Under its new US director Lisa Osofsky, the Serious Fraud Office (SFO) has stated a desire to deploy more “US tactics” in the course of its work and in particular, to use “insiders” and “co-operators” as witnesses for the prosecution. What could this mean for City professionals, particularly in the context of the Senior Managers Certification Regime (SMCR)?

As one of three British FX traders acquitted in New York in October last year of offences which could have landed them in US jails for a long time, Chris Ashton had first hand experience of being at the sharp end of “US tactics”.  Along with Alan Ward of Stephenson Harwood who represented Chris, a packed venue of market practitioners learned in detail how Chris’ 5-year nightmare came about arose – and was exacerbated by lack of clarity/understanding of ‘industry best practice’ and associated interna business processes – from internal compliance/regulatory teams to external parties including the Department of Justice in the US.   A situation not helped by the fact that a fourth party was given immunity from prosecution in exchange for his ‘testimony’ against the others.  In this case, in just 4 hours a US jury acquitted the parties of one count of violating the US Sherman Act (vis.”acting to suppress market with agreement not to trade at FIX”).  (Notably, the UK’s SFO’s position was that there was no case to answer).

The overriding message from his experience was the importance of seeking clarity – and continuing to do so – from an employer/organisation with respect to your specific role (and responsibilities) and particularly to receive explicit instruction/guidance on your firm’s – and industry – best practice with respect to trading behaviour and activity.  “Keep asking questions, seek clarity, continually assess “am I doing the right thing”, know and act in accordance with prevailing industry regulation/codes of conduct”