21.03.2014
The Daily Telegraph states that David Green, the director of the Serious Fraud Office (SFO), has put forward the new measures – which have already been discussed with bodies including the Law Commission – as part of changes to the Bribery Act.
According to the reports, the aim is to bring the UK system more in line with the style of prosecution seen in the US and could have wide-reaching consequences – particularly as any conviction under the legislation would prevent companies from bidding for certain work.
Talking to the newspaper, Mr Green said the change to Section 7 of the Bribery Act would be “a very small amendment”.
He explained: “At the moment it is an offence for a corporate to fail to prevent bribery by its employees with a statutory defence of adequate procedures. I have proposed expanding that to a corporate failing to prevent acts of financial crime by its employees.”
The SFO director added that the “stigma” of the crime would prove to be most important to many organisations.
The Bribery Act received Royal Assent in April 2010 and came into force subsequently in July 2011.
Plans To Amend Section 7 Of Legislation
New proposals which could see organisations fined or blacklisted from contracts across Europe as a result of failing to stop economic crime are being reviewed by the government, according to reports.The Daily Telegraph states that David Green, the director of the Serious Fraud Office (SFO), has put forward the new measures – which have already been discussed with bodies including the Law Commission – as part of changes to the Bribery Act.
According to the reports, the aim is to bring the UK system more in line with the style of prosecution seen in the US and could have wide-reaching consequences – particularly as any conviction under the legislation would prevent companies from bidding for certain work.
Talking to the newspaper, Mr Green said the change to Section 7 of the Bribery Act would be “a very small amendment”.
He explained: “At the moment it is an offence for a corporate to fail to prevent bribery by its employees with a statutory defence of adequate procedures. I have proposed expanding that to a corporate failing to prevent acts of financial crime by its employees.”
The SFO director added that the “stigma” of the crime would prove to be most important to many organisations.
The Bribery Act received Royal Assent in April 2010 and came into force subsequently in July 2011.
Expert Opinion
This proposed amendment comes about in the midst of the SFO’s continuing poor success rate with corporate prosecutions and would make it significantly easier for the SFO to pursue a corporate for failure to prevent financial crime committed by its employees, by moving them away from the need to rely on the current ‘controlling mind’ test. <br/> <br/>"Although the proposed amendment is claimed to be a small one the ramifications for companies could be very significant. <br/> <br/>"The move would widen the scope of this section hugely and, given the potentially devastating consequences of conviction for a company by the debarment from public contracts, any such amendment is likely to give companies a serious incentive to ensure adequate procedures are in place to prevent financial crime being committed by their employees in the first place."
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