Echoes of Guildford return to haunt appeal by the Guinness Four

Allegations of conspiracy feature in a City fight next week to overturn fraud convictions, writes Jeremy Warner

Conspiracy in high places, confessions extracted under duress, the withholding of possibly vital evidence by prosecuting authorities - anyone would think this was the Guildford Four case. This is also, however, what the four convicted Guinness defendants - Ernest Saunders, Gerald Ronson, Tony Parnes and Jack Lyons - claim happened to them.

On Monday, the Court of Appeal begins hearing aspects of these allegations - that defendants were unjustly deprived of their right of silence and that the Serious Fraud Office withheld evidence in its desperation to secure convictions. Lawyers rate their chances of a success as middling to high.

The Appeal Court hearing is only part of determined efforts by all four Guinness defendants to have their convictions quashed. Saunders, the former Guinness chairman, is also fighting to clear his name in Europe, claiming use of Department of Trade and Industry interviews as evidence deprived him of a fair trial. Already he has achieved a considerable breakthrough in having his case referred to the European Court of Human Rights. A scheduled hearing in May was delayed until next year to allow the Appeal Court proceedings to take place first.

Two of the defendants, Saunders and Lyons, dispute that they were ever a part of the complex shares fraud which enabled Guinness to gain control of the Distillers liquor company in the mid-1980s, but this is not the basis of the appeal. The other two, Parnes and Ronson, admit that they participated but claim there was no dishonest intent.

The appeal is based on alleged abuse of power and the holding back of evidence helpful to the defence. Saunders and his lawyers maintain that the use of evidence collected by DTI inspectors, who have the right to compel witnesses to answer questions on pain of imprisonment, deprived him of his right of silence and as a consequence a fair trial. Furthermore, he alleges that police were deliberately kept out of the Guinness affair for a number of months to allow the DTI a free hand in using its powers of compulsion to obtain self-incriminating statements.

This was a conspiracy that went to the highest possible levels in government, according to Mr Saunders. to secure high-profile fraud convictions regardless, he insists, of normally accepted human rights. The prosecution case against Saunders was not based on these transcripts, but on the evidence of Olivier Roux, Guinness's finance director, and senior auditor, Howard Hughes. However, the transcripts were used extensively to discredit Saunders in cross-examination. Furthermore, the case against Parnes and Ronson was almost exclusively based on these interviews, which amounted to "confessions" in all but name.

The other aspect of the appeal centres on evidence that was in the possession of the SFO at the time of the trial but was kept from defendants. What it showed was that a number of Guinness-style share support operations were conducted in the mid-1980s, lending some credence to defence claims that the Guinness indemnities were not unique. According to Parnes, such practices were a "grey area"; few believed they might be illegal.

More damning still, the SFO also had in its possession the private findings of a City disciplinary tribunal, which concluded that such operations were perfectly proper. The Director General of the City Takeover Panel, Tim Barker, was a party to these findings. This, too, was kept from the defence and the judge.

Whether the opinion of a private City disciplinary body would materially have influenced the outcome is anyone's guess. Lord Spens, who stood trial over Guinness but was not convicted, says he has not the slightest doubt that had this evidence been available to Saunders and the others, they would have been acquitted.

One of the problems with the "hidden" evidence, however, is that nearly all the other cited cases of indemnified support involved people who were also part of the Guinness affair. To the extent that such practices were common, therefore, they may only have been so among a relatively small group of practitioners, many of whom ended up being prosecuted over Guinness.

The SFO has always maintained that there was no deliberate attempt to withhold evidence, which in any case it regarded as being irrelevant. The decision not to release it was taken on the advice of counsel. Furthermore, more onerous rules on disclosure that might have required the release of such documentation were not introduced until some years after the Guinness trial. Shortly before the trial, lawyers for Parnes received written confirmation from the SFO that all unused material had been disclosed.

Failure to defend the convictions would be a serious setback for the SFO. Though the SFO's record in prosecuting fraud is not as poor as often portrayed, it does have a bad record on complex securities fraud. The Guinness Four are among the very few high-profile convictions.