BRITAIN’S SERIOUS Fraud Office (SFO) will not carry out a criminal investigation into the sale and collapse of carmaker MG Rover, it said yesterday, effectively drawing a line under a four-year saga.
The SFO said in a statement that it had reviewed documents relating to the transaction and the 2005 demise of the company and determined, after consultation with legal advisers, there were no grounds to initiate a criminal investigation.
MG Rover, Britain’s last major independent carmaker, went into administration in April 2005 with debts of almost £1.3 billion (€1.5 billion) and the loss of 6,000 jobs, prompting opposition calls for an inquiry into its collapse.
In July this year, after the completion of a four-year probe into the car plant’s failure that was never made public, Britain’s department of business asked the SFO to determine if there were any grounds for criminal prosecution.
“The Serious Fraud Office. . . does not intend to begin a criminal investigation,” it said in a short statement, giving no reasons for its decision.
British business secretary Peter Mandelson defended the SFO’s announcement and the time it has taken to investigate the company’s collapse, saying thoroughness was necessary.
“It was important to have clarity on whether or not this was a case that the SFO should be investigating,” he said. “The workers who lost their jobs and the creditors who were owed nearly £1.3 billion by the collapse deserved no less.”
Debate about the company’s failure has focused on four executives, known as the Phoenix Four, who took over MG Rover in May 2000 after buying it for a nominal £10 with an interest-free loan from a previous owner, BMW.
The four came in for criticism after their representatives confirmed they had drawn up to £20 million (€23.3 million) in pay and pensions during the years they controlled the firm. They have said there was no basis for an SFO investigation.
– Reuters