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U.K. Lawmakers Scold Ex-SFO Chief Over Executive Payoffs

March 7 (Bloomberg) -- U.K. lawmakers scolded Richard Alderman, former director of the Serious Fraud Office, for authorizing severance payments to executives at the agency before his departure last year.

Members of Parliament’s Public Accounts Committee said Alderman didn’t get government approval for the payoffs, and failed to keep official notes on his decisions.

“This is sloppy, this is slovenly,” said Stewart Jackson, a Conservative member of the committee before which Alderman testified today. “You weren’t considering value for money and you should apologize.”

The SFO has been criticized by the British National Audit Office for payments totaling 422,000 pounds ($632,600) to its former Chief Executive Officer Phillippa Williamson, who left in April last year at the same time as Alderman. David Green, the new director of the agency that investigates and prosecutes fraud, has sought an independent review of the payments, which the NAO said weren’t properly authorized.

Alderman said he didn’t agree he should apologize, and that he didn’t know how the payments were authorized without the government’s consent.

“I remain absolutely perplexed as to how this happened,” he said at today’s hearing, adding that he believed approval was given.

Under Alderman’s leadership, the SFO declined to investigate interest-rate fixing by banks, closed probes into fraudster Bernie Madoff’s London operations and botched a probe into U.K. property magnates Robert and Vincent Tchenguiz. The prosecution agency now faces a 200 million-pound lawsuit by the Tchenguiz brothers, whose offices were illegally raided by the fraud regulator in 2011.

The agency’s performance must improve under Green’s leadership, the U.K. Crown Prosecution Service said in a November report citing several dropped or failed investigations including the Tchenguiz probe.

To contact the reporter on this story: Kit Chellel in London at cchellel@bloomberg.net

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

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