The Financial Conduct Authority made 'significant errors' in obtaining a warrant to seize devices belonging to a barrister suspected of involvement in fraud, the High Court has found as it quashed a warrant.
According to the judgment in GSX, R (on the application of) v The Crown Court at Southwark the FCA alleged that the barrister, referred to as GSX, was involved in fraudulent activity by an overseas company which he incorporated in 2018. He denies any wrongdoing, stating he provided advice in a professional capacity and was unaware of any fraudulent activity.
The FCA arranged for the warrant application, acknowledging that GSX’s devices would be likely to contain items subject to legal professional privilege, to be made to the Crown court. His Honour Judge Baumgartner, resident judge at Southwark, issued the warrant and GSX was arrested in 2024.
In a judicial review judgment Lady Justice Yip, with whom Mr Justice Griffiths agreed, found that the FCA had relied on specialist counsel’s advice that the warrant application should be made under section 8 of the Police and Criminal Evidence Act 1984. The Metropolitan Police and the FCA now concede that, under s.8 a warrant 'cannot be granted...in respect of items where there are reasonable grounds for believing them to be subject to legal professional privilege’.
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The judges noted that 'a very experienced judge did not detect the legal errors in the application'. However, 'while he was misled by the way in which the application was presented, it would be harsh to criticise the interested parties for acting on counsel’s advice when there was no obvious basis to doubt it.
‘It is unfortunate that mistakes were made. However, it cannot be said that the interested parties acted with a cavalier disregard for the law or without at least attempting to do the right thing.’
According to the judgment, the FCA 'made significant errors of law in relation to the warrant application, but such were contributed to by independent legal advice which they were entitled to rely upon. So too were the police entitled to rely on the assurance that legal advice had been obtained. There was no failure to give full and frank disclosure of the relevant facts’.
‘Their failings represent a lack of rigour rather than any deliberate misconduct,’ the judge added.
Finding that the items seized should not be immediately returned and the issue of retention determined in the Crown court, Yip said: ‘If the material seized in the search contains evidence of criminality on the part of the claimant, it is appropriate that such material is properly considered as part of the investigation.'
She ordered the warrant be quashed and a declaration made that the entry, search and seizures were unlawful.
