1. UK To Adopt Deferred Prosecution Agreements Next Year

    UK regulators will have a new tool for fighting fraud, bribery, and money laundering when the Crimes and Courts Bill goes into effect in early 2014. How will they compare to those being used in the US? From attorneys at Dechert: 

    • “In the US, prosecutors can enter into DPAs with individuals whereas in the UK, only companies, partnerships and unincorporated associations can enter into DPAs.
    • In the UK, the range of offences to which DPAs apply are limited to economic crimes which are essentially fraud, bribery and money laundering offences. In the US, prosecutors have used DPAs more broadly including for health and safety or environmental offences.
    • In the UK, the Government has confirmed that an accused’s right to refuse to disclose information subject to legal professional privilege will continue to apply in its current form. In the US, companies were often finding themselves waiving legal privilege to demonstrate cooperation with an investigation. In 2006, the Department of Justice (the “DOJ”) put out guidance reminding prosecutors that they should seek waivers of privilege only in rare instances and only with approval from senior officials. The DOJ strengthened this guidance in 2008 and the Securities and Exchange Commission followed suit in 2010, but companies still sometimes waive privilege in an effort to show the fullness of their cooperation.
    • Further to Lord Justice Thomas’ criticism of the plea agreement entered into with Innospec Ltd in 2010 for lack of judicial input, the Act anticipates an early and active role for the UK judiciary in the negotiation, approval and variation of DPAs. In the US, DPAs do not require judicial approval.
    • The Act promotes transparency as it requires that the terms of the DPA, the declaration of the Court and the reasons set out at the preliminary and final hearings are publicly available. In the US, the DOJ has widely been criticised for a lack of transparency.”

    Read the full update, Deferred Prosecution Agreements: A Powerful New Tool for UK Prosecutors? - Dechert LLP»

  2. Do Third Parties Increase Corruption Risk for Your Business? Absolutely

    Doing business around the globe often means partnering with third parties, navigating market structures, sorting through cultural issues, and setting up business ventures. Those relationships can expose your company to risks under the Foreign Corrupt Practices Act (FCPA), the UK Bribery Act, or other anti-corruption laws, writes Carl Loewenson at law firm Morrison & Foerster:

    “The use of intermediary third parties is the single most common source of corruption risk. That does not mean that companies cannot work with intermediaries. Access to business in many markets is possible only through local partners. Rather, it means that companies entering into these relationships must take steps to mitigate the risks, including conducting reasonable due diligence.

    As the DOJ and SEC have made clear, ‘businesses may reduce the FCPA risks associated with third-party agents by implementing an effective compliance program, including due diligence of any prospective’ third-party intermediaries.”

    Read the full update, Avoiding (But Not Hiding From) Third-Party Corruption Risks - Morrison & Foerster LLP»

  3. Self-Reporting of UK Bribery Act Violations More Important Than Ever

    Think there may be violations for the UK Bribery Act lurking within your business? Turn yourself in now, writes Raymond Sweigart from law firm Pillsbury:

    “[I]f self-reporting is under consideration, it is critical that it be done right. The new SFO director has made it clear that there will be no upfront or blanket guarantees of non-prosecution for those who self-report under the SFO process, but he has also confirmed that the fact a company properly self-reports will weigh heavily on the scales when prosecutors balance the public interest test in deciding whether to pursue prosecution. 

    Nevertheless, self-reporting remains something that must be seriously and carefully considered when wrongdoing comes to light internally. The risk of waiting to see whether the SFO is tipped off by a competitor or a whistle-blower is now only heightened.”

    Read the full update, A Year-End Update on the UK Bribery Act - Pillsbury Winthrop Shaw Pittman LLP»

  4. UK Authorities Probe Alleged Corruption at Rolls Royce

    The UK Serious Fraud Office has launched an investigation of the world’s second-largest manufacturer of aircraft engines, write Kevin Roberts and Duncan Grieve of law firm Morrison & Foerster:

    “The allegations relate to past conduct (therefore likely not covered by the Bribery Act 2010) involving intermediaries in China, Indonesia and elsewhere and were brought to the attention of the SFO by a whistleblower earlier this year. At the request of the SFO, Rolls Royce conducted an internal investigation with the assistance of an external law firm and has now passed on areas of concern, identified by the investigation, to the SFO.

    These developments represent another high-profile investigation in the aerospace and defence sectors. This year the SFO has announced several active investigations in these areas. In August 2012, the SFO launched a criminal investigation into the European Aeronautic Defence & Space Co. (EADS) in relation to contracts in Saudi Arabia. EADS has also stated that it is cooperating with an investigation into the sale of fighter jets to the Austrian air force. The £280-million fines imposed on BAE Systems by the UK and U.S. authorities in February 2010 serve as a reminder of the potentially severe consequences for companies who are prosecuted.”

    Read the full update, UK Serious Fraud Office Focuses on Overseas Corruption with Rolls Royce Investigation - Morrison & Foerster LLP»

  5. Threading the Needle between Anti-Corruption and Privacy Laws

    Are anti-corruption laws like the US Foreign Corrupt Practices Act and the UK Bribery Act compatible with privacy laws in those jurisdictions and around the world? Yes, if companies proceed cautiously. From the law firm of Morrison & Foerster:

    “One common risk that compliance programs should address is the use of third parties, such as consultants, agents, distributors, and other business partners. After all, under such laws as the FCPA and the UK Bribery Act, the fact that a bribe is paid by a third party does not eliminate the potential for criminal or civil liability. Rather, under certain circumstances, a company can be held liable for the actions of its third parties. For this reason, companies should vet the third parties they work with and do their utmost to know with whom they are doing business… As a result, companies often collect information about individuals’ financial accounts, history of criminal activity, including bribery or related activities, debarments, inclusion on a public watch list, and business or personal relationships with government officials… 

    Because due diligence programs involve the collection of information about individuals, these programs fall within the scope of privacy and data protection laws in many jurisdictions that regulate the collection and use of personal information. More than 70 countries worldwide currently have a privacy or data protection law. Under these laws, personal information generally means any information pertaining to identified or identifiable individuals.”

    Read the full update, Anti-Corruption and Privacy Laws – Collision Course? - Morrison & Foerster LLP»

  6. It’s Like the “Who’s Who” of International Corruption and Bribery

    Law firm Morrison & Foerster has published an end-of-summer roundup of Foreign Corrupt Practices Act enforcement. It’s a nine-page must-read for any company that does business internationally:

    “While the temperatures rose this summer, the number of Foreign Corrupt Practices Act (“FCPA”) enforcement actions seems to have cooled off for the first time in the last five years. However, the leveling-off in the number of cases is not an indication that US regulators are losing interest in FCPA enforcement. To the contrary, all indications are that the fight against corruption — in the United States and elsewhere — will continue to heat up in the months and years to come… 

    The Summer 2012 developments have reinforced that the government’s aggressive enforcement of the FCPA remains a hot priority. While the promised DOJ guidance may give some additional contours to FCPA enforcement, with the increased heft and breadth of the global fight against corruption, companies are well advised to make anti-corruption compliance a top priority.”

    Read all about it: FCPA + Anti-Corruption Developments: 2012 End of Summer Round-Up - Morrison & Foerster LLP 

  7. New UK Bribery Act Rules Reveal Tougher Stance on Corruption

    From Corporate Law Report:

    “On October 9, the UK’s Serious Fraud Office (SFO) published new guidelines for the UK Bribery Act, setting the stage for significantly stricter enforcement of the anti-bribery law. Raymond Sweigart of law firm Pillsbury explains:

    ‘The SFO now says that it will prosecute under the Bribery Act based primarily on the statute itself rather than on previous, more lenient and somewhat subjective guidance principles issued after the new law was introduced in July 2011. The newly announced policy had been predicted by many observers based on promises to tighten up enforcement made by the current director, David Green QC, on his appointment this past May.’

    For your reference, an overview of the three key changes…”

    Read the full post»

  8. UK Bribery Act Reforms Create Uncertainty and Greater Risk

    From Baker & McKenzie Australia, a look at the ongoing UK Bribery Act revisions and their effects on Australian companies: 

    “…companies face an increased risk that there will be prosecutions in relation to facilitation payments, even if the company can demonstrate that it is taking practical steps to curtail such payments. Whilst there currently remains a defence for facilitation payments in Australia, in the UK, as with most other countries, there is no such defence. The withdrawal of the SFO’s existing guidance increases the risks of continuing to permit employees or agents to make facilitation payments on behalf of the company…”

    Read the update, UK Bribery Act guidance under review - Baker & McKenzie Australia»

  9. UK Bribery Agency Withdraws Offer of Leniency for Minor Infractions

    The new head of the U.K. Serious Fraud Office, David Green QC, has been in the job for less than six months. But he’s already begun to shake things up, writes Raymond Sweigart at law firm Pillsbury:

    “Previously, companies had been reassured in published guidance that the SFO would not pursue them for certain technical infringements of the Bribery Act and that if certain procedures were followed, it would not prosecute facilitation payments—small payments to ensure that public officials more expeditiously carry out functions they should ordinarily do without such ‘bribes’. In addition, corporate hospitality if considered ‘reasonable and proportionate’ would also not be considered to run afoul of the law. But such guidance has now been withdrawn without further comment or explanation.”

    Read the full update, Bribery Act Prosecutor Withdraws Guidance; Whither SFO Enforcement, Self-Reporting? - Pillsbury Winthrop Shaw Pittman LLP»

  10. [Video] Tom Fox on the Essential Elements of a Best Practices Compliance Program

    • Leadership
    • Risk Assessment
    • Standards and Controls
    • Training and Communication
    • Oversight

    Tom touches upon the five essential elements of a best practices compliance program, fodder for deeper insights at an upcoming compliance conference in Chicago (Tuesday, Sept 11 - more info in the video.)

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