Reframing justice: the SFO's new strategic vision 2024-2029

In April 2024, the Serious Fraud Office (SFO) published its new five-year strategy (the Strategy), setting out its commitment and focus for the period until 2029. The SFO is a specialist prosecuting authority tackling top level serious or complex fraud, bribery and corruption.

The Strategy replaces the three-year Strategic Plan 2022-25 published in April 2022 and is a clear statement of intent to leverage a new leadership style and purpose under its new Director, Nick Ephgrave. Although essentially forward facing, the SFO does not shy away from admitting where there are areas for improvement and creating an organisational culture that matches the SFO’s level of ambition is core to the document.

The Strategy may not hold many surprises, but it does form the next part of a complex puzzle that has been taking shape gradually over recent months. This progression began with the announcement of Ephgrave as the next leader of the SFO in July 2023.

Following on from Ephgrave’s inaugural speech at RUSI in February 2024, which has already been extensively analysed by many commentators, the Strategy elaborates on that speech. It also incorporates additional insights from comments made both publicly and in private meetings with stakeholders from the legal and justice sectors by Ephgrave and other senior SFO managers.

Now, the SFO has a clear roadmap that articulates its approach and vision under Ephgrave’s leadership.

The Strategy is arranged into four “Strategy Outcomes”:

• We have a highly specialised, engaged and skilled workforce
• We are equipped to harness the technology and tools of a changing world
• We combat crime effectively through intelligence, enforcement and prevention
• We are a proactive, authoritative player in the global and domestic justice system

Under each heading, the SFO details why this outcome is important, and sets out a number of specific ways in which it seeks to achieve the outcome over the next five years.

This includes a focus on its core remit: “The SFO has always played a part in preventing serious fraud, bribery and corruption from taking place by providing a strong deterrent through successful prosecution,” and that “the SFO takes on the cases which nobody else can.”

Another brick in the wall

Many of the ideas have been around for some time, and are now being built on or expanded for the next five-year period.

For example, the SFO has for many years been collaborating closely with its international counterparts, and cases such as the deferred prosecution agreement with Airbus in 2020 are a good example of what this can achieve: this involved a coordinated global resolution involving authorities in France and the US, and was the culmination of a long investigation supported by law enforcement in countries including Sri Lanka, Malaysia and Indonesia.

The Strategy acknowledges the benefit of collaborating with agencies on a global scale, stating that it “aspires to always work constructively with partners in the UK and across the world,” and sets out areas where there will be some further expansion, most notably supporting the upcoming inspection of the UK by the Financial Action Taskforce (FATF) as well as a plan to formalise the SFO’s “specialist training offer for partners at home and abroad.”

However, recent SFO raids and arrests which have been hitting the headlines demonstrate an emphasis on assisting and collaborating with domestic agencies and dealing with fraud on a national level; the SFO’s work on larger international cases is notably less evident at the moment.

Skilled human resources have always been essential for the SFO to operate successfully, and previous reports on the SFOs performance and effectiveness have noted the need to improve staff retention and make the agency a more attractive option for those seeking to further their careers in the field of criminal law.

The Strategy focuses an entire Strategy Outcome on its workforce, and refers to a specific “five-year strategic workforce plan” which will be developed; with detailed targets under this outcome ranging from upgrading the SFO’s HR software through strengthening learning and development for staff, to developing the overall benefits package.

The emergence of new thinking

Upon closer analysis of the strategy, several new important ideas have come to light. 

Firstly, there's an intent to enhance or more effectively utilise intelligence—be it through real-time covert operations, whistleblowers, or assisting offenders. Although these techniques have been available, they have been infrequently employed, marking a strategic shift for the SFO, albeit not without its risks.

Furthermore, the SFO is reigniting discussions about incentivizing whistleblowers. This topic was last examined by the government in the 2013 Serious and Organised Crime Strategy. Notably, two other UK regulators, the Financial Conduct Authority and the Prudential Regulation Authority, have conducted detailed assessments of this issue but decided against financial incentives for whistleblowers, citing potential issues such as the risk of malicious reporting and conflicts of interest.

Ephgrave mentioned the incentivisation of whistle-blowers during his inaugural speech at RUSI, which sparked a wide-ranging debate among commentators, with many concluding it was a non-starter and that the read across to similar schemes in the US was not as straight forward as was being suggested. Undeterred, Ephgrave has taken the proposal a step further and one of the SFO’s specific plans formalised under the third Strategy Outcome is to “Explore incentivisation options for whistle blowers, working with partners in the UK and abroad.”

One unclear aspect of the Serious Fraud Office's (SFO) current strategy is its target organisations. Under Ephgrave’s leadership, the SFO has initiated or participated in several investigations, actively publicising these efforts.

However, these cases have predominantly involved smaller, domestic businesses or companies already in administration, such as Buy2Let Cars and Safe Hands Plans, a funeral plan scheme. These investigations, especially the high-profile dawn raids, illustrate the SFO's collaboration with other domestic agencies.

For instance, the National Crime Agency supported the SFO's operations in February 2024, leading to the arrest of four individuals in Merseyside and Greater Manchester, and a raid on AOG Technics in London in December 2023.

These cases, involving significant frauds affecting domestic and sometimes international victims, markedly differ from the global giants and high street names historically targeted by the SFO.

Moreover, the SFO's success hinges on sufficient resources and investment to support its missions. While the Strategy touches on the need for robust resourcing, especially in areas like digital forensics, Ephgrave avoided discussing funding in his inaugural speech at RUSI in February 2024.

However, it's evident he recognises the long-standing underfunding of the agency and the need to optimise resource use. He has also echoed a frequent SFO complaint about facing well-resourced defendants with deep pockets. While this is often true—even though many are legally aided—it underscores the type of entities the SFO aims to target as it strives to be the leading agency in investigating and prosecuting fraud, bribery, and corruption.

Ephgrave will undoubtedly hope that the Treasury will take note of the findings in the SFO Disclosure Report published by HM Crown Prosecution Service Inspectorate (HMCPSI) on 30 April 2024.

The report emphasizes the need for increased financial support for the SFO to achieve its objectives. One of the six key recommendations is that by October 2024, “the government, through its economic and finance ministry must develop a long-term funding strategy to support the Serious Fraud Office to discharge its disclosure obligation to allow it to compete in the open market to secure enough experience to deal with its cases” (paragraph 9.33).

Furthermore, the report highlights, “We emphasize that the SFO must be supported by more government funding because they struggle to compete in the open market to deal with disclosure effectively,” (Executive Summary, paragraph 1.9).

Conclusion

Despite its brevity and lack of detailed information, the Strategy undeniably stands as a significant document. It has officially solidified certain concepts and marked them as corporate priorities.

Under the leadership of Ephgrave, the SFO appears to be adopting a more vigorous and outward-facing strategy, utilising social media announcements and speeches from its senior leaders to convey its intentions to the market.

Observers will undoubtedly continue to monitor for additional developments that fit into this strategic framework. However, to achieve the objectives outlined in the Strategy, the SFO will require substantial resources and investment, including a dedicated and motivated workforce.

As the broader political landscape evolves in 2024, the level of support the SFO can expect may become more apparent, although a change in government is unlikely to significantly alter its direction or funding.