JP Morgan Chase Bank National Association & Ors v The Director of the Serious Fraud Office & Anor

Judgment

LORD JUSTICE GROSS:

INTRODUCTION

The Claimants (collectively, “the Banks”) seek judicial review of the decisions of the Secretary of State for the Home Department (“the SSHD”) and the Serious Fraud Office (“the SFO”):

In the case of the SSHD, the decision of the 24 th February, 2012 (“the SSHD 24 th February decision”), not to withdraw the referral of the Letter of Request from the Public Prosecutor of Milan, dated 4 th April, 2011 (“the LOR” and “the Prosecutor” respectively) to the SFO under s.15(2) of the Crime (International Cooperation) Act 2003 (“CICA 2003”);

In the case of the SFO, the decision of the 24 th February, 2012 (“the SFO 24 th February decision”), not to withdraw two notices issued under s.2(3) of the Criminal Justice Act 1987 (“the s.2 Notices” and “the CJA 1987” respectively), pursuant to the LOR.

By way of remedy, the Banks seek the quashing of these decisions, together with the prior decisions taken by the SSHD and SFO which these decisions upheld. The focus throughout will be on the SSHD 24 th February decision; it was (sensibly) common ground that the SFO 24 th February decision stood or fell with the SSHD’s decision.

For present purposes, the background can be very shortly summarised. The Prosecutor, by way of the LOR, seeks assistance from the relevant authorities in this country in respect of criminal proceedings continuing in Italy, arising out of swap transactions agreed between the Banks and the City of Milan between 2005 and 2007. The matter is helpfully set out in the SSHD and SFO Summary Grounds:

“ 1.1 In May 2005, the City of Milan invited proposals for the refinancing of approximately €1.7 billion of the City’s indebtedness. The Claimant banks provided financial advice to the City, recommending a strategy of refinancing a portion of that indebtedness by the issue of a bond underwritten by an amortizing swap agreement with appropriate institutions. The Public Prosecutor contends that the fiduciary duty owed by the Claimants to the City required them to disclose all relevant information including details of any and all commissions and fees derived by the Claimants through their appointment as corporate finance advisers to the City.

1.2 Acting on the Claimants’ advice, between June 2005 and October 2007, the City entered amortizing swap agreements with the banks and the City issued the bond with the notional aggregate value of €1,685,347,000. The Claimants were instructed to act as arrangers of the bond iss