aspect of the Plan is the SFO’s intention to integrate state-of-the-art tools and to focus on artificial intelligence / machine learning to refine investigative processes and enhance analytical capabilities. The UK duty to disclose relevant unused material to the defence under the Criminal Procedure and Investigations Act 1996 has led to cumbersome and time-consuming disclosure exercises, contributing to significant delays in prosecuting cases. Indeed, Ephgrave is looking to combat these delays after two independent reviews on disclosure were commissioned in the last few years alone.
Strengthening International and Domestic Alliances
The Plan emphasises the importance of international and domestic collaboration. By fortifying partnerships with global organisations such as the OECD and contributing to the Financial Action Taskforce’s evaluation of the UK, the SFO aims to extend its global influence. The SFO also recently highlighted the strength of its relationship with the DOJ. Particularly, the SFO indicated an intention to maximise use of Criminal Overseas Production Orders (for example under the US-UK Data Access Agreement) to obtain data directly from overseas service providers without the need for the slow Mutual Legal Assistance process. The SFO appears keen to dispel recent commentary that it is looking to focus solely on domestic fraud committed by small businesses with UK victims and still sees itself as a key player in targeting complex multinational bribery and corruption cases.
The strategy also focuses on fostering collaboration with the UK’s National Crime Agency and the City of London Police to expedite evidence gathering and case development. Unsurprisingly, Ephgrave’s police background lends itself to working closely with an authority he knows well in order to pool resources and maximise efficiencies.
Developing Personnel
Central to the SFO’s strategic vision is the development of its personnel. The Plan makes clear that in order to achieve its goals, it will need to be able to attract and retain “the brightest and the best” from a range of professions. The SFO has historically struggled with staff retention, and this issue will need to be resolved if the SFO is to transform as envisaged. However, in order to lure talented individuals away from more lucrative positions in private practice, the organisation will need to secure more funding and potentially pay outside of civil service pay bands — matters that are outside of the SFO’s control.
Conclusion
Whilst the focus on streamlining the SFO’s case load, bringing swift justice, and collaborating with law enforcement agencies and corporates are ambitious goals, the Plan lacks specific detail. The goals are largely unchanged from the priorities outlined by the previous director, Lisa Osofsky, at the start of her tenure more than five years ago, indicating the challenges the SFO will likely face as it seeks to adapt amidst budget constraints and the difficulties of bringing legislative changes with an upcoming general election.
This post was prepared with the assistance of Mark Shakkour in the London office of Latham & Watkins.
