In a recent verdict from the High Court, the UK Serious Fraud Office (SFO), alleged to have engaged in collusion with the law firm Dechert, is now confronted with the potential obligation to pay substantial financial damages to Eurasian Resources Group (ERG). The court’s conclusions, as outlined by portugalnews, expose critical mistakes made by both entities, leading to noteworthy financial repercussions for the prominent metallurgical corporation.
SFO faces multimillion-pound consequenc:
High Court holds agency liable in landmark collusion case with Dechert, orders substantial payment to ERG
In a landmark ruling by the High Court, the SFO has been found liable for significant errors in its collusion case with law firm Dechert, resulting in a court-ordered payment of millions of pounds to ERG. Judge David Waxman, delivering the decision, emphasized the SFO’s misconduct as the catalyst that triggered a criminal investigation into ERG, asserting that without the wrongful actions of the SFO, the scrutiny into ERG would never have transpired.
The consequences of the SFO’s conduct imposed an unwarranted burden on ERG, leading to substantial financial costs and the depletion of management resources. It is noteworthy that ERG is a global conglomerate with a significant presence in the mineral resource extraction and processing sector. Operating with integrated capabilities covering mining, processing, energy production, and logistics, ERG’s primary assets are situated in Kazakhstan. Formerly known as Eurasian Natural Resources Corporation (ENRC), the company was previously listed on the FTSE 100 index, with its shares traded on the London Stock Exchange (LSE) and the Kazakhstan Stock Exchange (KASE).
ERG triumphs in High Court: SFO found liable for costly errors in landmark collusion case with Dechert
ERG holds a remarkable global position as the foremost producer of ferrochrome in terms of chromium content, the largest entity involved in iron ore mining and processing in Kazakhstan, and a significant exporter of iron ore on a global scale. Furthermore, it ranks as the ninth-largest producer of industrial alumina worldwide by volume.
Playing a pivotal role in the economic development of Kazakhstan, ERG’s operations contributed approximately 3% to the country’s GDP in 2009. The SFO initiated an investigation into ERG in 2013, concluding a decade later in August with the rationale of “insufficient admissible evidence for prosecution,” as communicated by the SFO. This prolonged investigation raised concerns about the conduct of Neil Gerrard, a former partner at law firm Dechert, who was appointed to advise ERG.
Judge Waxman, summarizing his judgment from the previous year, asserted that the SFO breached its duties by accepting information from Gerrard that was “manifestly unauthorized” and “contrary to the interests of his client.” In the legal proceedings held in March, ERG sought compensation exceeding £21 million, encompassing legal fees, unnecessary expenses, and lost management time. It is noteworthy that Dechert has already disbursed approximately £9 million to ERG for work and expenses. As a result, the court’s decision indicates that the outstanding amount ERG is yet to receive stands at nearly £12 million.