Setting an Example: Fraud Officer Convicted of Fraud

Guest PostFormer head of the Serious Fraud Office (SFO), Richard Alderman, has had a slap on the wrist for issuing £1m of unauthorised severance payments to his fellow workers, without evidence of the proper approval. He has subsequently apologised to parliament in a letter last week for not contacting the Treasury or Cabinet Office before going ahead with this hand-out.

His reign as the leading figure for anti-fraud and anti-corruption lasted for six years. After aggressively arguing that he did nothing wrong before the committee, he has since retracted his comments and issued a wholehearted apology.

Under questioning, he admitted that he had no documented proof that the payments had been approved by officials and that there was no evidence that he had written to the correct civil servants. He has since confessed that his behaviour was unprofessional and fell short of what was expected of someone in his position.

Argumentative Beginnings
Alderman has also been accused of acting irresponsibly by paying his chief executive, Phillippa Williamson, to work from her home in the Lake District for two days a week. Every year, the taxpayer paid £27,600 for Williamson’s travel and hotel costs in London.

Williamson left the department with £464,905, Chris Bailes (chief operating officer) with £473,167, and Ian McCall (head of IT) with £49,885. The Cabinet Office and the National Audit Office gave evidence that Alderman didn’t get permission to issue these payments. The committee’s chair, Margaret Hodge, accused Alderman of making these extraordinary payments because the individuals in question were ‘old friends.’

Alderman has issued a written apology for failing to apologise for his behaviour at the hearing. He claimed that the Treasury was aware of all his plans to make three executives redundant, with severance packages. The successor to his position, David Green, has claimed that this report is incorrect and has commissioned professional money laundering lawyers to look into these payments.

Alderman’s Poor Track Record
Property tycoons the Tchenguiz brothers are suing the SFO after a false investigation severely damaged their business prospects. They’re filing a £300m damages claim for SFO’s false step. And that’s not all; Alderman also closed down the probes which were examining fraudster, Bernie Madoff. Furthermore, he declined to examine the Libor-rigging taking place in UK banks, causing further business economic difficultly.

Now that the committee have received a letter of apology, they plan to see if they can reclaim some of the large payments made. Tory member, Stewart Jackson, accused Alderman of handling public money badly. Alderman’s only defence was that Williamson was a talented civil servant.

This obviously raises concerns for a public that is already struggling with a trust complex, when it comes to those in powerful positions. The banking crisis shook the faith the UK had in its financial sector. It’s hoped that by dealing effectively with public services, Great British citizens can once more trust in those pulling the strings. Jackson has called these events a ‘victory’ for the select committee.