Anti-bribery and corruption laws in the post-Brexit world
The Bribery Act 2010 came into force in July 2011. For UK businesses operating in the emerging and frontier markets its effect was seismic. Organisations were suddenly faced with having to comply with some of the toughest anti-corruption rules in the world. As we approach ten years on, we reflect on some of the key convictions of the last decade.
R v Patel, 2011
This was the first conviction under the Bribery Act. Mr Patel, who worked at Redbridge Magistrates Court, was found guilty of accepting bribes in return for arranging escape from disqualifications, fines or points on their licences for those who came before the Court for driving offences. Mr Patel’s conduct amounted to the systematic perverting of the course of justice including at least 53 cases. It lasted over a year and it netted Mr Patel over £90,000. On appeal, the sentence (which also reflected other offences) was reduced from six to four years’ imprisonment.
The legal, ethical and reputational risk of bribery is real. Billions in fines are levied every year and frequent reports of investigations and prosecutions from regulating authorities across the world hit the headlines.
We are delighted to be joined by Head of the OECD’s Anti-Corruption Division Patrick Moulette and Transparency International’s Global Business Integrity Programme Lead Britta Niemeyer.
These leading international bribery and corruption experts will discuss the challenges businesses face in building a strong anti-bribery and corruption programme in 2021, and give their insights into how businesses can best fight bribery.
The webinar will cover:
Major anti-corruption and bribery cases and what we can learn
The impact COVID-19 has had on anti-bribery and corruption
The industries most vulnerable to bribery and corruption
Guidance for whistleblowers and how they are handled by authorities
Anti-bribery training requirements and best practice
As the UK Bribery Act 2010, the world’s strongest piece of anti-corruption legislation reaches its tenth year, we look back on how the Bribery Act came to be.
Corruption you can see
The case of John Poulson provides an example of how small-scale bribery can, if unchecked, build up into a multi-million pound industry. Over 30 years Poulson, though not a qualified architect, and starting with just a £50 loan, built up the largest architectural practice in Europe through the corrupt purchase of local government contracts in northern England, and of contracts for the re-development of major railway termini through bribery of a British Rail employee, Graham Tunbridge. The bribes involved were not always large. When Tunbridge became Estates and Rating Surveyor for BR Southern Region, he gave Poulson contracts for the redevelopment of London Waterloo, Cannon Street and East Croydon stations–all in return for £253 a week and the loan of a Rover car.
Such corruption breeds more corruption; it was estimated at Poulson’s trial that 23 local authorities and over 300 individuals were involved. But the corruption had other deleterious effects. Taxpayers’ money was misused in paying more than the contracts might have cost on an open public tender.
Despite the UK Bribery Act having come into force in 2010, bribery is still a hugely problematic issue in corporate life. Billions of pounds of fines are levied every year and frequent reports hit the headlines of investigations and prosecutions from the US Department of Justice and UK Serious Fraud Office.
Bribery cases have ensnared some of the world’s largest companies, biggest sporting bodies and most powerful politicians. The propensity for some people to act corruptly might never change, but our approach to training and compliance can.
VinciWorks will soon be releasing Anti-Bribery: Fundamentals, a new anti-bribery course that will give employees the opportunity to understand the risks of bribery in their working life as well as to test their knowledge and understanding of the subject, and teach them how to avoid becoming ensnared in bribery.
The Foreign Corrupt Practices Act is a piece of American legislation aimed at outlawing bribery of foreign officials. The Act applies to those with formal ties to the US, such as US nationals or businesses incorporated in the US, as well as foreign nationals and entities who are in the US at the time of the improper conduct. Individuals face between five to 20 years imprisonment for each violation. Corporations can be fined up to $2m per violation, and individuals up to $100,000.
The FCPA does not prohibit facilitation payments made to foreign officials for the purpose of causing them to perform routine governmental actions, such as issuing licenses or performing shipping inspections. The FCPA also does not prohibit reasonable, bona fide expenditures associated with a product or contract, or payments expressly permitted under the written laws of the foreign country.
Here is some guidance on the role the FCPA plays in helping businesses identify and mitigate the risk of bribery. The guidance has been taken from VinciWorks’ online anti-bribery training, which can be taken by staff working in any country.
Key differences between the FCPA and Bribery Act
Business to business bribery
The FCPA does not cover bribery on a private, business to business level, which the Bribery Act does criminalise. However, this sort of corruption is outlawed under other US legislation.
Gifts and donations are often a part of business, whether it is cultural norms or celebrating a completed negotiation. However, there are certain instances in which it is important to be vigilant of the circumstances behind donations as they may be attempts to bribe. here is a short guide to spotting potential red flags and avoiding bribery.
Charitable or political donations can be viewed as attempts of bribery if there is something unusual about the inherent qualities or timing of the donation. Bribery is not always a mutual arrangement and it may not be known to the donee if there is a bribe occurring. When receiving gifts and donations it is important to be vigilant as some types may be seen as improper.
When your organisation is using third parties, it is essential to complete your own due diligence equal to the risk faced from the said relationship. With businesses and partnerships around the world growing, it is essential to make sure all your relationships and third parties are legal and legitimate. VinciWorks’ guide to risk based third party due diligence will give you a clearer understanding of how to conduct a detailed and genuine risk assessment.
Does your organisation have everything in place to ensure it is complying with the Bribery Act 2010? Do you have the latest anti-bribery policies in place to ensure your staff are aware of internal procedures? VinciWorks has created an anti-bribery resource page that includes a host of free anti-bribery compliance tools and resources.
VinciWorks has created two contract clause templates that can easily be edited to suit your organisation’s contact persons, industry, and internal policies. These contract clauses allow businesses to withdraw from their contract with either a supplier or employee should they be found to be offering or accepting bribes. Here is some guidance on what should be included in these clauses, as well as a link to download them. These templates are also included in the VinciWorks’ anti-bribery resource page.