The Serious Fraud Office (SFO) needs to strengthen the way it manages legally privileged material, according to the latest inspection by HM Crown Prosecution Service Inspectorate (HMCPSI).
The inspection found that the SFO has made significant progress in its disclosure practices since an earlier review in 2024. However, inspectors identified the handling of legal professional privilege (LPP) material as a continuing area of concern.
The latest assessment examined the SFO’s progress against three of the six recommendations made following the 2024 inspection. While improvements were identified, inspectors said the agency still lacked a reliable system for monitoring privileged material across its cases.
The report also highlighted uncertainty over responsibility for managing LPP issues within the organisation. Inspectors warned that this could create difficulties for case teams and potentially affect the progress of prosecutions.
According to the inspection, case teams can still depend heavily on specialist staff or external legal advisers when determining the status of potentially privileged material.
Inspectors found that there was no consistent organisation-wide process allowing case teams, managers and senior leadership to establish the quantity, status and potential risks associated with material that has been separated or quarantined because of possible legal privilege.
The report acknowledged that the SFO has introduced measures aimed at improving its approach. These include greater involvement from specialist counsel and the earlier use of technology-assisted review.
However, inspectors noted that some teams do not yet have sufficient knowledge or experience to obtain all the relevant information from eDiscovery systems or to assess whether material should be treated as legally privileged.
The SFO has established two projects aimed at improving its approach to legal professional privilege. HMCPSI described these initiatives as positive developments but said they do not yet provide a comprehensive assurance framework.
The inspectorate has recommended that the SFO introduce a process enabling case teams to monitor the progress and status of LPP reviews throughout the lifetime of a case.
Under the recommendation, the agency should provide regular monthly updates concerning relevant privileged material. The SFO has been given until October next year to implement this process.
HMCPSI Chief Inspector Anthony Rogers said the SFO is now in a stronger position than it was two years ago but needs to continue improving its management of legally privileged material.
He also stressed the importance of ensuring that serious fraud prosecutions are prepared to withstand challenges in court, describing the latest report as a roadmap for addressing the remaining weaknesses.
Matthew Wagstaff, the SFO’s Director of Legal Services, said the findings would help shape the next stage of the agency’s improvement programme.
He added that strengthening disclosure procedures remains a major priority for the organisation.
The findings highlight the importance of effective management of legally privileged material in complex fraud investigations and prosecutions. For the SFO, maintaining clear processes for identifying, reviewing and monitoring privileged material is particularly important because failures in disclosure can create significant legal and procedural challenges.
The latest inspection indicates that progress has been made, but further improvements will be required before the SFO can provide greater assurance over how LPP material is managed throughout its cases.
