LONDON (Reuters) -Britain’s Serious Fraud Office (SFO) has been refused permission to appeal against a ruling that it only opened a corruption probe into Kazakh mining group ENRC because of its own wrongdoing, leaving the watchdog facing a hefty damages bill.
London’s High Court ruled in December that ENRC was entitled to millions of pounds in damages over a decade-long criminal investigation into alleged bribery, which was dropped by the SFO last year without any charges. ENRC had denied any wrongdoing.
That ruling also said the SFO would not have launched the probe in 2013 if the agency had not first induced ENRC’s former lawyer to act against its interests, and the Court of Appeal refused permission to appeal on Monday.
ENRC was seeking around 21 million pounds ($28 million) for “unnecessary” work linked to the investigation, though the High Court has said ENRC would receive less than that sum.
The figure is, however, dwarfed by the nearly $1 billion former FTSE 100 company ENRC is claiming for losses it says were caused by the probe, which will be the subject of another trial.
The SFO has recorded a provision of 237.7 million pounds in its accounts for 2023/24, which states that the figure represents about 25% of what ENRC is claiming.
A spokesperson for the SFO said: “We are disappointed by the Court of Appeal’s decision. Any damages awarded are subject to ongoing proceedings.”
The spokesperson added: “We have received the information ENRC is relying on for its damages claim, which we are considering. We do not recognise that figure.”
The agency has faced a number of setbacks in recent years, including being forced to abandon high-profile prosecutions because of disclosure failures.
If ENRC is entitled to further damages, then liability for paying could be split between the SFO and ENRC’s former lawyers Dechert, whose former co-head of white-collar crime Neil Gerrard conducted an internal investigation for ENRC.
A spokesperson for Dechert said: “Dechert denies that it is liable for any of the losses claimed by ENRC against the SFO in (the next phase) of the litigation.”
ENRC declined to comment. Gerrard’s lawyers did not immediately respond to a request for comment.
The High Court previously ruled that Gerrard had engaged with senior SFO officials without authority in a “reckless breach of duty” and that the SFO induced him to do so.
(Reporting by Sam Tobin; Editing by Mark Potter and Alex Richardson)
