Key cases for anti-bribery & corruption law since 2008
Tobiasen (September 2008) – First conviction for bribery of a foreign public official.
Neils Tobiasen (a Danish national and head of CRBN Team Ltd – a British security company) made five payments (amounting to £83,000) to public officials in Uganda in order to win six contacts (worth £500,000) to supply training and equipment to guard the commonwealth meeting in Kampala. He pleaded guilty and was handed a suspended sentence of five months’ imprisonment.
Balfour Beatty (October 2008) - First self-reported case resulting in a non-criminal sanction (i.e. a civil recovery order).
Balfour Beatty self-reported to the SFO in relation to “inaccurate accounting” and “payment irregularities” in a joint venture between a subsidiary and an Egyptian company to secure contracts worth £22.5m to construct the Alexandria Biblioteca in Egypt. The SFO obtained a civil recovery order of £2.25m against Balfour Beatty.
Mabey & Johnson (September 2009) – First conviction of a corporate for overseas corruption.
Mabey & Johnson self-reported to the SFO that it paid a £100,000 bribe to a Jamaican official to win contracts worth £16m. The company also paid £470,792 in bribes to officials in Ghana to secure contracts worth £26m. In addition, the company entered into a contract under the UN Oil-For-Food Programme to supply 13 steel modular bridges. Illegal payments of over €420,000 secured the contract with the Iraqi government, representing 10% of the total contract value.
On conviction, the corporate paid £6.6m, including fines and reparations to the relevant foreign governments. In addition, two directors and a sales manager were individually prosecuted.
For further information see the sentencing remarks of Judge Rivlin QC.
Innospec (March 2010) – First joint settlement with US and UK prosecuting authorities.
Following an investigation by the US and UK authorities, as part of a joint plea agreement with those authorities, Innospec Ltd pleaded guilty to conspiracy to corrupt. The offence related to the payment of bribes of around $8 million to public officials of the Government of Indonesia between 2002 and 2006 to secure contracts (worth some $160 million) for the supply of an anti-knock fuel additive TEL, which was banned almost throughout the world because of its health and environmental impact. Some of the corrupt payments were also made to delay the banning of the additive in Indonesia.
The settlement terms agreed with the authorities included, amongst other measures, Innospec and its US parent agreeing to pay a total of approximately $40 million in fines, the UK portion of this being $12.7 million. At the sentencing hearing Lord Justice Thomas very reluctantly approved the terms of the agreed settlement but concluded that the SFO “had no power to enter into the arrangements made and no such arrangements should be made again” (the plea agreement had been very prescriptive as to the penalty that should be imposed by the court and the split of the global settlement amount between the UK & US authorities; however, sentencing questions are entirely in the discretion of the court).
In addition to the corporate prosecution, four individuals, including two former CEOs, the global sales and marketing director and a regional sales director have been convicted and are awaiting sentencing.
For more detailed discussion of the judgment and its potential implications read our Law-Now article here. Also take a look at Lord Justice Thomas’ sentencing remarks here.