British Airways, Asda, Shell, Sainsbury and the cream of the British construction industry have all felt the wrath of the OFT over the past few years, while BAE Systems was investigated for bribery by the Serious Fraud Office. It just goes to show that reputation is no barrier to investigation and enforcement.
April saw the introduction of the Bribery Act, which will have far- reaching implications for British industry. Agencies in different countries are increasingly working together and jurisdiction boundaries are becoming more blurred.
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Activities which might have been custom and practice are now explicitly illegal. It is important that companies get appropriate legal advice and bring in new procedures and processes to ensure they do not fall foul of the Bribery Act. This will require a lot of additional training, and evidence that the training has been done.
The main difference between the OFT and the Bribery Act investigations will be that in the latter, firms are likely to be on their own. Market rigging activity will involve more than one company, as we have seen with the supermarkets and the construction cases. Bribery tends to involve just one.
What will be interesting, though, is how international agencies work together to ensure that countries which show less enthusiasm for tackling their own firms’ illegal activities are bypassed by the use of extra-territorial powers.
The US Department of Justice (DoJ) has been very successful in this respect. It managed to get Swiss banks to provide information on US citizens who had money secreted away to avoid tax scrutiny.
The investigation of Dunlop Oil and Marine for cartel activity on marine hose led to a fine in the US, an extradition to the UK and prison sentences through OFT action, followed by another fine from the EU for breaching its regulations.
The DoJ also led the way with BAE Systems and through a plea bargaining process opened the way for the UK Serious Fraud Office to register a rare win. International
co-operation will increase, if only to ensure there is a level playing field.
I just hope we don’t experience the same amount of anguished chest-beating when one of our own gets done for bribery. While there was some empathy with the cover pricing issue, there will be little with this.
