Letter: No chance for Fayeds to clear their name

Sir: Your comment of 11 June upon the unconfirmed reports that this company might be floated on the stock market made much of the 1990 Department of Trade and Industry report on the takeover of the of House of Fraser in 1985 and the critical comments made by the two inspectors.

As the Government itself made clear in the case of Fayed vs the United Kingdom before the European Court of Human Rights in 1994, the contents of the report were no more than the inspectors' opinion and they had taken into account hearsay which would not be admissible in a court of law.

It was not the inspectors' function to reach any conclusions as to whether any offences had been committed. Those who did have that responsibility, the Serious Fraud Office and the Director of Public Prosecutions, said that there was nothing to warrant criminal proceedings. The report did not lead to any civil proceedings, nor was there a reference to the Monopolies and Mergers Commission, nor was there any move to seek the disqualification of the Fayed brothers as company directors.

Because no case was ever brought the Fayed brothers were never able to demonstrate in court the wrongheadedness of the inspectors' opinion. At the same time, the report was protected by privilege and so the Fayed brothers were not able to institute proceedings for libel. As Lord Mishcon said in the House of Lords at the time, it is the worst of all worlds when someone is accused in an official report but denied any means of defending himself because no action is taken upon it.


Director of Public Affairs


London SW1