David Prosser: The SFO's timing on Weavering is curious

Outlook Only the Serious Fraud Office knows exactly what evidence it has been able to gather in the investigation into Weavering Capital, the hedge fund that collapsed two-and-a-half years ago, saddling investors with losses of more than £300m. Still, its decision to drop the inquiry yesterday looks curious. One set of investors has just won significant damages in a civil case against Weavering executives heard in the Cayman Islands. And a similar case is listed shortly for the High Court in the UK.

That a civil proceeding has succeeded does not guarantee a criminal prosecution would do so too – the standards of proof in such hearings are higher. Nor should the SFO waste public moneypursuing a case it expects to fail simply for the sake of being seen to be doing something.

Still, would it not have beenbetter to wait for the Weavering liquidators to present their case in the UK before abandoning the investigation altogether? Newevidence may yet present itself and that hearing is due to begin in less than a month.

The SFO is no longer the supine beast that was once so regularly lampooned for its failure to tackle white-collar crime. But perceptions are important and Weavering may prove to be a missed opportunity to improve its reputation for vigour still further.