SFO 'shambles' as trial collapses

The Serious Fraud Office (SFO) has been branded a "shambles" after the collapse of a major anti-corruption trial involving a billionaire Labour donor.

4575dee2-61c4-11e3-bb37-0a0c0223000020131211T084354
Victor Dahdaleh has been a donor to the Labour Party for several years

The Serious Fraud Office (SFO) has been branded a "shambles" after the collapse of a major anti-corruption trial involving a billionaire Labour donor.

Jordanian-born metals magnate Victor Dahdaleh was accused of paying more than £35 million in bribes to former managers at smelting company Aluminium Bahrain (Alba) in return for contracts worth more than £2 billion.

Mr Dahdaleh, who has been a donor to the party for several years, faced eight charges including conspiracy to corrupt and acquiring and transferring criminal property.

But the SFO confirmed today it had withdrawn its case after offering no evidence at a hearing at Southwark Crown Court in London.

An SFO spokeswoman said: "The SFO has today offered no evidence against Victor Dahdaleh, having concluded that there is no longer a realistic prospect of conviction in this case."

The decision came after former Alba chief executive Bruce Hall, described by the SFO as "a conspirator and significant witness", "significantly changed" his evidence from that contained in his witness statement, the SFO said.

Two key American witnesses, Mark MacDougall and Randy Teslik, senior partners at law firm Akin Gump which acted for Alba, had also refused to attend to be cross-examined, it added.

Shadow attorney general Emily Thornberry said the case had highlighted that the SFO "cannot be relied on" to carry out complex investigations.

"This collapse shows that the Government has yet to put the SFO on a sustainable footing," she said.

"The SFO under this Government has lurched from shambles to shambles and cannot be relied on to carry out the complex investigations and prosecutions it was created to undertake.

"Worryingly, this is not the first time that a case has collapsed in part because of a failure related to outsourcing and due diligence. Blunders on this scale risk costing the taxpayer more than is being saved.

"As long as ministers fail to get a grip of this situation, the taxpayer and the UK's reputation for fighting economic crime will suffer."

Responding to Ms Thornberry, an SFO spokeswoman denied any aspect of its investigation into Mr Dahdaleh was outsourced.

"Alba in Bahrain gave its documents to Akin Gump, the company's lawyers," she said.

"The SFO framed specific requests to Akin Gump for that documentation and obtained what was requested.

"The SFO also obtained evidence from other sources including banks and individuals.

"Thereafter the SFO made its own evaluation and assessment of that evidence.

"No aspect of this investigation was outsourced."