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Crime in the time of Covid – the impact of the pandemic on SFO investigations
Crime in the time of Covid – the impact of the pandemic on SFO investigations
22 May 2020
Series
Blogs
22 May 2020
Following the almost complete closure on 23 March 2020 of UK court buildings due to the Covid-19 pandemic, a small number of jury trials recommenced this week in designated criminal courts. One such trial is that of three individuals being prosecuted by the Serious Fraud Office (SFO) for alleged conspiracy to bribe an Iraqi public official. However, the capacity of the SFO to investigate new cases has been heavily curtailed by the health emergency, with the agency’s usual procedures and practices being severely impacted by social distancing and remote working arrangements. How it and other criminal enforcement authorities will progress their existing caseload while responding to the reported sharp increase in financial scams and pandemic-related crimes, such as NHS, charitable and pensions-related frauds, is uncertain.
In common with many businesses, the SFO has had to reduce the number of staff working at its offices, with the majority of personnel now working from home. However, the nature of the agency’s work and its desire to keep its interviews secure and confidential have led to particular problems in the conduct of investigations.
The consideration of physical evidence is particularly hard at this time. Items such as hard copy documents, personal laptops, memory sticks and mobile phones are usually handled by SFO personnel, who upload the data to the SFO’s own electronic review platform. But staff working from home are unable to operate in this way to minimise the risk of transmitting the virus, and only electronic evidence already compatible with the SFO’s platform can be accepted. This has led to delays as documents fail the submission process and the SFO’s IT struggles to receive and process data.
Meanwhile, most interviews with witnesses and suspects and searches of properties have had to be suspended. In fact, Global Investigations Review (GIR) reported that the SFO had revealed, in response to a Freedom of Information request by GIR, that it had not carried out any searches or interviewed a suspect between 23 March, when the UK government instructed the country to go into lockdown, and 30 April.
In most cases, face-to-face interviews are simply not possible under current social distancing measures. Interviews of suspects and witnesses take place in the basement rooms of the SFO which are tiny and (perhaps deliberately) windowless – there is no space to maintain the required distances. The Crown Prosecution Service and the Law Society have said that interviews under the Police and Criminal Evidence Act could take place remotely if it was a “fair, reasonable and proportionate option” and the interviewee consents. However, virtual interviews are not favoured by the SFO due to the potential for them to be recorded or otherwise compromised, for example, by there being another person in the room prompting responses or providing access to additional information.
The agency has confirmed it is still holding voluntary interviews over the phone or online where security concerns can be overcome and given that many of its investigations are long-running affairs, it may not yet be feeling the pressure to push on with witness interviews at all costs. This cannot be a permanent solution, however; the increasing likelihood of long-term social distancing means that even the longest-running investigations will need to be progressed. The SFO was criticised last year by the House of Lords Select Committee conducting post-legislative scrutiny of the Bribery Act 2010 for the length of time it took to investigate and charge cases, which the Committee considered had a detrimental effect on individuals and companies, especially SMEs.
Anecdotally, lawyers are reporting delays in responses from SFO staff to correspondence and disruption to document review processes and the operation of the SFO’s Digital Forensics Unit. The SFO appeared slower than other authorities to offer guidance on how it would continue to operate during the crisis, leading to unfavourable comparisons with the Financial Conduct Authority, Crown Prosecution Service and HM Revenue and Customs, which have all provided clear information about their operations during the lockdown. The SFO eventually published an update on 7 May, which confirmed that it is continuing to investigate suspected fraud, bribery and corruption under adapted ways of working where necessary. As a result, “[the SFO] have been able to continue to follow active lines of inquiry in open investigations, as well as looking into allegations and referrals at the “pre-investigation” stage”. However, there has as yet been no indication as to how it intends to progress its portfolio of ongoing investigations.
In any event, getting a prosecution to court in these difficult times is a challenge in itself. The SFO’s prosecution of three individuals for bribery in connection with a major investigation into Unaoil, the Monegasque oil group, was adjourned at the completion of evidence following the Covid-19 outbreak. The trial resumed with closing speeches on 13 May at the Old Bailey (rather than Southwark Crown Court, where it had commenced) and is taking place under strict social distancing conditions with reduced hours, to avoid participants travelling during rush hour. However, the extent to which complex or lengthy trials will be able to recommence generally is unclear. The Old Bailey is one of only four court buildings so far approved to reopen. Most prosecutions of business or financial crimes take place in the Southwark Crown Court but this currently remains out of action. In addition, each trial will need to occupy perhaps three separate rooms - one for the judge, counsel, defendants and jury, a second for the public, press and other attendees and a third for jury deliberations – severely limiting the number of trials that may effectively take place in each court location.
Even before the pandemic struck the UK, there were over 37,000 criminal cases outstanding - a two-year high. Meanwhile, crimes are still being prosecuted that will need to come before the crown courts, despite the magistrates handling as many as possible virtually. The Jury Trial Working Group, made up of members of the criminal justice system and legal professions, has been set up by Robert Buckland, justice secretary, to consider plans to resume jury trials while adhering to social distancing and protecting the health and safety of court users. One option is to use a small number of larger crown courts only or hold trials in large buildings outside the courts, such as university lecture halls. Another, possibly more radical, suggestion has been to reduce the number of jurors from 12 to seven, which was last done during the Second World War.
Meanwhile, new video technology is being rolled out to more than 100 criminal courts to enable participants in criminal hearings to take part remotely and allow crown and magistrates' courts to hold secure hearings. Not everyone has approved of the suggested move to virtual jury trials. Some commentators have suggested that remote hearings involving screen-only access may impact on a defendant’s right to a fair trial under the European Convention on Human Rights by providing too many opportunities for outside influences to exist, and there are concerns that individual jurors could be left vulnerable and open to outside influence or even intimidation and manipulation. Other cases, such as complex, multiparty cases, could just not be viably held virtually.
What all this means for the conduct of future trials of financial crime – and indeed the SFO itself - is uncertain. The SFO’s stated aim is the investigation and prosecution of serious or complex fraud, bribery and corruption. At the very time we are seeing an increase in these types of crimes, the SFO’s task will be to bring cases to court. Will it be able to rise to the challenge? Only time will tell.