Watching the City

International corruption cases have succeeded the high-profile corporate collapses of the early 1990s, but the UK Serious Fraud Office's job remains the same - to pick through the debris left when financiers decide to step outside the law. The SFO's director, Robert Wardle, says the office is keeping up with the growing complexity of modern fraud - but juries may be having more difficulty.

"I think there are some cases incapable of being tried by a traditional jury. It's not a question of understanding - although we don't know whether they understand or not, because of course we can't ask them. The problem is that the cases take a long time to try."

A complex fraud case can last as much as two years - an enormous burden on the jury, Wardle says. "It's not satisfactory if a trial lasts longer than six months. We have to reach agreements with the defence in order to make them manageable, but we can't always do that - these cases have outgrown this very respected institution."

Fraud trials without juries were suggested in 2003, but, faced with a possible parliamentary revolt, the UK government decided not to introduce them. Wardle believes the time is well past due for the move. "It is still possible to have a fair and just trial without a jury. Chancery judges [who usually handle civil cases] are well used to these cases."

Another way of cutting costs and the time spent on fraud cases would be to emulate the US and introduce plea bargaining. "The prospects for plea bargaining are good," Wardle says. With access to the judge scheduled to try a fraud case, prosecutors and the SFO could present the defendant with a complete package, including agreements to testify, sentencing, and even resolution of civil cases associated with the fraud.

"I think it would be welcomed because it would be efficient from everyone's point of view," adds Wardle. "The difficulty is making it attractive enough. If you compare it with the US, the difference (in sentencing after a plea bargain) is marked - it's a powerful incentive. I'm not saying we would want their 25-year fraud sentences, but higher sentences would be welcome - we don't have much headroom at the moment."

The SFO itself is adequately funded, but that doesn't mean much unless the police forces also regard fraud as an important issue - which, in general, they don't, says Wardle. "The problem is police resources. Except for the City of London police, fraud is not treated as a priority." He points out that the Metropolitan Police, which covers all of London outside the City, has cut back its fraud squad from 200 to 60 in order to focus on other priorities.

The SFO has its own investigative arm, but its job is to focus only on the largest cases: "There are a lot below that which are not being dealt with at all."

At present, the 52 local police forces in the UK handle fraud in their own areas, with the SFO handling large cases and collaborating on international investigations. But Wardle sees room for more work at a national level. The newly established Serious and Organised Crime Agency will deal with the involvement of organised crime in fraud and money laundering, but this will not cover every case of fraud.

"There is an argument for a national fraud squad," Wardle says, although he acknowledges that the cost makes it unlikely. A more feasible option is the creation of a national fraud intelligence base and a fraud reporting centre.

"At present, it's difficult to report fraud - you tend to get pushed around the place," he says. That makes it harder to assess the size of the problem. "Fraud is a huge amorphous thing. It can happen in lots of ways and can go on worldwide. We need better intelligence to stop it before it starts."

Alexander Campbell

BIOGRAPHY: ROBERT WARDLE

2003: Succeeds Rosalind Wright as director, SFO

1992: Assistant director, SFO

1988: SFO founded; Wardle joins as solicitor.