The Bribery Act: “Government Keen To Accept Bribes”

****STOP PRESS. OFFICIALLY ENDORSED BY BLACKADDER HIMSELF****

(See Comment below from theBriberyact.com)

There was I bemoaning the fact in the last bungblog that the Bribery Act was the preserve only of the rich and famous, and along comes news of a prosecution by the CPS involving an allegation of a bribe of £500
We will not go into any of the details, which might of themselves explain a little more behind this decision, but is it really possible that we might end up following the Indian lead on Bribery, (popular that is rather than political) and see this as the acorn of the cultural change the OECD have been advocating for years?

Small bribery can be just as insidious as Big Bribery, but it is much less likely to be prosecuted for one very good and compelling reason, which I will turn to in a minute.

The first important point to notice is that this prosecution was brought by the CPS and not the SFO.

Both are able to prosecute offences under the act, but neither can institute proceedings without the approval of their respective heads, the DPP Keir Starmer QC, or the Director of the SFO, Richard Alderman.

At the time the section 9 guidance on “Adequate Procedures for Preventing Bribery” was issued, those two bodies issued a joint document setting out the guidance that they themselves would follow in making the decision on whether or not to prosecute.

http://www.cps.gov.uk/legal/a_to_c/bribery_act_2010/

When you read it, you begin to realise that in fact we do have a two tier approach, in much the same way as we do with fraud. Big fraud to SFO, small fraud to CPS, or at least that’s how it looks on paper, together with a bifurcation (!) between domestic Bribery and International Bribery.

Let’s look at a short passage from the introduction:

“Scope of the Act

The Act takes a robust approach to tackling commercial bribery, which is one of its principal objectives. The offences are not, however, limited to commercial bribery. There may be many examples outside the commercial sphere where individuals attempt to influence the application of rules, regulations and normal procedures. Examples would include attempts to influence decisions by local authorities, regulatory bodies or elected representatives on matters such as planning consent, school admission procedures or driving tests.”

And then this:

Bribery is a serious offence. There is an inherent public interest in bribery being prosecuted in order to give practical effect to Parliament’s criminalisation of such behaviour.

It then launches into the jargon of “The Full Code Test” and the “Public Interest Test.”

So should we really be at all surprised that a CPS prosecution has been brought in relation to what is an apparently minor offence, (I mean in terms of the amount involved)?

Highly respected commentators of a Transatlantic persuasion have already been turning their noses up at such an apparently lacklustre opening act in the brand new theatre that is the Bribery Act.

BUT as the erudite and interesting thebriberyact.com has pointed out:

(this) misses a fundamental but important difference between the US FCPA (Foreign Corrupt Practices Act) and the Bribery Act.

The UK Bribery Act covers domestic bribery AND foreign bribery.  The US FCPA only covers foreign bribery.

Broadly speaking foreign bribery cases are likely to be more complicated from an evidential perspective.  They will, as a result, take longer to investigate and prove. (and cost a lot more, – that was me.)

This is the raison d’etre for the Serious Fraud Office in the UK.

http://thebriberyact.com/2011/09/01/a-golden-rule-in-litigation-never-underestimate-your-opponent-or-why-it-is-a-mistake-to-pooh-pooh/

(Although AA Milne was never an authority on the Act. That  should be poo-poo, Richard and Barry)

****CONTROVERSY NOW RAGES – SEE COMMENT BELOW FROM thebriberyact.com****

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So if the CPS will prosecute someone for bribing a member of a council planning committee, a headteacher for selecting a dunce who is the child of rich parents, or a driving instructor for passing Mr. Toad, (very English joke Tom, see Wind in the Willows), then maybe the act will achieve that which the bare words of the statute intend.

After all, we should not forget for a minute the Provisions of Schedule 2.

You have  forgotten the provisions of Schedule 2 haven’t you?

Schedule 2 contains a list of all the old Acts of parliament which are repealed on the passing of the Bribery Act, including:

Public Bodies Corrupt Practices Act 1889

Prevention of Corruption Act 1906

Prevention of Corruption Act 1916

Anti Terrorism Crime and Security Act Sec 108 – 110

(Section 109 dealt with Bribery and Corruption committed outside UK)

To save you looking them up, they effectively comprise all the previous anti corruption legislation, although we still retain Common Law offences such as Misconduct in a Public Office, which could apply to public officials accepting bribes, but not private individuals.

Which means in the absence of The Bribery Act, such small bribes are not an offence.

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Which brings me wobbling back to sort of where I started at the beginning of last week’s blog.

Small bribes involving excessive hospitality, facilitation payments, (Grease is the word, if you are in the USA), the fashion journalists tale, (last week) and what about the rampant corruption in the hotel and leisure industry? Tips for good service are fine, but £50 to turf someone off a better restaurant table, or £100 to grab someone else’s superior hotel room? (Concierges cringing the world over hopefully.) If they are given cash to persuade them to effect an improper performance of their function, i.e. bumping someone from a room that they had booked and paid for, that’s a bribe.

Yes of course there is the old argument that such people are traditionally poorly paid because they are expected to make extra dosh in that way. Well that is where the concept of culture change comes in. If India can think the unthinkable, with the inspiration of Anna Hazare, then so can we.

In a recent seminar given by a senior officer of the SFO, we heard this, particularly in relation to Facilitation Payments:

“The SFO look also at the effect of small payments. They can have a corrosive effect, and are often part of schemes orchestrated at higher level by people into whose pocket a proportion of payments go.

Once you have someone in your pocket by means of small payments, just like blackmail, there is nowhere for it to stop. It perpetuates a culture of corruption within an organisation.

In some parts of world, it is not possible to avoid them, so we consider the public interest in prosecuting

• We consider amount of payment concerned
• Was it systemic, one off or one of many?
• What steps have company taken to reduce payment of this sum?
• Were there any special sector considerations.
• No prosecution if payment at the end of a gun or risk to life and limb.”

So the SFO, and the vast majority of comment and publicity about the Act has really been focused on International Corruption.

They will not prosecute the “Low hanging fruit.” But why should not the police and the CPS do exactly that, because if they don’t prosecute the bent planning officer or the driving examiner, who will?

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I said earlier that I would get to the reason in a minute why it is that I think there are likely to be very few prosecutions for Bribery by the SFO, initially. Well unless you are a very fast reader it has probably taken you a little longer than that. Sorry, maybe I got carried away.

BUT HERE IT IS.

The clue lies in two factors. Firstly the abysmal budget allocated to them for investigating and prosecuting Bribery Act offences. Second, the Proceeds of Crime Act 2002.

My own personal view, although you could call it an educated guess, is simply this.

A successful prosecution of a large corporation for Bribery, or a successful Civil Recovery action in the event of self-reporting (remember the pink fluffy handcuffs?) will result in potentially a huge amount of money confiscated from the offending company.

A proportion of those funds will be directed towards compensating those who have suffered loss as a result of the offender’s actions, but some of the money will be ploughed back into resources needed for further investigations.

To what degree I cannot say, (as I said I am guessing) but does there not exist the very real possibility that at least in the early stages, prosecution policy of Bribery Act offences will be influenced if not governed by the Cost-Benefit analysis?

If you prosecute a company for sending someone on an over-luxurious glee club trip to Tierra del Fuego, the investigative costs of an international investigation could be not inconsiderable. The proceeds of such a crime might be pathetically small. Am I barking up the right tree here? I think so.

On the other hand, if there is a concentration on Big Bribery at the start, then the coffers will be swelled that much sooner, and the whole process might well snowball into a situation where the Prosecuting Authorities  are sufficiently flush not to have to risk picking only the fruit at the very top of the tree.

They might even turn it into a flourishing industry.

Hence… “Government Keen To Accept Bribes!”

Got there in the end.

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The above is subject to the usual old tosh about all views being my own etc etc, but if anyone else wants to express a view (including Elm Street) then just hit the comment button below. But be warned, I have the power of moderation!

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IN OTHER NEWS:

If you are in the Construction industry and are near Bristol, I shall be spouting forth to members of the RICS Bristol on 13^th September. You have to get the guff from them but I’d be delighted to meet followers there. It’s near the big RAC thingy on the M5.

IN EVEN OTHER NEWS

thebungblog now has its own Group on LinkedIn, for news, view, comments and a cup of tea, (iced if you are of the transatlantic persuasion)

Join now

UK BRIBERY ACT 2010 thebungblog SPEAKEASY

IN OTHER REALLY BIG NEWS:

If you are reading this blog, then you are bound to have heard of @charonqc http://charonqc.wordpress.com/

There’s a link to it in my blogroll as well.

ANYWAY…. every week the eponymous blogger produces a podcast of a discussion with some distinguished lawyer or other on a topic of the day.

In a surprise break with that tradition of distinguished lawyers, this coming week it will be …. me!

So watch his space.

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AND FINALLY:

An esteemed and highly respected blogger from “overseas” who specialises on the FCPA in particular, has had the temerity to suggest that the brand of humour promulgated on this modest little blog, just might not translate into American.

Views please!

TheBungBlog