The prosecution of three former G4Sexecutives over claims of defrauding the Ministry of Justice has collapsed, in a fresh embarrassment for the Serious Fraud Office.
Richard Morris, Mark Preston, and James Jardine were all accused of fraud over the handling of a multi-million pound contract for electronically tagging offenders.
Criminal charges were brought in 2020 at the culmination of an investigation that began in 2014, but at the Old Bailey on Friday the SFO offered no evidence against the three men, bringing the case to an abrupt end.
It is the latest disappointment for the beleaguered SFO, after failed prosecutions against Tesco and Serco directors and a humiliating Court of Appeal ruling about its handling of a case against oil and gas consultancy Unaoil.
In 2020, the SFO struck a three-year Deferred Prosecution Agreement with G4S Care and Justice Services over the tagging scandal, after the company accepted responsibility for three charges of fraud. Under the deal, the firm admitted hiding the true extent of its profits in 2011 and 2012 from the MoJ and agreed to pay a £38.5m fine plus £5.9m in costs. It was also allowed the firm to continue bidding for government contracts.
SFO director Lisa Osofsky hailed the deal at the time as “unprecedented” and said the body would “hold corporates to account and ensure justice for victims of fraud”.
Explaining Friday’s decision to abandon the case against the G4S directors, prosecutor Crispin Aylett KC said the SFO was facing a complex disclosure exercise in advance of a six-month trial in April next year and ever-mounting costs.
“While the prosecution considers there remains a realistic prospect of conviction against each defendant, we have come to the conclusion it is no longer in the public interest to proceed with this case”, he said.
Mr Aylett, an experienced prosecutor, said the trial had been delayed twice amid disclosure issues, and said he had “never come across financial evidence as complicated as the evidence in this case”.
“The prosecution now have had to assess the resources in terms of both costs and time that would be required to complete a disclosure exercise which we have concluded would in fact take many more months to complete”, he said.
“The prosecution recognises that the defendants, all men of good character, have been under suspicion for ten years. The prosecution are only too aware of the impact these proceedings will have had on them and on their families. We recognise 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.”
Speaking after the hearing, Mr Morris said he was “shocked” by the SFO’s deal with G4S which directly accused him of wrongdoing.
“This amounted to G4S signing a false confession, plain and simple”, he said.
“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.”
Joanna Dimmock, from law firm Paul Hastings which acted for Mr Jardine, said “fundamental errors” should have been spotted by the SFO earlier.
“Yet again the SFO has wasted millions of pounds of tax payers money whilst three men’s lives have been ravaged and put on hold for nearly a decade”, she said.
“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.”
In 2021, an attempt to prosecute ex-Serco bosses over an alleged £12 million fraud collapsed amid problems with disclosure, while in 2019 a prosecution of former Tesco directors failed with a judge dismissing the case as “weak”. In both investigations, the SFO had entered into Deferred Prosecution Agreements with the companies before bringing criminal cases against individual directors.
Ross Dixon, from Hickman and Rose Solicitors, who acted for Mr Morris in the G4S case, accused the SFO of having “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”, he said. “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.”
In September last year, Ms Osofsky called for reform of the disclosure system, saying prosecutors have to waded through vast quantities of paperwork and are at “deep risk of human error”.
“Despite requiring the manual review of each document, the defence can use a mistake – which is capable of correction – to mount tactical challenges to our cases”, she said.
In court on Friday, Mr Justice Johnson entered not guilty verdicts against Mr Morris, the former managing director of G4S Care and Justice, ex-commercial director Mark Preston and former finance manager James Jardine for seven counts of fraud by false representation.
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.”
