“Volaw Trust” - A strengthening of the privilege against self incrimination from requests for pre-existing documents?
Seven former employees of Autofocus, a company which provided expert evidence on the cost of replacement hire cars for motorists involved in road traffic accidents, have been found guilty of perjury and jailed.
Accident Exchange (AE) was in the business of providing car hire services to victims of road traffic accidents. AE’s internal fraud team uncovered that Autofocus and its directors had systemically and deliberately produced false evidence in approximately 30,000 cases. Evidence produced by Autofocus was used by insurers to reduce legitimate claims for damages for car hire charges brought by innocent victims of collisions. AE applied to commit the defendants to prison on the grounds that they had engaged in conduct which interfered by the due administration of justice and they were thereby in contempt of court.
The impact of this conduct was catastrophic on AE. Mr Justice Supperstone observed that “the dishonest actions of Autofocus and the Defendants had serious implications not only for the value of the shares of Accident Exchange owned both by individuals and institutional investors which led to the loss of very substantial sums, but also for 300 employees of Accident Exchange who were made redundant”.
Mr Evans, the retired Chief Executive of AE and the person who was responsible for commencing these proceedings, was quoted in The Times yesterday as saying that he was appalled when the police refused to take action in 2014, citing “resource” implications; despite him handing them evidence from an external hard drive on to which the Autofocus liquidator had copied the company's computerised records, which contained evidence of all the relevant phone calls and documents.
What is most interesting about this case is that despite the availability of evidence and notwithstanding the scale of the crime, the City of London police decided not to commence a criminal prosecution. This, in a case, accordingly to Mr Justice Supperstone, where the evidence that Autofocus was involved in the systemic, endemic fabrication of evidence and in which each of the defendants actively and knowingly participated throughout the material time was “overwhelming”.
Every day we hear from victims who are frustrated or upset by the lack of action from the police to investigate and prosecute serious financial crime. In many cases these victims have already invested significant amounts of their own time and money to uncover the offending. Despite being in a position to provide the police with a complete package of evidence that could be relied upon to prove offences in a criminal court, all too often, as in this case, the police take no action.
The reality is that the police and other traditional law enforcement agencies have suffered massive cutbacks in recent times and they no longer have the resources to dedicate to certain types of crime. In the current climate of austerity and budgetary constraints it is easy to understand why the use of private prosecutions is firmly on the rise.
The Crime Survey for England and Wales estimates that there were approximately 7 million fraud offences committed in the year ending June 2015. Action Fraud (the UK’s national reporting centre for fraud and cyber crime) reported that of those suspected 7 million offences:
With that rate of attrition it is easy to see why victims of economic crime are looking for alternative routes to justice. Whilst not all disputes will be suitable for a private prosecution, in the right case, such as this one, they are undoubtedly a useful route to achieve justice for those who are a victims of crime.
Melinka leads the team at Kingsley Napley responsible for conducting regulatory and private prosecutions.
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