SFO posts new guidance on self reporting
Tuesday, October 9, 2012 at 9:16PM
Richard L. Cassin in Affrmative Defense, Facilitiating Payments, Proceeds of Crime Act 2002, Promotional Expenses, Self Reporting, Serious Fraud Office

The U.K. Serious Fraud Office isn't making any promises to self-reporting companies.

They might still be prosecuted -- 'each case turns on its own facts.'

And even if there's no prosecution under the Bribery Act, the SFO reserves the right to bring an action under the Proceeds of Crime Act. That could happen, the SFO said in related new guidance, when facilitating payments and hospitality and gifts are involved.

The SFO's new guidance on hospitality and gifts starts this way:

Bona fide hospitality or promotional or other legitimate business expenditure is recognised as an established and important part of doing business. It is also the case, however, that bribes are sometimes disguised as legitimate business expenditure.

That sounds like the FCPA's affirmative defense for promotional expenses, which also uses the 'bona fide' payments standard.

Is this evidence of a more coordinated approach to enforcement by the SFO and DOJ?

It looks like it.

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Here's the full guidance on self reporting:

Whether or not the SFO will prosecute a corporate body in a given case will be governed by the Full Code Test in the Code for Crown Prosecutors, the joint prosecution Guidance on Corporate Prosecutions and, where relevant, the Joint Prosecution Guidance of the Director of the SFO and the Director of Public Prosecutions on the Bribery Act 2010.

If on the evidence there is a realistic prospect of conviction, the SFO will prosecute if it is in the public interest to do so. The fact that a corporate body has reported itself will be a relevant consideration to the extent set out in the Guidance on Corporate Prosecutions. That Guidance explains that, for a self-report to be taken into consideration as a public interest factor tending against prosecution, it must form part of a "genuinely proactive approach adopted by the corporate management team when the offending is brought to their notice". Self-reporting is no guarantee that a prosecution will not follow. Each case will turn on its own facts.

In appropriate cases the SFO may use its powers under proceeds of crime legislation as an alternative (or in addition) to prosecution; see the Attorney General's guidance to prosecuting bodies on their asset recovery powers under the Proceeds of Crime Act 2002. If the SFO uses its powers under proceeds of crime legislation, it will publish its reasons, the details of the illegal conduct and the details of the disposal.

In cases where the SFO does not prosecute a self-reporting corporate body, the SFO reserves the right (i) to prosecute it for any unreported violations of the law; and (ii) lawfully to provide information on the reported violation to other bodies (such as foreign police forces).

This statement of policy has immediate effect. It supersedes any statement of policy or practice on self-reporting previously made by or on behalf of the SFO.

The SFO's new guidance on facilitating payments is here and on business expenses here.

Article originally appeared on The FCPA Blog (http://www.fcpablog.com/).
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