EFFECTIVE MEASURES TO COMBAT AND PREVENTCORRUPTION IN THE UK AND THE CURRENT SITUATION ON
ENFORCEMENT OF THE BRIBERY ACT 2010David GreenI. OUTLINE OF LECTURES
A. Hand-outs
A:Lecture outline (this document)
B:Understanding Bribery and Corruption (slides)
C:The Bribery Act 2010 (slides)
D:SFO powers
E:The Bribery Act 2010 (commentary)
F:Deferred Prosecution Agreements (DPAs)(flow-chart)

II. LECTURE 1
A. General
Brief outline of the criminal justice system in England and Wales
The problem of fraud in the UK context
B. The SFO
Origins of the SFO:the Fraud Trials Committee (Roskill)1983
The Criminal Justice Act 1987:establishing the SFO
The Roskill model
The size and organisation of the SFO
SFO jurisdiction
SFO powers
The SFO and Mutual Legal Assistance (M LA)
SFO funding
Recent restatement of the SFOʼs mission and purpose

Director, Serious Fraud Office, United Kingdom.

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Self-reporting of criminal activity to the SFO by corporates
Why investigations are lengthy
Framing charges
Examples of contemporary SFO investigations and prosecutions
C. The SFO and Other UK Agencies in Economic Crime
National Crime Agency
PoliceCrown Prosecution Service
Her M ajestyʼ
s Revenue and Customs (HM RC)
Financial Conduct Authority (FCA)
Office of Fair Trading (OFT)
Competition and Markets Authority
D. Practical Problems Facing the SFO in Investigation and Prosecution
obstructions in the way of obtaining evidence
electronic data:uploading and searchingexecution of SFO M LA requests abroad
the need to keep investigations and prosecutions focused
media attention
court delays

III. LECTURE 2
A. The Bribery Act 2010
Hand-outs C and D
Background to the Act
Legislation before the Bribery Act
Examples of cases before the Bribery Act
OECD criticisms
Distinctive features of the Bribery Act 2010
Act in force from 1/7/2011;not retrospective
S1 Active bribery

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S2 Passive bribery
S6 Bribery of foreign public officials
S7 Corporate liability for failure to prevent bribery
Statutory defence to an offence under S7Territorial application
Business entertainment
Facilitation payments
M inistry of Justice published Guidance
Joint DPP/DSFO published Guidance
Sentencing
SFO enforcement
B. Deferred Prosecution Agreements (DPAs)
What are DPAʼs?
When might they be used?
Hand-out F:DPA flow chart
DPA Application process
DPA compliance and oversight
DPA breach and variation
Key differences from US practice on DPAs
Corporate criminal liability in English law
C. Investigation, Prosecution and Confiscation
How information comes to the SFOIntelligence
Self-reporting
Whistle-blowing
Evaluation
Investigation by the SFO
Domestic documentary evidence
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Witness evidence
Prosecution and asset recovery

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SFO POWERS

I. S.2 CJA 1987 POWERSThe Criminal Justice Act 1987 provides powers to enable me and my staff to carry out
investigations more effectively. They are contained in s.2 of the Act.
These are wide-ranging powers exercisable only in respect of cases where I have decided tocommence an investigation into serious or complex fraud,bribery or corruption.The powers
can be exercised personally by me or by staff whom I have designated to exercise these powers
on my behalf.
I can also exercise these powers on behalf of an overseas authority where requested to do soby the Secretary of State but,again,only where it appears to me on reasonable grounds thatthe offence in respect of which I have been requested to obtain evidence involves serious orcomplex fraud.
S.2 of the Act enables me to require,by way of a written notice,any person being investigatedor any other person whom I have reason to believe has relevant information to either answer
questions or provide me with information with respect to any matter relevant to the investigation.
Importantly, I can require the production of specified documents that relate to the offence
under investigation ― this is the single greatest use of the power.It includes a power requiring
the person producing the documents to also provide an explanation in relation to any of them.
What powers of enforcement are there?Where a magistrate is satisfied that there are reasonable grounds for believing that:any person has failed to comply with an obligation to produce documents, or
it is not practicable to serve a notice;orthe service of a notice might seriously prejudice the investigation
he can issue a warrant authoring a police constable to enter and search premises and seize
relevant documents.
There are limits as to the use to which the SFO may put any statement that a person isrequired to give in response to a notice.We cannot rely on such statements in evidence unless
it is for a specific offence of providing a false or misleading statement or, in the course of aprosecution for some other offence,the accused makes a statement which is inconsistent withwhat he said in response to the notice.
We can,however,rely in evidence on documents which were already in existence at the time
we served the s.2 notice ― and, indeed, such material often forms the core of many of ourcases.
This distinction ― between being able to rely upon documents which already exist as opposed
to not being able to rely on the answers to questions which someone is required to provide ―is intended to give effect to the law against self-incrimination which, in its most basic form,
provides that a person accused of a criminal offence cannot be compelled to produce material
that may subsequently be used as evidence against him save and unless that material alreadyhas its own independent existence.
There are also express provisions protecting legally privileged material. In addition, special
protection is given to confidential banking material ― such material can only be obtained if
I personally authorise the making of a requirement (or, if I am unavailable, for example

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because I am overseas, an individual nominated by me does so).
Failure,without reasonable excuse,to comply with any requirement under a s.2 notice is itself
a criminal offence, punishable by way of up to six months imprisonment and /or a fine.
As noted already, making a false or misleading statement in response to a notice is also an
offence. The maximum punishment here is two years imprisonment and /or a fine.
Finally, there is also an offence of knowingly falsifying, concealing, destroying or otherwise
disposing of documents relevant to an investigation.This is considered a serious offence― themaximum penalty is seven years imprisonment and /or a fine.
These powers are an important tool in our armoury.In 2012-13 the SFO issued 402 s.2 notices
in relation to both our own domestic investigations and in support of overseas investigations.
As at the end of August this year, we have issued 200 such notices.
The great value of these powers is that they enable us to obtain important documentary
evidence that might not otherwise be easily available to us,right at the outset of an investigation. For example, early access to banking material is often a crucial aspect of our cases.
Banks,as you will appreciate,hold their clients information subject to a dutyofconfidentiality
and will ordinarily only release information if they are made subject to a court order. A s.2
notice,however,overcomes any legal duty of confidentiality that a bank has and so is a highly
efficient means of securing relevant evidence quickly.
As with any aspect of an investigation,focusing the request being made is critical.Asking,forexample,for the entire server of a particular institution is likely to result in the production of
millions of documents,all of which then have to be reviewed and many of which are likely tobe wholly irrelevant. Our experience is that time spent considering exactly what is required(often,where it is appropriate,with input from those upon whom the notice is to be served)istime well spent.
Finally, in July 2008, the Act was amended to enable me to use my s.2 powers at the ʻ
preinvestigativeʼstage of a case in relation to overseas bribery and corruption cases. This isbecause experience has taught us that it is often difficult to make an accurate assessment as
to whether it is worth accepting such cases for investigation without at least some assessment
ofthe underlying documentarymaterial and this amendment is therefore intended to enable me
to obtain such material even before I decide whether to accept a case for investigation or not.

II. OTHER POWERS
In addition to s.2 notices,the SFO has access to a wide range of others powers which are notunique to the SFO but which can be used by the police and other law enforcement agencies
generally. These include the following:
Powers under the Serious Crime Act 2007 to seek Serious Crime Prevention Orders ―where a person has been convicted of having committed a serious offence,the Crown
Court may make an order designed to protect the public by preventing,restricting or
disrupting his further involvement in serious crime (we can also apply to the High
Court in respect of cases where a person has not been convicted but the Court isnonetheless satisfied that a person has been involved in serious crime).
Powers under the Serious and Organised Crime and Police Act 2005 (SOCPA) ―these provide a legislative framework for those who wish to co-operate with theauthorities. M ain provisions are:s.71 (full immunity from prosecution),s.72 (an agreement not to use specified evidence against a person ― a socalled ʻ
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s.73 (written agreement in which a defendant agrees to assist an investigationor prosecution with a view to thereby obtaining a reduced sentence;ordinarily, this will require the accused to plead to certain offences and may also
require him to agree to giving evidence on behalf of the prosecution);and
s.74 (enables a prosecutor to refer a defendantʼs case back to the court for areview of sentence after conviction;this is used in cases where a defendantoffers assistance after he has already been sentenced for his own offending).
SOCPA also enables a court to make a Financial Reporting Order (s.76)wherever a
person is convicted of a relevant financial offence and the court is satisfied that therisk of the offender committing another such offence is “sufficiently high”to justify
the making of the order.The order requires the individual concerned to make regular
reporting of their financial affairs to the authorities for a specified period.
Covert powers under the Regulation of investigation Powers Act 2000 (RIPA)― thisprovides a legislative framework for a wide range of covert law enforcement techniques including intercepts (note that the product of domestic intercepts is inadmissible within UK criminal proceedings), the use of covert intelligence sources (i.e.
informants)and surveillance (two main types of surveillance are covered;general orʻ
directedʼsurveillance and ʻ
intrusiveʼsurveillance (e.g. surveillance within a personʼ
shome)that requires a higher level of authorisation and greater safeguards).
Powers under the Proceeds of Crime Act 2002 ― these cover a wide range of issues,
most of which are related to the preservation (pre-conviction) and the confiscationand subsequent enforcement (post-conviction) of a personʼ
s criminal benefit. Key
powers include:
Account monitoring orders (an order of a court which instructs a financial
institution to provide an investigator with information on the current activityof an account).
Restraint orders (an order of the Crown Court that prevents named individuals from dealing with any aspect of their assets without the authority of thecourt;the aim being to preserve assets in the event of a conviction)
Confiscation orders (an order of the Crown Court in which a convicted
defendant is ordered to pay over their ʻbenefitʼfrom specified criminal
conduct)
Production orders (an order of the Crown Court for a person or company toproduce specified material for the purpose of assisting certain types ofinvestigation, including any investigation into an offence of money laundering and any confiscation investigation)
Civil Recovery orders (an order of the High Court that specified property isdeemed to be ʻ
criminal propertyʼand that the value of that property is thus
to be paid to the State; usually used only as an alternative to criminal
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THE BRIBERY ACT 2010
1. Background leading up to the Bribery Act 2010
Recognition that, pre-Bribery Act, the UKʼs anti-bribery legislation was antiquated and inneed of modernisation
The legislation in force was, in some cases, more than a century old:
The Public Bodies Corrupt Practices Act 1889 (only applied to those working on local
public bodies (i.e. local government)and did not extend to Crown employees)
The Prevention of Corruption Act 19 06 (this was, and is, the main pre Bribery Act
offence;applies to all agents and any person who gives consideration to an agent)
The Prevention of Corruption Act 19 16 (extended the PCA 1906 to Crown employees
or employees of a public body)
The only previous change to our law had been contained within The Anti Terrorism, Crime& Security Act 2001:
This extended the previous legislation to all UK nationals who conduct businessoverseas
It was thus an extension of the existing law ― but not a full overhaul.
Became increasingly apparent that the UK needed a modern ʻ
fit for purposeʼanti-bribery
legislation
Pressure arose from the OECD for the UK to update its anti-corruption legislation:
E.g.in their 2008ʻ
Phase 2ʼreport1 into the UK,the OECDʼs Working Group on Bribery
noted that:“...the UKʼs continued failure to address deficiencies in its laws on bribery of foreign
public officials and on corporate liability for foreign bribery has hindered investigations.
The Working Group reiterates its previous 2003, 2005 and 2007 recommendations
that the UK enact new foreign bribery legislation at the earliest possible date.”(page4)
and on page 71 of the same report the Working Group concluded as follows:“
The Working Group is disappointed and seriously concerned with the unsatisfactory
implementation of the Convention by the UK ... and urges the UK to adopt appropriate
legislation as a matter of high priority.”
2. Famous cases of combating bribery of foreign public officials before the Bribery Act 2010 was
enactedRobert John Dougall ― Dougall was a former DePuy executive who pleaded guilty in April
2010 to his involvement in ￡4.5 million worth of corrupt payments to medical professionals
within the Greek healthcare system. He was sentenced to 12 months imprisonment.
Dougall was appointed Director of M arketing at DePuy International Limited in 1999.
He was responsible for developing business in Greece.DPI sold orthopaedic products;
in order to penetrate the Greek market, inducements and rewards were provided tosurgeons in return for the purchase of DPI products.
1See

http://www.oecd.org/daf/anti-bribery/anti-briberyconvention/41515077.pdf>.

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DPI used a local distributor, Medec S.A. which was owned and run by Nikolaos
Karagiannis.He was paid,in advance,a “commission”by DPI on all sales;a proportion of which was used to make the corrupt payments to surgeons in Greece.
These payments were made with the knowledge and oversight of Dougall.
Also worthy of note― Dougall was the first “co-operating defendant”in a major SFO
investigation.He entered into a s.73 written agreement with the SFO in June 2009 andprovided substantial assistance to the investigation.
In April 2011, the SFO obtained a civil recovery order against DPI to the value of￡4.829 million plus costs, representing the proceeds of crime for the period 1998 to2006.
Mabey & Johnson ― M abey& Johnson,an engineering firm,was the first corporate in the UK
to be prosecuted for overseas corruption offences.
The prosecution for corruption arose out of a self-report in which the company
disclosed evidence that it had sought to influence decision-makers in public contracts
in Jamaica and Ghana between 1993 and 2001.
In addition to the corruption offences,the company was also prosecuted for sanctions
offences relating to a breach of UN sanctions in 2001/02 as they applied to contracts
in the Iraq “Oil-for-food”programme.
The company pleaded guilty to these offences in July 2009. They were sentenced in
September 2009, paying a total fine of ￡3.5 million plus a ￡1.1 million confiscation
order, ￡1.4 million by way of reparations, prosecution costs of ￡350k and a further￡250k towards the cost of an independent SFO approved monitor who would review
their internal compliance programme.
Richard Alderman, the then Director, hailed the sentence as “
a landmark outcome”
and noted this was “the first conviction in this country of a company for overseas
corruption”.
Following the conviction, new management took over the company and introduced
new anti-bribery measures. The company continued to co-operate with the SFO and,in January 2012, agreed to the making of a civil recovery order in the High Court tothe value of ￡130k in recognition of sums it had received through share dividends
derived from contracts won through unlawful conduct.
Innospec ― Two senior Innospec executives have pleaded guilty to offences of conspiring to
make corrupt payments to individuals in Indonesia and Iraq to secure contracts for Innospec
Ltd for the supply of its products.
Paul Jennings,former CEO,pleaded guilty in June 2012 to two offences of conspiring
to corrupt in that he gave,or agreed to give,corrupt payments to public officials andother agents of the governments of Iraq and Indonesia between 2003 and 2008 as
inducements to secure, or rewards for having secured, contracts from those government for the supply of products by Innospec.
Another Innospec executive, Dr David Turner, former Global Sales and M arketing
Director, had pleaded guilty to similar offences in January 2012.
Sentencing has been adjourned pending the outcome of proceedings against two
further defendants, due to be tried in M arch 2014.
The company itself had pleaded guilty to offences of bribing employees of Pertamina(an Indonesian state owned refinery) and other government officials in Indonesia in
March 2010.The company was fined the sterling equivalent of$12.7 million as part ofa global settlement involving the UK and the US authorities.
Oxford Publishing ― In July 2012,Oxford Publishing Ltd.agreed to pay a ￡1.895 million civil
recovery order in recognition of sums it had received which were generated through unlawful
conduct related to UK subsidiaries incorporated in Tanzania and Kenya.
OPL is a wholly owned subsidiary of Oxford University Press.It operates throughout

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Africa where it is principally involved in the publication of school textbooks.
In 2011, OUP became aware of possible irregular tendering practices involving its
education business in East Africa. As a result of an internal investigation, they
voluntarily disclosed to the SFO concerns in relation to contracts arising from tenders
which itʼs Kenyan and Tanzanian subsidiaries had entered into between 2007 and2010.
Following further work, supervised by the SFO, it was accepted by OUP that payments had been offered and made, directly and through agents,which were intended
to induce the recipients to award competitive tenders and /or publishing contracts forschoolbooks to both the Kenyan and Tanzanian subsidiaries.
In the light of the co-operation offered,it was decided that the public interest in thiscase was best met not byprosecuting but through the making ofa civil recoveryorder.
At the time of the order, I said “This settlement demonstrates that there are, inappropriate cases, clear and sensible solutions available to those who self-reportissues of this kind to the authorities”.
BAE Systems plc ― In December 2006, the then Director, Robert Wardle, decided to discontinue an investigation into the affairs of BAE Systems plc as far as they related to the Al
Yamamah defence contract with the government of Saudi Arabia. His decision was taken
following representations that had been made to both the Attorney General and the Director
concerning the need to safeguard national and international security.In reaching that decision,
no weight was given to commercial interests or the national economic interest.
3. Outline of provisions and distinctive features in the Bribery Act 2010
The Act came into force on 1 July 2011. It is not retrospective.
It repeals the offences outlined above in relation to conduct that post-dates the Act.
Creates a number of offences:s1 Bribery of another person (ʻactive briberyʼ
): committed where a person offers,
promises or gives a financial or other advantage to another person, intending to
induce them to perform improperly a relevant function or activity, or to reward a
person for such improper performance.
s2 Receiving a bribe (ʻpassive briberyʼ
):committed where a person requests,agrees toreceive or accepts a financial or other advantage intending that, in consequence, a
relevant function or activity should be performed improperly by themselves oranother.
s6 Bribery of foreign public officials:committed where a person in the act of intending
to obtain or retain a business advantage bribes a foreign public official with the intent
of influencing them.
s7 Corporate liability for failure to prevent bribery:this is the most radical innovation
within the Act.Under this provision,a ʻ
relevant commercial organisationʼis guilty of
an offence if any person associated with it bribes another person intending to obtainor retain a business advantage.
It is a defence for the organisation to show that it had ʻadequate proceduresʼ
in place to prevent such activity from taking place.
This offence applies to any organisation that conducts “part of their business”in the UK.
Territorial application ― if any part of the conduct involved in ss.1, 2 or 6 are committed in
the UK, then the UK courts have jurisdiction. Even if all the actions in question take placeabroad,the UK still has jurisdiction as long as the person performing them is a British nationalor resident in the UK or incorporated in the UK or has a “close connection”with the UK.
Two other changes made by the Act:

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The maximum sentence on conviction was increased from seven to ten years (plus anunlimited fine).
Removal of requirement for consent to be given by our Attorney General ― proceedings are now commenced personally by me as Director.
4. Current situation of enforcement of the Bribery Act 2010
The Act has now been in force for a little over two years
M uch has been made in the British media of the fact that there have been relatively few
prosecutions under the Act, including thus far only one case brought by the SFO
This is not surprising ― firstly, as noted, the Act only applies to conduct which occurs after
July 2011;secondly,these are cases which,by their very nature,tend to involve conduct donein secret which may not come to light until months or even years later and;thirdly,even once
corrupt activity is discovered,gathering and reviewing material sufficient to mount a successful prosecution can be a lengthy and time-consuming exercise.
At present,the SFO has around a dozen or so active investigations or prosecutions into cases
involving foreign public officials ― with several more in the pipeline. Of these, at least four
involve conduct that, if capable of proof, would fall under the Bribery Act.
Even with new legislation, these are complex cases that are often difficult to investigate andprosecute successfully. Key issues include:
Evidence of corrupt activity is ordinarily hidden, making it difficult to identify andrecover for the purposes of criminal proceedings;
Potential witnesses are often reluctant to co-operate with the authorities, meaningthat the documentary evidence becomes even more important in proving the case;
Where there is corrupt activity,this is rarely confined to just one or two instances ―often, our investigations unearth a whole system of corruption, often spanning
multiple countries;
This can mean that we need to make some tough choices about where to best focus
our resources in order to ensure that we pursue a focused and manageable case;
It also means that we are very much dependent upon assistance from other jurisdictions to secure admissible evidence ― not all of whom have a fully developed system
of mutual legal assistance.

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Bribery Act 2010
M inistry of Justice guidance on the Bribery Act 2010https://www.justice.gov.uk/legislation/bribery>
Bribery Act 2010: Joint Prosecution Guidance of the Director of the Serious Fraud Office and the
Director of Public Prosecutions
http://www.sfo.gov.uk/media/167348/bribery act 2010 joint prosecution guidance of the directorof the serious fraud office and the director of public prosecutions.pdf>
Guidance on Corporate Prosecutions:Joint Prosecution Guidance of the Director of the Serious Fraud
Office and the Director of Public Prosecutions
http://www.sfo.gov.uk/media/65217/joint guidance on corporate prosecutions.pdf>
Deferred Prosecution Agreements
Draft Deferred Prosecution Agreement Code of Practice(“
DPA Code”)issued by the Director of Public
Prosecutions and Director of the Serious Fraud Office
http://www.sfo.gov.uk/media/256647/dpa%20code%20consultation%20final%20approved.docx>202