A failed decade-long investigation by the Serious Fraud Office into a Kazakh mining company could cost British taxpayers more than £250million, The Times has revealed.
The watchdog has already spent £27million on its investigation into Eurasian Natural Resources Corporation (ENRC), which was dropped in August 2022 due to insufficient evidence.
An additional £237.7million has been set aside to cover potential settlement costs following legal action by the company against the SFO.
A trial expected in late 2025 or early 2026 will determine the final damages to be paid to ENRC from public funds.
The SFO launched its investigation into ENRC in 2013, examining suspected bribe payments by the company and connected individuals.
The case took a dramatic turn when ENRC's lawyers took legal action against the watchdog for misfeasance in public office.
The Serious Fraud Office launched its investigation into ENRC in 2013
GETTY
While the High Court ruled in 2022 that misfeasance couldn't be established, it found the SFO had acted in bad faith by accepting unauthorised disclosures from an ENRC lawyer.
The court determined the watchdog was in serious breach of its duties in its handling of the case.
The investigation was ultimately abandoned in August last year when the SFO concluded it had insufficient admissible evidence to prosecute.
The £27million spent on the investigation was revealed after the SFO was forced to disclose the figure to The Times through an information tribunal ruling last month.
The additional £237.7million set aside for settlement costs represents two and a half times the watchdog's annual budget.
ENRC's overall costs are expected to exceed even this substantial sum.
The final amount to be paid to the company will be determined at trial, though there remains the possibility of an earlier settlement.
The SFO strongly resisted disclosing the investigation costs, leading to a legal battle lasting more than a year.
The watchdog argued that revealing the figures could harm crime prevention, prosecution of offenders and the administration of justice.
While the Information Commissioner's Office initially refused to enforce disclosure, an appeal tribunal overturned this decision.
The tribunal ruled that despite "clear public interest in not disclosing the information," this was outweighed by "particularly strong public interests" in this specific case.
The ruling noted that similar future requests would be assessed differently, with public interest balances likely to vary.
The SFO defended its position, stating: "We pursue our criminal cases with vigour and deliver £3 to the taxpayer for every £1 in our budget."
The watchdog added that the costs reflected their "complex criminal investigation into ENRC, which spanned many years and exhausted all reasonable lines of enquiry, as well as our robust defence of its claims against us."
ENRC struck a more conciliatory tone in their response, saying: "We hope a line can be drawn under this unfortunate story sooner rather than later and remain open for settling matters."
