Fraud

Attorney-General written question – answered at on 2 April 2014.

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Photo of Emily Thornberry Emily Thornberry Shadow Attorney General

To ask the Attorney-General against what corporate defendants the Serious Fraud Office has brought enforcement actions in the last 10 years; what the outcome of each such action was; what civil recovery was ordered in each successful case; what criminal fines were imposed in each successful case; and under what primary legislation each case was brought.

Photo of Oliver Heald Oliver Heald The Solicitor-General

The Serious Fraud Office (SFO) has brought enforcement actions against 11 corporate defendants in the last 10 years, as set out in the following table.

Before 2008, all successful SFO prosecutions were of individuals. The following table shows the fines and civil recovery orders (CROs) in SFO cases involving corporates since then.

  Case Penalty1
2008 Balfour Beatty plc £2.25 million CRO
2008 Severn Trent Water Ltd £2 million fine
2009 AMEC plc £4.94 million CRO
2009 Mabey and Johnson Ltd £3.5 million fine
2010 BAE Systems plc £500,000 fine
2010 Innospec Ltd $12.7 million fine
2011 De Puy International Ltd £4.8 million CRO
2011 MacMillan Publishers Ltd £11.3 million CRO
2011 M W Kellogg Ltd £7 million CRO
2012 Mabey Engineering (Holdings) Ltd £131,000 CRO
2012 Oxford Publishing Ltd £1.9 million CRO
1 Figures are rounded

The above proceedings marked “CRO” were commenced in accordance with Chapter 2 of Part 5 of the Proceeds of Crime Act 2002.

Severn Trent Water Ltd pleaded guilty to an offence under the Water Industry Act 1991.

Mabey and Johnson Ltd pleaded guilty to offences under the Criminal Law Act 1977, the Prevention of Corruption Act 1906 and United Nations Act 1946.

BAE Systems plc pleaded guilty to an offence of failing to maintain adequate accounting records under the Companies Act 1985.

Innospec Ltd pleaded guilty to an offence under the Criminal Law Act 1977.

In 2006, the SFO brought charges against five companies in relation to alleged price fixing of pharmaceutical products. The five companies were Kent Pharmaceuticals, Norton Healthcare Ltd, Generics (UK) Ltd, Ranbaxy (UK) Ltd, and Goldshield Group plc. In 2008, a judge ordered the acquittal of all five companies.

If a company is to be prosecuted, it is usually necessary in cases to demonstrate that the controlling minds of a company were knowing participants in the criminality being alleged. This can be difficult to prove, especially in complex cases, and so most SFO prosecutions have been of individuals rather than companies. Other outcomes are also possible. In 2010, BAE Systems plc agreed to make a £29.5 million payment for the benefit of the people of Tanzania, following a settlement with the SFO and the US Department of Justice. Last year, Oxford University Press (owners of Oxford Publishing Ltd) unilaterally offered to contribute £2 million to not-for-profit organisations for teacher training and other educational purposes in sub-Saharan Africa.

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