Bribery Act & Proceeds of Crime - Written by on Saturday, March 2, 2013 10:07 - 0 Comments

Opinion: Don’t buy snake oil. Why a lack of Bribery Act prosecutions should not signal complacency.

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Looking at settled FCPA cases you are hard pressed to find enforcement of FCPA violations post dating July 1 2011.

This is hardly surprising.

It generally takes some time for suspected violations to come to light, additional time for those suspicions to be investigated and probed (to ascertain if they are indeed real) and more time for a prosecutor to review them and consider whether a case can be put together to prove wrongdoing to a courtroom standard.

Against this back drop commentary in the media that the Bribery Act has failed to deliver is misguided.

The Bribery Act only applies to conduct from and including July 1 2011.  Even then there are somewhat complicated transitional provisions which mean that the Bribery Act does not apply to offences committed wholly or partly before July 1, 2011 – namely if, broadly speaking, any act or omission which forms part of the offence takes place before that time.

This raises an interesting technical question of what might happen in connection with a bribe paid on or after July 1 2011 but under a contract (for example a fake Agency Agreement) entered into before July 1, 2011.

The news stories in recent weeks about the allegations surrounding Rolls Royce and latterly Agusta Westland all appear (based on what is in the public domain) to relate to alleged conduct pre-dating July 2011.

It appears unlikely that they will be the first corporate Bribery Act case.

Section 19(5) and (6) of the Bribery Act lay out the salient 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.”

It is likely that a prosecutor would prefer a clear case where there could be no argument that an act or omission (for example the entry into of a prior fake agreement) forming part of the offence took place before July 1, 2011.  We will have to wait and see if this ever needs to be tested.

In the meantime the chances of violations of the Bribery Act emerging are increasing with the passage of time.

This is borne out in fact.  We are aware that the SFO has a number of pre-investigation (or projects as the new Director of the SFO has dubbed them) in connection with the Bribery Act already.  Whether these develop into Bribery Act enforcement cases remains to be seen.

One thing is for sure.  Bribery Act enforcement for corporate violations is inevitable.

Those who would suggest otherwise are selling snake oil.  Don’t buy it.

 

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