Six companies have come under scrutiny from the Serious Fraud Office as it pledges to crack down on “irregularities” in the City with regards to fraud.
Last week the Serious Fraud Office confirmed it had opened an investigation into the UK operations of AIG. This followed an announcement in January that it was investigating the UK arm of Bernard Madoff’s company.
The fraud office also confirmed four other companies were under assessment but a full-blown investigation into these unnamed firms was not yet underway, so it could not name any of them. The inquiry into AIG is into its investment operations as opposed to the insurance arm.
David Jones, spokesman for the Serious Fraud Office, said it was liaising with a number of partner authorities including those in the US, as well as the FSA in its investigation into AIG. Mr Jones said the Serious Fraud Office was determined to begin investigations as soon as any irregularities or suspicions of large scale fraud came to light.
He said starting a formal investigation the fraud office would “deploy certain powers and use certain procedures”.
Richard Alderman, director of the Serious Fraud Office, said: “It is right for us to look into the UK operations of AIG Financial Products Corp, to determine if there has been criminal conduct. “We will use our full range of powers to seek information and to speak to those with an inside knowledge of the company’s operations.”
The fraud office said AIG was co-operating in its investigation. Simon Webster, managing director of Kent-based IFA Fact & Figures Financial Planners Limited, said it was a catch-22 situation for regulators. He felt unnecessary investigations stilted the market worked as investors were “paralysed by fear of being ripped off”. However he said there was a duty to stamp fraud out of the industry. Mr Webster said: “They are damned if they do and damned if they do not.”
Huntswood