Two senior Grant Thornton employees have been ordered to disclose documents relating to Robert and Vincent Tchenguiz which the property entrepreneurs claim were used by the Serious Fraud Office (SFO) to launch an investigation into their business affairs in 2011
Steve Akers, partner, and Mark McDonald, a director, who head up Grant Thornton's (GT) office in the British Virgin Islands, have failed to overturn a judgment from July last year, ordering them to release five reports as part of the Tchenguiz brothers’ £300m damages claim against the SFO over the investigation, which was subsequently abandoned in 2012.
The Court of Appeal dismissed the GT pair’s appeal that the documents, which they prepared as liquidators of Oscatello, an investment vehicle of Robert Tchenguiz, were covered by litigation privilege and therefore should not be disclosed.
The Court of Appeal judgment stated: ‘The reports are plainly relevant not just to the case which the claimants wish to put forward but also to the defence of the SFO that it was entitled to have regard to information made available to it by GT.’
Akers and McDonald will have to pay the brothers’ legal costs over the appeal, and an interim costs order of £81,200 was made. They also have to make the reports available within seven days.
In a statement after the ruling, they said: ‘We are disappointed by today’s judgement and are deeply concerned that the ruling will impede our work to recover assets from the Tchenguiz Discretionary Trust (TDT). However, we will not challenge the ruling. Instead we will continue to focus on our work to recover assets from the TDT. This includes work to recover £183m of assets held in the TDT following a positive ruling by the Royal Court of Guernsey in December.’
Vincent Tchenguiz has stated that he believes the GT documents, which relate to the Tchenguizes’ dealings with the failed Icelandic bank Kaupthing which collapsed in 2008, helped the SFO secure search warrants to enter and search their homes and offices. At the time the liquidators showed the documents to the SFO but did not let the agency keep or copy them.
The inquiry was brought to an end after the SFO had to admit to a series of mistakes, including unlawfully obtaining search warrants. Both brothers allege that serious damage was inflicted on their reputations and businesses, with Vincent claiming £200m in damages from the SFO and Robert more than £100m.
In a written statement following the latest ruling, Vincent Tchenguiz said: ‘The SFO’s blind faith in these reports led to the organisation gaining unlawful warrants and I find it alarming that as a public prosecution body, the SFO, could have been so heavily influenced by a corporate entity and its executive(s) with their own commercial purposes.’
The SFO has made no comment on the case.
