Madoff: Calls for specialist Scottish fraud unit - Sovereign Regulators Probe Madoff

Calls for a specialist Scottish fraud unit grew today in the wake of a UK investigation into the activities of alleged multi-billion pound fraudster Bernard Madoff.

Several British banks have been caught up in the financial scandal, including the Royal Bank of Scotland, which said £400 million could be at risk in hedge funds.

Conservative justice spokesman Bill Aitken said: "The SNP Government is dragging its feet in giving Scotland the tools we need to protect the public from serious fraud and with the Madoff scandal, the chickens have come home to roost."

Mr Aitken's call came one day after the UK's Serious Fraud Office (SFO) launched its probe into the British dealings of Madoff, who was accused by US authorities of running a bogus business which lost up to £33 billion.

The SFO can investigate and prosecute UK cases through courts in England, Wales and Northern Ireland but cannot prosecute under Scottish law.

Mr Aitken said: "In May last year, Her Majesty's chief Inspector of Constabulary for Scotland, Paddy Tomkins, published a report revealing that, when it comes to investigating and tackling serious fraud, Scotland is badly behind the rest of the United Kingdom.

"Specifically, the report called on the SNP government to establish a national fraud capability and to do so as a matter of urgency, within three months. And in January 2009, we do not have it."

Last month, Labour MP John McFall, chairman of the House of Commons Treasury Committee, added his concerns that Scotland could not properly deal with sophisticated financial crime.

And Scottish Tory leader Annabel Goldie called on First Minister Alex Salmond before Christmas to stop the "inexcusable delay" on the issue.

Mr Salmond told MSPs a business case will be presented to ministers in February