The SFO have launched an investigation into the alleged fraudulent activities of the Raedex Consortium, which comprises of a number of car leasing companies, including Buy2Let Cars. Raedex entered administration in March 2021, after the Financial Conduct Authority (FCA) required the firm to cease conducting regulated activities because of concerns about its finances.
Details on the investigation are sparse, but the SFO have stated that, with the assistance of the National Crime Agency and City of London Police, on 8 April 2021 they conducted searches of two London properties and interviewed two individuals (one of whom was arrested). This was a multi-agency effort with both the National Economic Crime Centre (NECC) and the FCA having also been thanked by the SFO for their assistance.
The fact that this latest investigation focuses on fraudulent activities is not surprising. As we noted in our piece 'What can we expect from the SFO in 2021?', the SFO appears to be increasingly focused on investigating and prosecuting fraud, in lieu of bribery or corruption. We have likewise seen that the SFO's focus appears to be increasingly domestic and this latest investigation appears, at least at this stage, not to have an international element. We anticipate that these trends will continue, particularly with the increased fraud associated with the Covid-19 pandemic.
The NECC have set out the three categories of fraud which have been increasing over the last year: fraud which specifically takes advantage of the pandemic such as selling fake PPE; fraud against the public sector and taking advantage of the government stimulus packages; and general fraud, such as courier and pension fraud. The SFO will take an interest in the most serious and complex of these cases.
The SFO is facing a number of challenges in its investigatory work including the sheer volume of data associated with each case and a need to enhance their technical capabilities. However, following the closure of high-profile investigations into KBR Inc.'s UK subsidiaries and British American Tobacco Plc, the SFO should now have the opportunity and resources to pursue new investigations.