contents what does the law say about bribery and corruption?
DESCRIPTION
What does the law say about bribery and corruption? As a law firm, we have legal obligations imposed on us through Acts of Parliament, and through regulations that are issued by Government or via one of the regulators we are governed by, eg the Solicitors Regulation Authority (SRA). Many of these rules and regulations apply to all business, not just law firms. We also have internal policies and procedures that we need to adhere to. The area we are going to look at today relates to the issues of bribery and corruption: corruption is the misuse of office or power for private gain bribery is a form of corruption Our main obligations relating to anti-bribery and corruption are contained in the Bribery Act 2010, although these obligations are supplemented by the SRA Handbook 2011. Corruption and bribery are serious offences that we need to ensure we don’t get involved with, inadvertently or otherwise. The potential consequences of committing a crime under the Bribery Act 2010 include: a maximum of ten years' imprisonment an unlimited fine criminal penalties under the Proceeds of Crime Act 2002 disciplinary action by the SRA These penalties don’t just apply to the firm—they could apply to people within the firm, including you.TRANSCRIPT
Session 5Avoiding bribery and
corruption
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Contents
• What does the law say about bribery and corruption?
• What does the SRA Handbook say about bribery and corruption?
• Our anti-bribery and corruption processes and procedures
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What does the law say about bribery and corruption?
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Bribery Act 2010
• Bribery Act 2010 (BA 2010) came into force on 1 July 2011:oapplies to any business incorporated or trading
inthe UKocovers bribery committed by an organisation, or
on its behalf through an associated person, anywhere in the world
• BA 2010 creates new four new offences
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BA 2010—new offences
Offence Description Can be committed by
1 bribing another person
individual or business2 soliciting or accepting a bribe
3 bribing a foreign public official
4 failing to prevent bribery business only
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BA 2010—Offence 1
Description of Offence 1
Offence is committed if
Intention of bribing another person is
Bribing another person
one party offers or gives another party an advantage
• an advantage is offered or given with the intention of bringing about or rewarding improper performance of a relevant function or activity
• an advantage is offered knowing or believing that the other party accepting the advantage would itself constitute improper performance of a relevant function or activity
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BA 2010—Offence 1 (cont)
Examples Could be seen as an advantage if offered/given?
Cash/cash equivalent
Preferential treatment in a tender
Hospitality
Entertainment
Gifts
Donations
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BA 2010—Offence 2
Description of Offence 2
Offence is committed if
Intention of soliciting or accepting a bribe is
Soliciting or accepting a bribe
one party accepts or requests an advantage from another party
• a relevant function or activity is improperly performed either by the party or by another person with that party’s consent
• the request or acceptance is in itself improper performance of a relevant function or activity by that party
• as a reward for the improper performance of a relevant function or activity
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BA 2010—Offence 2 (cont)
Examples Could be seen as an advantage if offered/given?
Cash/cash equivalent
Preferential treatment in a tender
Hospitality
Entertainment
Gifts
Donations
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BA 2010—Offence 3
Description of Offence 3
Offence is committed if
Intention of bribing another person is
Bribing a foreign public official
a party bribes a foreign public official
• to influence them in their capacity as a foreign public official, and
• to obtain business advantage
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BA 2010—Offence 3 (cont)
Examples Could be seen as an attempt to bribe an FPO?
Cash/cash equivalent
Paying any amount to expedite a visa
Paying any amount to expedite a planning application
Political or other donations
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BA 2010—Offence 4
Description of Offence 4
Offence is committed if Difference from Offences 1–3
Failing to prevent bribery
a person associated with an organisation bribes another person with the intention of obtaining or retaining business or a business advantage for this organisation
• It applies to commercial organisations only
• It does not apply to individuals
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BA 2010—other points to note
• Senior officers—if a senior officer has consented to or been involved with a bribery offence that has been committed by an organisation:
o they can also be held liable, and o proceedings can be taken against them personally• Territorial application—offences 1–3 are committed:o if they take place in the UK, oro if they take place abroad and they would be offences in the UK, and o the perpetrator is closely connected with the UK• Facilitation payments—are not permissible
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BA 2010—penalties
First conviction under s 2 of Bribery Act 2010: R v Patel (Munir) [2012] EWCA Crim 1243
Individuals Directors Companies
May be subject to unlimited fines and/or up to ten years' imprisonment
May be disqualified from acting as a director for between two and 15 years
May be subject to unlimited fines and may be disbarred from public procurement in the UK
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Proceeds of Crime Act 2002 (POCA)
Actions Offence?
Concealing, disguising, converting, transferring or removing criminal property out of the jurisdiction
Entering into or becoming concerned in an arrangement that facilitates the acquisition, retention, use or control of criminal property
Acquiring, using or possessing criminal property
Failure to report suspicions
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Penalties under POCA
• Up to 14 years’ imprisonment
• Unlimited fines
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What does the SRA Handbook say about bribery and corruption?
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SRA Handbook—key extracts Principle 2:
You must act with integrity
Principle 3: You must not allow your independence to
be compromised
Principle 6: You must behave in a way that maintains the
trust the public places in you and in the
provision of legal services
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SRA Code of Conduct—key extracts
• Management of your business:o Outcome 7.2: have effective systems and
controls in placeo Outcome 7.5: comply with legislation applicable
to your business
• You and your regulator:o Outcome 10.4: report to the SRA promptly any
serious misconduct by any person/firm/employee/manager/owner
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Our anti-bribery and corruption processes and procedures
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Our policies
Name of policy Location of policy
Anti-bribery and corruption policy Intranet & Firm’s Compliance Manual
Gifts and hospitality policy Intranet & Firm’s Compliance Manual
Intermediaries policy Intranet & Firm’s Compliance Manual
Charitable and political donationspolicy
Intranet & Firm’s Compliance Manual
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Indicators of bribery and corruption
Action Indicator?
Payments are for abnormal amounts
Payments are made in an unusual way
Processes are bypassed for approval or sign-off of terms or other commercial matters
You are prevented from or hindered in monitoring commercial processes
Individuals are secretive about certain matters/relationships and/or insist on dealing with them personally
Records are incomplete or missing
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If you suspect bribery or corruption…
• REPORT!
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Summary
• What does the law say about bribery and corruption?
• What does the SRA Handbook say about bribery and corruption?
• Our anti-bribery and corruption processes and procedures
• What to do if you suspect bribery or corruption
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Final comments
• Any questions?• Email to [email protected]• Update your training records in Compliance
Manager