In her first published speech since taking over as Joint Head of Bribery and Corruption at the SFO, Camilla de Silva addressed compliance specialists at the recent ABC Minds Financial Services conference, tackling a number of familiar themes and giving some insight into the SFO's approach to the "adequate procedures" defence under section 7 of the Bribery Act 2010 (the "UKBA"). In particular, Ms de Silva took the opportunity to comment on the recent successful CPS prosecution of R v Skansen Interiors Limited (the first contested trial of a section 7 offence in which a jury was asked to consider whether a corporate could rely on the adequate procedures defence) and noted that the case was a "salient reminder to corporates to ensure their compliance procedures are sufficiency robust" as well as being evidence of "the high bar that will need to be reached for a section 7 defence to succeed".
During the lifetime of the UKBA, there have been repeated calls for the SFO to engage more openly with business and, in particular, provide its own specific guidance on the adequate procedures defence in addition to the statutory guidance issued by the Ministry of Justice (the "MoJ Guidance"). Whilst Ms de Silva reiterated David Green QC's now familiar retort that it is not the SFO's job as a prosecutor to provide guidance on what may or may not constitute adequate procedures, she pointed to a growing number of sources of information on this subject which can help inform those tasked with ensuring that their business' approach to ABC is sufficient and fit for purpose.
As well as the MoJ Guidance, Ms de Silva suggested that the OECD’s case studies (available here http://www.oecd.org/corruption/anti-bribery/The-Detection-of-Foreign-Bribery.pdf) and the compliance-related comments contained in the Rolls Royce and Standard Bank DPA "documents" (i.e. the agreements, statements of fact and judgments) may prove insightful in this regard. On the latter source she was keen to emphasise that what stood out for her in the DPA documents was the importance of "a top level commitment from the Board for proper governance and organisation of compliance and this effort being properly resourced". Focussing on the Rolls Royce DPA in particular, she highlighted the importance of the steps taken by the company to "enhance ethics and compliance personnel in key positions of seniority", and to appoint "additional compliance officers […] who were sufficiently empowered and whose reporting lines were independent of the business divisions" and "local ethics advisers in areas and jurisdictions of high risk to the business".
Aside from these sources of information, Ms de Silva also appeared to suggest that as more and more jurisdictions seek to enhance their enforcement against bribery and corruption and financial crime generally, the approach taken by enforcement agencies in other jurisdictions may also prove instructive, allowing businesses with global operations to "construct a compliance programme with common characteristics across [the] businesses’ footprint". She noted that "although law enforcement agencies do not approach compliance programmes in exactly the same way, there will be similarities in what we are looking for". This comment raises the interesting prospect of what approach the SFO would take to allegations against a company with uniform ABC policies across its global operations where these have been accepted as adequate by another overseas law enforcement agency.
Despite Ms de Silva's comments and the recent case of Skansen Interiors, the scope and interpretation of the adequate procedures defence remains ill-defined and is a continued source of uncertainty both for businesses seeking to ensure their policies and procedures are adequate, and for those businesses unfortunate enough to be subject to investigation by the SFO and who face the potential prospect of being prosecuted under section 7.
Although we know that the jury in Skansen Interiors must have rejected the defence argument that the company had in place adequate procedures designed to prevent bribery, the reasons for this verdict remain known to that jury alone. In this sense, the verdict offers no real clarification of the scope of the section 7 defence. However, the jury's decision may well add weight to the view that seeking to deploy this defence in the absence of substantive prosecutorial guidance or an established body of case law is too great a risk, especially when balanced against the obvious benefits of cooperation with law enforcement and the prize of a potential DPA. Indeed, Ms de Silva commented in her speech that the SFO "have yet to encounter a corporate with sufficient confidence in its compliance programme to persuade us of its adequacy or run a section 7 defence argument in court". Whether this fact can genuinely be attributed to those companies under investigation lacking confidence in their policies or rather a lack of appetite on the part of those companies to take the risk of running this defence in the absence of prosecutorial guidance and case law on the point is unclear.
Clearly, it remains in the SFO's interests to maintain the current status quo whereby corporates do not seek to rely on their procedures being adequate in order to fight a prosecution under section 7 and, instead, cooperate in the hope of being invited to enter into a DPA. This perhaps explains Ms de Silva's willingness to assert on the part of the SFO that the defence of adequate procedures represents a "high bar", when other sources of information, such as the MoJ Guidance, suggest a more fluid approach, whereby adequacy is likely to be a question of proportionality in the context of the particular risks faced by a business. The question remains: when will the SFO be challenged on this?