U.K. Fraud Office Payoff to Ex-CEO Ruined Morale, Lawmakers Say

The U.K. Serious Fraud Office’s morale and reputation was hurt because of severance payments its former director made to outgoing executives of more than 437,000 pounds ($660,000), lawmakers said.

The agency’s former director, Richard Alderman, gave the former chief executive officer, Phillippa Williamson, a 422,000 pound pay-off last year, and Chris Bailes, its former chief operating officer, 15,000 pounds in severance pay, a U.K. parliamentary committee said in a report published today. Alderman didn’t seek approval from the Treasury Department for any of the payments.

“The reputation of the Serious Fraud Office has been undermined by a catalog of errors and poor judgment and the morale of its staff has suffered,” Richard Bacon, a member of the Committee of Public Accounts, said in a statement.

Alderman, who stepped down in April last year, didn’t immediately respond to an e-mail seeking comment on the committee’s report. The SFO is considering the report and its recommendations, Susan Givens, a spokeswoman for the agency, said in an e-mail.

While Williamson worked at the SFO, she was also paid about 100,000 pounds between 2008 and 2012 to cover the expense of traveling to London from her home in England’s Lake District and staying in a hotel for three days a week.

Williamson was previously the subject of an internal whistle-blower investigation at the agency over allegations made by staff members of improper conduct within the SFO relating to her pay, two people familiar with the complaint said at the same. The probe found no evidence of wrongdoing, according to the Attorney General’s office.

The SFO’s current director, David Green, should “explore all possibilities to minimize the cost to the taxpayer, including requesting that the recipients of special severance payments repay the money,” Bacon said.

To contact the reporter on this story: Nicole Mortimer in London at nmortimer1@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net

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