All Party Parliamentary Group on Anti-Corruption - A "state of the art" review by the Director of the SFO of anti-corruption enforcement in the UK
On Tuesday 28 February 2012 Mr Richard Alderman, the current director of the SFO, delivered a speech to the All Party Parliamentary Group (“APPG”) on anti-corruption. Mr Alderman’s speech is, overall, very encouraging in that he believes that we in Britain often underestimate the way the rest of the world views the way in which the UK is tackling corruption, and that the respect shown overseas extends to the rule of law in the UK and the independence of our courts and judiciary as well as to our parliament.
Mr Alderman also reports that the approach taken by the British Government in enacting the Bribery Act 2010, as regards facilitation payments, has also been positively received abroad. He comments that
“one of the big challenges for the future concerns what to do about the demand side of bribery…tackling the demand side is partly, of course, about prosecutions of officials who take bribes and cooperation between countries so that evidence can be provided. But a successful approach needs more than this. We also need to see proper salaries for public officials in countries where these payments are common. I come across cases where the public officials are paid nothing or very little and are expected to make money to support their family by taking bribes…a successful approach on the demand side also involves education. The most successful anti-corruption agencies worldwide devote a lot of time to this even, for example, starting by conducting sessions in kindergartens about ethics and the difference between right and wrong”.
Mr Alderman goes on to say, quite rightly, that the Bribery Act is now being regarded, together with the Ministry of Justice Guidance on the Bribery Act, as being the gold standard that there is internationally for what is to be expected of corporations in dealing with anti-corruption. Mr Alderman also recognises, very realistically, that not everyone wants to get to the gold standard.
Turning to enforcement, the director reported that there is internationally increasing respect for the United Kingdom’s robust approach in dealing with corruption cases. He said that when he arrived at the SFO [four years ago] there were
“no convictions for corruption and of course the UK was best known for BAE and Saudi Arabia. Of course we are still known for BAE and Saudi Arabia. This regularly comes up in my discussions with foreign corporations and law enforcement officials. Indeed a few months ago I gave a presentation to senior judges in another jurisdiction. Towards the end one of them said “this is all very well Richard but tell us about BAE””.
Mr Alderman went on to say that the decision to stop the investigation into BAE’s alleged corruption in Saudi Arabia, despite the support of the House of Lords, “caused the UK great reputational damage” (this shows of course that a damaged reputation can take many years to repair). On the other hand, he reports, there are many others who recognise that the UK’s enforcement record has been transformed over the last three to four years as a result of [increased] enforcement action and the passing into law of the new Bribery Act and that, in terms of enforcement, there are NGOs who say that the UK is a close second to the US Department of Justice in this area (personally, I find this a little hard to accept since I heard the Department of Justice saying at a conference that they have over 150 “open” corruption cases and the SFO on its own admission has a small fraction of this number).
Although there are large corporations who are stepping up to the plate and will endeavour to reach the gold standard set by the new Bribery Act and the Government’s guidance, there are others who plainly will not. Mr Alderman says that by definition the way they carry out their corruption activities is often hidden and using complex international structures and that this takes some time to detect and unravel, but the SFO has very good international contacts which are “…essential in order to be able to investigate and prosecute these cases”.
Mr Alderman then listed a few challenges for the SFO, which I paraphrase below, as follows:
- Getting money back to victims: He praises the International Development Committee which decided to look at this issue in the context of the BAE payment to Tanzania. He reports that this has taken longer than he anticipated but following guidance from the IDC, the SFO needs to reflect on what they should be doing as regards restitution in the future. Mr Alderman wholeheartedly believes that financial settlements should go to the victims of the crime of corruption.
- Civil Recovery Orders: He reports that whilst the use of CROs is controversial, they do have their place and the IDC has accepted that a judge needs to be involved earlier in the discussions in order to be able to give any views he/she may have about a proposed settlement. He offers the view that this should not be a choice between a civil recovery order and a criminal trial, but in the past it has often been the difference between there being a civil recovery order or nothing happening at all due to the inadequacies of the existing corruption laws.
- Deferred prosecutions: Mr Alderman is very supportive of the Solicitor General, Edward Garnier QC MP who is trying to introduce deferred prosecutions into the criminal justice system’s armoury and he believes offers prosecutors and courts an alternative to the current choice between civil recovery and no criminal action.
- Full public and parliamentary discussion: Mr Alderman said that it needs to be understood and discussed as to the circumstances in which society feels there should be a full prosecution, or when there should be a deferred prosecution and indeed when a civil recovery may still be appropriate.
He concludes by saying that bearing in mind that he is leaving his position as director of the SFO in April, a number of the challenges that he had outlined in this speech will have to be left to his successor David Green CB QC to follow through, so this may in effect be Mr Alderman’s “valedictory” speech.
The full text of the director’s speech is here.