SFO Chief Recuses Herself From Barclays Case

The new director of the Serious Fraud Office (SFO) has stepped down from the prosecution of four former Barclays bankers over potential conflicts of interest.

According to City A.M., Lisa Osofsky has handed over responsibility for the case to the SFO’s general counsel Alun Milford to “avoid any potential conflict” from previous private sector work. Osofsky joined the fraud office in August from U.S. risk and compliance firm Exiger.

“Both movement between public and private sectors, and potential conflicts of interest more generally, are not unknown in the legal profession – law enforcement agencies, law firms and barristers’ chambers have long-established measures in place to identify and take action to avoid such potential conflicts,” said an SFO spokesperson.

Last week the SFO suffered a setback when the High Court ruled that it could not reinstate charges against Barclays over a loan it made to Qatar during the financial crisis in 2008, which means the bank won’t face regulatory sanctions over its fundraising.

Barclays has denied that the $3 billion (£2.34bn) loan was related to a Qatari investment that helped it avoid a government bailout. Firms that are publicly listed in the U.K. are typically prohibited to lend money for a third-party to purchase their shares.

The SFO had requested that the High Court reinstate all charges after its charges were dismissed in the Crown Court. Despite the ruling, “the SFO believes it was right to bring this to the attention of the High Court,” a spokesperson said on Friday (October 26).

In the meantime, the trial of four Barclays bankers relating to the capital raising will proceed in January. Former chief executive John Varley, then-senior executives Roger Jenkins, Thomas Kalaris and Richard Boath have all been charged with conspiracy to commit fraud by false representation. In addition, Varley and Jenkins were slapped with a second charge of conspiracy to commit fraud. All have pleaded not guilty.