Bribery and corruption in context

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. 

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Foreign Corrupt Practices Act (FCPA) definition:

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.

FCPA anti bribery provisions

The anti-bribery provisions of the FCPA prohibit offering, promising, or giving anything of value, directly or indirectly, to foreign officials in order to obtain or retain business or secure an improper advantage. This includes bribes, kickbacks, or other illicit payments. The law also covers third-party intermediaries such as agents, consultants, or distributors who may act on behalf of companies.

What does the FCPA not prohibit?

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 licences 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.

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A brief guide to avoiding bribery

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.

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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.