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The UK Serious Fraud Office spent £16.2mn on its botched corruption investigation into the oil consultancy Unaoil, almost a third of which went to compensate three executives it improperly prosecuted, according to data it was forced to disclose by a tribunal.
The years-long probe into corrupt oil and gas deals fixed by Monaco-based Unaoil resulted in tensions with the agency’s US counterparts, a critical UK government review, and the acquittal of three defendants because they did not receive a fair trial.
The SFO spent £11.3mn on the probe and a further £4.9mn on settlements with the defendants, according to a freedom of information request submitted by the Financial Times.
The anti-fraud agency resisted disclosing the costs of the investigation for nearly 18 months until the First-tier Tribunal ordered the agency in November to provide the data.
The revelation underscores the impact of the high-profile case failure for the SFO under the leadership of former director Lisa Osofsky, which, in addition to the collapse of a number of other key cases, has left the agency battling to rebuild its reputation and get back on a secure footing.
An SFO spokesperson said: “We recognise the public interest in our cases and publish information about our work wherever possible, whilst protecting more sensitive details about our investigations.”
The SFO first opened a criminal investigation into Unaoil, its officers, employees and agents in 2016 over suspected offences of bribery, corruption and money laundering. The case triggered a string of criminal investigations into large western multinational companies including KBR and Petrofac.
The KBR probe was ultimately closed, while prosecutions in the Petrofac case are ongoing.
Unaoil was run by the British-Iranian Ahsani family, founded by father Ata Ahsani and operated with his sons, Cyrus and Saman.
Ata Ahsani paid the US Department of Justice a $2.25mn settlement, but was never convicted. Cyrus and Saman pleaded guilty to charges and co-operated with the DoJ in return for more lenient sentences. Saman was sentenced to a year in prison in 2023. Cyrus is yet to be sentenced.
In the UK, the SFO prosecuted four individuals in relation to the bribery scandal. Ziad Akle and Stephen Whiteley were both Unaoil territory managers. Paul Bond worked for Unaoil client Dutch energy services company SBM Offshore and Basil al-Jarah was Unaoil’s former partner in Iraq.
Al Jarah pleaded guilty and was sentenced to three years and four months in prison. The other three individuals were found guilty of various conspiracy to give corrupt payments and jailed before having their convictions quashed on appeal.
The case involved a fierce battle between the US and UK investigations, which led to former SFO director Osofsky being dragged into the scandal over her personal contact with David Tinsley, a representative for the Ahsanis.
Tinsley, a retired US Drug Enforcement Agency official, had offered to persuade a former Unaoil executive and business partner to plead guilty in the UK in return for the SFO’s abandoning its case against the Ahsanis.
The SFO ultimately dropped its pursuit of Cyrus and Saman after they agreed a deal with the DoJ. In response to a government-ordered review of the case, Osofsky said the agency was overhauling its “working practices and culture”.
The three former executives who were found guilty at trial in the UK had their convictions overturned on appeal in 2021 and 2022 in part because of Tinsley’s role in the broader case and SFO disclosure failures linked to the agency’s contact with him.
The investigation also led to an employment claim against the SFO, which the agency lost, after one of its prosecutors was fired in connection with the case.
Lawyers for the defendants in the UK case either declined to comment or did not immediately respond to requests for comment. A lawyer for Bond said that the cost to the taxpayer for the case was “eye-watering” and “nobody has really been held accountable for the decision to blindly proceed with this ill-founded prosecution”.
Previous representatives for the Ahsanis did not immediately respond to emails from the FT.
The review of the Unaoil probe in 2022 concluded that, while some of the events were “beyond the control of the SFO”, others were caused by “failings on the part of particular individuals and/or by ‘cultural’ issues” within the agency.
