House of Commons Releases Eleventh Report of Session 2010-12 on Financial Crime and Development

On 5 February 2010 an agreement was reached between the Serious Fraud Office (SFO) and BAE Systems arising from the criminal offence of improper book-keeping, which BAE Systems admitted in connection with the sale of a military air traffic control system to the Government of Tanzania. The agreement, under which an ex gratia payment for the benefit of the people of Tanzania of £29.5 million (£30 million less court penalties) would be made by the company, became publicly known at the conclusion of the Court proceedings on 21 December 2010. Aspects of the agreement attracted critical comment and the UK Parliament decided to hold a brief inquiry. The inquiry considered a number of other issues relating to financial crimes. It finds that existing legislation provides sufficient scope to allow reparations to be made to developing countries in appropriate circumstances by British companies guilty of financial crimes. The inquiry recommends that, as in the BAE case, payments be proportionate to the offence. Changes are not required to the Bribery Act, 2010 at this very early stage in the Act's life. Further, The Ministry of Justice should address the SFO's recommendation that, in cases of financial crimes involving plea bargaining, the SFO and company involved could take a proposed resolution to a Judge before the criminal justice process has been engaged by a formal charge.

Originally Published: 
15/11/2011