December 2014 was a stellar month for the UK Serious Fraud Office (SFO), which secured two significant sets of convictions - including its first conviction under the UK Bribery Act 2010 (the Act) and its first contested conviction of a corporation under the Prevention of Corruption Act 1906 (PCA). (1)

On December 8, 2014, Messrs. Gary West and Stuart Stone, connected to the company Sustainable AgroEnergy plc (SAE), were convicted of domestic bribery offences under the Act, in the first prosecution brought by the SFO since the Act became law in July 2011.

On December 22, 2014, Smith & Ouzman Ltd (S&O) and two of its former directors became the first SFO conviction of a corporation for bribing foreign public officials under Section 1 of the PCA.

Although these cases do not involve vast sums of money or household names they are the first signs that the SFO is beginning to deliver on promises of greater and more significant enforcement - indicating that they may be ready to move on to bigger beasts, “striking tigers as well as flies.” (2)

Sustainable AgroEnergy plc


Two UK nationals, Mr. Gary West, former Director and Chief Commercial Officer of SAE and Mr. Stuart Stone, Director of SJ Stone Ltd, were convicted for a number of offences, including fraud and two counts of bribery, relating to the giving and receiving of bribes.  The prosecution resulted from an SFO investigation into Sustainable Growth Group and its subsidiaries, SAE and Sustainable Wealth (UK) Investments Ltd, and related to the fraudulent promotion and sale of “green biofuel” investment products, involving Jatropha tree plantations in Cambodia.  The green biofuel products were subsequently sold to 250 UK investors, who had primarily invested via self-invested pension plans (SIPPs), expecting returns of between 8 to 25%.  These UK investors were led to believe that SAE owned land in Cambodia which had Jatropha trees planted on it, and that there was an insurance policy in place to protect the investors in case the Jatropha crops failed.  The overarching fraud resulted in losses of £23 million.  See our previous advisory for further details of the charges.

Details of the Bribery Act Convictions

The bribery convictions arose from a separate, but linked scheme, whereby Mr. Stone submitted duplicate invoices for services provided to the SAE group, and paid Mr. West over £189,000 in bribes so as to induce Mr. West to approve the falsified invoices.

These bribery offences were found to be an aggravating feature of the overarching fraud and were described in court as falling into the highest category of culpability and harm, due to the abuse of trust involved, the substantial losses experienced by the 250 UK investors and the value of the bribes offered and accepted.

Mr. Stone was sentenced to six years imprisonment for offering the bribe and Mr. West was sentenced to four years imprisonment for receiving the bribe – to be served concurrently with the other sentences of imprisonment that they received. Moreover, both men are subject to a director disqualification order; Mr. West for 15 years and Mr. Stone for 10 years.  It is of note that punishments under the Act have potential to be considerably greater than under the US Foreign Corrupt Practices Act, with individuals facing up to 10 years imprisonment, an unlimited fine and confiscation of assets, and companies facing unlimited fines, all for a single offence.

Smith & Ouzman Ltd


Smith & Ouzman Ltd, a printing firm based in Eastbourne, Mr. Christopher Smith, the former chairman of S&O, and his son, Mr. Nicholas Smith, the former sales and marketing director of S&O, were all convicted of offences under Section 1(1) of the PCA. S&O specialize in printing secure documents, i.e., electoral ballet papers and examination certificates.  The prosecution resulted from the SFO’s investigation which began in October 2010 into S&O’s business in a number of African countries, in particular with the Independent Electoral Commission of Kenya, the Kenyan National Examination Council, the Mauritanian Ministry of Interior and the National Electoral Commission of Somaliland.

The company and Messrs. Smiths were found guilty of paying £395,074 to public officials in Kenya and Mauritania between November 1, 2006 and December 31, 2010, so as to secure public contracts.  S&O was convicted of three counts of corruptly agreeing to make payments.  Mr. Christopher Smith and Mr. Nicholas Smith were also respectively convicted of two and three counts of corruptly agreeing to make payments.

Details of the Bribery Convictions

S&O employed agents (who worked on commission) in various African countries to assist them in placing tenders and pitching for business.  The SFO maintained that those commission payments made to the agents masked the corrupt payments to public officials, who were in a position of authority thereby influencing the outcome of the tenders for work.  The bribes are said to have ranged from £330,000 for contracts in Kenya (which were coded as payments for “chickens” in internal e-mails) to £12,000 for contracts in Ghana.  In return for these payments, S&O secured contracts for various businesses.  In particular, one such bribe is said to have secured S&O £1,377,257 worth of work.

The sentencing hearing is scheduled to take place on February 12, 2015.  It is notable that this will be the first case in which the Sentencing Council’s Definitive Guidelines on Fraud, Bribery and Money Laundering Offences will be utilized in the sentencing of a corporate offender (3).


Although these cases are neither a prosecution of a well-known corporation nor a prosecution under the much vaunted “failure to prevent bribery” offence, they remain significant.

Not only are they the SFO’s first successful prosecution under the Act and the SFO’s first successful contested prosecution of a corporation involving the bribery of foreign public officials - they also highlight the SFO’s willingness to charge bribery even when the value of the bribe is not of the highest order and even when the bribes are ancillary to the main offences uncovered.

The Sustainable AgroEnergy case also highlights the speed at which the SFO can investigate and prosecute matters - with offences committed in 2011 and 2012, charges brought in August 2013, and a contested trial successfully concluded and sentenced in December 2014.

Most importantly, the Sustainable AgroEnergy case demonstrates the SFO’s appetite to enforce the Act, which when combined with the increasingly used “blockbuster funding” from the UK Government and the SFO’s ever increasing caseload, shows that they may now be in a position to “strike tigers as well as flies.”

2015 will likely see more investigations and prosecutions following suit, as David Green, the Head of the SFO, has stated that the agency has many targets in their sights; emphasising the importance of and increase in cross-border cooperation, intelligence gathering and whistle-blowing reports (4).

It is therefore important that companies which conduct part of their business in the UK take account of these developments and the additional compliance considerations arising under the UK Bribery Act.