Yahoo Finance Anger as Serious Fraud Office head says she’s proud of ‘revolving door’ between regulator and law firms
The head of the Serious Fraud Office, Lisa Osofsky, has insisted she is proud of the fact that some of the most senior figures at Britain’s financial crime prosecutor have been poached by major law firms, as she insisted that a “revolving door” with the business world benefits the regulator.
Concerns have also emerged about the lack of checks being made on the officials who move from the SFO to the corporate world. Current rules mean that only one such move in the last seven years has been examined by the Advisory Committee on Business Appointments (Acoba), the body that scrutinises sensitive moves from Whitehall to the private sector.
It comes amid fears that the movement of senior SFO figures into major law firms sees them use their inside knowledge to help companies that the regulator could be tasked with investigating.
Among those to take posts with major corporate law firms over the last decade are the SFO’s former director, Sir David Green, two of its former general counsels, four former heads or co-heads of its bribery and corruption divisions, two former heads of its fraud division and the former heads of its assurance and international assistance divisions.
Between April 2015 and March this year, Green was the only member of SFO staff whose new job was reviewed by Acoba. When he moved to the law firm Slaughter and May, Acoba concluded there should be a six-month hiatus before Green was able to take up his post and placed other restrictions on the use of knowledge gained in his former role at the prosecutor.
However, when concerns were raised about such moves, Osofsky said that she was “proud that the people we attract and the training and experience they get at the SFO are highly prized by other organisations”.
“We proudly welcome professionals from the legal sector, law enforcement, accounting and tech, and benefit from a revolving door with the private sector,” she said. “I firmly believe that any risk that may arise from the private sector ‘poaching’ SFO talent is far outweighed by the skills and experience we gain from external appointments.”
Osofsky made the comments in response to Labour’s shadow solicitor-general Andy Slaughter, who had contacted her with concerns about the number of prosecutors leaving to work for private law firms. Labour said it had identified at least 20 other individuals, mostly investigators and prosecutors for the SFO, who have in recent years taken up posts with corporate law firms.
Some firms are open about the benefits of recruiting ex-SFO staff. One company’s website said of a former SFO employee: “Her significant experience as a prosecutor of financial crime at the Serious Fraud Office … puts her in a unique position to assist those facing an investigation by the authorities.” Another said: “Her prior experience at the SFO … enables her to provide insightful and strategic advice to both her corporate and high-net-worth clients at all stages of a case.”
Slaughter said that he could not understand “why the SFO director seems content, and indeed proud, to see dozens of her senior staff being poached in that way”.
“This cannot be allowed to continue unchallenged,” he said. “As a minimum, any senior SFO managers, investigators and prosecutors planning to take up jobs with corporate law firms need to have those appointments vetted by Acoba, so any necessary conditions can be laid down.”
A spokesperson for the regulator said: “The SFO has always fully complied with Acoba requirements, and it is wrong to suggest otherwise. We advocate for the interchange of personnel; it grows the collective capability of our organisation more than a closed shop ever could. The SFO attracts talented, experienced staff because of the nature of the work that we do. The SFO is committed to tackling serious cases of fraud, bribery and corruption. This year, we have convicted Glencore Energy (UK) Ltd with seven counts of bribery in connection with its oil operations; we are also at trial eight times, prosecuting 20 individuals for fraud exceeding £550m in value.”
