The Serious Fraud Office’s (SFO’s) long-awaited first prosecution under the UK Bribery Act began yesterday (23 September), as four men from biofuel investment promoter Sustainable AgroEnergy went on trial in Westminster Magistrates Court.
Four of the men, all former employees of AgroEnergy, which parent company Sustainable Growth is now in administration, are charged with conspiring to conduct a £23m fraud operation in relation to the promotion and selling of bio fuel investment products to UK investors between April 2011 and February 2012, while three of them are also charged with making and accepting a financial advantage contrary to section 1(1) and 2(1) of the act.
The legislation, which came into effect in July 2011, gives the SFO the power to prosecute a company or individual regardless of where the bribery took place, as long as they have a link to the UK. The penalty if convicted is up to 10 years in prison and companies face an unlimited fine, although the SFO has still yet to bring charges against a company.
While the new act overhauled antiquated legislation and in theory makes it far easier for the SFO to prosecute bribery offences, the organisation has been criticised for the length of time it has taken to bring a prosecution and the lack of progress in bringing a case against a corporate under new provisions in the act.
The more sympathetic of commentators suggest it has taken a while for the SFO to build up a pipeline of prosecutions. Norton Rose Fulbright disputes partner Neil O’May, who was previously head of crime at tier one Legal 500 firm Bindmans, adds: ‘It will show the ease with which a prosecution can now be brought under the 2010 Bribery Act as opposed to the previous, rather difficult and cumbersome law, from the 1906 Act.
‘It will also hopefully bring together the internationality of the UK Bribery Act which was previously very clunky under the old law.’
However he points out, ‘It could be a precedent setting case for the act in respect of individuals but not for corporate liability.’
Corporates currently being investigated include Barclays, which the SFO began investigating on 15 August in relation to ‘certain commercial arrangements’ between Barclays Bank and Qatar Holdings in 2008 and more particularly, fees paid to Qatar’s sovereign wealth fund as the bank sought to raise money to avoid a government bailout. Barclays is strongly contesting the claims.