The Serious Fraud Office has abandoned a long-running criminal inquiry into a miners union and the worlds largest personal injury compensation scheme.
It follows a four-year inquiry into financial links between Union of Democratic Mineworkers (UDM) officials and a law firm handling tens of thousands of damages claims by sick miners. The UDM officials have always denied any wrongdoing.
It means no one will be prosecuted over the scandal, first exposed by The Times, that led to an independent inquiry and the striking off in 2008 of two solicitors, Jim Beresford and Doug Smith, partners in Doncaster-based Beresfords, a firm paid 136 million for processing health claims.
They were found guilty by a disciplinary tribunal of dishonesty and conscious impropriety in their dealings with the UDM.
Related LinksPair who profited from sick miners lose appealBeresfords - how The Times broke the storyThe dropping of the investigation, announced in a brief statement yesterday, surprised many closely involved with the case and is understood to have caused disappointment in some quarters of the SFO.
Until recently, sources close to the inquiry were assuring interested parties that prosecution papers had been prepared, counsels opinion taken and that a series of arrests were imminent.
The SFO said yesterday it was felt that there was no reasonable prospect of securing a conviction and that there were fundamental difficulties in showing that the UDM/Vendside has suffered any loss ... when there was arguably no direct legal entitlement ... to the referral fees [paid by Beresford].
Mr Beresford, 59, earned more than 30 million from the compensation scheme and used the money to buy a 1.8 million private jet, Aston Martins and a Ferrari, while tens of thousands of miners with chronic lung disease and a crippling hand condition caused by their work underground, received damages totalling less than 1,000 each.
The SFO inquiry began in the summer of 2005 after The Times exposed payments made by Beresfords to Indiclaim, a company owned by a UDM employee, Clare Walker.
Her company received hundreds of thousands of pounds under the terms of a secret 2002 deal between the law firm and Mick Stevens, the UDMs general secretary.
He agreed that the union, which owned a claims-handling company called Vendside, would in future pass all its coal-health claims to Beresfords.
In return, the solicitors would pay a fee to Miss Walkers company for each claim they received. All correspondence relating to the agreement was to be sent privately to her home address and not to the UDM offices.
Five years ago the union said that Indiclaim had absolutely no connection to the UDM or any of its claims. But The Times has seen a memorandum setting out the agreement.
Miss Walker, 45, a former British Coal employee who was on an estimated 18,000 salary until 1997, was by 2005 earning 260,000 a year as the part-time head of claims at Vendside.
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