No end in sight for fraud inquiry at Lancs council
THE Crown Prosecution Service (CPS) says that even if any charges are ultimately brought as a result of a long-running investigation involving Lancashire County Council and one of its former leaders, the matter may still take “some time” to come to court.
The warning came in response to a call from a member of the authority for a swift conclusion to a fraud inquiry known as Operation Sheridan - which is now well into its ninth year.
The probe was launched by Lancashire Police back in 2013 after concerns were raised about the awarding of a fleet maintenance contract to One Connect, a now defunct joint venture between the county council and BT, which had been established two years earlier.
Former County Hall leader Geoff Driver - whose Conservative group was in control of the authority when that tie-up deal was signed - was publicly exonerated of any wrongdoing in relation to the original focus of the investigation in March 2016.
However, he and three other men - former Lancashire County Council chief executives Ged Fitzgerald and Phil Halsall and former One Connect chief executive David McElhinney - were subsequently arrested on suspicion of conspiracy to pervert the course of justice and witness intimidation just over 12 months later.
A file of evidence on the four individuals was passed to the CPS for consideration in August 2018 - but there has still been no decision about whether to prosecute any of them over the allegations which led to their arrests the year before.
They all deny any wrongdoing and none has ever been charged in relation to the wider fraud investigation.
As the Local Democracy Reporting Service (LDRS) revealed back in February, Liberal Democrat county councillor John Potter wrote to Lancashire Police chief constable Chris Rowley urging a rapid resolution to the force’s investigation.
Similar correspondence was also sent to the CPS.
The Preston West division representative - who is also the leader of the Lib Dem group on Preston City Council - cited concerns over the cost of the ongoing inquiry and what he said was the unfairness of leaving people “swinging in the wind”, not knowing whether or not they would ever be charged.
County Cllr Potter also said that it was important for County Hall to be able to address any structural issues that might become apparent once the investigation was complete.
Responding to his hurry-up request, the CPS has said that it does consider the impact on those awaiting decisions by the organisation - but cautioned that even if one or more individuals eventually face charges, a court case might be some way off.
In a letter - which has been seen by the LDRS - Zoe Gascoyne, deputy head of the CPS’s Specialist Fraud Division, said that the case was being “proactively worked upon and reviewed by both CPS Lawyers and a team of external Counsel”.
She added: “The case also has senior oversight and we are working alongside the police to ensure that we are in a position to make a decision once all reasonable lines of inquiry have been completed.
“If a decision is made to prosecute the case, then I should point out that it may take some time for the matters to proceed before the court and there will only be a determination following a finding of guilt, whether by a jury or by virtue of a guilty plea.
“In terms of the impact upon individuals, this is something that we always keep in mind and, if the evidential test is met, it is formally considered in respect of public interest,” explained Ms. Gascoyne, who added that she was unable to discuss “the detail” of Operation Sheridan, as it is an active investigation.
She also said that she understood “the tensions” outlined in Cllr Potter’s letter and stressed the resultant importance of the CPS making its decisions “independently”.
Ms. Gascoyne asserted that the inquiry was “sufficiently resourced internally” within the CPS and revealed that the bill for external lawyers working on the case for the service now stands at £1.2m - up slightly from the £1.05m cost incurred up to July 2021, which was revealed by a freedom of information request late last year.
The CPS said at the time that it was unable to calculate the internal costs of time expended by its own directly-employed lawyers, paralegals and administrative staff, as it does not record such details on a caseby-case basis.
County Cllr Potter told the LDRS said that he understood “how complex this investigation must have been”, but said of the CPS response to his letter:
“For all individuals involved - and the taxpayers’ purse - it would have been good for this case to have progressed more quickly.
“Rarely did I agree politically with former Lancashire County Council leader Geoff Driver, but everyone deserves the chance to clear their name.”
Mr. Driver, who is 77, retired from politics last May after a lifetime in local government, both as a senior council officer and politician.
Last November, he told the LDRS that he was “entirely innocent of the allegations the police make” and said it was “most frustrating and upsetting that this matter is still unresolved after all this time”.
The CPS reply to Cllr Potter was sent last month, several weeks before a development in Operation Sheridan which emerged on Tuesday this week, when it was revealed that former Liverpool mayor Joe Anderson - and three other individuals - were no longer under investigation as part of the probe.
Mr. Anderson was reported to have been interviewed under caution in the case four years ago.
A spokesperson for Lancashire Police said: “Lancashire Constabulary have written to four men to tell them they are no longer under investigation as part of Operation Sheridan.
“The four, aged 64, 68, 66 and 62 were contacted last month and told they would face no further action.
“Operation Sheridan was launched in 2013 following allegations of financial irregularity made to the constabulary by Lancashire County Council.
“On completion of the investigation, we referred the matter to the Crown Prosecution Service who are currently considering potential offences in relation to four other individuals.
“We would like to remind all concerned that criminal proceedings in this matter remain active.
“It is extremely important there should be no reporting, commentary or sharing of information online which could in any way prejudice any future proceedings,” the spokesperson added.
The Lancashire force last year declined a freedom of information request seeking its Operation Sheridan costs on the basis that it could be harmful both to any subsequent court case and also the ongoing investigation - by potentially alerting suspects to police activity.
However, back in January 2017, the then Lancashire Police and Crime Commissioner Clive Grunshaw revealed that the bill up to that point - after just over three years of investigation - already amounted to £2m.
Cllr Potter’s concerns over the duration and cost of Operation Sheridan were made jointly with Liverpool City Council’s Liberal Democrat group leader Richard Kemp, who raised the same issues over Merseyside Police’s separate Operation Aloft inquiry into building and development contracts in Liverpool, which has been running since 2019. Their co-signed letter was sent to Merseyside Police chief constable Serena Kennedy, as well as Lancashire’s top cop.
Mr. Anderson is one of several individuals to have been arrested under the Operation Aloft investigation - in his case, in December 2020, on suspicion of conspiracy to commit bribery and witness intimidation.
He has vehemently denied any wrongdoing and is no longer on bail.
Mr. Driver’s arrest as part of Operation Sheridan in 2017 came shortly after the Tories retook control at County Hall following local elections - and days before he was officially reinstated for the second of two four-year stints as leader of Lancashire County Council. It was during the first of those that the One Connect joint venture deal with BT was signed in 2011.
Police began investigating alleged financial irregularities at Lancashire County Council in September 2013, four months after local elections in that year had returned a Labour administration at County Hall. The authority pulled the plug on the venture in 2014.
Lancashire County Council’s external auditors have not certified the authority’s annual audit since Operation Sheridan was launched.
In their assessment of the authority for 2020/21, auditors Grant Thornton said they were unable to issue a “certificate of completion” until “we have completed our consideration of a matter brought to our attention by the authority in 2013”.
The audit findings report states that Grant Thornton are “satisfied that this matter does not have a material effect on the financial statements”.