Mr Grayling still hasn’t Cottoned on. Crown Court Judge explains it to him very slowly.
On 1st May 2014, HHJ Leonard stopped a Financial Conduct Authority prosecution against five defendants accused of a three year, lb5m organised conspiracy to defraud hundreds of land investors, dubbed Operation Cotton.
In white collar fraud terms, this case was a very big deal. And it has been stopped simply because Chris Grayling's Ministry of Justice has refused to listen to justice practitioners. Essentially, savage legal aid cuts have meant no suitable Counsel, either in the independent sector or employed by the Public Defender Service, would or could take on the defence of these five defendants. It was agreed by all parties that no fair trial could start this week, but the issue was whether the Prosecution should be allowed an adjournment to see if that position would change, in the hope this industrial dispute could be resolved. Amusingly, the argument for the defence was advanced by the Prime Minister's brother.
To put the key points in HHJ Leonard's scathing words:
"The overriding objective of the Criminal Procedure Rules to deal with criminal trials justly is therefore subverted by the failure of the State to provide adequate representation", and
"To allow the State an adjournment to put right its failure to provide the necessary resources to permit a fair trial to take place now amounts to a violation of the process of this Court"
These allegations of conspiracy to defraud, money laundering and carrying on regulated activities without proper authorisation, had arisen out of years of investigative work by the FCA, and, by way of illustration, 1,000 hours of case preparation by just one of the FCA's four instructed barristers.
The Prosecution relied on over 46,000 pages of evidence and 194 financial spreadsheets. All of these had to be considered by the defence teams, which HHJ Leonard estimated would have taken about four months of pre-trial reading, and a three month trial. Of the very small number of State-employed barristers at the Public Defender Service, none of them could satisfactorily commit to this case above their other commitments. And those commitments will not simply dissolve in future.
As an aside, 46,000 prosecution pages for a (not terribly high value) land-banking matter? I am reminded of the missive: "I wanted to write you a short letter but I did not have enough time, so I wrote a very long one instead". Perhaps someone at the FCA should purchase a red pen in future.
Due to 30% legal aid cuts to these Very High Costs Cases (VHCCs), and the limited time to prepare for trial, no independent barristers and no solicitor advocates would take the defence case on, despite exhaustive efforts by the defence solicitors. What is worse, HHJ Judge Leonard saw no reason to think the advocates' motivation will change before early 2015, meaning any adjournment would be on an entirely speculative basis and therefore, should not be allowed. The Court of Appeal will find it hard to fault that reasoning with any degree of intellectual honesty.
Fiddling the figures
On any measure, this was a monumental failure both of government policy and the personal attitude of the Lord Chancellor. Mr Grayling has firmly grasped the wrong end of the stick for eight months now. His Ministry has shown no respect for the practitioners of justice. The MoJ response to this ruling came via a spokesman because Mr Grayling was busy trying to politically capitalise on the fatal stabbing of teacher Ann Maguire, by suggesting higher sentences for knife offenders. What interesting timing for such a policy.
The MoJ today claimed that any barristers dealing with this fraud case would still earn between lb60,000 and lb100,000, as if that was a valid argument in itself. So much for the Tories denouncing the politics of envy, eh?
But, on this issue, I hereby apply for bad character. Mr Grayling already has been caught out by the Head of the UK Statistics Authority for misleading people about what barristers earn. His claim in March 2014 that the average barrister earns lb84,000 was contradicted by Andrew Dilnot (himself appointed by Grayling's government) because it did not take into account considerable expenses, chambers rent and VAT at 20%. The Criminal Bar Association claims the typical earnings are less than half of the MoJ estimate.
The moral is: be very careful when discussing money with Chris Grayling.
Now, we're all in this together - even the bankers
Crucially, the collapse of this case goes beyond the impact of justice denied for these defendants and their alleged victims, a real tragedy though that is. It also means that the forthcoming VHCC trials listed for September and for 2015 may also be affected. These include the Libor-rigging scandals of bankers allegedly manipulating interest rates for their own benefit, and/or bribing each other to assist in this practice. At present, those men have no Counsel for the same reason. Barristers will not do it on legal aid rates, given the cuts. At present, there can be no fair trials in VHCC matters.
If and when those trials begin to fall apart, we will be dealing with a national scandal probably on the eve of a General Election. Perhaps then the cotton wool will be forcibly removed from Mr Grayling's ears. And if not the cotton, then perhaps Grayling himself?
Alistair Parker is a Solicitor in our Crime team.