DOCSLIB.ORG

Briefing Corporate Crime with Copy.Indd

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Briefing Corporate Crime with Copy.Indd CORPORATE CRIME BRIEFING Bribery Act 2010: still a sleeping giant Having just celebrated its third birthday, the Bribery Act 2010 (2010 Act) is still a Enforcement before the Bribery Act 2010 sleeping giant. In 2010 and 2011, there One rationale for the Bribery Act 2010 (2010 Act) was to replace the notoriously was an alarmist atmosphere concerning its diffi cult Victorian legislation and make it easier for the Serious Fraud Offi ce (SFO) to perceived broad jurisdictional scope and the bring enforcement proceedings. However, despite the challenges of the pre-2010 Act requirement to create and maintain adequate legislation, the SFO has a respectable track record of bringing successful enforcement procedures to prevent bribery (see feature proceedings. For example: article “Bribery Act 2010: what does it mean for your company?”, www.practicallaw.com/8- • In 2009, Mabey & Johnson Ltd was convicted of overseas bribery (see News brief 505-9543). Companies also feared draconian “Serious Fraud Offi ce: targeting dividends”, www.practicallaw.com/3-517-3268). enforcement, particularly for those used to • In 2010, Innospec Ltd pleaded guilty to a charge of conspiracy to corrupt ([2010] US enforcement of the US Foreign Corrupt EW Misc 7 (EWCC); see News brief “Self-reporting corporate corruption: where are we Practices Act of 1977 (FCPA). after Innospec?”, www.practicallaw.com/2-502-1218). These fears have not yet been realised. • In 2011, BAE Systems plc pleaded guilty to accounting irregularities following its Headlines suggesting that the 2010 Act was investigation by the SFO for bribery allegations (www.practicallaw.com/2-504-8661). the “FCPA on steroids” in hindsight appear • In 2011, the SFO obtained a civil recovery order against Macmillan Publishers Limited wide of the mark and the required adequate after it self-reported attempts by its agent to bribe World Bank employees to win procedures have turned out to be prevailing book sales in southern Sudan. good international compliance practice. To date, the Serious Fraud Offi ce (SFO) has not • In 2012, the SFO obtained a civil recovery order against Oxford Publishing Ltd after brought any corporate prosecutions under it self-reported bribery in its East African operations. the new failure to prevent bribery offence and • In 2014, the Innospec investigation ended with the company’s two former CEOs, there has yet to be a signifi cant UK corporate its business director and sales director being convicted of, and receiving signifi cant prosecution for bribery of overseas public prison sentences for, conspiracy to corrupt under the pre-2010 Act legislation (R offi cials. v Turner, Kerrison, Papachristos and Jennings, unreported Southwark Crown Court, 4 August 2014). Despite what may be viewed as a slow start, we do not believe that the SFO has • In 2014, Bruce Hall, the former CEO of Bahraini company, Aluminium Bahrain BSC, failed to enforce the 2010 Act rigorously or was sentenced to 16 months in prison for corruption under the pre-2010 Act legislation that UK companies can relax about active (R v Hall, unreported Southwark Crown Court, 22 July 2014). anti-corruption enforcement. Indeed, SFO (See also feature article “Foreign bribery and corruption: sentencing trends”, www. pronouncements and its current casework practicallaw.com/9-525-7910). suggest otherwise, and international historical practice indicates that it takes time to mobilise resources to bring cases under a article “Deferred prosecution agreements: sentencing range for corporate corruption and newly enhanced anti-corruption law. In the moving into the unknown”, www.practicallaw. how UK sentences would be benchmarked US, for example, although the FCPA was com/6-525-6101). Under a DPA, a company against other legal systems. The Crown Court enacted in 1977, vigorous enforcement of it that admits certain economic and fi nancial in Innospec said that states should adopt a did not begin until the early 2000s. offences will be able to avoid prosecution uniform approach to fi nancial penalties for if it complies with set conditions, including the corruption of foreign government offi cials Post-2010 Act reforms the payment of fi nancial penalties. DPAs are so that companies in different states are not Since the 2010 Act came into force on 1 July intended to act as an incentive for companies subject to widely varying penalties. 2011, the UK has made signifi cant changes to to co-operate with the SFO and achieve a the criminal justice system to accommodate more proportionate sentencing outcome. In an effort to provide additional uniformity the anticipated upswing of serious corporate and predictability in relation to corporate economic crime cases, such as introducing Until R v Innospec Limited, sentencing fi nes, new guidelines were published on 31 deferred prosecution agreements (DPAs) and principles for corporate corruption were January 2014 for companies convicted of new sentencing guidelines. unclear ([2010] EW Misc 7 (EWCC); see fraud, bribery or money laundering (see News News brief “Self-reporting corporate brief “Sentencing guidelines for corporates: DPAs, which have been available since 24 corruption: where are we after Innospec?”, giving teeth to the DPA?”, www.practicallaw. February 2014, provide a new means of www.practicallaw.com/2-502-1218). It was com/4-558-0365). The guidelines are resolving corporate investigations (see feature almost impossible to predict and advise on a intended to level the playing fi eld between US © 2014 Thomson Reuters (Professional) UK Limited. This article fi rst appeared in the November 2014 issue of PLC Magazine, published by Practical Law, part of Thomson Reuters (Professional) UK Limited, and is reproduced by agreement with the publishers. 1 and UK sentences and provide a framework Future enforcement strategy Principled decisions. The 9 October against which DPAs can be negotiated and It has not always been easy to perceive a announcement reaffirmed principled benchmarked. consistent enforcement strategy in the prosecutorial decision making. When evolution of the SFO’s corporate enforcement considering an enforcement action, SFO The government has also recently announced actions. Several previous corporate corruption prosecutors will be guided by pre-existing that it is considering proposals to create a investigations have been resolved using non- and well-established law and protocol in its new corporate offence of failing to prevent corruption charges, limitations on conduct decision-making process and the exercise of economic crime, which would mirror and included in admissions or public resolutions, prosecutorial discretion. The SFO’s decision expand the corporate offence of failing to and civil forfeiture. In addition, there has been to prosecute a company is governed by prevent bribery that was introduced in the no clear policy on the standard by which the Full Code Test in the Code for Crown 2010 Act (see News brief “Failure to prevent follow-on proceedings against individuals Prosecutors (www.cps.gov.uk/publications/ economic crime: a new corporate offence”, would be brought. docs/code_2013_accessible_english.pdf), the www.practicallaw.com/7-581-8568). Joint Prosecution Guidance on Corporate On 9 October 2012, the SFO announced Prosecutions (www.sfo.gov.uk/media/65217/ Pipeline delay revised policies regarding corporate self- joint_guidance_on_corporate_prosecutions. The 2010 Act does not apply to conduct reporting, hospitality and facilitation pdf) and, where relevant, the Bribery Act carried out before it came into force (see payments (the 9 October announcement) 2010: Joint Prosecution Guidance of the box “Enforcement before the Bribery Act (see News brief “Self-reporting fi nancial crime: Director of the SFO and the Director of 2010”). Given the normal timeline of moving the goal posts”, www.practicallaw. Public Prosecutions (www.sfo.gov.uk/ enforcement cases, this means that there com/1-522-6197). The revised policies media/167348/bribery_act_2010_joint_ has not necessarily been a delay by the SFO followed a review that was instigated by Mr prosecution_guidance_of_the_director_of_ in bringing 2010 Act cases; rather, it means Green and, somewhat pointedly, superseded the_serious_fraud_offi ce_and_the_director_ that investigation of post-2010 Act conduct the SFO’s previous statements and practices of_public_prosecutions.pdf). is underway. (see box “Procedural guidance”). The revised policies and later press statements also shed Bold decisions. Mr Green signaled a more Complex, multi-jurisdictional matters always some light on the future strategy of the SFO. aggressive approach to previous decisions by have a reasonably predictable time lag reopening the Weavering Capital case in 2012. between detection, investigation and the SFO as prosecutor. In the 9 October The SFO’s 2009 investigation into Weavering start of enforcement proceedings. In the announcement and in subsequent speeches, related to interest rate swaps that infl ated 1990s and 2000s, it was common for the Mr Green has emphasised that the SFO is the apparent net asset value of a managed SFO to have so-called “blockbuster” cases a specialist investigator and prosecutor of fund. The previous director of the SFO had on its roster, with typically no more than the highest level of serious and complex shelved the two and a half-year investigation, one or two cases under investigation at any fraud, bribery and corruption (www.sfo.gov. but subsequent civil proceedings found that given time. Investigations of Guinness plc, uk/about-us/our-views/director’s-speeches/
Load more

Recommended publications
  • Implications for White-Collar Criminals [Note]
    The New U.S.-U.K. Extradition Regime: Implications for White-Collar Criminals [Note] Item Type Article; text Authors Copenhaver-Celi, Jennifer Nicole Citation 25 Ariz. J. Int'l & Comp. L. 157 (2008) Publisher The University of Arizona James E. Rogers College of Law (Tucson, AZ) Journal Arizona Journal of International and Comparative Law Rights Copyright © The Author(s) Download date 05/10/2021 09:03:41 Item License http://rightsstatements.org/vocab/InC/1.0/ Version Final published version Link to Item http://hdl.handle.net/10150/659051 THE NEW U.S.-U.K. EXTRADITION REGIME: IMPLICATIONS FOR WHITE-COLLAR CRIMINALS Jennifer Nicole Copenhaver-Celi* I. INTRODUCTION On July 13, 2006, three British citizens, David Bermingham, Giles Darby, and Gary Mulgrew ("the NatWest Three") were flown to Houston, Texas to face fraud charges.' The victim of their alleged fraud was a British corporation. Nearly all of the allegedly criminal dealings took place in Great Britain. Yet, the NatWest Three will be 2 tried in the United States. Ian Norris is another British citizen 3facing extradition to the United States. His alleged crime is price-fixing. The NatWest Three and Ian Norris were extradited under a new treaty between the United Kingdom and the United States, the 2003 Extradition Treaty,4 and under a new British statute, the 2003 Extradition Act.5 Extradition arrangements under the treaty and the statute provoked public outrage in the United Kingdom. A range of public figures have spoken out against the arrangements, from politicians on the left and right, to businessmen, to civil-liberties activists.6 Much of the uproar was over a lack of reciprocity.7 When the NatWest Three were extradited in July 2006, the United States had *.
    [Show full text]
  • Extradition and the Natwest Three: Unintended Consequences Economist, July 15, 2006 Reciprocity Is Not the Issue; Safeguarding the Right to a Fair Trial Is
    Extradition and the NatWest Three: Unintended consequences Economist, July 15, 2006 Reciprocity is not the issue; safeguarding the right to a fair trial is THEY weren't dragged away in leg-irons, but the dispatch by air on July 13th of three British bankers to America to stand trial was as dramatic as legal spectacles get. David Bermingham, Gary Mulgrew and Giles Darby--the so-called NatWest Three--are charged with helping to pull off a £11m ($20m) fraud linked to the collapsed energy giant, Enron. The suspects are British; their victim is British; virtually all the alleged wrongful dealing was carried out in Britain. Their trial, however, like that of Enron's executives, will be in Houston. Outrage over their plight, and the flawed fast-track bilateral extradition treaty that produced it, has united left and right, law lords and NGOs, businessmen and civil-liberties activists (see page 34). Most of the fuss has been about reciprocity--or the lack of it. The three were handed over under the terms of a treaty signed by Britain and America in March 2003 and broadly enshrined in Britain's omnibus Extradition Act later that year. The treaty and the act reduced the supporting material that America must provide in requesting extradition from Britain. But America (which had a lousy record of surrendering Irish terrorists to Britain) has yet to ratify the treaty. Under the old rules America had to present "prima facie" evidence of guilt on the basis of which a jury, in the absence of a defence, could have convicted somebody.
    [Show full text]
  • Kindle \\ Corporate Crime / Download
    Corporate crime » Book ~ HL2SK17XWV Corporate crime By - Reference Series Books LLC Dez 2011, 2011. Taschenbuch. Book Condition: Neu. 247x192x14 mm. This item is printed on demand - Print on Demand Neuware - Source: Wikipedia. Pages: 124. Chapters: Enron, MCI Inc., Arthur Andersen, U.S. Securities and Exchange Commission, Industrial espionage, Pfizer, Samuel D. Waksal, Bank of Credit and Commerce International, Halliburton, NatWest Three, Sony BMG copy protection rootkit scandal, Tyco International, KPMG tax shelter fraud, RegisterFly, Crazy Eddie, Parmalat bankruptcy timeline, Seveso disaster, Federal Trade Commission, Options backdating, Financial Crisis Inquiry Commission, Holdings of American International Group, Bribery, Polly Peck, FirstEnergy, Cookie Jar Group, Franchise fraud, Precarity, Corporate manslaughter, McJob, Anti-corporate activism, White-collar crime, CUC International, William K. Black, Adelphia Communications Corporation, Baptist Foundation of Arizona, Robert Douglas Hartmann, Corporate Manslaughter and Corporate Homicide Act 2007, Media Vision, Satyam scandal, Precarious work, Contingent workforce, State-corporate crime, Ovson Egg, Trial of Kenneth Lay and Jeffrey Skilling, List of corporate scandals, Compass Group, Eurest Support Services, Statement on Auditing Standards No. 99: Consideration of Fraud, Byrraju Ramalinga Raju, John Peter Galanis, Titan Corp., Jeffrey Grayson, PurchasePro, Arthur Andersen LLP v. United States, Micheline Charest, Medco Health Solutions, Pro Arts Inc., Wiwa family lawsuits against Royal Dutch Shell, Minecode, Langbar International,... READ ONLINE [ 2.91 MB ] Reviews If you need to adding benefit, a must buy book. This really is for all who statte that there had not been a well worth reading. It is extremely difficult to leave it before concluding, once you begin to read the book. -- Claud Bernhard It is an remarkable pdf which i have ever go through.
    [Show full text]
  • International Prison Transfer Program
    G THE B IN EN V C R H E S A N 8 8 D 8 B 1 AR SINCE WWW. NYLJ.COM VOLUME 246—NO. 66 TUESDAY, OCTOBER 4, 2011 Outside Counsel Expert Analysis International Prison Transfer Program n our last column, we discussed benefit exists to the transfer of foreign the basics of extradition law and its nationals out of U.S. prisons. Currently, increasing relevance in white-collar almost 59,000 foreign nationals are cases.1 A related topic is the transfer imprisoned in the United States, which of foreign citizens convicted in the accounts for approximately 27 percent IUnited States to their home countries of the federal prison population.6 On to serve their sentence, as in the case By And average, it costs more than $25,000 of the “NatWest Three”—three British Robert G. Robert J. annually to incarcerate one prisoner.7 businessmen who pled guilty in 2007 Morvillo Anello to Enron-related fraud charges in the Governing Treaties U.S. District Court in Houston and numbers, fewer than half of the transfers served only six months in the United sought by foreign nationals serving The United States is party to 12 States before being transferred to the criminal sentences in the United bilateral and two multilateral treaties United Kingdom for the balance of their States are approved. The former chief with 74 other countries that provide 37-month sentences.2 of the International Prison Transfer for the execution of a foreign national’s Unit (IPTU), a unit within the Justice penal sentence in the defendant’s home Treaties facilitating such transfers 8 initially were formalized by the federal Department that administers such country.
    [Show full text]
  • Extraterritorial Jurisdiction: Lessons for the Business and Human Rights Sphere from Six Regulatory Areas
    Extraterritorial Jurisdiction: Lessons for the Business and Human Rights Sphere from Six Regulatory Areas Dr. Jennifer A. Zerk Jennifer Zerk Consulting A report for the Harvard Corporate Social Responsibility Initiative to help inform the mandate of the UNSG’s Special Representative on Business and Human Rights June 2010 ⎪ Working Paper No. 59 A Working Paper of the: Corporate Social Responsibility Initiative A Cooperative Project among: The Mossavar-Rahmani Center for Business and Government The Center for Public Leadership The Hauser Center for Nonprofit Organizations The Joan Shorenstein Center on the Press, Politics and Public Policy 1 Citation This paper may be cited as: Zerk, Jennifer A. 2010. “Extraterritorial jurisdiction: lessons for the business and human rights sphere from six regulatory areas.” Corporate Social Responsibility Initiative Working Paper No. 59. Cambridge, MA: John F. Kennedy School of Government, Harvard University. Comments may be directed to the author – [email protected] Corporate Social Responsibility Initiative The Corporate Social Responsibility Initiative at the Harvard Kennedy School of Government is a multi-disciplinary and multi-stakeholder program that seeks to study and enhance the public contributions of private enterprise. It explores the intersection of corporate responsibility, corporate governance and strategy, public policy, and the media. It bridges theory and practice, builds leadership skills, and supports constructive dialogue and collaboration among different sectors. It was founded in 2004 with the support of Walter H. Shorenstein, Chevron Corporation, The Coca-Cola Company, and General Motors. The views expressed in this paper are those of the author and do not imply endorsement by the Corporate Social Responsibility Initiative, the UN Special Representative on Business and Human Rights, the John F.
    [Show full text]
  • Lettering to the Max the Art & History of Calligraphy
    KORERO PRESS Lettering to the Max Ivan Castro, Alex Trochut Summary Lettering, the drawing, designing, and illustration of words, has a personal uniqueness that is increasingly valued in today's digital society, whether personal or professional. This manual, by the internationally renowned Iván Castro, outlines the basic materials and skills to get you started. Typographical concepts and the principles of construction and composition are decoded. In addition, Ivan outlines several practical projects that allow the reader, not just to practice, but to develop their own ideas. In-depth but accessible, this book is the ideal beginner's guide and an excellent reference for the more well versed. Korero Press 9781912740079 Pub Date: 3/1/21 Contributor Bio On Sale Date: 3/1/21 Ivan Castro is a graphic designer based in Barcelona, Spain, who specializes in calligraphy, lettering, and $32.95 USD typography. His work involves everything from advertising to editorial, and from packaging to logo design and Discount Code: LON gig posters. Although Ivan claims to have no specific style, one could say that he has a strong respect for the Trade Paperback history of popular culture. He has been working in the field for 20 years, and has been teaching calligraphy 128 Pages and lettering for 15 years in the main design schools in Barcelona. He travels frequently, holding workshops Full color throughout Carton Qty: 24 and giving lectures at design festivals and conferences. Alex Trochut was born in 1981 in Barcelona, Spain. Art / Techniques After completing his studies at Elisava Escola Superior de Disseny, Alex established his own design studio in ART003000 Barcelona before relocating to New York City.
    [Show full text]
  • Hayes' Fate No Sea Change for White Collar Extradition Fears by Melissa Lipman
    Portfolio Media. Inc. | 111 West 19th Street, 5th Floor | New York, NY 10011 | www.law360.com Phone: +1 646 783 7100 | Fax: +1 646 783 7161 | [email protected] Hayes' Fate No Sea Change For White Collar Extradition Fears By Melissa Lipman Law360, London (October 7, 2016, 6:46 PM BST) -- The 11-year jail term handed to former swaps trader Tom Hayes in late 2015 for Libor manipulation shocked long-held perceptions that British courts are softer on financial crime than their U.S. counterparts, but attorneys said the case doesn't herald a sea change in white collar defendants' prospects on either side of the Atlantic. British financial fraudsters who also have fallen afoul of U.S. laws often work hard to avoid extradition to America, calculating that U.K. courts tend to be more lenient. U.S. public appetite for prosecuting bankers is still running high, plus maximum sentences in the U.S. generally are longer and early releases few and far between. Hayes, a former UBS AG and Citigroup Inc. trader who was indicted by the U.S. Department of Justice in 2012 for rigging the London Interbank Offered Rate, later claimed in court that he was "suicidal" over the possibility of being extradited to the U.S. But ultimately, his play to court prosecution in the U.K. netted him sentence that, reduced from 14 years on appeal, dwarfed the two years given a former Rabobank trader after being convicted in New York in the DOJ's only Libor trial so far. "People might think that the sentence in the Hayes case, which was extraordinary by English standards, has changed the way people think about [extradition], but I think Hayes is a fairly distinct case," said Skadden Arps Slate Meagher & Flom LLP's Elizabeth Robertson.
    [Show full text]
  • The Domestic Politics of International Extradition
    Texas A&M University School of Law Texas A&M Law Scholarship Faculty Scholarship 7-2012 The Domestic Politics of International Extradition William Magnuson Texas A&M University School of Law, [email protected] Follow this and additional works at: https://scholarship.law.tamu.edu/facscholar Part of the Law Commons Recommended Citation William Magnuson, The Domestic Politics of International Extradition, 52 Va. J. Int'l L. 839 (2012). Available at: https://scholarship.law.tamu.edu/facscholar/757 This Article is brought to you for free and open access by Texas A&M Law Scholarship. It has been accepted for inclusion in Faculty Scholarship by an authorized administrator of Texas A&M Law Scholarship. For more information, please contact [email protected]. The Domestic Politics of International Extradition WILLIAM MAGNUSON Extradition poses a set of unique challenges for current theories of internationallaw. State decisions regarding extradition involve the intersection of domestic criminal law, complex international treaties, and often overtly political considerations, thus def ing neat explanation by legal theorists. This Article argues that current theory fails to adequately explain the international law of extradition because it relies on state-centric models of international relations. By focusing our attention on unitary state interests, commentators overlook the important ways in which domestic politics shapes and influences state behavior. More particulary, this Article argues that domestic groups and institutions both constrain and empower government decision-makers in structuring international extradition arrangements. Government officals often have conflicting incentives regarding extradition decisions, and these tensions help explain the tradeoffs states have made between commitment andflexibility in extradition treaties.
    [Show full text]
  • Chapter One - Educational Approach Overview, Style Sheet, and Business Math Overview
    Auditing Spring 2012 by Jim Peters Table of Contents CHAPTER ONE - EDUCATIONAL APPROACH OVERVIEW, STYLE SHEET, AND BUSINESS MATH OVERVIEW ............ 1-1 SUMMARY ................................................................................................................................................................ 1-1 EDUCATIONAL APPROACH ........................................................................................................................................... 1-1 HOW TO STUDY TEXT MATERIALS AND CASES ................................................................................................................. 1-3 HOW TO STRUCTURE ANSWERS TO DISCUSSION QUESTIONS .............................................................................................. 1-4 Descriptive ........................................................................................................................................................ 1-4 Recommendations for action ........................................................................................................................... 1-5 Evaluation Questions ....................................................................................................................................... 1-5 Diagnosis .......................................................................................................................................................... 1-6 PROFESSIONAL WRITING AND SPEAKING .......................................................................................................................
    [Show full text]
  • Is Extradition a Real and Significant Threat to Foreign Antitrust Offenders? Daseul Kim
    Northwestern Journal of International Law & Business Volume 28 Issue 3 Spring Spring 2008 "Perfectly Properly Triable" in the United States: Is Extradition a Real and Significant Threat to Foreign Antitrust Offenders? Daseul Kim Follow this and additional works at: http://scholarlycommons.law.northwestern.edu/njilb Part of the Antitrust and Trade Regulation Commons, Criminal Law Commons, International Law Commons, and the International Trade Commons Recommended Citation Daseul Kim, "Perfectly Properly Triable" in the United States: Is Extradition a Real and Significant Threat to Foreign Antitrust Offenders?, 28 Nw. J. Int'l L. & Bus. 583 (2007-2008) This Comment is brought to you for free and open access by Northwestern University School of Law Scholarly Commons. It has been accepted for inclusion in Northwestern Journal of International Law & Business by an authorized administrator of Northwestern University School of Law Scholarly Commons. "Perfectly Properly Triable" in the United States: Is Extradition a Real and Significant Threat to Foreign Antitrust Offenders?' Daseul Kim* Imagine that you are a U.K. citizen who has been running a manufacturing business for several years in Windsor, England. One day, the U.K. authorities arrest you for violating U.S. antitrust laws by price- fixing; your own government then surrenders you to the United States, where you will be tried and sentenced for the alleged antitrust violations in the U.S. courts. As surreal as this scenario may sound, this is exactly what the Bow Street Magistrates' Court in London decided when it held that Ian P. Norris, a U.K. citizen and the former CEO of Morgan Crucible Company Plc, was extraditable for allegedly violating U.S.
    [Show full text]
  • Fm Oct06 Dragnet(1).Pdf
    DRAG.NET DRAG.NET Fraudsters – especially the new breed of criminal that’s exploiting web technology – have largely brought into question the adequacy of existing legislation – and kept one step ahead of the UK’s what actually constitutes fraud. The problem, according to legal experts, is that the specificity of the current regulations antiquated legislation, but it’s governing this area and their allowance of technical defences has made bringing cases enormously expensive and securing about to be upgraded. Neil Hodge convictions virtually impossible. The Jubilee line trial cost £60m alone, for example. asks the lawyers whether the fraud As a result, the government has announced that it’s taking a bill will close all the loopholes. co-ordinated approach to tackling the problem. It has intro- duced the fraud bill, which is currently before Parliament, and it will bring forward another bill to allow for non-jury trials in a limited range of serious and complex fraud cases. In addition, the government has just published for consulta- tion the final report of the Fraud Review, which began a year ago. This advocates the establishment of a financial court juris- diction so that the different proceedings arising from serious fraud cases can be combined in one court and be heard by specialist judges. It suggests allowing plea-bargaining as an t the end of 2005 Norwich Union estimated that alternative to a full criminal trial. Afraud had cost the UK economy £16bn over the year – the The report’s other proposals include setting up a national equivalent of each adult in the country being £340 out of strategic authority as a public-private partnership to devise and pocket.
    [Show full text]
  • The Smartest Guys in the Room - Postscript
    The Private Investor · Issue 177 · July 2015 The Smartest Guys in the Room - Postscript In the last issue, I wrote a few remarks about Enron and mark-to-market accounting. A bit of further reading took to the UK connection here with the ‘Natwest Three’ whose involvement with Enron led three NatWest employees to jail sentences in the United States. Obviously I do not want to comment on this—but in an exculpatory book by one of the men (A Price to Pay: The Inside Story of the NatWest Three by David Bermingham) give an amazing insight into ‘Investment Banking’ when applied to a UK Clearing bank. As the story is told NatWest, which had bought an American boutique, (Greenwich) retired the then Chief Executive of NatWest Markets and persuaded the Greenwich Joint Chief Executive to come to London and run a reconstituted organisation. The man in question, Mr. Kruger, a brilliant but ruthless individual we are told changed the name to Greenwich Natwest. Moreover he found the Structured Trade Finance Department being run by some employee or other guilty of ‘old bank’ thinking and turfed him smartly out and replaced him by one Gary Mulgrew, later one of the co-indicted colleagues of Mr. Bermingham and one whose new-bank thinking eventually propelled him into an American prison. What was Structured Trade Finance? Well it can mean many things to many people we are coyly told, but the resources of the department were mainly used for off-balance sheet financial transactions. What is off- balance sheet finance? Well the example we are given is that of a sale-and-leaseback which ‘in one way’ can be regarded as ‘assets and liabilities that don’t appear in the balance sheet’.
    [Show full text]