The Serious Fraud Office (“SFO“) this month published new guidance in relation to interviews conducted pursuant to section 2 of the Criminal Justice Act 1987 (the “Act“). The guidance replaces the SFO’s previous Operational Handbook (the “Handbook“).
By way of context, section 2 sets out the SFO Director’s powers to investigate cases, and creates the power to compel individuals to attend SFO interviews and answer questions. Following a number of adverse outcomes for the SFO in recent years (most notably the acquittals of all five defendants in the Wickes case in 2003 ), it is now broadly understood that the SFO will usually compel individuals under section 2 only if it is satisfied that they are not suspects in the case.
Having said that, failure to cooperate with a section 2 interview request carries a criminal penalty of up to six months in prison, as does attending but refusing (without reasonable excuse) to answer questions. Fear of self-incrimination is not generally accepted as a reasonable excuse, because section 2 includes safeguards to prevent the SFO from using interviewees’ statements against them (unless it is alleged they have been dishonest in their interview). Furthermore, an individual who recklessly makes a false or misleading statement whilst answering questions in a section 2 interview faces a criminal penalty of up to two years in prison, so the stakes can be high.
Section 2 is silent on the matter of legal representation, so the SFO guidance is currently the only definitive framework governing the attendance of lawyers at such interviews. Under the Handbook, the guidance provided as follows:
“It is SFO policy to permit the attendance of defence legal advisers at s2 interviews provided that
- their attendance does not unduly delay or in any way prejudice the investigation; and
- they understand their role (which is different to the role of a legal adviser to a suspect being interviewed under PACE 1984 caution)…
The interviewee should be asked to confirm what representation s/he wishes to have”.
The Handbook therefore inferred a presumption that the interviewee was entitled, not just to legal representation but, to legal representation from the solicitor of his / her choice. This was qualified so that the SFO retained discretion to prohibit the attendance of a specific lawyer or firm, if it was concerned that the firm acted for the company under investigation, and that the firm’s attendance might therefore impede or prejudice the free flow of evidence from the witness. That qualification has therefore always existed. It is not a new concept, and the High Court last year confirmed that it is not unreasonable1.
What the new guidance has arguably done is remove that presumption in favour of legal representation, replacing it instead with a discretion on the part of the SFO to allow a lawyer to attend only “if the case controller believes it likely they will assist the purpose of the interview… or that they will provide essential assistance to the interviewee by way of legal advice or pastoral support.” This appears to impose a burden on the interviewee to prove that s/he needs a lawyer for a specific reason, or that having a lawyer there will assist her/him in providing the information requested. This is not necessarily a particularly cumbersome burden, and in complex, high value investigations, the benefit of having a lawyer present with a clear grasp of the facts and the legislative regime will not be particularly controversial.
The same cannot be said of paragraph 8 of the Guidance for Lawyers, which sets out a new obligatory process for applying to have a lawyer present. This includes a requirement on the part of the lawyer to give a number of legally binding undertakings prior to permission being granted. The majority of these, again, are not particularly controversial, and it is arguable that they are already covered by the solicitors’ regulatory framework. However, paragraph 8(b)(1) of the Guidance for Lawyers requires the firm to give an undertaking that it does not represent “any individual or legal person who is a suspect in the investigation”. This could present significant issues for the SFO in negotiating and administrating section 2 interviews going forward, for the following reason.
The nature of SFO investigations is often (necessarily) covert and / or confidential. In many cases the SFO will not publicise full lists of all suspects in the case. In such circumstances, how can any solicitor be expected to undertake that they are not representing an unidentified individual? This provision imposes an unintended but substantial administrative burden on the SFO in negotiating section 2 interviews moving forward. Any decision made to exclude a lawyer from attending because s/he will not give the requisite undertaking will immediately be susceptible to judicial review and, unlike in the High Court last year, there is potential scope for arguing that the new guidance is unreasonable and / or unenforceable. The SFO will either have to demonstrate significant flexibility in enforcing paragraph 8(b)(1) or, not enforce it at all if it wants section 2 interviews to progress expeditiously and without challenge. For that reason, whilst the new guidance may appear more hostile towards interviewees and their solicitors, it will be interesting to see the extent to which it is relied on by the SFO in practice.