Serious Fraud Office in talks to increase annual budget

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The Serious Fraud Office (SFO) is in talks to change the way it is funded.

The SFO has a basic annual budget of £31m to maintain its 500 staff.

It asks the Treasury for extra cash when it takes on “blockbuster” cases, like the Tesco fraud probe. Critics have said the agency needs a larger budget rather than having to rely on case-by-case funding.

David Green, the SFO’s director-general, told the BBC any final decision was in the Treasury’s hands.

Since the financial crisis, the SFO has received more than £100m in top-up funding to fund big cases, including the investigations into Rolls-Royce, Tesco and Barclays.

Mr Green defended the arrangement. “I have never not pursued a case that we thought worthy of investigation because of a lack of funding, and nor would I ever do that,” he told the BBC in an interview.

Mr Green said he had never had “the slightest difficulty” in securing funding to pursue a blockbuster case: “We are in discussion at the moment over whether the relationship between the basic and blockbuster funding is the right one, but that is a matter for the Treasury.”

‘Too big to jail’

Mr Green, who took charge at the SFO in 2012 after its embarrassing – and costly – failure to bring charges against the Tchenguiz brothers over the collapse of the Icelandic bank, Kaupthing, steps down in April.

He negotiated a settlement with the Tchenguizs, and went on to bring high-profile cases over the rigging of Libor and Euribor benchmark interest rates, as well as against Barclays, Tesco and Rolls-Royce.

The last resulted in a near £700m penalty payment under a “deferred prosecution” agreement – a legal arrangement where a company agrees to pay up in return for not receiving a criminal conviction that might put it out of business.

Some legal experts think such agreements amount to a concession that some companies are “too big to jail”.

Mr Green said they were a recognition that “people commit fraud, not companies, and you can’t jail a company”.

He said the deferred prosecution law here had drawn on the set-up in America, but with one crucial difference – each UK agreement has to be signed off by a judge: “That judicial oversight is the key,” he said.

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