U.K. Top Prosecutor Can't Go After Wall Street, She Laments

(Bloomberg) -- The U.K.’s top prosecutor said she is “hamstrung” in dealing with fraud cases and can’t always pursue the biggest companies and banks.

“I’m worried that we won’t always be able to pursue the fraud cases we want,” Lisa Osofsky, who started as director of the Serious Fraud Office in August, told U.K. lawmakers at a parliamentary hearing Tuesday.

That’s because of a principle that prosecutors need to have a company’s “controlling minds” on trial to hold the firm liable for fraud or other economic crimes, she said.

“That’s an old law that was developed at a time when two, three or four people ran companies in our country,” she said. “What this ends up getting at is, I can go after Main Street, I just can’t go after Wall Street, and that’s unfair.”

Osofsky has already suffered a pair of setbacks since she started the job a few months ago. Last week, a London judge tossed charges against a pair of Tesco Plc executives implicated in an accounting scandal and in October another court upheld a decision to dismiss charges against Barclays Plc related to its Qatari fundraising in 2008.

The SFO does need to go after individuals suspected of wrongdoing, “but we also need to look at the corporate behavior that’s led these individuals to perform these acts,” said Osofsky, who has dual U.S.-U.K. citizenship and has previously worked for the Justice Department and the Federal Bureau of Investigation.

Brexit Slowdown

During the hearing, Osofsky also warned that Brexit may slow down the agency’s work in some areas. If the SFO isn’t able to use the European Arrest Warrant -- which allows for the extradition of people suspected of serious offenses -- it may have to “fall back on” older arrangements that are often more cumbersome.

“We’re going to have to all accept it may take a little bit longer to do our job,” she said, though she hopes it’ll be possible to “come up with solutions that will work for us at an operational level.”

Speeding up the SFO’s work is a top priority, however. In a move that suggested the U.K. could see shorter U.S.-style trials, Osofsky said juries would appreciate a faster process.

“Juries have to make sense of what we present to them,” she said. “If we present them with years worth of material, god bless anyone who can really focus on it.”

Prosecution Deals

She said if companies want to resolve a probe through a deferred prosecution agreement -- a deal that lets a company escape criminal liability -- they should cooperate from the start. Such deals have been popular, with both Tesco and Rolls-Royce Holdings Plc agreeing to pay fines as part of so-called DPAs.

“I’m not interested in having a company tell me to go away and they’re not going to give me anything, and then thinking they’ll get a DPA,” she said. “That is not going to happen on my watch.” Companies should show “a little bit of accountability, remorse.”

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