Global Investigations Review - The law and practice of international investigations

Europe, Middle East and Africa Investigations Review 2020

UK Anti-Corruption Enforcement and Investigation

WilmerHale


In summary

This chapter explores the main developments in UK anti-corruption enforcement in the past 12 months, focusing on the Serious Fraud Office (SFO), the National Crime Agency (NCA), and the Financial Conduct Authority (FCA). It contrasts the SFO’s successful cooperations with corporates, with its difficulties in pursuing individuals for alleged corrupt or fraudulent conduct. It then discusses the NCA’s increasing readiness to use its statutory powers to investigate and recover criminal assets. Finally, it considers the consequences of Brexit for anti-corruption enforcement, examining the future of international cooperation and extraterritorial investigations.


Discussion points

  • The SFO nearly doubled its DPA number, including its largest ever settlement
  • A large number of individuals were acquitted in SFO prosecutions
  • The NCA started to make use of new enforcement tools
  • FCA and SFO convictions against individuals for failing to comply
  • The UK left the EU and has tried to shift to a broader international perspective

Referenced in this article

  • Serious Fraud Office
  • Serious Fraud Office v Serco Geografix Ltd
  • Serious Fraud Office v Güralp Systems Ltd
  • Serious Fraud Office v Airbus SE
  • Bribery Act 2010
  • National Crime Agency
  • Proceeds of Crime Act 2002
  • Money Laundering and Terrorist Financing (Amendment) Regulations 2019 and Fifth Money Laundering Directive
  • Financial Conduct Authority

In the last 12 months, UK law enforcement agencies have known a mix of successes and failures. While the Serious Fraud Office (SFO) successfully encouraged corporates to cooperate, resulting in no fewer than three deferred prosecution agreements (DPAs) after only four had been approved since the scheme came into force in February 2014, it struggled to prosecute and secure convictions against individuals. Enforcement action and regulatory developments continued to focus, as they have in the past few years, on money laundering, with the National Crime Agency (NCA) using its powers to track criminal property more aggressively and the UK government broadening the scope of the anti-money laundering regime. All-in-all, UK law enforcement agencies still have some progress to make to attain the UK government’s long-term anti-corruption goal of ‘stronger law enforcement, prosecutorial and criminal justice action’.[1] Looking ahead, despite Brexit, the inexorable direction of travel appears to be towards closer international cooperation.

SFO provides clarity on cooperation in new guidance

In April 2019, Lisa Osofsky, director of the SFO, reiterated her hope that companies that become aware of internal criminal conduct ‘would be brave enough’ to report that conduct to, and cooperate with, the authorities.[2]

A few months later, the SFO released its long-awaited Corporate Co-operation Guidance (the Guidance) to assist companies contemplating self-reporting.[3] With the publication of the Guidance, Ms Osofsky set herself apart from her predecessor Sir David Green CB QC, who asserted towards the end of his tenure that as ‘investigative prosecutors’, and unlike US law enforcement agencies, the SFO did ‘not do guidance’ on self-reporting and cooperation.[4]

The Guidance sets out the agency’s expectations of cooperation in relation to, notably, the preservation and production of digital and physical material, the handling of individual witnesses and suspects, and the waiving of legal professional privilege. It also provides examples of non-cooperative conduct, including ‘protecting specific individuals’, ‘silence about selected issues’ and ‘tactical delay or informational overloads’.[5] Thus, the Guidance supplements the DPA Code, which lists cooperation as the first ‘additional public interest facto[r]’ to be taken into consideration when assessing whether a DPA, rather than a prosecution, is in the interests of justice.[6]

SFO masters the art of DPAs

In the past year, at least three corporates responded to the SFO’s call to cooperate, thereby securing invitations from the SFO to enter into DPAs. The SFO thus achieved three DPAs, out of seven since the scheme came into force six years ago, in a 12-month period – a series that culminated in a record billion-pound multi-jurisdictional DPA with European aircraft manufacturer Airbus SE.[7] Ms Osofsky’s statement in the second week of her tenure that DPAs are ‘no longer a US only phenomenon’ holds all the more true two years later.[8]

In July 2019, the SFO entered into a DPA with Serco Geografix Ltd, a subsidiary of Serco Ltd within Serco Group Plc (together, Serco). Serco provided electronic monitoring services for the UK criminal justice system.[9] Serco admitted to three counts of fraud by false representation contrary to section 2 of the Fraud Act 2006 (the 2006 Act) and two counts of false accounting contrary to section 17 of the Theft Act 1968, having dishonestly submitted false information on its profits to the Ministry of Justice. The company had become aware of the fraudulent conduct in the context of an investigation into other suspicions reported to the SFO by the Ministry of Justice and had informed the SFO of its discovery.

Notwithstanding the context in which the fraudulent conduct came to light, the SFO emphasised ‘the prompt and detailed reporting’ of the wrongdoing, as well as the ‘substantial co-operation by [Serco] with the investigation by the SFO’ when arguing in support of a DPA.[10] This cooperation involved, notably, the instruction of an independent law firm to conduct a full document review and report its findings to the SFO; granting unrestricted access to the email accounts of current and former employees; and a waiver of privilege in respect of certain accounting material. In the words of Mr Justice William Davis, who approved the DPA, these measures amounted ‘by any standard’ to ‘very substantial co-operation’.[11]

In October 2019, the SFO concluded its second DPA of the year with Güralp Systems Ltd (Güralp), a UK company specialising in seismic measurement systems.[12] Güralp admitted to one count of conspiring to make corrupt payments contrary to section 1 of the Criminal Law Act 1977 and section 1 of the Prevention of Corruption Act 1906 (the 1906 Act), and one count of failing to prevent bribery contrary to section 7 of the Bribery Act 2010 (the 2010 Act), in the context of its dealings with an Earthquake Research Centre (ERC) in South Korea. Güralp’s new chief executive officer had started to suspect that employees had made payments to the head of the ERC within months of his appointment, had promptly instructed a law firm to conduct an internal investigation and had shared its findings with the SFO and the US Department of Justice (DOJ).

In assessing whether the DPA was in the interests of justice, Mr Justice Davis noted that this self-reporting had gone further than simply notifying the authorities of the suspected conduct. He also contrasted it with self-reporting in previous DPAs, in which the wrongdoing had come to light in the context of another investigation (Serco),[13] through an internal whistleblower (Tesco),[14] following online comments by a former employee (Rolls-Royce)[15] or thanks to the concerns of associated companies (Standard Bank and Sarclad).[16] If Güralp had not been as ‘brave’ as Ms Osofsky had hoped, it may have covered up the conduct.

Finally, in January 2020, the SFO entered into a DPA with Airbus SE (Airbus), whereby Airbus admitted to five counts of failing to prevent bribery contrary to section 7 of the 2010 Act, in relation to commercial aircraft orders in Malaysia, Sri Lanka, Taiwan and Indonesia, and military aircraft orders in Ghana (count 5).[17]

The Airbus DPA is unprecedented in several ways. Firstly, the UK, French and US courts simultaneously approved deferred prosecution or equivalent agreements between Airbus and, respectively, the SFO, the French National Financial Prosecutor’s Office (PNF) and the US DOJ and Department of State.

Secondly, those agreements resulted from the close cooperation of multiple agencies worldwide. In particular, the PNF and the SFO formed a Joint Investigation Team (JIT) and assisted the parallel investigation of the DOJ. Together, the three agencies investigated Airbus’s conduct in over 15 countries.[18] They successfully worked together despite the difficulties posed by the ‘French Blocking Statue’, which prohibits the disclosure of certain information for use in foreign legal proceedings. This close cooperation fulfilled another of Ms Osofsky’s ‘greatest hopes’, namely that of ‘increas[ing] co-operation with other prosecutors and investigators around the world’.[19]

Thirdly, Airbus agreed to pay a global financial sanction in excess of €3.5 billion. The UK DPA alone required the company to pay close to €1 billion, comprising the disgorgement of profits (approximately €585 million) and a fine (approximately €398 million). Dame Victoria Sharp noted in approving the DPA that this sum exceeded both ‘the total of all the previous sums paid pursuant to previous DPAs’ and ‘double the total of fines paid in respect of all criminal conduct in England and Wales in 2018’.[20]

Regarding Airbus’s cooperation with the JIT, the steps taken by the company were commensurate with the scale of the investigation. For instance, Airbus developed, with the JIT:

  • new procedures for the review of relevant documents (30.5 million in total);
  • reported its findings to the JIT through presentations;
  • provided internal investigation documents, including transcripts of interviews with employees and business partners, to the JIT, having waived privilege on a limited basis;[21]
  • provided a schedule of documents withheld on grounds of privilege, setting out its reasons for asserting privilege, to the JIT; and
  • accepted that the SFO enjoyed extended extraterritorial investigative powers under the 2010 Act.

Those ‘exemplary’ steps made up for what Dame Victoria Sharp described as ‘a slow start’ in Airbus having failed to report its suspicions to the authorities at the earliest opportunity.[22]

Companies that wish to self-report and cooperate, but are concerned that they might be penalised for any delay in voicing their suspicions might take comfort in the court’s assertion that there was ‘no necessary bright line between self-reporting and co-operation’.[23] Thus, on this occasion, the court was willing to look beyond the ‘first report of wrongdoing’ to ask whether Airbus had ultimately revealed to the authorities wrongdoing of which they would not otherwise have become aware.

The above DPAs, read together with the Guidance, are a helpful reference for companies that detect internal criminal conduct and consider that their interests would be best served by a DPA.

SFO struggles against individuals

Whereas the SFO has enjoyed some success against corporates, it has continued its recent poor form prosecuting individuals, with a string of failures in 2019 and 2020 putting further pressure on the agency to improve its conviction rate. The key question for the SFO in 2020 will be why it is unable to convert supposedly sound prosecutions into convictions.

One of the most striking trends of the past year has been the SFO’s unsuccessful prosecution of individuals in cases where the corporate has accepted wrongdoing by entering into a DPA. While the SFO has agreed even more DPAs, it has yet to secure a single conviction of an individual relating to one of these investigations. In 2019, the agency dropped its investigation into individuals at Rolls-Royce and failed to secure convictions against Tesco executives following DPAs with both corporates. The case of Carl Rogberg, former finance director at Tesco, was particularly troubling, as the SFO offered no evidence on the day of trial.[24]

In 2019, there were two further high-profile prosecutions of individuals following on from DPAs. The first related to Sarclad Ltd (Sarclad, the company formerly known as XYZ), which entered into the second ever DPA with the SFO in 2016. In July 2019, three individuals associated with the company were acquitted of conspiring to pay bribes, contrary to section 1 of the 1906 Act and section 1 of the 2010 Act.[25] Similarly, in October 2019, Güralp reached a DPA with the SFO and two months later three individuals associated with the company were acquitted of conspiracy to pay bribes contrary to section 1 of the 1906 Act.[26] The result in the Güralp case is notable: in the US, the DOJ successfully prosecuted the Korean official who received bribes from Güralp (the US trial evidence included emails where the official admitted his guilt).[27]

The SFO has a number of well-worn arguments relating to its lack of success in the courtroom. One is that if its conviction rate was high, the agency would be criticised for cherry-picking the easiest cases and failing to challenge the full spectrum of potentially criminal economic activity. Another is that, in making prosecutorial decisions, the SFO can only have regard to the Full Code test for Crown Prosecutors: firstly, whether the evidence provides a realistic prospect of conviction and, secondly, whether it is in the public interest to prosecute the case. If both of these criteria are met, the matter should go before a jury. In the event that the judge finds that there is a case to answer, the SFO’s job is done. Any deficiencies in the conviction rate can be blamed on other systemic factors, such as the statistical quirks inherent in having a small caseload, the criminal standard of proof, juries’ inability to comprehend complex evidence or the ineffective assistance of counsel.

Those arguments are less persuasive in the context of cases where the corporation has entered into a DPA, thereby admitting wrongdoing that must, save in the case of failure to prevent offences, have involved criminal actions by an individual associated with the corporation. Transparency International has written to the SFO imploring it to be transparent about the reasons for these acquittals and to examine other means of holding corporate management to account.[28]

The SFO’s best argument for these failures may be simply that juries are required to apply the criminal standard of proof, whereas DPAs do not require a judge to apply that standard. The fact that a litigation risk analysis undertaken by a suspect corporation has resulted in that corporation seeking a DPA, is no guarantee that a jury will subsequently find a similar case proven.

Observers have been quick to note that the SFO’s courtroom failures may give corporations pause when considering whether to enter into a DPA: if the SFO’s success rate is so poor, why not take the risk and go to trial? However, in examining the reasons for the disconnect between DPAs and the subsequent acquittal of associated individuals, it is important to note that although the legal considerations for the corporation and individuals are similar, the strategic considerations are completely different. For a corporation, the existence of an investigation or prosecution negatively affects the company’s finances, primarily by suppressing its share prices through the financial risk associated with a possible conviction. Going to trial inevitably lengthens the process, incurs weeks of sustained negative publicity and carries the risk that a jury, potentially unsympathetic to a large corporation, will convict. By cooperating fully with the SFO and seeking to achieve a DPA, the company may have an opportunity to deal with the case quickly, (relatively) discretely and without the risk of incurring criminal liability. Individuals have no such luxury.

The recent DPAs with Airbus and Serco will give the SFO the opportunity to rectify its recent poor form. Whether or not the SFO is able to secure convictions of individuals following on from these agreements will have a significant impact on the future of DPAs, the corporate criminal liability regime in the UK and the future of the SFO.

Potentially the most significant loss for the agency over the last year was the acquittal of three former Barclays executives in February 2020. The SFO heralded this case as the ‘first’ prosecution of executives for misconduct relating to the 2008 crisis, and, at present, it looks set to be the last. This result marks the end of a tortured journey for the SFO and has raised questions regarding the agency’s strategic judgement and its future structure. The allegations related to the bank’s attempts to raise capital during the 2008 crisis, which the SFO said amounted to conspiracy to commit fraud contrary to section 2 of the 2006 Act. In 2017, the SFO charged Barclays PLC, Barclays Bank PLC (together, Barclays) and four individuals. In early 2018, the case against the bank was thrown out by the Crown Court and the SFO’s attempt to have the case resuscitated in the High Court was unsuccessful and permission to appeal to the Supreme Court was refused. The case against one of the remaining four individuals was thrown out in April 2019 and the remaining three were acquitted by a jury. In a crowded field of prosecutorial failures, the Barclays case stands out as a particularly heavy loss for the SFO.

SFO successes

The past year has not been entirely doom and gloom for the SFO. Despite a poor record of courtroom wins in the past year, in January 2020 the SFO secured a conviction against an individual for failure to comply with a notice under section 2 of the Criminal Justice Act 1987 in relation to its ongoing investigation into ENRC. The individual was given an £800 fine. This is the first conviction for this offence and underscores the importance of complying fully with ‘here and now’ notices.

In July 2019, the SFO secured a guilty plea from an individual relating to its Unaoil investigation and the trial of a further three individuals began on 23 January 2020. The trial was adjourned on 23 March 2020 due to covid-19 fears. The Ministry of Justice has since ordered that, due to the pandemic, no new jury trials are to start, but that some existing jury trials should continue. As the pandemic deepens, it looks likely that a key trend for the remainder of 2020 will be a sharp drop-off in criminal trials.

NCA deploys unexplained wealth orders and account-freezing and forfeiture orders to investigate and recover criminal assets

Some two years after the Criminal Finances Act 2017 (2017 Act) came into force, the NCA started to gain confidence in its use of the powers introduced by the 2017 Act to investigate and recover criminal assets. The NCA deployed two of those powers in particular:

  • unexplained wealth orders (UWOs),[30] which require politically exposed persons (PEPs) and persons suspected of being involved in serious crime to account for the origin of their high-value property[31] when their known sources of lawful income appear insufficient to have obtained that property; and
  • and account-freezing and forfeiture orders (AFFOs), which provide for the freezing and ultimate recovery of funds suspected to derive from crime or to be intended for use in crime.[32]

Having obtained its first account-forfeiture order February 2019, the NCA went on to secure the forfeiture of close to £25,000 held in the bank account of a niece of Syrian leader Bashar al-Assad in May 2019.[33] The money had been deposited in the account in cash while her parents and uncle were subject to international sanctions.

Just over a week later, the NCA successfully applied for UWOs in respect of three London-properties ultimately owned by a PEP later named as Nurali Aliyev and Dariga Nazarbayeva, respectively grandson and daughter of former president of Kazakhstan Nursultan Nazerbayev.[34] The properties, whose value reportedly totalled over £80 million, were acquired by Mr Aliyev and Ms Nazarbayeva through offshore companies, allegedly using the proceeds of Mr Aliyev’s father’s crimes. Crucially, this was the first time the NCA applied for UWOs since securing its first two UWOs in relation to property held by Zamira Hajiyeva, the wife of a former Azerbaijani banker, in February 2018. The NCA thus started to dispel the criticism that it had come under for failing make full use of its new powers.

Persevering in its efforts, the NCA secured UWOs on the ground that the respondent, a ‘businessman from the North of England’ with a ‘£10 million property empire’ later named as Mansoor Hussain, was suspected of involvement in serious crime in July 2019.[35] In previous cases, UWOs had been sought on the ground that the respondent was a PEP, rather than suspected of involvement in serious crime.[36] The UWO application was made without notice and the UWOs were unsuccessfully challenged by Mr Hussain in the High Court a week later. This was followed two weeks later by a second batch of serious organised crime UWOs granted in respect of six properties financed by a Northern Irish woman believed to be associated with criminals involved in paramilitary activity and cigarettes smuggling.[37]

The NCA significantly increased the stakes the following month, when it obtained account-freezing orders in respect of eight bank accounts holding over £100 million.[38] The funds on the accounts were suspected of being derived from bribery and corruption ‘in an overseas nation’, later revealed to be Pakistan. On this occasion, the NCA did not seek the forfeiture of the funds in the accounts, agreeing instead a record £190 million settlement with Malik Riaz Hussain, a Pakistani businessman associated with the accounts, in December 2019.[39] In addition to the £100 million frozen in August 2019, the settlement comprised £20 million frozen in December 2018 in the context of the same investigation and London-property valued at around £50 million. The NCA confirmed that the assets would be returned to the Pakistani Government. While the settlement did not involve any finding nor admission of guilt, it raises the question of the availability of financial settlement agreements to individuals suspected of being involved in serious crime.

More recently, the NCA proved its ability to use AFFOs and UWOs in combination in the context of its continuing investigation into Mansoor Hussain’s property empire. In January 2020, the NCA obtained an account-freezing order over a £1.13 million account connected with a company linked to the businessman in January 2020.[40] A month later, the NCA also successfully converted the UWOs made against him in July 2019 into property freezing orders in respect of properties in Leeds, Cheshire and London worth in excess of £10 million.[41] The NCA believes that the properties were funded by associates of his involved in drug trafficking, armed robberies and supplying firearms.

In addition to this recent success, the NCA’s readiness to use UWOs and AFFOs will no doubt be reinforced by the dismissal in late January 2020 of Ms Hajiyeva’s appeal against the first two UWOs made against her in February 2018[42] and the dismissal in November 2019 of son of former Prime Minister of Moldova Vlad Luca Filat’s appeal against the first account-forfeiture order made in February 2019.[43] Although in April 2020, the UWOs issued in May 2019 against the three properties ultimately owned by Mr Aliyev and Ms Nazarbayeva were successfully challenged, the NCA did not falter and announced that it would appeal the decision.[44]

Other law enforcement agencies are yet to follow the example set by the NCA. Based on publicly available information, the SFO and HMRC have obtained only one account-­forfeiture order each, over a year ago,[45] and HMRC has recently lost a with notice application for an account-freezing order.[46] Neither have reportedly applied for UWOs. It should soon be confirmed whether they have, as some have speculated, piled up applications for UWOs to be made after the hearing, and subject to the outcome, of Ms Hajiyeva’s appeal.

The 2019 regulations extend the scope of the UK anti-money laundering regime

In January 2020, notwithstanding the UK’s subsequent exit from the European Union, the Money Laundering and Terrorist Financing (Amendment) Regulations 2019 (the 2019 Regulations) transposed the Fifth Money Laundering Directive (5MLD) into UK law. The 2019 Regulations amend the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (the 2017 Regulations), which implemented the requirements of the 4th Money Laundering Directive (4MLD).

The 5MLD builds upon the 4MLD to strengthen the EU anti-money laundering (AML) and counter-terrorism financing (CTF) regimes in two main ways. Firstly, the 5MLD and the 2019 Regulations extend the scope of the AML and CTF regimes to new sectors. Specifically, the 2019 Regulations bring cryptocurrency exchange and custodian wallet providers, high-value letting agents, and high-value art market participants within the regimes. They also broaden the definition of tax adviser in the 2017 Regulations. Those operating in these new sectors now have an obligation to conduct due diligence on their customers.

Secondly, the 5MLD seeks to increase the transparency of beneficial ownership, notably of bank accounts. For that purpose, the 2019 Regulations introduce new powers for law enforcement agencies to request a wide range of account information from credit institutions to help them identify account holders and beneficial owners of funds.[47] These new powers come into force in September 2020. Requests for information will be submitted, and the requested information provided, using a central automated mechanism to be set up by the Treasury.

FCA dabbles in criminal enforcement

The FCA has had a rather uneventful year on the criminal prosecutions front with only a few developments of note. In June 2019, the FCA secured the conviction of two individuals, a senior compliance officer at investment bank UBS AG and an experienced day-trader, for five offences of insider dealing contrary to section 52 of the Criminal Justice Act 1993, following an eleven-week trial at Southwark Crown Court.[48] The former had repeatedly accessed inside information concerning several takeovers and passed that information to the latter using pay-as-you-go mobile phones. They were both sentenced to three years’ imprisonment. In the course of its investigation, the FCA had analysed thousands of documents and searched businesses and searched the suspects’ business and residential premises with the assistance of the NCA.

A few months later, in September 2019, the FCA announced that it was bringing the first ever prosecution of an individual for destroying documents that he knew or suspected were or would be relevant to an investigation contrary to section 177(3)(a) of the Financial Services and Markets Act 2020.[49] The individual, a banker, allegedly deleted WhatsApp, a messaging application, from his mobile phone while he was under investigation by the FCA for insider dealing. The FCA allege that he deleted the application after they requested that he provide them with his phone. He appeared at Southwark Crown Court on 18 November 2019 and pleaded not guilty.[50]

Brexit accomplished

On 31 January 2020 the UK left the European Union. Four years after the UK’s decision to leave the EU, the shape of its future relationship with the bloc is still unclear; however, it will inevitably make cooperation with European enforcement agencies significantly more bureaucratic, complex and time-consuming. Although negotiations are still at an early stage, it is possible to draw out some preliminary points.

The UK has now said that it will not seek to continue to participate in the European Arrest Warrant (EAW) scheme. The EAW scheme allows a member state to issue a warrant for an individual’s arrest that is recognised and enforceable throughout the EU, which has the effect of rapidly expediting extraditions between the UK and other EAW countries (approximately three times as fast as between the UK and non-EAW countries). It is unsurprising that the UK will not seek to remain in the scheme, as only EU states can participate; however, it does contrast with Theresa May’s intention to ‘rejoin’ the EAW post-Brexit. The new announcement seems to signal that the UK will not seek to come to an equivalent arrangement with the EU. Once the transition period expires, we can expect extradition of individuals to and from the EU to take significantly longer than it does presently. Austria, Germany and Slovenia all have constitutions that bar them from extraditing their citizens to non-EU countries and all have said that they will not extradite their own citizens to the UK during the transition period.

The UK will also lose access to Europol, the body responsible for coordinating EU law enforcement cooperation between EU states. This will restrict its intelligence sharing capabilities; for instance officers in the UK will no longer be able to access the criminal records of European nationals. This is also a blow to Europol itself, as the UK is the second largest contributor of intelligence to the agency. More significantly for white-collar crime practitioners, the UK will leave Eurojust, the agency responsible for ensuring prosecutorial cooperation for cross-jurisdictional cases. Whilst the increasing practical importance of international cooperation to agencies such as the SFO was underscored by the Airbus DPA (see above), some of the key tools for achieving that level of cooperation will be eroded by Brexit.

Streamlining international enforcement

If one of the blockbuster international enforcement developments of 2018 was KBR v SFO (in which the High Court held that the SFO can issue section 2 notices in respect of documents held overseas) its eagerly anticipated sequel would be the Crime (Overseas Production Orders) Act 2019 (the 2019 Act). [51] Overseas production orders (OPOs) give officers at agencies such as the SFO, HMRC and FCA the power to require a person based overseas to give access to data wherever it is stored within seven days. This Act is the sibling of the US Clarifying Lawful Overseas Use of Data Act (the CLOUD Act), which makes similar provisions for US law enforcement.

The practical effect of OPOs will be to shortcut the need for formal requests for mutual legal assistance, which require an officer to apply to the foreign state to compel the individual to produce the information. That process is time-consuming and the foreign state may refuse to grant the request. With OPOs, oversight rests entirely with the British authority and the process is much quicker. Similarly, with the CLOUD Act, authority rests entirely with the requesting US authority.

To take effect, an OPO requires the existence of a ‘designated international cooperation agreement’ with the foreign state. Such an agreement was signed with the US in October. However, at present this is the only such agreement and it has not yet been passed by Parliament or Congress. Another hurdle may be that the sanction for failure to comply with an OPO is contempt of court; in contrast, failure to comply with a here and now notice carries the much heavier penalty of a possible custodial sentence. It remains to be seen whether this will provide a sufficient incentive for compliance for individuals based outside the United Kingdom. Over the next year, with the UK keen to present itself as outward-looking ‘Global Britain’, we can expect the government to push for further OPO cooperation agreements.


Notes

[1] United Kingdom Anti-Corruption Strategy 2017-2022, page 35.

[2] SFO News Release, Lisa Osofsky, Director, speaking at the Royal United Services Institute in London (3 April 2019) https://www.sfo.gov.uk/2019/04/03/fighting-fraud-and-corruption-in-a-shrinking-world/

[3] Corporate Co-operation Guidance, SFO Operational Handbook, https://www.sfo.gov.uk/publications/guidance-policy-and-protocols/sfo-operational-handbook/.

[4] ‘SFO Director: We don’t do guidance’, Global Investigation Review (1 November 2017), https://globalinvestigationsreview.com/article/1149586/sfo-director-we-dont-do-guidance.

[5] Ibid, page 1.

[6] Deferred Prosecution Agreements Code of Practice, SFO and CPS https://www.cps.gov.uk/sites/default/files/documents/publications/dpa_cop.pdf.

[7] Th DPA scheme under section 45 and Schedule 17 of the Crime and Courts Act 2013 came into force on 24 February 2014.

[8] SFO News Release, Lisa Osofsky, Director, speaking at the Cambridge International Symposium on Economic Crime 2018, Jesus College, Cambridge (3 September 2018) https://www.sfo.gov.uk/2018/09/03/lisa-osofsky-making-the-uk-a-high-risk-country-for-fraud-bribery-and-corruption/.

[9] Serious Fraud Office v Serco Geografix Ltd [2019].

[10] Serious Fraud Office v Serco Geografix Ltd, Approved Judgment of 4 July 2019, paragraph 23.

[11] Ibid, paragraph 24.

[12] Serious Fraud Office v Guralp Systems Ltd, Approved Judgment of 22 October 2019.

[13] Serious Fraud Office v Serco Geographix Ltd [2019].

[14] Serious Fraud Office v Tesco Stores Ltd [2017].

[15] Serious Fraud Office v Rolls Royce Pls [2017].

[16] Serious Fraud Office v Standard Bank Plc [2015] and Serious Fraud Office v Sarclad [2016].

[17] Serious Fraud Office v Airbus SE [2020].

[18] Serious Fraud Office v Airbus SE [2020], Statement of Facts accompanying the DPA, paragraph 38.

[19] SFO News Release, Lisa Osofsky, Director, speaking at the Cambridge Symposium on Economic Crime 2019 https://www.sfo.gov.uk/2019/09/02/cambridge-symposium-2019/.

[20] Serious Fraud Office v Airbus SE, Approved Judgment of 31 January 2020, paragraphs 1–2.

[21] On privilege see Serious Fraud Office v Airbus SE, Approved Judgment of 31 January 2020, paragraphs 36 and 74, and Statement of Facts accompanying the DPA, paragraph 32.

[22] Serious Fraud Office v Airbus SE, Approved Judgment of 31 January 2020, paragraph 69.

[23] Ibid, paragraph 68.

[24] ‘Former Tesco executive Carl Rogberg cleared of fraud’, The Guardian (23 January 2019) https://www.theguardian.com/uk-news/2019/jan/23/former-tesco-executive-carl-rogberg-cleared-of-fraud.

[25] SFO News Release, Three individuals acquitted as SFO confirms DPA with Sarclad (16 July 2019) https://www.sfo.gov.uk/2019/07/16/three-individuals-acquitted-as-sfo-confirms-dpa-with-sarclad/.

[26] SFO News Release, Three individuals acquitted as SFO confirms DPA with Güralp Systems Ltd (20 December 2019), https://www.sfo.gov.uk/2019/12/20/three-individuals-acquitted-as-sfo-confirms-dpa-with-guralp-systems-ltd/.

[27] DoJ News Release, Director of South Korea’s Earthquake Research Center Convicted of Money Laundering in Million Dollar Bribe Scheme (18 July 2017) https://www.justice.gov/opa/pr/director-south-koreas-earthquake-research-center-convicted-money-laundering-million-dollar.

[28] Letter from Transparency International to Lisa Osofsky, re: Strengthening the UK’s Deferred Prosecution Agreement regime, 13 February 2020, available at https://www.transparency.org.uk/publications/airbus-uk-deferred-prosecution-agreement-dpa-bribery-sfo-lisa-osofsky/.

[30] These powers are found in sections 362A-I of the Proceeds of Crime Act 2002, as amended by the Criminal Finances Act 2017.

[31] Assets of a value greater than £50,000.

[32] These powers are found in sections 303Z1-Z17 of the Proceeds of Crime Act 2002, as amended by the Criminal Finances Act 2017.

[33] NCA News Release, Al-Assad family cash forfeited in London court (21 May 2019) https://www.nationalcrimeagency.gov.uk/news/al-assad-family-cash-forfeited-in-london-court.

[34] NCA News Release, NCA secures Unexplained Wealth Orders for prime London property worth tens of millions, 29 May 2019, https://www.nationalcrimeagency.gov.uk/news/nca-secures-unexplained-wealth-orders-for-prime-london-property-worth-tens-of-millions.

[35] NCA News Release, NCA secures first serious organised crime Unexplained Wealth Order for property worth £10 million, 18 July 2019, https://www.nationalcrimeagency.gov.uk/news/nca-secures-first-serious-organised-crime-unexplained-wealth-order-for-property-worth-10-million.

[36] Respectively, sub-sections 362B(4)(a) and 362B(4)(b) of the Proceeds of Crime Act 2002, as amended by the Criminal Finances Act 2017.

[37] NCA News Release, NCA secures Unexplained Wealth Order against properties owned by a Northern Irish woman, 31 July 2019, https://www.nationalcrimeagency.gov.uk/news/nca-secures-unexplained-wealth-order-against-properties-owned-by-a-northern-irish-woman.

[38] NCA News Release, £100m Account Freezing Orders are largest granted to NCA, 14 August 2019, https://www.nationalcrimeagency.gov.uk/news/100m-account-freezing-orders-are-largest-granted-to-nca.

[39] NCA News Release, NCA agrees £190m settlement after frozen funds investigation, 3 December 2019, https://www.nationalcrimeagency.gov.uk/news/nca-agrees-190m-settlement-after-frozen-funds-investigation-3.

[40] NCA News Release, Court grants NCA £1m freezing order, https://www.nationalcrimeagency.gov.uk/news/court-grants-nca-1m-freezing-order.

[41] NCA News Release, NCA secures freezing order over Leeds businessman’s £10.5m property portfolio, https://www.nationalcrimeagency.gov.uk/news/nca-secures-freezing-order-over-leeds-businessman-s-10-5-property-portfolio.

[42] Zamira Hajiyeva v National Crime Agency [2020] EWCA Civ 108 and NCA News Release, Court dismisses UWO appeal by Zamira Hajiyeva, https://www.nationalcrimeagency.gov.uk/news/court-dismisses-uwo-appeal-by-zamira-hajiyeva.

[44] National Crime Agency v Andrew J Baker and others [2020] EWHC 822 (Admin).

[45] SFO News Release, SFO nets £1.52m from convicted Birmingham fraudster, 15 March 2019, https://www.sfo.gov.uk/2019/03/15/sfo-nets-1-52m-from-convicted-birmingham-fraudster/ and 5SAH, James Fletcher in HMRC’s first successful application for an Account Forfeiture Order where claim contested by respondent, 26 March 2019, https://www.5sah.co.uk/news-and-events/news/2019-03-26/james-fletcher-in-hmrcs-first-successful-application-for-an-account-forfeiture-order-where-claim-contested-by-respondent.

[46] Blackfords LLP, Our Law Team Solved an Account Freezing Order, 13 March 2020, https://blackfords.com/hmrc-application-account-freezing-order/.

[47] Regulation 45C, as amended, The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.

[48] FCA News Release, Two found guilty of insider dealing, 27 June 2019, https://www.fca.org.uk/news/press-releases/two-found-guilty-insider-dealing.

[49] FCA News Release, Konstantin Vishnyak appears at court for destruction of documents offence, 6 September 2019, https://www.fca.org.uk/news/press-releases/konstantin-vishnyak-appears-court-destruction-documents-offence.

[50] Ex-Banker Denies Deleting WhatsApp Over FCA Probe, Law360, 18 November 2019 https://www.law360.com/articles/1220703/ex-banker-denies-deleting-whatsapp-over-fca-probe.

[51] R (KBR Inc) v The Director of the Serious Fraud Office [2018] EWHC 2012 (Admin).

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