SFO criticised as fraud case against three ex-G4S executives collapses

The Serious Fraud Office (SFO) has come under fire for wasting millions of pounds of taxpayers’ money and making “huge mistakes” in its 10-year investigation into G4S’s electronic tagging arm as charges against three former executives were dropped.

In September 2020, former managing director Richard Morris, former commercial director Mark Preston and former finance manager James Jardine were charged with seven counts of fraud.

The executives of G4S Care and Justice Services, which provided electronic monitoring services, were accused of making false representations to the Ministry of Justice between 2009 and 2012.

The charges were brought after G4S accepted responsibility for three counts of fraud and agreed to pay a financial penalty of £38.5 million, and to pay the Serious Fraud Office (SFO) costs of £5.9 million.

On Friday, prosecutor Crispin Aylett, KC, offered no evidence in the case against the three former executives who were due to go to trial in April next year.

Mr Aylett said: “The decision to drop this case is not one that could be taken either quickly nor lightly.”

Following a “careful and comprehensive review” it was decided it was “no longer in the public interest” to proceed, he said.

Mr Aylett said: “The defendants have been under suspicion for 10 years and the prosecution are only too aware of the impact the proceedings will have had on them and their families.

“We recognised the potential unfairness of asking that this should go on for a substantial period of further time.

“We regret the way the case has turned out.”

Mr Justice Johnson formally acquitted  Mr Morris, 47, from High Wycombe, Buckinghamshire, Mr Preston, 51, from Cheshire, and Mr Jardine, 41, from Cumbria.

After the Old Bailey hearing, Mr Morris, who attended court, said he was “delighted” the case was over and thanked his lawyers who “worked so determinedly to expose the truth and dismantle the SFO’s flawed case”.

He said: “From the outset, the allegations against me were plainly wrong.

“That it has taken 10 years for the SFO to acknowledge as much is a scandal.”

Mr Morris said he had been “shocked” G4S had entered into a Deferred Prosecution Agreement (DPA) with the SFO, accusing him of a “wholly untrue allegation”.

He said: “This amounted to G4S signing a false confession, plain and simple.

“The outcome of this case shows G4S’s decision to enter into a DPA was unfair and misguided. To later learn that the SFO accepted the DPA’s untrue narrative and decided to prosecute me without properly investigating the underlying evidence, was incomprehensible.

“I am of course pleased to be vindicated, but no-one should have to go through such an ordeal. Without significant changes to the DPA regime and the SFO, I fear they will.”

Mr Morris’s lawyer Ross Dixon, of Hickman & Rose Solicitors, blamed the SFO for “failing to understand its own evidence”.

He said: “This is not the first time a major fraud prosecution has come unstuck for the SFO after it signed a DPA with the company at the centre of its investigation.

“As in the cases of Tesco and Serco, this DPA was based on the alleged wrongdoing of individuals, but the narrative on which the DPA was based has failed to stand up to scrutiny in criminal proceedings.

“This case collapsed because the SFO failed to understand its own evidence; failed to secure significant evidence (the underlying books and records that would have demonstrated the true position as to costs that were at the heart of the allegations); and only at the eleventh hour disclosed key material that undermined its case.

“It is deeply worrying that after such a long time, only now has the SFO offered no evidence. Ten years is far too long for any individual to have to wait for justice.

“The SFO must engage in an honest and searching appraisal of what went wrong in this case. If not, this won’t be the last time this happens.”

Mr Jardine’s lawyer Joanna Dimmock, partner in the Investigations and White Collar Defence practice of Paul Hastings, said: “After 10 years of delay, mismanagement and misunderstanding of the evidence, the SFO have finally recognised this case should never have been brought.

“The SFO knew in 2021 fundamental errors existed which impacted the safety of Mr Jardine’s case. What followed has been a litany of disclosure disasters and breaches by the SFO of over 60 Court Orders.

“In light of its discovery of further huge mistakes in its investigation in December 2022 and our relentless pursuit to uncover this mishandling, the SFO has now elected to drop the case rather than reveal the sheer scale of the errors they had discovered.

“Yet again the SFO has wasted millions of pounds of taxpayers’ money whilst three men’s lives have been ravaged and put on hold for nearly a decade.

“This case has collapsed without any evidence even being heard. Mr Jardine is grateful that he can finally put the injustice of the last nine years behind him and begin to rebuild his future with his family.”

An SFO spokesperson said: “As a public prosecutor we have to make difficult decisions, including ending a prosecution where it is right to do so.

“In line with the Code for Crown Prosecutors, we have determined it is no longer in the public interest to continue this prosecution.”

Under the DPA with the SFO, G4S could continue to be considered as a Government supplier.

The DPA only applied to the potential criminal liability of G4S Care and Justice Services as a company, and not to any current or former employees.

The defendants in the case had previously pleaded not guilty to the charges against them.