The Director of the Serious Fraud Office, David Green CB QC, appeared before the Culture, Media and Sports Select Committee on 26th October 2015. Mr Green provided evidence regarding the SFO’s involvement with the FIFA investigation. Reuters, UK fraud office receives new money laundering details in FIFA investigation.
The Director’s Evidence
In May 2015, the SFO announced it was examining information relating to possible corruption charges. At the select committee hearing, three important developments were revealed:
- That the SFO had not found any evidence of a link to the United Kingdom that would enable the SFO to investigate FIFA for bribery.
- That “sponsors” could be held liable if it were to be established they had failed to follow adequate procedures.
- That the SFO has received new information about money laundering concerning FIFA.
The 2018 and 2022 World Cups were both awarded to the host nations on 2 December 2010. The Bribery Act 2010 came into force on 1 July 2011, meaning a prosecution under the Act would be impossible. However, the SFO continues to investigate and prosecute cases under the previous legislation, and the timing of the alleged corruption should not automatically rule out any action.
The jurisdictional reach of the Bribery Act 2010 is extensive. Proceedings for an offence under sections 1, 2, or 6 of the Bribery Act can be brought in circumstances where no act of bribery takes place in the UK, if the person concerned has a “close connection” with the UK. A close connection includes a British subject, an individual resident in the UK and a body incorporated under the law of any part of the UK.
Equally important is the assertion that sponsors could be held liable if it were to be established they had failed to follow adequate procedures. Section 7 of the Bribery Act makes it an offence for corporate entities to fail to prevent bribery, where if there is evidence that a person associated with a commercial organisation has committed an offence of bribery, a company will only have a defence if it can prove it had adequate procedures in place to prevent bribery. This would however only apply to actions taking place after the commencement of the Bribery Act.
There are various money laundering offences in the UK, some affecting actions undertaken by any citizen and others specifically related to the regulated sector. Persons operating within the regulated sector, including banks, law firms and accountants, can be prosecuted for an offence should they fail to report their knowledge or suspicions of money laundering to the National Crime Agency, or if there were “reasonable grounds to suspect” money laundering. Co-incidentally, HM Treasury and the Home Office published the UK national risk assessment of money laundering and terrorist finance one week ago.
Criticism from Members of Parliament
Mr Green received some criticism from members of the committee. Mr Andrew Bingham MP asserted that “It strikes me that the SFO are busy standing around to help, but that’s all they’re doing – just standing around”. Mr Green responded that:
- The evidence obtained by the SFO did not meet the threshold for opening an investigation.
- That other jurisdictions had to formally request assistance for the SFO to legally take part.
Perhaps there are also strong policy reasons for not taking part. Considering the Swiss and US authorities have ongoing investigations, a third substantive investigation may simply get in the way.
To read more about the jurisdictional reach of the Bribery Act, see the Practical Law practice note, Bribery Act 2010: jurisdictional reach.
To read more about adequate procedures, see the Practical Law practice note, Bribery Act 2010: anti-corruption policies.
To read more about reasonable grounds to suspect, see the Practical Law practice note, Offences under section 330 of the Proceeds of Crime Act 2002