Andrew Kent, one of the cleared defendants, intends to sue Rahn & Bodmer, the private Swiss bank that made allegations against him to the SFO, for defamation and malicious prosecution. It is thought that Patrick Mahon, former managing director of the stockbroker TC Coombs, will consider a similar action when his solicitor returns from holiday.
Their trial began in mid-June. The cost of the SFO investigation and the trial runs into millions, one lawyer estimated.
Mr Mahon and Mr Kent, who was TC Coombs' corporate development manager, were accused of deceiving regulators to ensure their firm would be allowed to continue trading. They were accused of lying about a pounds 2m share deal and about the source of pounds 3.7m made available to TC Coombs. Mr Mahon faced a third charge of dishonestly attempting to obtain Cdollars 2m ( pounds 1m) from Rahn & Bodmer.
Directing the jury to find Mr Kent and Mr Mahon not guilty, Judge Clark outlined numerous weaknesses in the evidence. These included the 'unbelievable' absence of Rahn & Bodmer documentation to support the prosecution's account of the Cdollars 5m share deal at the heart of the case.
The judge said he was convinced that no sensible jury could be sure about the deal. Any conviction would be based on speculation rather than a safe inference.
The judge named five witnesses - three of them from Rahn & Bodmer - who he said had given unsatisfactory or dubious evidence. The witnesses included Dr Christian Rahn, who was not present when the deal was struck and whose evidence appeared to be 'mere speculation'.
Dr Rahn was unaware of the collapse of the case when contacted yesterday. He would not comment on the judge's remarks or Mr Kent's action until he knew 'the whole story'.
Judge Clark said he could conceive of no possible criticism of the SFO. 'Any prosecuting authority can only work with the material which is supplied to it,' he said.
The SFO has been much criticised for its conduct of other cases. The second Guinness trial collapsed without a verdict and the convictions handed down at the end of the year-long Blue Arrow case were eventually overturned.
In common with other judges who have handled lengthy fraud trials, Judge Clark suggested: 'This sort of inquiry were far better left to the regulatory organisations which have been set up under the Financial Services Act.' The allegations did not accuse Mr Mahon or Mr Kent of causing investors financial loss.
'Courts spend an awful lot of time and money on these matters which could have been dealt with in a completely different way,' the judge said.
Through his solicitor, Mr Mahon said he was delighted that the enormous professional and personal pressures that he has faced since the SFO raid on TC Coombs in November 1990 were behind him and that his good character was restored.
The Securities Association, TC Coombs' financial regulator, withdrew its authorisation shortly before the arrests of Mr Mahon and Mr Kent in February 1991. The firm, which employed 180 people, called in receivers.
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