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International

BREAKING: FIRST CORPORATE DISPOSAL OF FAILURE TO PREVENT BRIBERY OFFENCE

Drum roll.  We now have the first corporate disposal for a violation of the new offence of failure to prevent bribery. ...in Scotland. Last Friday the Scottish authorities announced a civil settlement with Brand-Rex Limited. The settlement is of note for two reasons. Firstly, it is the first concluded settlement for a contravention of the Bribery Act 2010, s.7 - corporate failure to prevent bribery by a third party. It is a classic case on the thorny question of corporate hospitality and that hospitality being misused. Secondly, it is the third concluded corporate self-report and civil settlement in Scotland. The Scottish system is akin to that operated by the SFO before deferred prosecutions agreement were introduced. It is clear that Scottish system is encouraging self-reports and that the settlements are being progressed in a reasonable timescale. Here is the announcement from the Crown Office and Procurator Fiscal Service: The Civil Recovery Unit has today recovered £212,800 under an ...

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Sectors

Significant jail term in Edinburgh construction works bribery case

By Tom Stocker, Partner, Corporate Crime & Investigations, Pinsent Masons LLP Yesterday, two former employees of Edinburgh Council and two directors of a construction company received significant jail sentences for bribery contrary to The Public Bodies Corrupt Practices Act 1889 (the legislation that pre-dates the Bribery Act 2010). The council employees helped award contracts to Edinburgh Action Building Contracts Ltd (ABC Ltd) and in return they received extensive hospitality including corporate seats at Hibs and Hearts football grounds, meals out and visits to lap dancing bars as well as cash.  Invoices were then inflated to cover the cost of the hospitality. The charges related to the maintenance of council buildings from 2006 to 2010. Council worker Charles Owenson was sentenced to 4 years and 4 months for accepting bribes. The sentencing Sheriff considered that, despite Mr Owenson's guilty plea, the plea-in-mitigation put forward on his behalf  demonstrated that Mr Owenson had not accepted ...

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News & what’s on

Picking over the bones of the Chickengate sentencing: The analysis

Over the weekend we promised to pick over the bones of the Chickengate sentencing. The first SFO successful prosecution of a company for bribery of foreign public officials came to its conclusion Friday with the order of fines and confiscation against Smith & Ouzman Ltd. We promised some more analysis of James' Hot off the Press post.  Today we pick over the bones. First, some readers have been in contact!!! We like this. Some Points of Order: 1. Under the Proceeds of Crime Act compensation takes priority and so if there had been a compensation order it would have normally flowed from the sum to be confiscated unless there were sufficient funds to meet both a compensation order and a confiscation order, so while there is no compensation order, the chances are if there was one it would have come out of the confiscation. The free to ‘repatriate’ part is in fact referring to the ...

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Bribery Act & Proceeds of Crime

Hat trick for the SFO: First Section 7 Bribery Act Admission outside of a DPA* by Sweett Group PLC

"SFO investigation We continue to co-operate with the SFO.  The SFO investigation with respect to Sweett Group into the allegations made in the Wall Street Journal in June 2013 is at an end.  During the process of our own investigations two related contracts within the Middle East were identified as suspicious and were duly reported to the SFO.  This has led to an admission by Sweett Group of an offence under Section 7(1) of the UK Bribery Act 2010 (failing to prevent an associated person bribing another to obtain or retain business for the company).  Subsequent prosecution is expected, with the likely outcome of a fine, the quantum of which cannot be ascertained at the present time.   Importantly, an offence under Section 7 (1) does not attract a mandatory debarment from public sector tendering under EU/UK law." Read the Sweett Group PLC interim financial statements posted with the London Stock Exchange yesterday. The SFO ...

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Your Questions: Answered

My company has entered into contracts with FIFA. Should I be doing anything?

Question My company has entered into various contracts over the years with FIFA.  I read with alarm last week the news stories about the arrests of FIFA officials in Switzerland. The US has signalled more arrests are likely and the Swiss prosecutor is also investigating. Should I be worried that my business may be drawn into the FIFA investigation and should I be doing anything now? Yours, Anon. The short answer Expect more revelations.  So far the enforcement action in the public domain focusses on the alleged bribe recipients – expect the suspected bribe payers to be targeted next and under the full glare of publicity. A head in the sand approach is never the best option. Businesses who have negotiated licencing deals etc. with FIFA would be well advised to run some basic checks (speak to a lawyer before you do to make sure the checks don’t create legal problems) to confirm their deals are not tainted. The longer ...

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