News & what's on - Written by on Monday, August 29, 2011 23:36 - 0 Comments

Timing is everything: Libyan Investment Authority in London corruption probe

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Before the dust has even settled stories are emerging of a corruption probe being undertaken by the Libyan National Transitional Council.

The probe follows a common pattern. A new regime takes over, and one of the first jobs is to discredit the former regime – unlikely in this instance to take much doing. We have written about the same phenomenom in the context of the Arab Spring earlier this year.

In interviews in London last week Mahmoud Badi, the man charged with the task of following the money and tracking Libyan assets overseas, told the Financial Times “We are collecting all the information and data needed to evaluate the state of these assets, and will look at all the misdoings and corruption and those responsible for it,”

In an interview with the BBC Mr. Badi said early investigations had already found “misappropriation, misuse and misconduct of funds” at the Libyan Investment Authority (LIA).

The Libyan Investment Authority has a London arm.  In a leaked Wikileaks cable the Daily Telegraph reported that in January Mr. Layas (formerly in charge of the fund) said the LIA’s primary investments are in London, in banking and residential and commercial real estate.

So. There is a clear UK connection with the LIA and any corruption probe looks certain to feature on activities in the UK.

But the Bribery Act is unlikely to feature.

On July 27 UK Companies House published its intention to strike the London arm of the LIA off the Companies House register.  At the same time the Libyan uprising was (and still is) in full swing.

Unsurprisingly, little if any activity appears to have been taking place in the fund in London or elsewhere since the entry into force of the Bribery Act.

There will be a time lag before Bribery Act cases kick in.

Section 19 of the Bribery Act deals with the transitional provisions:

‘(5)      This Act does not affect any liability, investigation, legal proceeding or penalty for or in respect of—

(a)  a common law offence mentioned in subsection (1) of section 17 which is committed wholly or partly before the coming into force of that subsection in relation to such an offence, or

(b)  an offence under the Public Bodies Corrupt Practices Act 1889 or the Prevention of Corruption Act 1906 committed wholly or partly before the coming into force of the repeal of the Act by Schedule 2 to this Act.

(6)      For the purposes of subsection (5) an offence is partly committed before a particular time if any act or omission which forms part of the offence takes place before that time.’

Richard Alderman, the Director of the SFO said recently, “The Bribery Act is not retrospective. It is a criminal statute and criminal statutes are not retrospective.  There are complex transitional provisions that we shall need to have a look at, but broadly the Bribery Act will apply only to new bribes paid after the Act comes into force tomorrow.  This is what we shall be looking for – new bribes that come within our jurisdiction. Unless we are very lucky, we are unlikely to find out tomorrow afternoon that a big bribe was given tomorrow morning. These things take time.”

Timing is everything.

 

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