Wednesday, January 2, 2019
Today the Serious Fraud Office announced the end of the UK’s first Deferred Prosecution Agreement, confirming that Standard Bank PLC (now known as ICBC Standard Bank PLC) had fully complied with its terms.
The DPA required Standard Bank to pay nearly $26m in fines and disgorgement of profits, and to pay $6m in compensation to the Government of Tanzania.
Under the DPA terms, Standard Bank was required to commission an external consultant to report on its anti-bribery and corruption controls, policies and procedures, and to recommend improvements to strengthen its controls, with regular reports issued to the SFO.
Since their introduction in 2014, the SFO has secured four DPAs, which have seen more than £670m of financial penalties paid to the Treasury.
Lisa Osofsky, Director of the Serious Fraud Office said:
“I welcome this successful conclusion of the UK’s first Deferred Prosecution Agreement.”
“DPAs are a way of holding companies to account without punishing innocent employees, and are an important tool in changing corporate culture for the better.”
“Under the terms of the DPA, the SFO alleged that Standard Bank had failed to prevent its associated person(s) from committing to secure a contract to raise sovereign debt for Tanzania.”
The six terms imposed on Standard Bank to secure a DPA were:
- Cooperation– Standard Bank was required to fully and honestly cooperate with the SFO and other authorities investigating the bribes, including disclosing information and material relating to activities by individuals involved. This has occurred throughout the term of the DPA.
- Compensation– $6m of compensation, plus interest of $1,046,196.58 to be paid to the Government of Tanzania, this was paid in full in May 2016.
- Disgorgement of profits– All $8.4m fees paid to Stanbic Tanzania and Standard Bank through the secured contract to be confiscated by the SFO and passed to the UK Treasury, this occurred in May 2016.
- Financial Penalty– $16.8m in fines were imposed on Standard Bank by the SFO and passed to the UK Treasury, this occurred in May 2016.
- Corporate Compliance Programme– Standard Bank agreed to commission a review by Price Waterhouse Coopers on the bank’s internal anti-bribery and corruption compliance procedures, in agreement with the SFO, who advised on the scope and extent of that review. On completion of that review, Standard Bank was required to implement any recommendations and act on advice received within 12 months of the review completing, with PWC verifying their implementation with regular reports provided to the SFO for certification. This was completed in August 2017.
- Costs– SFO costs of £330,000 to be paid by Standard Bank, this occurred in May 2016.
The Deferred Prosecution Agreement between Standard Bank and the Serious Fraud Office expired on Friday 30th November 2018, three years after it was initially imposed, with formal notification sent to the Court.
Notes to Editors
1. Deferred Prosecution Agreements were introduced by the Crime and Courts Act 2013, which came into effect in 2014 and are available to the Serious Fraud Office and Crown Prosecution Service.
2. Since their introduction four DPAs have been agreed, all by the SFO, these are:
- Standard Bank PLC (2015)
- XYZ (the company cannot be named due to ongoing criminal proceedings) (2016)
- Rolls-Royce (2017)
- Tesco (2017)
Further information on DPAs and their use by the SFO can be found here.
3. Standard Bank PLC’s Deferred Prosecution Agreement with the SFO came into force on 30th November 2015.
- The DPA was approved by the President of the Queen’s Bench Division, the Rt. Hon. Sir Brian Leveson at Southwark Crown Court.
- A separate bill of indictment was preferred by the SFO on the same day, charging Standard Bank with one offence of failing to prevent bribery contrary to Section 7 of the Bribery Act 2010 and proceedings were automatically suspended in accordance with paragraph 2(2) of Schedule 17 to the Crime and Courts Act 2013. Further information on the Standard Bank DPA can be found here.
4. The SFO has formally notified the courts of its decision to conclude its Deferred Prosecution Agreement without restarting prosecution proceedings within 15 days of the expiry of this agreement.
5. A ‘Details of Compliance’ outlining how Standard Bank has met the terms of the DPA will be published on the SFO’s website.