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White Collar Crime: Osofsky looks to utilise co-operators in SFO investigations

Posted on 15 January 2019 by Alex Tyerman & Tim Thompson

Osofsky looks to utilise co-operators in SFO investigations

In a previous blog post, we considered new SFO Director Lisa Osofsky's potential impact on the SFO, and whether she would seek to introduce changes that could be seen as a move towards the US criminal law enforcement model. Four months in, and it seems that Ms Osofsky intends to do just that. 

In comments made in Washington towards the end of 2018, Ms Osofsky noted and expressed a keen desire for the continuance of co-operation between prosecutors, regulators and law enforcement agents from around the world.  She also directly referenced the DOJ Prosecutor who is currently seconded to the SFO and said that whilst he is learning the ways of the SFO he is also 'teaching [the SFO's] prosecutors DOJ’s ways'.

One specific topic Ms Osofsky mentioned was the use of "co-operators", by which she means co-operating defendants who testify against others in exchange for a reduced sentence or punishment.   Ms Osofsky is clear about what co-operating means: it is providing prosecutors with information they do not know so they are able to get to the truth of a matter as quickly as possible.  She also confirms that, unsurprisingly, co-operation is not responding to requests that a person is obliged to respond to, burying incriminating evidence in a 'document dump' or protecting certain executives.

White collar crime investigations are often document heavy, and having co-operating witnesses who are able to direct investigators to key documents or information would help cases reach a swifter resolution.  Ms Osofsky explains that US prosecutors have commented on how useful co-operators are in cracking white collar crime cases, suggesting co-operation agreements with witnesses are something the SFO will actively look to utilise in the future.

The power to recognise for co-operation already exists in the UK.  These powers arise by virtue of sections 71 to 74 of the Serious Organised Crime and Police Act (SOCPA 2005).

Under SOCPA 2005, a 'specified prosecutor' – which includes the Director of the SFO – has the power to:

  • Grant immunity whereby no proceedings for an offence of a description specified in the notice may be brought against that person in England, Wales or Northern Ireland, except in the circumstances specified in the notice (s.71 SOCPA 2005);
  • Give a restricted use undertaking whereby information provided will not be used against the co-operator in any criminal or confiscation proceedings or civil recovery (s.72 SOCPA 2005);
  • Make a written agreement under which a defendant is willing to assist an investigation or prosecution (s.73 SOCPA 2005); and
  • Refer an offender's sentence back to the sentencing court if certain conditions are met (s.74 SOCPA 2005).

The decision as to whether it is appropriate to treat someone as an assisting offender in any particular case is entirely that of the specified prosecutor.  When deciding whether to do so, the prosecutor should consider whether it is in the interests of justice or public safety and security.  The likelihood of whether the information or evidence could be obtained without such agreement should also be taken into account.

Given Ms Osofsky's comments in Washington, and the discretion she has as Director of the SFO, we may well see an increase in the use of these SOCPA provisions. Connected to this, Ms Osofsky has told a Commons justice committee she is personally reviewing 70 cases in an effort to understand why it was taking so long to conclude investigations and reach charging decisions. Ms Osofsky has said since taking on the role of Director, she has been hearing this as the 'biggest criticism' of the SFO.  Co-operators may be part of Ms Osofsky's plan to tackle this concern.

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