….. or the trouble with having an independent judiciary.
One of the great strengths of British Law is that the Judicial System is separate from the Legislative and Police functions, and can make decisions based on legal writ (both legislative and case law) rather than bowing to inappropriate pressure from the establishment – or, indeed, the tyranny of public opinion. However, this can sometimes cause problems, and nowhere is this more the case than with Companies considering whether or not to self-report when they find evidence of the payment of bribes within their organisation.
In the US, there is a well established mechanism for plea bargaining so that, if a Company can reach a deal with the authorities, they can go to court for the agreement to be “rubber stamped” by a judge and everyone can go home happy. In the UK, there is no such process, as John Dougall of Depuy found out, to his cost, when he went to Court, reassured by promises from the SFO that, in return for his co-operation during the investigation of his Company, he would get a suspended sentence. Mr Justice Bean did not agree and – I suspect – was not impressed by the SFO making promises, effectively on his behalf, to someone facing charges in his court. Mr Dougall went to prison and, although he was released on appeal, his sentencing sent out shockwaves on all sides, and left several Companies that had self-reported, wondering if they had done the right thing.
In the wake of this case, the Authorities have done a great deal to try and calm the situation. A couple of recent high-profile cases, involving Willis and Macmillan have underlined the fact that Companies who self-report will be treated leniently (if such a word can be applied to multi million pound fines) and that matters can be resolved by the use of civil recovery orders, validated in court. Quite how this works in practice remains a mystery – the Judiciary is still independent and, in spite of their blandishments, there is still no mechanism by which the SFO can absolutely assure malefactors that they will avoid prosecution and a custodial sentence, if they co-operate with the authorities.
However, it’s worth looking at the SFO’s guidelines (no, honestly!), as set out in their document “Approach to dealing with Overseas Corruption”, where they state that “wherever possible following a self-report, full co-operation and meaningful action to address the problems uncovered and to ensure an ethical future, the SFO will proceed via the Civil route”. In other words, if you make a clean breast of matters to the authorities, take substantive action to put your house in order and make sure it doesn’t happen again, the SFO will probably try and settle the matter via a civil, rather than a criminal, route. So that’s all right then. Isn’t it?
Well; probably. Bear in mind, however, that there are certain contra-indications to such a happy outcome, including any suggestion that Directors of a Company have been complicit in paying bribes, particularly if they have benefitted personally from it. Furthermore, if it becomes apparent that a Board of Directors was aware that corrupt activities were taking place, and chose not to do anything about them, it is probably too late to do anything about it when the SFO arrive at your offices first thing in the morning, armed with search warrants and a pair of handcuffs.
Transparency is a word – and a concept – much in vogue in the Anti-Bribery field. If you think there is a problem within your business, it’s better to admit to it straight away and to talk to the authorities. You won’t escape scot-free, but you will probably be doing a great deal to mitigate the consequential damage – and to ensure that you don’t end up in the dock facing a judge who got out of bed the wrong side, that morning…..