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Abstract
Freedom of information laws can arguably enhance public accountability of policymakers and check unethical and corrupt behaviour by the state and corporate elites. This paper provides case studies relating to the affairs of two fraud-infested banks in the UK. The information was secured through a direct engagement with ministers, courts, judges and the state apparatus via freedom of information laws. The cases draw attention to the politics of public accountability and show the difficulties encountered by anyone seeking information about banking frauds. The cases show that the state apparatus goes to considerable lengths to shield elites from public scrutiny.
Notes
1 George Orwell, Nineteen Eighty-Four, London: Penguin, 1954 (first published in 1949 by Secker and Warburg).
2 Hansard, House of Commons, 24 February 2009, col. 153.
3 The Freedom of Information and Data Protection (Appropriate Limit and Fees) Regulations 2004.
4 ICO website – http://www.ico.gov.uk/about_us.aspx; (Accessed 7 January 2012).
5 Hansard, House of Commons Debates, 22 November 1991, col. 347.
6 Hansard, House of Commons Debates, 20 July 1993, cols. 131–132.
7 Hansard, House of Commons Debates, 22 November 1991, col. 343.
8 Hansard, House of Commons Debates, 29 January 1990, cols. 5–6.
9 The Department of Business, Innovation and Skills (DBIS) was formed in June 2009. At various times, it has been known as the Department for Business, Enterprise and Regulatory Reform (BERR), the Department for Trade and Industry (DTI) and the Board of Trade (BoT).
10 Mr. Austin Mitchell: To ask the Secretary of State for Trade and Industry what representations he has received seeking the publication of the final report on Bryanston. Mr. Redwood: The papers are being recovered from store. I will write to the hon. Member as soon as possible (Hansard, House of Commons Debates, 22 May 1991, col. 477).
11 This is a reference to the interim report which was published in 1983 (CitationUK Department of Trade and Industry, 1983).
12 A notice by liquidators Baker Tilly appeared in the London Gazette (issue 58425, page 12109) on 20 August 2007.
13 Following interventions by the Information Commissioner (see below) the redacted words in this paragraph were released on 29 April 2010. These were “The final report could not be published because it disclosed details of a confidential settlement with Inland Revenue [UK’s tax authority]”.
14 CitationSikka and Willmott (1995) note a number of instances where the government appointed inspectors, but the reports were not published.
15 This claim is not supported by evidence. For example, the non-publication of the final report was queried by inspectors in the 1990 report by the Treasury Committee (CitationUK House of Commons Trade and Industry Committee, 1990) and since 1990 has also been the subject to questions in parliament and letters to the relevant Ministers.
16 After further correspondence, reviews and interventions by the Information Commissioner, the DBIS revealed that the six redacted words were “and subsequently disciplined by the ICAEW” (letter from the DBIS, 4th June 2009).
17 John Redwood was a junior minister at the Department of Trade and Industry from 1989 to 1992.
18 This point is later pushed by the Information Commissioner.
19 This report related to frauds by media tycoon Robert Maxwell and was published in March 2001. On 2 February 1999, auditors Price Waterhouse were fined £1.2m and ordered to pay an additional £2.2m in costs for audit failures at Maxwell’s empire (BBC News, Record fine for Maxwell accountants, 3 February 1999; http://news.bbc.co.uk/1/hi/business/270359.stm; (Accessed 7 January 2012)).
20 Its contents are not known to the author.
21 Some further extracts were released later (see below).
22 The words in bold letters appear in the document released to Sikka.
23 This is available at http://www.ico.gov.uk/upload/documents/decisionnotices/2010/fs_50129139.pdf.
24 The request for information was made on 18 November 2005.
25 This is listed in Appendix C accompanying the Decision Notice. However, Appendix C was neither sent to the complainant nor made public because at the date of the DN the information in Appendix C is disputed information, which in principle can be the subject of litigation, and is thus treated as confidential.
26 Hansard, House of Commons Debates, 22 October 1992, cols. 574–89.
27 This is not to suggest that the US is somehow gloriously open. Rather it has a different history and politics (for a discussion, see CitationBarone, 2006).
28 In March 1991, the Bank of England asked BCCI auditors Price Waterhouse to prepare the report under Section 41 of the Banking Act 1987. An interim report was submitted on 22 June 1991. It was not finalised.
29 The Guardian, Files closed on BCCI banking scandal, 17 May 2012 (http://www.guardian.co.uk/business/2012/may/17/files-close-bcci-banking-scandal; (Accessed 20 May 2012)).
30 Hansard, House of Commons Debates, 22 July 1991, col. 755, 761.
31 Hansard, House of Commons Debates, 22 October 1992, cols 574–89.
32 See http://visar.csustan.edu/aaba/Sandstorm1.pdf and http://visar.csustan.edu/aaba/Sandstorm2.pdf.
33 Mr. Mitchell: To ask the Chancellor of the Exchequer if he will (a) make a statement on the publication on the website of the Association for Accountancy and Business Affairs of the Sandstorm report by Price Waterhouse on BCCI and (b) place a copy of the report in the Library. Ms Hewitt: No (Hansard, House of Commons Debates, 14 June 1999, col. 28). The Association for Accountancy and Business Affairs (AABA) is a not-for-profit organisation registered in the UK. Prem Sikka is its director.
34 For example, letters from Austin Mitchell MP on 26 October 1998, 22 April 1999, 22 June 1999, 14 October 1999; replies on 10 December 1998, 16 June 1999, 2 August 1999, 9 December 1999.
35 For example, letters from Austin Mitchell MP on 17 June, 23 June 1998, 20 January 2000; replies dated 22 July 1998, 9 December 1999.
36 Bank of England press release, BCCI Liquidators Withdraw Case Against the Bank of England, 2 November 2005 (http://www.bankofengland.co.uk/publications/news/2005/111.htm; (Accessed 4 January 2012)). The liquidator, Deloitte & Touche, had accused the Bank of England and 22 present and former staff members of misfeasance in public office and sought damages of £1 billion.
37 BBC News, Bank awarded £73m in BCCI costs, 7 June 2006 (http://news.bbc.co.uk/1/hi/business/5056056.stm; (Accessed 4 January 2012))
38 Hansard, House of Common Debates, 27 February 2007, col. 1300.
39 Hansard, House of Common Debates, 7 January 2008, col. 340.
40 Paragraphs 21–23 of the Decision Notice issued by the Information Commissioner on 14th December 2009 (see http://www.ico.gov.uk/upload/documents/decisionnotices/2009/fs_50202116.pdf).
41 Sikka was not shown any of this correspondence and was therefore not in a position to comment on the contents.
42 Case Number FS50202116, available at http://www.ico.gov.uk/upload/documents/decisionnotices/2009/fs_50202116.pdf.
43 At that time Sikka was employed at the University of Essex in UK.
44 For example, Sikka would not need to reschedule classes to make court appearances.
45 Professor Prem Sikka v Information Commissioner (The Tribunal Procedure (First-tier Tribunal) (General Regulatory Chamber) Rules 2009) [2010] UKFTT EA_2010_0054 (GRC); available at http://www.justice.gov.uk/downloads/tribunals/information-rights/how-to-appeal/Prof-Sikka-vs-IC-Ruling-0410-9.4.10_w.pdf.
46 The judgment established new principles for allowing late appeals and stated that amongst other things the Tribunals should consider the reasons for the delay, complexity of the decision being appealed, the fact that the appellant is unrepresented and unfamiliar with the appeal process and the public interest in the disputed information. Following the judgement, it is possible to apply for an extension of time to appeal before lodging the actual appeal. Since May 2010, the instructions issued by the UK Department of Justice for completion of the Notice of Appeal form for freedom of information disputes refer appellants to the “Ruling in Prof Sikka v Information Commissioner dated 9 April 2010”.
47 Sikka was invited to add his observations on the appeal.
48 See the final four pages of http://www.justice.gov.uk/downloads/guidance/courts-and-tribunals/tribunals/information-rights/how-to-appeal/Prof-Sikka-vs-IC-Ruling-0410-9.4.10_(w).pdf.
49 These included a statement from Washington DC lawyer Jack Blum, an adviser to the US Senate Committee which investigated the BCCI frauds (CitationUnited States Senate Committee on Foreign Relations, 1992). Blum is credited with first uncovering BCCI frauds. Witness statements were also provided by a number of NGOs and journalists, legislators, a former member of the UK House of Commons Treasury Committee, a former US partner of PricewaterhouseCoopers and two UK accounting academics, Professor Michael Jones and Professor Jill Solomon.
50 Information Commissioner v First Tier Tribunal Information Rights: Interested Party – Professor Prem Sikka – Judicial Review Application J R/1600/2010
51 http://www.11kbw.com/barristers/detail.php?bid=21; (Accessed 30 January 2012).
52 There were five people in attendance: Judge Nicholas Wikeley, the court clerk, the Head of legal services at the Information Commissioner’s Office, Timothy Pitt-Payne QC and Prem Sikka.
53 Upper Tribunal (Administrative Appeals Chamber), March 07, 2011, [2011] UKUT 94 (AAC) Information Commissioner v PS [2011] UKUT 94 (AAC), and GIA/1488/2010 and JR/1600/2010 Information Commissioner v PS [2011] UKUT 94 (AAC); Available at http://www.osscsc.gov.uk/judgmentfiles/j3215/GIA%201488%202010-00.doc.
54 Available at http://visar.csustan.edu/aaba/BCCI%20Final%20Statement%20Sikka%20-%2022%20April%202011.pdf.
55 For example, see http://catalog.hathitrust.org/Record/007608474; for further links see http://visar.csustan.edu/aaba/bccipage.html.
56 UK Treasury press release 26 July 2010 (http://www.hm-treasury.gov.uk/press_32_10.htm).
57 Available at http://www.fas.org/irp/congress/1992_rpt/bcci/.
58 Available at http://www.informationtribunal.gov.uk/DBFiles/Decision/i544/20110909%20Decision%20and%20Conf%20Sch%202.pdf.
59 The nature of this Schedule is explained in the judgement.
60 Available at http://visar.csustan.edu/aaba/BCCI%20Sandstorm%20Confidential%20Schedule.pdf. It is also part of the Tribunal judgement available at http://www.informationtribunal.gov.uk/DBFiles/Decision/i544/20110909%20Decision%20and%20Conf%20Sch%202.pdf.
61 The comparison is available at http://visar.csustan.edu/aaba/BCCISandstormRelease.html.
62 New York Times, 6 August 1995 (http://www.nytimes.com/1995/08/06/obituaries/agha-hasan-abedi-74-dies-in-the-shadow-of-a-vast-fraud.html).
63 New York Times, 26 August 2009 (http://www.nytimes.com/2009/08/27/world/middleeast/27mahfouz.html).
64 The Independent, 15 June 1994 (http://www.independent.co.uk/news/business/bcci-men-jailed-and-ordered-to-pay-dollars-9bn-by-abu-dhabi-court-former-chief-executive-and-founder-of-collapsed-bank-sentenced-in-their-absence-1422790.html).
65 Page 6 of the Information Commissioner’s Annual Report 2009/10 (http://www.ico.gov.uk/upload/documents/library/corporate/detailed_specialist_guides/annual_report_2010.pdf).
66 Freedom of Information Act 2000 (FOIA) Decision notice FS50601833, 12 January 2017 (https://ico.org.uk/media/action-weve-taken/decision-notices/2017/1625676/fs50601833.pdf; (Accessed 30 May 2017)).