Andrew Reeves (UK)

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UK FRC enhances fraud-spotting standards for auditors

On 27 May 2021, the Financial Reporting Council (FRC) published a revised version of its auditing standard on the responsibilities of auditors in relation to fraud. The revisions set out more stringent requirements to identify and assess the risk of material misstatement because of fraud and the procedures to respond to those risks. Such amendments … Continue Reading

Mobile data and investigations

Remote working has accelerated the merger of work and private data, particularly on mobile phones and instant messaging services such as WhatsApp. While employees are performing their jobs, mobile access may be putting their employers at risk – because work-related communications on unapproved platforms are frequently not preserved in accordance with regulatory requirements (where applicable), … Continue Reading

Making it count: Transparency International’s key recommendations on measuring the effectiveness of an ABC compliance programme

On 4 May 2021, Transparency International published its “Making it count” report on measuring the effectiveness of anti-bribery and corruption (ABC) programmes (the TI Report). Authorities globally are focused on the practical effectiveness of companies’ ABC programmes. As the Department of Justice (DOJ) and Securities and Exchange Commission (SEC) Resource Guide puts it, authorities’ primary … Continue Reading

Post script: Airbus subsidiary pleads guilty to corruption offence

On 28 April 2021, Airbus’ UK subsidiary GPT Special Project Management Ltd (GPT) was convicted of corruption and sentenced to pay penalties of over £30m by the Crown Court in London. This case preceded the wider investigation into Airbus culminating in its US$3.9 billion global deferred prosecution agreement in 2020 (see our previous article here). … Continue Reading

Coalition for Integrity report: AI a useful tool in ABC compliance for larger organisations

The Coalition for Integrity has published a report summarising how machine learning (or AI) can be used in anti-bribery and corruption (ABC) compliance programmes (the Report). The Report provides companies with key points to consider in determining whether (and if so how) they should consider developing or using machine learning solutions for their ABC programmes. … Continue Reading

SFO publishes Serco Statement of Facts

On 28 April 2021, the SFO published the statement of facts relating to the DPA that it agreed with Serco Geografix Limited (SGL) back in July 2019. The publication was made possible as a result of the ending of the trial of two former Serco directors, which collapsed this week as a result of issues … Continue Reading

ABC Risk assessments: FAQs

Last month we hosted a webinar on anti-bribery and corruption (ABC) risk assessments. This was the first in our series of ABC compliance webinars marking the 10th Anniversary of the UK Bribery Act coming into force. You can listen to the audio recording of the webinar on-demand here. We have put together a selection of … Continue Reading

Risk assessments and the expectations of global authorities – what this means for businesses

On 18 March 2021, we will be holding the first of our global webinars on putting into practice authorities’ expectations in relation to each of the components of an ABC programme. In this first session we will examine global expectations in relation to risk assessments – the starting point of an effective ABC programme. We … Continue Reading

Conducting an ABC risk assessment: 4 key steps

Anti-bribery and corruption (ABC) risk assessments are the cornerstone of an effective compliance programme, ensuring that compliance resources are focused on the most significant ABC risks faced by the business. A genuinely risk-based compliance programme helps to achieve both the primary objective of a compliance programme (preventing ABC issues occurring), the secondary objective (providing a … Continue Reading

Immunity for criminal conduct in undercover investigations to be granted to a wide range of UK authorities

The Covert Human Intelligence Sources (Criminal Conduct) Act 2021 (the Act) received royal assent on 1 March 2021 but is yet to come into force. It will enable criminal conduct by a covert human intelligence source (a CHIS) in the course of covert intelligence gathering to be authorised (a Criminal Conduct Authorisation or CCA) by … Continue Reading

Misuse of the furlough scheme: an emerging risk in M&A

More than one in four UK employees (over 9 million people) have been furloughed during the course of the Government’s Coronavirus Job Retention Scheme (the Scheme). HMRC considers that as much as £3.5 billion has been paid out in wrong or fraudulent claims and it has received over 20,000 reports of fraudulent furlough claims from … Continue Reading

UK Supreme Court overturns controversial decision on extraterritorial effect of Section 2 Notices

Today, 5 February 2021, the UK Supreme Court has handed down the long-awaited judgment on the extra-territoriality of the Serious Fraud Office’s powers to obtain documents. The Supreme Court held that Section 2 Notices do not have extra-territorial effect against a foreign company that does not carry on business in the UK. (R (on the … Continue Reading

NCA publishes 2020 SARs Annual Report highlighting 81% increase in requests for a defence against money laundering

On 19 November 2020, the National Crime Agency’s (NCA) UK Financial Intelligence Unit (UKFIU) published their 2020 Suspicious Activity Reports (SARs) Annual Report. The Report provides that: Between April 2019 and March 2020, the UKFIU received a record number of SARs: 573,085 SARs were submitted, which is almost a 20% increase on the previous year. … Continue Reading

SFO recovers £1.2 million from London property connected with Brazilian bribery

The Serious Fraud Office (SFO) has announced that it has secured almost £1.2 million from Julio Faerman, owner of a luxury London flat which the SFO suspected to have been partly purchased with the proceeds of his criminal conduct in Brazil. According to the SFO’s press release, during ‘Operation Car Wash’, the investigation by Brazilian … Continue Reading

SFO Guidance on Deferred Prosecution Agreements: what’s new?

The Serious Fraud Office (SFO) last Friday published its first specific guidance on DPAs (the Guidance). Lisa Osofsky, Director of the Serious Fraud Office, said that ‘publishing this guidance will provide further transparency on what we expect from companies looking to co-operate with us’. Inevitably, the new Guidance remains high-level with little detail on the … Continue Reading

SFO publishes a chapter from its handbook offering guidance on DPAs

The Serious Fraud Office (SFO) on Friday published a chapter from its handbook, which offers “comprehensive guidance” on Deferred Prosecution Agreements (DPAs). This is the first set of guidance specific to the SFO, and sets out how the agency will approach its use of DPAs and engage with companies where a DPA “is a prospective … Continue Reading

Bribery and money laundering considerations for joint ventures

Introduction Whatever the legal form of a joint venture, the collaboration and joint participation in the JV’s business objectives can present an enhanced corruption risk. This is because in some circumstances, a company entering into a JV could be criminally liable for the corrupt actions of its JV partner, the JV itself, or third parties … Continue Reading

NCA emphasises the importance of SARs in combatting modern slavery and provides pointers on information that should be included

In the latest episode of the UK Financial Intelligence Unit (FIU) podcast, panellists from the FIU and the National Crime Agency (NCA) discuss the unique importance of Suspicious Activity Reports (SARs) in combatting modern slavery and human trafficking – and how to make these SARs more helpful. SARs are essential in identifying potential modern slavery … Continue Reading

Legal Professional Privilege in Investigations: Two New High Court Decisions

The High Court recently handed down two notable rulings that impact on the application of legal professional privilege to investigations (see here for a previous article on privilege in investigations): In A v B and another[1] (see further details below), the court held that it is for auditors – and not their audit client – … Continue Reading

Private Equity firms to face increased scrutiny of their AML procedures and how they deal with AML issues

The UK Financial Conduct Authority’s (FCA) recent announcements indicate that private equity firms (PE Firms) will see increased regulatory scrutiny over their anti-money laundering (AML) systems and controls. Earlier this year, the FCA issued a “Dear CEO” letter outlining its Alternatives Supervision Strategy, including its view of the key risks of harm that PE and … Continue Reading

Managing corruption risks when making charitable donations: key questions for Compliance and Legal teams to ask

Many companies have made significant donations of funds, goods and services as part of international relief efforts. These efforts are of course to be applauded, but it is important to be mindful of the bribery and corruption risks presented by charitable donations, particularly in emerging markets, and to take proactive steps to manage legal and … Continue Reading

New US DOJ compliance guidance: six key points from a UK perspective

On 1 June 2020, the US Department of Justice (DOJ) released the latest update to its ‘Evaluation of Corporate Compliance Programs’ policy, which was first released in 2017 (DOJ Guidance). The DOJ Guidance provides companies with detailed guidance on how the DOJ will review the adequacy and effectiveness of compliance programmes when making charging and … Continue Reading

Cannabis: a UK Overview

Introduction: Cannabis and the majority of its derivative substances are controlled drugs in the UK, and their use remains illegal subject to some exceptions. Since November 2018 doctors in the UK have been able to prescribe certain cannabis-based products for medicinal use, but access is still limited because the key UK healthcare provider and regulator … Continue Reading

Triaging, scoping and managing investigations: making difficult decisions

We have set out below ten top tips on triaging, scoping and managing investigations. These points focus on the difficult decisions that are faced during the course of an investigation in relation to what you are trying to achieve, how best to investigate and when to stop. Fundamentally, the purpose of an investigation has to … Continue Reading