FOCUS analyses the SFO’s Ambitions for 2025-2026 & New Guidance on Corporate Cooperation
In April the SFO published two important documents which provide critical insight into the organisation’s direction with Nick Ephgrave at the helm. For this edition of FOCUS, Ed Vickers KC and Anita Clifford invited Matthew Wagstaff, the interim Director of Legal Services, to help us delve deeper into some of the important issues facing the SFO.
Published on 3 April 2025, the SFO’s Annual Business Plan contains several eye-catching objectives for the coming year. Most noticeable is the plan to progress a whistleblower incentivisation scheme which would see the United Kingdom take inspiration from well-established systems in the United States which ensure whistleblowers receive meaningful financial rewards. Since being appointed in September 2023, the Director of the SFO has been a vocal supporter of whistleblower incentive schemes. The Business Plan also shows that the SFO is investing heavily in technology aimed at making document review more efficient, will reform the approach to disclosure and has plans to improve crypto-asset investigation and asset confiscation capabilities. The SFO is further preparing for the commencement of new offences and identifies the promotion of the new corporate failure to prevent fraud offence, which takes effect from 1 September 2025, as a major objective.
On 24 April 2025, the SFO also published new guidance on Corporate Co-Operation and Enforcement in relation to Corporate Criminal Offending. Significantly, the Guidance introduces a presumption that a company that reports itself to the SFO and engages in full cooperation will be invited to negotiate a Deferred Prosecution Agreement (DPA) unless “exceptional circumstances” apply. Even if the SFO’s investigation has been triggered by a third party report, a DPA will still be possible. The SFO will consider inviting to DPA negotiations a company that has engaged in “exemplary cooperation” and provides a raft of practical steps that should be taken by a company if it wants to be seen as cooperative. Markers of uncooperative conduct are also set out and companies are warned against forum shopping. The fresh Guidance shows that the SFO is eager to boost corporate self-reporting in the coming years.
Q & A with Matthew Wagstaff
1. Whistleblowing incentive schemes are highly developed in the United States and have evolved over several years. What has caused the SFO to choose this moment to call for a whistleblowing incentive scheme?
MW: Simply a recognition that whistleblowing incentivisation has the potential to significantly increase both the number of cases that are referred to us and the speed with which we are able to subsequently investigate those cases.
In respect of the first of those points, we know there have been examples of UK whistleblowers going across to the United States and blowing the whistle there. Those are cases which, in many instances, ought to have been investigated and prosecuted here in the UK.
In respect of the second point, we know that our cases can take a long time to investigate – too long in some cases. We are working really hard to shorten the gap between taking a case on for investigation and reaching a decision on charge. Increasing the number of cases where we have a whistleblower – someone ‘on the inside’ who can point us to where the real criminality lies, who we should go and speak to, which set of accounts to look at first, and so on – will help us get to the nub of the case quicker and more effectively than if we were starting from scratch.
2. To what extent are whistleblowers already the catalyst for SFO investigations and what are the factors which currently prevent more from coming forward?
MW: We do have some cases where we are relying on information provided by whistleblowers, and they can be a really important source of information for us, but it’s only a small proportion of our overall caseload. To pick up on the US analogy, we don’t have anywhere near the number of whistleblower cases that they do, even taking into account the difference in size between our two jurisdictions. The main reason for that is the obvious one: they have multiple incentivisation schemes, some of which can pay out very large sums, and we don’t. So if you’re a senior executive, enjoying a certain lifestyle, and you want to whistleblow, you’re much more likely to do so in a jurisdiction where there’s a decent chance you’ll be financially compensated for doing so.
There are, I’m sure, other factors as well which prevent more whistleblowers coming forward. The main one is probably cultural: there seems to be a view amongst some here in the UK that paying people to whistleblow “isn’t British”. I completely disagree; we pay informants where it’s appropriate to do so, so why not pay those who are actually largely removed from the criminality itself?
3. In 2024, in the US, $255 million was paid out to 47 whistleblowers (including $98 million split between 2 whistleblowers), with payments calculated on a ‘net proceeds forfeited’ basis. How does the SFO expect to fund payments and what sort of scale do you envisage the scheme running at annually?
MW: We don’t actually envisage a scheme at all in quite the way you suggest. Our proposal is that whistleblowers would recover a percentage from any financial penalty imposed after conviction.
4. The Annual Business Plan refers to disclosure reform as a key objective for the coming year and RLC’s Jonathan Fisher KC has recommended greater use of AI. What steps are the SFO taking to reform its approach to disclosure? How do you plan to develop the use of AI in disclosure and how can Judges and the defence be confident that the technology will provide accurate disclosure?
MW: We’ve already begun to develop the use of AI in our approach to disclosure through the use of TAR (Technology Assisted Review) on one live case and we’re now extending that to other cases as well. Our initial findings suggest that TAR is able to assist us in identifying material that is likely to fall to be disclosed far more quickly than if we reviewed the same material manually.
Over time, it’s likely that we’ll want to extend the use of TAR so that it becomes standard practice across our casework.
The point about Judges and the defence being confident in the use of TAR is obviously really important. We’re engaging with the defence as we go along and our Disclosure Management Documents will set out precisely what TAR is and how we’ve deployed it on each specific case. The key here is transparency – making it crystal clear what we’ve done so that any challenge can be brought on a fully informed basis.
Obviously, AI is a fast-evolving technology and there will doubtless be a whole range of other uses to which we want to put in the months and years ahead, both in relation to disclosure and more widely. We’re certainly very open to exploring those opportunities and being as innovative as possible, whilst always ensuring that we continue to operate within a clear legal framework.
One final point – it’s not quite accurate to say that “technology” will be providing disclosure. At the end of the day, there will always be a human being (the prosecutor) making the decision as to what material falls to be disclosed, as required by the legislation and Code of Practice.
5. Building an asset confiscation enforcement team is earmarked as a priority for the SFO in the coming year. Can we expect the SFO to increase its use of civil powers under Part 5 POCA to recover the proceeds of crime?
MW: Yes, we’re keen to increase the use of our Part 5 POCA powers and the creation of a discrete asset confiscation enforcement team is certainly a key part of our commitment to recovering the proceeds of crime. We obtained our first Unexplained Wealth Order earlier this year as part of wider efforts to recover property believed to have been bought with the proceeds of a £100 million fraud.
I would add that it really is important that we make full use of these powers, even if they are relatively untested. If there are other opportunities for us to seek a UWO, and we believe it appropriate to do so, or to use any of the other applicable powers under Part 5 POCA, we will certainly do so.
6. What does the SFO hope to achieve with the new guidance on company self-reporting? Given that the conduct of companies who may face allegations of fraud is often far less than exemplary, what does ‘exemplary cooperation’ look like in real terms when it comes to self-reporting?
MW: We’ve deliberately not tried to delve into defining exactly what ‘exemplary co-operation’ looks like; both because it’s actually really difficult to be prescriptive for every possible scenario and because it’s inevitably a question of fact and degree that will differ from case to case. The guidance makes the point that merely complying with your legal duties and obligations is not, of itself, co-operation. Beyond that, we’ve also set out what we consider to be some pretty clear and practical examples of co-operation at paragraph 22 of the guidance – things such as preserving all digital and hard copy material likely to be relevant to our investigation; collecting and identifying potentially relevant material for us; identifying all the relevant personnel involved; engaging with us as to the parameters of any internal investigation and so on.
I don’t think it’s necessary or helpful for us to go further than that.
7. Although the new guidance says that a company will not be penalised for maintaining a valid claim of LPP, it does make clear that waiver will be an important indicator of cooperation. Does this mean that a company that self-reports and cooperates in other ways but claims LPP will be less likely to be offered a DPA?
MW: Not necessarily - it all depends on the circumstances of the case and our overall assessment of the corporate’s co-operation. If they are able to demonstrate exemplary co-operation in all other ways, even having put forward a valid claim of privilege, a DPA ought still to be a strong possibility.
Ed Vickers KC took silk in 2017 and has a mixed practice of fraud and serious and complex crime. He is the editor of Red Lion Chambers’ Focus on Fraud blog.
Anita Clifford defends and prosecutes business crime cases and is a leading junior in proceeds of crime and sanctions matters.
Faras Baloch is a specialist in fraud and corporate crime. He is the editor of the Fraud Newsletter.