The UK chapter of Transparency International has recently published a new report subtitled “An evaluation of UK corporate plea agreements and civil recovery in overseas bribery cases”.
The report contains a very useful review of the following:
- Plea agreements and civil settlements, including the legal framework that governs plea agreements, protocols that govern the conduct of prosecutors, plea negotiations and the principles of civil recovery;
- Sentencing, including fines, confiscation, rehabilitation (monitors), restitution (compensation) and debarment;
- Alternative legal procedures including prosecutions in the United States for FCPA offences and in other jurisdictions;
- Case studies in criminal proceedings including the recent cases of Mabey & Johnson, Innospec Ltd, the BAE Systems case;
- Commentary and issues in criminal plea agreements including prosecution, conduct and sentencing issues;
- Case studies and civil settlements including the recent cases of Balfour Beatty, AMEC, the Aon settlement with the Financial Services Authority, MW Kellogg Limited, Depuy, Macmillan Publishers, and the Willis settlement with the Financial Services Authority;
- Commentary and issues on civil settlements including the use of civil powers under Proceeds of Crime Act, prosecution practice, sentencing issues and the role of the FSA;
- Emerging issues and recommendations including the primacy of criminal settlements, transparency, the respective roles of the judiciary and prosecutor in criminal plea agreements, the seriousness of overseas bribery, rehabilitation – the appointment of monitors, bribery offences and debarment, limitations of civil settlements, deferred prosecutions and international cooperation on investigations and prosecutions.
TI states that the report intends to provoke discussion and to make recommendations to the UK government and prosecuting authorities that will “help to ensure just, fair and transparent outcomes”. Transparency International states that “the right balance, both on the exercising of prosecutorial discretion and in sentencing, has yet to be realised…”.
Transparency International make 23 recommendations (set out on pages 6 to 8 of the report). The ones which we find particularly interesting include:
- Recommendation 6: Protocols in international cases: The Attorney General should agree some form of protocol or Memorandum of Understanding with his counterparts, especially with the US, which deals with the underlying principles of settling concurrent jurisdictional issues. Decisions should be taken on grounds of public interest rather than narrow national self interest. Defendants should not be encouraged to believe that they can forum shop in the expectation that they can play jurisdictions against each other.
- Recommendation 7: Double jeopardy: Double jeopardy should not be used to frustrate criminal proceedings in the UK, in those cases where there is a strong public interest to argue for primacy of the UK courts. In those cases where double jeopardy is pleaded as a reason for not proceeding with criminal charges it should be fully reasoned and publicly justified. The SFO should contribute to the legal debate over double jeopardy by publicly explaining its view on the application of double jeopardy in US and European cases.
- Recommendation 8: Sentencing guidelines: The Sentencing Guidelines Council should issue guidance on sentencing in overseas bribery cases, reflecting the seriousness of the offences, the damage that bribery inflicts on society and to provide an effective deterrent to future corporate defending. There should be greater clarity and certainty over the level of fines and the method of calculation, and the aggravating or mitigating factors that should be taken into account in the sentencing.
- Recommendation 12: Corporate liability: The work of the Law Commission on corporate criminal liability should be finalised as soon as possible to enable the SFO to seek to clarify its application in respect of offences under the Bribery Act and if necessary test its interpretation before the courts.
- Recommendation 19: Debarment: There should be more clarity on the process for entering and exiting the debarment process, including taking into account any remedial action taken by the company. TI–UK recognises that the current uncertainty over the risk and nature of debarment can play a disproportionate role in pre-negotiations, which may result in an inappropriate charge being laid before the court.
- Recommendation 20: Appointment of monitors: The process by which monitors are appointed, their terms of reference, their powers and reporting need to be subject to clear published guidelines.
- Recommendation 22: Earlier judicial oversight: Prosecutors should have access to the court at an earlier stage in plea negotiations to obtain tacit judicial approval of plea agreements and to obtain an indicative range of the fine and confiscation. It is important that whatever extended role is played by the judiciary, the independence and separation of powers between the judiciary and prosecutors is not undermined.
- Recommendation 23: Use of Deferred Prosecution Agreements: The Government should consider the introduction of DPAs or some similar sentencing procedure after a thorough assessment of the alternatives. DPAs have proved to be a useful procedure to settle FCPA cases in the USA but the process has also be criticised with little judicial oversight.
We will blog further on this comprehensive and stimulating report, including US perspectives on it, in due course.