When the Bribery Act 2010 (the “Act”) came into force in the UK on 1st July 2011, it was widely regarded as being one of the most stringent anti-corruption systems in the world. In summary the Act created a number of new offences for which commercial organisations, employees and directors can be liable for up to 10 years imprisonment and/or an unlimited fine.
These offences comprise:
• Offering, promising or giving a bribe;
• Requesting, agreeing to receive or accepting a bribe;
• Bribing a foreign public official; and
• Organisations failing to prevent bribery.
In several respects the Act went considerably further even than the USA’s Foreign Corrupt Practices Act 1977, which was previously seen as providing the benchmark standard for legislation designed to fight international corruption. However, by the end of 2013 there remained only three convictions under the Act, but this number has more than doubled since then.
In June 2014, Chann Sankaran, Kirshna Ganeshan and former Whitehawk FC defender Michael Boateng were convicted of plotting to fix the results of football matches. Sankaran and Ganeshan had come to the UK to find players at lower division football clubs they could corrupt. It seems they believed it would be easier to bribe players at lower division football clubs to influence the score of matches given their more modest wages. They recruited Boateng in order to help them do so. The National Crime Agency was however watching them closely and on 17 June 2014 they were convicted under the Act. Ganeshan and Sakaran were sentenced to five years imprisonment and Boateng was sentenced to sixteen months for his part in the scheme. More recently in April 2015, former Premier League footballer Delroy Facey was sentenced to two and a half years and Former non-league player Moses Swaibu was sentenced to 16 months for their involvement in the match-fixing.
In December 2014, a Serious Fraud Office investigation into an investment scam relating to the sale and promotion of biofuel products involving Sustainable Growth Group’s subsidiary, AgroEnergy plc resulted in the conviction of three directors. Two of these convictions were for offences under the Act. Chief Commercial Officer Gary West was found guilty of accepting bribes from Stuart Stone, an Independent Financial Adviser. False invoices had been approved, which allowed Stone to charge 65% commission rates on investor’s funds. Stone was sentenced to six years imprisonment and disqualified from being a director for ten years. West was given a thirteen year prison sentence and disqualified from being a director for 15 years. The Serious Fraud Office has also commenced legal proceedings to establish compensation and confiscation orders against the individuals.
In addition to these convictions, the Serious Fraud Office has an ongoing investigation into the activities of GlaxoSmithKline and its subsidiaries in multiple jurisdictions.
Two points remain to be considered: firstly the application of the Act to “ordinary decent UK SMEs” who are extorted for facilitation payments when trading internationally (for example by corrupt customs officials) has not yet been tested. Possibly the UK authorities’ inactivity in this area might give comfort to exporters who fear being criminalised for being the victims of such extortion, even if lawyers know never to rely on such comfort.
Secondly, the extraordinary extra-territoriality of the Act has not yet been tested: in theory, any non-UK company with a UK brass plate subsidiary somewhere in its structure can be prosecuted in the UK for the payment by a third party agent in any country of a facilitation payment. Given that President Putin is currently suggesting that the West is using its anti-corruption legislation as a geopolitical weapon to target its enemies, will we see the UK invoke this extra-territorial scope? Watch this space.
Philip Gilliland is Managing Partner of Caldwell & Robinson (www.caldwellrobinson.com) and is an experienced practitioner in global trade.
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