British investigators reassess suspect in Icelandic bank case

Britain’s embattled Serious Fraud Office (SFO) has promised to urgently review the suspect status of property tycoon Vincent Tchenguiz in connection to his alleged dealings with Iceland’s Kaupthing Bank. The news comes as just the latest humiliation for the SFO, which has been accused of “sheer incompetence” by a judge after a serious of high profile bungles in the ongoing fraud case.

Vincent was arrested along with his brother Robert last year when dozens of police swooped in and seized their properties in both London and Iceland. They are, however, still to be charged with any crime and have since launched a judicial review that accuses the SFO of unlawful entry, searches and seizures. The organisation is also accused of abuse of process and misleading a judge.

Reports received by the Reuters news agency this week suggest that the SFO has seen financial records that have the “potential” to raise suspicions about the relationship between Vincent Tchenguiz and the Icelandic bank, which collapsed in 2008 with massive debts.

“As such, the Director (of the SFO) is not in a position to reach a concluded view as to VT’s [Vincent Tchenguiz’s] status as a suspect in advance of [the court] hearing; but does wish to make it publicly clear that he is conducting an urgent review of that status,” the document said, adding that Robert’s dealings with senior executives at Kaupthing still needed to be looked into.

The brothers’ three-day judicial review began in London’s High-Court this week. The SFO has already had to apologise several times throughout the case, which is it’s most ambitious to date, and there has been talk of dissolving the organisation all together.

“I’m afraid the quality of the investigation and the attention to detail you would have expected to be applied has not been applied,” Raj Parker, a partner at UK law firm Freshfields, told Reuters. “There is the prospect that it [the SFO] will remain, but that it will be … considerably chastened by yet another debacle in its rather inglorious history,” he added.

The SFO said any change to Vincent’s status will be announced by June 18, and that all items seized last year will be returned. The organisation is also facing an independent assessment from the UK government’s Crown Prosecution Service Inspectorate.