An interesting article by Richard Kovalevsky QC at Stewarts Law where he shares his views on the recent SFO cases as well as the challenges and future direction of these sort of matters.
He draws a useful comparison between the early days of the FCPA and how the UK Bribery Act is playing out, specifically looking at whether the trajectory in the UK will follow how the U.S. authorities used FCPA.
Regardless of whether it keeps pace, is an accelerated version or slows down, financial crime in all its guises, be it fraud, bribery/corruption, money laundering, trade violations or sanction breaches, will continue to grow in significance for companies and, increasingly, individuals in senior positions within them.
Given this, it is important that companies take compliance seriously and a good starting point is to consider the Three Lines of Defence model regularly deployed in the financial sector, looking how controls can be employed at an operational level, within risk management & compliance and finally within internal audit. I appreciate that this approach does not fit all companies of any size for all issues - but it does make them think about the different controls that can be embedded within organisations at different parts of the business, rather than relying on a single person or control.
It is also important for companies to consider how they respond to these sorts of incidents, making sure that they have a robust and tested plan to follow if the worst should happen. This involves making sure that the appropriate professionals are involved early on the process to ensure that a defensible approach is followed.
These issues are going to continue to come to the fore in law enforcement, government and the public's eyes, therefore it is important that companies tackle these issues seriously! As Richard Kovalevsky QC states "...the activity of the prosecuting authorities in the area of financial crime in the UK will continue to increase."
In my view, the activity of the prosecuting authorities in the area of financial crime in the UK will continue to increase. While the UK’s jurisprudence is different from that of the US, (meaning that while we will not mirror the development witnessed through the activity of the DoJ and SEC), we will find that the general trend of activity will be similar.