THE Bribery Act looks set to claim its highest profile scalp to date. Rolls-Royce, a FTSE 100 company, has admitted to the Serious Fraud Office (SFO) concerns about bribery and corruption involving multiple overseas intermediaries.
In a statement, a spokesperson conceded that individuals and the company itself might be prosecuted.
This comes only weeks after the Civil Recovery Unit netted the £5.6 million profits the Aberdeen-based Abbot Group had made from corrupt dealings overseas. Abbott confessed its crimes to the Crown Office in July 2012, becoming the first company to enter into a civil settlement under the self-reporting initiative.
Set up to encourage companies to confess to dodgy dealings in return for favourable treatment, the self-reporting programme was used north and south of the Border from July 2011.
It was closed in England and Wales in June 2012 amid public and judicial criticism of “secret settlements”. Self-reporting has been replaced with US-style deferred prosecution agreements (DPAs), which will be openly published and have the seal of approval from a judge. This means the UK now has a two-track Bribery Act. Companies that report to the Scottish Crown Office can settle matters quickly and in secrecy until June 2013, whereas south of the Border the introduction of DPAs means that for the first time settlements will be out in the open.
When the Bribery Act came into force, much noise was made about the impact it would have on corporate gifts and hospitality. However, newspapers reported this year that SFO director David Green had said it was not the “serious Champagne office”.
It is now clear from the recent enforcement activities across the UK that the biggest risk to businesses under the Bribery Act is not the occasional Christmas fruit basket, but the third parties who act on their behalf and companies operating in overseas territories.
Foreign trade can offer massive rewards, but companies need to choose their partners very carefully. Breaches of the Bribery Act can blacken reputations and cause long-term damage.
• Val Surgenor is compliance and regulatory partner with MacRoberts.