Businesses at risk in corrution law reform

10 August 2009
The failure of the SFO over many years to prosecute any case of overseas corruption successfully created an area of uncertainty which has benefited no-one.  Its recent victory in the Mabey and Johnson case may be changing this.  In 2010 the draft Bribery Bill will come into force, creating a new offence of negligent failure to prevent bribery. At that point no UK company should do business abroad without a thorough health check first.

According to a recent report by KPMG Forensic there is good reason for companies to look out. A KPMG survey shows that two thirds of companies believe that there are countries where bribery is fundamental to business practice, but only a third have ever pulled out of a national market as a result. It seems that less than half of firms conduct regular audits of third party business partners and local country representatives as part of their anti-corruption compliance controls. These companies risk prosecution.

The level of attention necessary to avoid falling foul of regulators, and of the criminal law, increases apace. Smaller businesses in particular can find this onerous. But it is better for any business to take precautions now to avoid the real pain of criminal investigation later. Installing a relatively simple system will reduce risks considerably.

H&R recommends that companies act now to give their new systems time to bed down before the 2010 legislation begins to bite.

The KPMG report can be found at http://www.kpmg.co.uk/pubs/Bribery_and_Corruption_Survey_2009.pdf

Time to rebalance government rhetoric?

6 August 2009

A Committee of MPs says the government has fallen into error with its rhetoric on rebalancing the criminal justice system.

“Telling a victim that their views are central to the criminal justice system, or that the prosecutor is their champion, is a damaging misrepresentation of reality. Expectations have been raised that will inevitably be disappointed. Furthermore, the criminal justice system is set up to represent the public rather than individuals and there are good reasons for this. The CPS’s role as an independent arbiter of decisions about prosecution is critical. Explaining this role clearly to victims such that their expectations are managed realistically, rather than raised then disappointed, is vital”.

H&R welcomes this insight. A great deal of unnecessary human misery is caused by over-zealous prosecutors. We need a prosecution service which is dedicated to truth and justice, not to scoring political points or winning votes for politicians.

For further information, see the House of Commons Justice Committee Report “The Crown Prosecution Service: Gatekeeper of the Criminal Justice System”.