The co-Chairs of the All Party Parliamentary Group on Anti-Corruption (APPG on Anti-Corruption), Catherine McKinnell MP and Nigel Mills MP, have written to the Lord Chancellor and Secretary of State for Justice, urging the Ministry of Justice and the Government to fulfil the commitment to begin reform in the area of corporate liability for economic crime.
The APPG on Anti-Corruption welcomes the statement by the Minister for Security on 22 November 2016, at the sixth sitting of the Committee stage of the Criminal Finances Bill, that the Government will publish a call for evidence on this matter. But the APPG on Anti-Corruption calls for a firm date on when this will open.
In May 2016, the UK Government committed to opening a consultation in summer 2016 on extending the scope of the criminal offence of a corporate ‘failing to prevent’ beyond bribery and tax evasion to other economic crimes. However, the Ministry of Justice is yet to release a date for when the process will begin: a consultation on this issue has been dropped once before. The APPG on Anti-Corruption is concerned this does not happen again.
Extending the ‘failure to prevent’ offence, as set out in Section 7 of the Bribery Act 2010, to all economic crime would significantly assist in the prosecution of such crimes; encourage companies to improve their corporate governance procedures and bolster pragmatic corporate regulation. It would also address the current potential imbalance in prosecution for economic crime between small and medium-sized enterprises and larger or multi-national companies due to the identification principle which makes it harder to capture senior level malfeasance in businesses with complex structures. The application of the model set out by Section 7 of the Bribery Act 2010, to other economic crime, has previously been questioned due to a lack of prosecutions. This argument is no longer as persuasive given the conviction of Sweett Group PLC in February 2016.
The APPG on Anti-Corruption reiterates the statement made by the UK Government in the communique which accompanied the Anti-Corruption Summit in May this year. Namely identifying that the “private sector is at the forefront of the fight against corruption and we encourage them to take steps to avoid any corruption in commercial companies through the implementation of appropriate prevention procedures.” The Government has also committed to reviewing its progressing on reaching the goals set after the Anti-Corruption Summit.