The Bribery Act has UK-wide application but also provides a large scope of extra-territorial jurisdiction to combat bribery committed abroad by companies and individuals linked to the UK.With the Act now in force, individuals breaching the new legislation can be punished with up to 10 years in prison, while companies can be liable for an unlimited fine and a ban from public work.
The first convictions were for two individuals involved in a large-scale fraud worth approximately £23m.
The case focused on the sale and promotion of Sustainable AgroEnergy plc's (SAE) 'green biofuel' investment products, specifically Jatropha tree plantations in Cambodia. These products were sold to UK investors who were deliberately misled into believing that SAE owned land planted with Jatropha trees in Cambodia. Investors were also led to believe there was an insurance policy to protect investors if the crops failed.
The SFO investigation uncovered serious accounting irregularities within Sustainable Growth Group (SGG), the umbrella corporation that owned SAE. In addition to the false representations being made to investors, the individuals conspired to produce false sales invoices worth more than £3m, which enabled one of the individuals, a sales agent, to secure commission rates of 65%.
The fraudulent transactions were disguised in a complex web of fake email addresses, Swiss bank accounts and overseas registered companies. One individual, the former Director and Chief Commercial Officer of SAE, received bribes for his role in the false invoices submitted by the sales agent.
The individuals involved were convicted of conspiracy to commit fraud, conspiracy to furnish false information, fraudulent trading and bribery offences under the Bribery Act 2010.
This is the first time the SFO has successfully convicted individuals under the Bribery Act 2010. The first corporate prosecution under the UK Bribery Act has still not arrived, but a number of SFO investigations are currently ongoing and are expected to take centre stage soon.
If you are looking for ways to gain more transparency over your customers and suppliers, why not look at the range of solutions that LexisNexis offers – click here for more information.