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192. Furthermore, as is explained elsewhere, the SFO have sought where appropriate to have regard to the model for corporate regulation adopted by the Department of Justice in the United States of America under the Foreign Corrupt Practices Act 1977. That model contemplates corporate remediation as an important factor in considering the propriety and proportionality of lengthy investigations into companies that are willing to come forward, engage co-operatively with the Prosecuting authorities and admit their guilt.
193. Accordingly, given that the Company has engaged and is continuing to engage in efforts at remediation, and can face only a financial penalty, it is felt that further investigation of offending corporate behaviour would not be an appropriate use of resources nor be in the public interest given how this case is being presented for sentencing.
194. The SFO has decided not to name certain directors, executives and employees of M&J at this stage because they may face trial in English Courts. The fact of the naming of certain directors, executives, employees of M&J and any others should not be taken by this court, the public and press as determinative of guilt of any of the persons named in this Opening Note. In the interests of fairness to those who are under investigation, no settled view concerning the culpability of individuals whether named here or not has been made.
195. The corrupt payments made benefited the recipients directly, and in all likelihood will have benefitted the shareholders of M&J indirectly, in that they profited from business they might not otherwise have obtained.
196. The corruption, came at the cost of those least able to afford it: the peoples of the countries in which M&J operated.
X: IRAQ: ‘OIL FOR FOOD’
197. A separate Opening Note is being prepared in respect of the Iraq “Oil For Food matter.
APPENDIX 1
The following matters are intended to assist the Court. They are a non-exhaustive list of the factors which the Director of the SFO takes into account when considering whether to investigate and prosecute allegations of overseas corruption by United Kingdom based companies and individuals.
1. The case of M&J is the first prosecution undertaken by the SFO’s dedicated Anti Corruption Domain.
2. The present Director of the SFO has made clear his position in the public domain and to the UK business community that companies can and should refer themselves to the SFO where it appears they have previously engaged in corrupt practices overseas.
3. The SFO is committed to the interests of the victims of overseas corporate corruption.
Overseas corruption is not a “victimless crime”. As the present case demonstrates only too well, the victims are all or any of the proper interests of the governments of the countries where such practices are carried out, the integrity of their civil services and public officials, and - more generally - the peoples of those countries, particularly the poorer and poorest sectors of those populations.
4. The United Kingdom has ratified the OECD Convention of 1999 prohibiting overseas corrupt practices. As a result, it enacted sections 108 and 109 of the Anti-Terrorism, Crime and Security Act 2001. Furthermore, at the G8 summit at Gleneagles in July 2005, the United Kingdom re-affirmed its commitment to the eradication of overseas corruption, as did the world’s other leading industrialised nations. By virtue of the multilateral approach to the problem, it can be seen that United Kingdom companies are not disadvantaged in their endeavours to compete for overseas business. Equally, it is the view both of the United Kingdom government and the Director of the SFO (amongst others) that corrupt practices overseas distort proper competition and are wasteful and damaging to the economies of, in particular, developing nations.
5. Where companies which have been engaged in corrupt practices refer themselves to the
SFO, the Director will consider the option of imposing a monitoring system to ensure absolute compliance with UK law in particular and ethical standards in general. Although UK law does not, at present, provide for monitoring as a means of remediation, the Director will, where appropriate, seek to follow the model provided by the United States of America’s Foreign Corrupt Practices Act 1977. In particular, the Director of the SFO will have regard to whether the instances of corrupt practices by a self-referring company are relatively historic, and what the company itself has done to remedy its past conduct, including whether the company remains in the same ownership and/or whether the board of directors and the management remain the same as those responsible for instigating and supervising corrupt practices.
6. The Director of the SFO does not necessarily regard monitoring as an alternative to prosecution; nevertheless he acknowledges that a company’s agreement to being monitored may constitute significant mitigation in cases which are prosecuted.
7. The Director of the SFO will consider where the public interest lies in deciding what approach to take in dealing with a company in these circumstances. There will be cases where the public interest is very firmly in favour of prosecution. There will be others where alternatives to prosecution (which still impose significant penalties on the company) will be appropriate. The Director has also made it clear that any resolution will ultimately be subject to public scrutiny.
8. The Director of the SFO has also explained publicly that any resolution relating to any company is entirely without prejudice to any investigation and prosecution of those individuals who took part in unlawful activity. There are circumstances in which the public interest will be in favour of investigation and prosecution of those individuals, notwithstanding that the company is dealt with by way of an alternative or alternatives to prosecution.
The Statesman
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