As reported in the Independent newspaper today, a major anti-corruption trial in London involving a billionaire, Victor Dahdelah, collapsed following what is described as an “embarrassing error” by the Serious Fraud Office. We have previously blogged on the Dahdelah trial here.

Mr Dahdelah was accused of paying more than £35 million in bribes to former executives at Aluminium Bahrain, the fourth largest aluminium smelter in the world, in return for contracts worth more than £2 billion.

Yesterday, however, the case was dropped by the SFO after it received considerable criticism from the judge hearing the trial for “delegating” the Bahraini strand of its investigation to Akin Gump, one of the world’s largest law firms which is also separately suing Mr Dahdelah in the United States.

The decision to abandon the case against Mr Dahdelah is another very significant blow for the SFO which has made a series of high profile errors during its attempts to prosecute various white collar crime cases.

Yesterday at Southwark Crown Court, Phillip Shears QC, acting for the SFO, offered no evidence against Mr Dahdelah and blamed the unwillingness of two Akin Gump lawyers to attend court to give evidence, as the reason for having to drop the case.  Those lawyers apparently cited client privilege issues as their reason for refusing to travel to the UK and be cross-examined.

As reported by the Independent, the trial also featured an intervention from the Deputy Prime Minister of Bahrain, the government which owns 77% of Alba.  The Deputy Prime Minister wrote to the Director of the SFO and the Attorney General stating that all the payments made by Mr Dahdelah had been approved by the government.

In a statement made by Mr Dahdelah’s lawyer Neil O’May of Norton Rose Fulbright, he said that:

 “[Mr Dahdelah] is overwhelmed by the acquittal today and very grateful that the English courts system has reached the correct result.  However, he is extremely concerned that those supervising the SFO allowed its essential functions as an impartial investigating organisation to be outsourced to an American law firm with a conflict of interest, such that the lawyers themselves refused to attend court to give a full explanation of their part in the investigation”

It is further reported that the SFO consulted with the Attorney General yesterday.  Mr Shears QC says:

 “After careful consideration of all of the circumstances of the case the Serious Fraud Office has concluded that there is no longer a realistic prospect of conviction in this case and accordingly we offer no evidence”

It would appear that this case shows that while the SFO is not afraid to bring high profile cases, the way in which it puts its cases together and presents them to the court is lacking, leading to spectacular high profile failures such as this one and such as the case against the Tchenguiz brothers which collapsed last year on which we have previously blogged.