CPS inspectorate report published into the SFO’S handling of disclosure

On 30 April 2024 HM Crown Prosecution Service Inspectorate (“HMCPSI”) published a report on its inspection of the handling and management of disclosure in the Serious Fraud Office (“SFO”).

The inspection, initially planned to take place no earlier than late 2023 or early 2024, was brought forward after the SFO offered no evidence against three former executives of G4S in March 2023 because of insurmountable disclosure failings. The collapse of the G4S prosecution followed several high-profile disclosure failings that have damaged the SFO’s reputation in recent years, despite robust recommendations in July 2022 by Sir David Calvert-Smith and Brian Altman KC in their respective reviews of the SFO’s failings in the Unaoil and SERCO prosecutions. The SFO described those reviews as “a sobering read for anyone who believes in the mission and purpose of the SFO” and announced its commitment to overhaul the SFO’s working practices and culture and implement the recommendations as a pressing priority.

In preparing its recent report the HMCPSI compared the SFO’s handling of G4S with the successful prosecution of three executives of Balli Steel Plc resulting in their convictions in 2023.

The exercise revealed important inconsistencies in the SFO’s approach to disclosure. In Balli Steel there was better continuity and retention of staff, clearly defined disclosure strategy, early engagement with the defence, and case management documentation to ensure the SFO’s approach to disclosure was clear to the defence and the court. Overall, there was a proactive approach to the management and control of the disclosure process.

G4S on the other hand lacked continuity, proper record-keeping and planning, especially at the early stages of the prosecution. There were considerable issues relating to the outdated operation of the SFO’s Document Review System (DRS) at the time which meant that disclosure decisions were not always fully recorded and there was widespread misunderstanding of how key-word search functions worked. There were broader structural issues that contributed to the failings, including that the role of disclosure officer was perceived to be unattractive, carrying with it a high risk of criticism and low opportunity for development.

The report recognised that the SFO had considerably improved its approach to disclosure in the past two years by incentivising staff to take on the role of disclosure officer, strengthening its assurance processes, improving its internal document on how to manage and progress investigations and prosecutions (the “Operational Handbook”) and introducing a new document review platform with greater functionality which, although not infallible, was said to mitigate much of the risk of the past.

Nevertheless, HMCPSI found room for improvement and made six recommendations with the stated aim to “reinforce the SFO’s disclosure practices and provide greater reassurance to the public that justice is being delivered fairly in the top tier of cases involving fraud, bribery and corruption.” The recommendations are as follows:

1. By September 2024, the Serious Fraud Office updates the Operational Handbook with guidance in relation to the handling of a Deferred Prosecution Agreement (DPA) and its related material on the prosecutions of individuals in which a DPA has been entered into with the corporate entity.
2. By October 2024, the SFO revisits the guidance provided in the Disclosure Management Document template to ensure that it guides the case teams to fully explain the disclosure processes employed and safeguard their position should their disclosure handling be challenged.
3. By September 2024, the SFO should introduce a disclosure review process, like a peer review, conducted on every case post-charge by an individual independent of the case team.
4. By September 2024, the SFO should consider ways to incentivise staff to take on the roles of Disclosure Officer and Deputy Disclosure Officer to increase the pool of able and experienced candidates and improve staff retention in those roles.
5. By October 2024, the government must develop a long-term funding strategy to support the SFO to discharge its disclosure obligations and allow it to compete in the open market to secure enough experience to deal with its cases.
6. By October 2024, the Serious Fraud Office should review the current model for the management of Legal Professional Privilege (LPP) material. It should consider whether due to risks association with the delivery of core business by the eDiscovery team, a different system for management and control of LPP material should be implemented. The SFO must engage with others who have similar requirements to consider how it might manage and control LPP material.

Overall, the report is hopeful notwithstanding apparently persistent cultural challenges; HMCPSI was satisfied that improvements to the Operational Handbook, DRS and internal assurance processes would improve the handling of disclosure even though some staff were reportedly “unconvinced that they needed to change” and others of the unhelpful opinion that assurance was “unnecessary because they knew their cases best.”

HMCPSI’s assessment was that the SFO’s changes to how it manages and assures its casework since the handling of G4S “should provide a degree of assurance that the SFO has the right skills and infrastructure to discharge its disclosure obligations.”

Whether HMCPSI’s optimism is well-founded remains to be seen but the broader structural issues can only be properly addressed with immediate substantial investment to enable the SFO to attract and retain staff and counsel with the necessary experience to deal with disclosure effectively. Absent that support, it cannot sensibly be suggested that there will be systemic change. While the report has identified encouraging signs of improvement by the SFO, it will plainly take prolonged and consistent progress to restore confidence in the SFO’s disclosure processes and practitioners should continue to scrutinise the SFO to mitigate against repetition of past failings.

Neelam Gomersall