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Business Crime Solicitor Rod Fletcher on the Serious Fraud Office announcing tougher policies

On 9 October 2012 the Serious Fraud Office issued a press release announcing that it has reviewed its policy on facilitation payments, business expenditure and corporate self-reporting. The revised policies come as a response to recommendations made by the Organisation for Economic Co-Operation and Development (OECD) Anti-Bribery working group that met on 9 October 2012 in Paris for its annual consultation.

According to the SFO, the purpose of the revised policies is to:
1. restate the SFO’s primary role as an investigator and prosecutor of serious and/or complex fraud, including Corruption;
2. ensure there is consistency with the approach of other prosecuting bodies; and
3. take forward certain OECD recommendations.

The Director of the SFO David Green QC insists that any decision to prosecute unlawful activity in respect of facilitation payments and/or bribes presented as hospitality or other business expenditure will be governed by the Full Code Test in the Code for Crown Prosecutors and the applicable joint SFO/CPS prosecution guidance. Further, while corporate self-reporting is encouraged, it offers no guarantee that prosecution will not follow any such report.

The SFO has maintained throughout that:
“Facilitation payments were illegal before the Bribery Act came into force and they remain illegal under the Act, regardless of their size or frequency. It is also the case that bribes are sometimes disguised as legitimate business expenditure. If therefore on the evidence there is a realistic prospect of conviction, the SFO will prosecute if it is in the public interest to do so.”

These new policy changes clearly reflect the recent change in SFO Director. The new policy statement shows a very different approach to the previous Guidance on Corporate Self-Reporting released in 2009 under Mr Alderman, Mr Green’s predecessor. The 2009 Guidance showed the SFO offering to work with companies in looking for, even negotiating solutions in order to avoid prosecution.

Mr Green has since made it clear that the SFO’s primary role is to investigate and prosecute; the revised policies are intended to illustrate that there will be no presumption in favour of civil settlements. It is only if the requirements of the Full Code Test are not established, that the SFO may consider civil recovery as an alternative to prosecution. By Business Crime Solicitor Rod Fletcher & Trainee Solicitor Meghna Shetty.