The Bribery Act - How Businesses can Neutralise the Risk

White-collar crime remains one of the rising areas of criminal activity in the UK, The Office of National Statics (ONS) reports a 9% increase in their latest statistics.  As businesses attempt to keep afloat and retrieve their pre-coronavirus position whilst many are still operating with part or all staff working from home, it is possible that the normal levels of vigilance around regulatory procedures may slip or the staff out of the office cannot be monitored as effectively. One regulatory area that constantly creates temptation, particularly in challenging financial climate, is bribery. 

The Bribery Act 2010 is unequivocal in that in the event of bribery being revealed, both the employee and the employer are caught by the Act, regardless of whether the employer was unaware of the bribery; lack of knowledge is no defence.  An employer is expected to have fully considered the potential risks they face, dependent on the markets in which they operate, particularly in overseas markets and to have drafted a policy, made available to all employees, outlining the measures the business takes to avoid any actions that can be interpreted as bribery. There is also an expectation to undertake comprehensive due diligence when faced with a new client and extremely hard though it may be to choose to avoid business dealings with a new client on the grounds of their deficient reputation, it is infinitely better than finding yourself in the situation where a vulnerable employee has succumbed to temptation and compromised the firm.

Vincenzo Senatore, a partner specialising in white-collar crime, comments “there is a full defence to a charge of bribery; if there are comprehensive procedures in place that can be seen to be adequate for the risk posed that have been disseminated clearly to all staff,” Vincenzo further pointed out, “an anti-bribery policy should be reviewed and monitored on a regular basis to ensure it is still fit for the purpose and appropriate to the markets the firm is operating within. Understandably, in the current climate, organisations will look for business in markets and countries that they may be less familiar with.”

Giambrone’s corporate and commercial department can monitor any changes to the law and ensure that all anti-bribery policies are sound.  Our lawyers have extensive experience in a wide range of jurisdictions as well as comprehensive knowledge of different cultures and practices across the world.  Care must be taken to avoid inadvertently being drawn into an act of bribery, for example, The Bribery Act 2010 makes no exemption for facilitation payments, where a payment is made to an official to persuade them to perform a routine task or function they are, in any event, obligated to perform.  Such a payment is regarded as a bribe within the Act, (as does the Serious Fraud Office (SFO)).  Administrative fees and charges are legally payable as they fall outside the terms of the Act.

Vincenzo remarked “in certain countries where there may be an expectation of bribery in some fields, the use of agents and their activities must be very carefully supervised to ensure that bribes are not paid to get or keep business in an environment where bribery is prevalent and the agent may not fully recognise the risk. The Bribery Act 2010 section 8 regards an agent as an “associated person”.”

Proportionate hospitality is permitted provided it is genuine and reasonable. It is permissible to provide tickets to sporting events, take clients to dinner, offer moderate gifts to clients to encourage good relations.  Also, reasonable travel expenses can be paid, where necessary, to enable a potential client to experience your goods or services. Flying a client to a lavish destination unconnected with your business dealings and handing them a limitless credit card to use would constitute bribery; afternoon tea at the Ritz would not.

The penalties for contravening The Bribery Act are severe.  An individual can receive a prison sentence of up to ten years or an unlimited fine.  An organisation can also receive an unlimited fine; the directors will face disqualification for up to 15 years as the act of bribery demonstrates a failure at top-level.  In addition, the return of all financial gain obtained due to act of the bribery (Proceeds of Crime Act 2002) and Serious Crime Prevention Orders must be implemented, including how the finances of the organisation are to be conducted going forward to prevent future breaches and to ensure that the organisation does not falsify their accounts.

For more information about the risk of The Bribery Act 2010 please click here