ARTICLES: WRITTEN MOOT 2
paid, or the facilitation of tax evasion committed by, an ‘associated person’,106 which includes any person performing services for or on behalf of the company.107 This is because liability for these offences is “semi-strict”:108 a company is prima facie liable for the bribes paid for its benefit by an ‘associated person’,109 or for the facilitation of tax evasion by an ‘associated person’ acting in that capacity,110 unless it has implemented adequate procedures at the time of the bribery111 or reasonable prevention procedures at the time of tax evasion facilitation.112 In other words, prosecutors can circumvent the identification doctrine and its evidential difficulties when prosecuting companies in these areas.113 Therefore, in the context of these offences, the likelihood of successful prosecution (along with the unsupported nature of the ‘Arthur Andersen effect’) undercuts the necessity of the flexibility provided by DPAs.114 Hence, it is arguable that the DPAs entered into in relation to the failure to prevent bribery offences, i.e. Standard Bank,115 XYZ (partially),116 and RollsRoyce (partially),117 have been to some extent unnecessary because enforcement action via prosecution could have been taken instead. Notwithstanding the above, this essay also
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106 Tim Pope and Thomas Webb, ‘Legislative Comment – the Bribery Act 2010’ (2010) 25 JIBLR 480, 482; Campbell (n 45) 60. 107 BA (n 100), ss 7-8; CFA (n 101), s 44. 108 Celia Wells, ‘Corporate criminal liability: a ten year review’ (2014) 12 Crim LR 849, 872. 109 BA (n 100), s 7(1). 110 CFA (n 101), ss 45(1), 46(1). 111 BA (n 100), s 7(2). 112 CFA (n 101), ss 45(2), 46(3). 113 Call for Evidence 2017 (n 38) 8, 18; Rita Cheung, ‘Money laundering - a new era for sentencing organisations’ (2017) 1 JBL 23, fn 4; Ryder (n 41) 259; Karl Laird, ‘The Criminal Finances Act 2017 - an introduction’ (2017) 12 Crim LR 915, 933. 114 Colin King and Nicholas Lord, Negotiated Justice and Corporate Crime: The Legitimacy of Civil Recovery Orders and Deferred Prosecution Agreements (Palgrave Macmillan 2018) (Negotiated Justice and Corporate Crime) 137. 115 Serious Fraud Office v Standard Bank Plc [2015] Southwark Crown Court Case No. U20150854, [2016] Lloyd’s Rep FC 102 (Standard Bank) [10]. 116 Serious Fraud Office v XYZ Ltd [2016] Southwark Crown Court Case No. U20150856, [2016] Lloyd’s Rep FC 509 (XYZ) [12]. 117 Rolls-Royce (n 8) [77].
furthers the argument that the UK DPA is unlikely to be an effective tool in addressing corporate economic crime because it is unlikely to improve corporate accountability and change corporate culture in practice. B. Accountability is likely limited because self-reporting is potentially disincentivised DPAs are unlikely to improve prosecutors’ ability to hold corporate offenders accountable in practice because the incentives to self-report are potentially undermined following the RollsRoyce DPA. This would deny prosecutors the evidential benefits that DPAs purportedly facilitate. The Rolls-Royce DPA was approved by Sir Leveson P even though Rolls-Royce had failed to self-report; instead, SFO investigations had commenced only after becoming aware of corruption allegations involving the company online.118 This was despite the fact that the previous two DPAs (Standard Bank119 and XYZ)120 appeared to have been approved on the ‘precondition’ of a self-report.121 Indeed, in approving those, His Lordship had held that the “core of the interests of justice test”, which the court has to consider when approving a DPA, “lies in the promptness of the self-report”.122 In addressing this inconsistency, Leveson P accepted the SFO’s argument that Rolls-Royce’s “extraordinary” cooperation,123 like its voluntary disclosure of internal investigations and waiver of privilege over internal investigation 118 Rolls-Royce (n 8) [16]; noted Rachel Nicolson et al, ‘The Rolls-Royce bribery case and its implications in Australia’ (2017) 69 Governance Directions 117, 118. 119 Standard Bank (n 115) [14]. 120 XYZ (n 116) [16]. 121 OECD, Implementing the OECD Anti-Bribery Convention Phase 4 Report: United Kingdom (OECD, 2017) 16 <http://www. oecd.org/corruption/anti-bribery/UK-Phase-4-Report-ENG. pdf> accessed 13 March 2019. 122 Rita Cheung, ‘Deferred Prosecution Agreements: Cooperation and Confession’ (2018) 77 Camb LJ 12, 13 citing Standard Bank (n 115) [14] and XYZ (n 116) [16]. 123 Rolls-Royce (n 8) [22], [23].