If Mr Mates is right, things are seriously wrong

IT IS, at root, a simple question, this tangled-seeming affair of the Serious Fraud Office. The question is: whom do we trust? Do we trust the allegations by a fugitive Cypriot tycoon and a former Northern Ireland minister that the SFO is out of control? Or do we trust the smooth assertions from the Attorney-General that nothing fundamental is wrong?

Whom we trust colours our view of Britain. On one side, Michael Mates's vision of power corrupted and lawlessness at the heart of the legal process: the SFO as a leaking, rule-breaking, judge-threatening, conspiracy- juggling organisation, charging round the country with television cameras in attendance like some chalk-striped chapter of the Tartar Horde. On the other, Sir Nicholas Lyell's depiction of this five-year-old body, very powerful certainly, but pursuing fraudsters in the 'unsullied tradition' of Crown investigations.

So much in politics comes down to a judgement of character. Mr Mates, in spite of previous errors of judgement, has that simplest and most lethal of weapons, an honest face. He has put his remaining reputation, perhaps his very self-respect, into the scales and left the country to judge. His performances in the Commons and on television have been masterly.

He is an earthy, impulsive, rather formidable man. The American writer Logan Pearsall Smith said: 'Hearts that are delicate and kind and tongues that are neither - these make the finest company in the world.' Mr Mates is, in that context, fine company. He may also be a fool.

If he isn't, then Sir Nicholas must be a fool. Sir Nicholas is a quiet man, who has been notable thus far for his neatly zipped lips. Back in November, he repeatedly refused to apologise to the three men acquitted in the Matrix Churchill affair. Since innocent men might have gone to jail, this seemed churlish. He also refused to publish the legal precedents for ministers signing public-interest certificates which damaged their defence. In May, he refused to publish his controversial advice to ministers about the Social Chapter opt-out from Maastricht, even though it would have cleared up a complex row and even though legal precedents existed for his doing so.

Yesterday's Commons statement may have seemed like a break with Sir Nicholas's habitual reticence. It wasn't. First, he did not directly deal with the allegations of a conspiracy to pervert the course of justice. Second, he exonerated the SFO from leaking to the press on the grounds that there was no 'tangible evidence' of this. Of course there isn't: how can you lay your hands on a telephone tip-off? Third, though he told the Commons he had 'caused' these matters 'to be investigated', he then admitted that this amounted to asking the SFO itself whether it had been guilty of wrongdoing. Surprisingly, there was no heavily-publicised dawn raid during this investigation.

This was not, in short, a statement that put the SFO in the clear. Had these allegations come out of the blue, we might have dismissed them as the frenzied ravings of guilty men. But there have been too many similar stories, including the testimony of the Guinness defendant Lord Spens, and too many spectacular collapses of trials, for anyone to be completely happy about the SFO. Yesterday, casually dropped into the pot, came the revelation that an SFO lawyer forged a letter purporting to come from the Liberal Democrat MP, Sir David Steel. This forgery concerned a bail application, not usually a laughing matter, but it was explained by Sir Nicholas as an unfortunate 'April fool joke'. Wild sense of humour, these SFO boys have.

Even if the Mates allegations are over-lurid, the SFO needs to be investigated thoroughly to restore its credibility. Something is wrong there.

And clearing it up matters far more than the Nadir trial itself - the man is, anyway, out of reach. This is the reason why the panicking, bewigged Commons clerks were wrong to try to stop Mr Mates on Tuesday and why the Speaker, Betty Boothroyd, was right, eventually, to let him have his say. The Commons is the only place where such grave charges can properly be made, and where the SFO may have to be dealt with. As Sir Nicholas said yesterday: 'It was this House which decided that these powers should be given to the SFO.' If there is no inquiry then, one day, it may have to take them away.

For until the Government sounds a little more convincing about the SFO, the balance of trust remains, however tentatively, with the dogged, emotional Mr Mates. As he said: 'Surely we are here, either as front or back- benchers, to take up questions of apparent injustice, and if we should ever flinch from such a duty then the reasons for our existence as MPs would be much diminished.'

Quite right. And Sir Nicholas and the rest of the Government are there to protect the public and the reputation of the law - fair do's for everybody, including fugitive Cypriots who seem to have made their money selling us oranges at pounds 15 a time. They are not there, first and foremost, to protect their recent creation, the SFO. There is a fundamental choice here - government by independent-minded politicians, or government by a clique of secretive insiders.

So if the constitutional lesson is that, for once, the Commons has been doing its job, then the political lesson is that John Major's Government ought to think first about the allegations and only second about any embarrassment or loss of face. They owe it to everybody to take this affair more seriously.

Until they do, it may fade, but it will not vanish.