UK bribery trial collapses in blow to anti-fraud agency

Tue Dec 10, 2013 8:32am EST
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By Estelle Shirbon

LONDON (Reuters) - One of Britain's biggest corruption trials in years came to an abrupt halt on Tuesday when the Serious Fraud Office (SFO) called off the prosecution of businessman Victor Dahdaleh in a further setback for its already tarnished reputation.

The SFO had accused Dahdaleh of paying some $67 million in bribes to former managers of Aluminium Bahrain (Alba) ALBH.BH the world's fourth-biggest aluminum smelter, between 1998 and 2006 in return for a cut of contracts worth over $3 billion.

The case had involved allegations of corruption at senior levels of government and business in Bahrain, a sensitive issue at a time of political unrest in the secretive Gulf kingdom.

But the SFO's lead counsel told a London court there was no longer a realistic prospect of conviction after a key witness changed his evidence and two U.S. lawyers who had played a crucial role in the case refused to testify in court.

The sudden collapse of Dahdaleh's trial, which began on November 5 and had been expected to run into 2014, followed costly blunders by the SFO in other high-profile cases that had piled pressure on the agency to deliver notable convictions.

"After careful consideration of all the circumstances of this case, the SFO has concluded that there is no longer a realistic prospect of conviction," Philip Shears, lead counsel for the prosecution, told Southwark Crown Court.

With the SFO not presenting any evidence, the judge instructed the jury to return verdicts of not guilty on all eight charges. The jury was then discharged.

Addressing the jurors before discharging them, Judge Nicholas Loraine-Smith said he had asked the SFO to reconsider its position on Thursday after becoming concerned about a particular aspect of the case.   Continued...

Canadian billionaire Victor P. Dahdaleh waves as he leaves Southwark Crown Court after a plea and case management hearing in central London, January 13, 2012. REUTERS/Finbarr O'Reilly