United Kingdom

Topic: Investigations and enforcement

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UK Export Finance adopts OECD recommendation on tackling bribery in international business transactions

On 14 March, the UK Export Finance (UKEF) announced the adoption of the revised OECD Council recommendation on Bribery and Officially Supported Export Credits (the Recommendation), to prevent bribery in international business transactions. The Recommendation, while not legally binding, strengthens anti-bribery and corruption policies and procedures across adherent Export Credit Agencies (ECAs). Current adherents to … Continue Reading

FCA fines multinational firm £27.6 million for transaction reporting failures

The Financial Conduct Authority (FCA) has fined a multinational investment bank and financial services company (the Firm) £27,599,400 for failing to ensure it provided complete and accurate information to approximately 86 million reportable transactions and erroneously reporting 49 million transactions to the FCA. The Final Notice states that over a period of more than nine years, … Continue Reading

Financial Reporting Council to be replaced by new regulator with enhanced powers

On 11 March 2019, the Business Secretary, Greg Clark, announced that the Financial Reporting Council (“FRC”), a UK regulator responsible for auditors, accountants and actuaries, will be abolished. The FRC will be replaced by a new regulator, the Audit, Reporting and Governance Authority. The decision follows an independent review of the FRC completed in December … Continue Reading

Financial Ombudsman Service – increased award limits

On 8 March 2019, the FCA confirmed that from 1 April 2019 the Financial Ombudsman Service’s (FOS) current £150,000 award limit will change to: £350,000 for complaints about actions or omissions by firms on or after 1 April 2019; and £160,000 for complaints about acts of omissions by firms before 1 April 2019, and which … Continue Reading

The FCA fines an individual for failing to observe proper standards of market conduct and on similar facts issues its first formal decision under its competition powers against three asset management firms

On 21 February 2019, the FCA fined two asset management firms for breach of competition law.  No fine was imposed on the other asset management firm, Newton Investment Management Limited (Newton), as it had been given immunity under the competition leniency programme.  This decision followed the FCA’s announcement on 4 February 2019 that it had … Continue Reading

BlackRock’s CEO emphasizes social impact for a second year in a row in his 2019 letter to investee companies

Earlier this year BlackRock’s Chairman and CEO Larry Fink published his annual letter to the asset management firm’s investee companies. For the second year in a row Fink has focused on social impact. At the beginning of the letter he addresses the importance of practices that “will drive sustainable, long-term growth and profitability”. Fink acknowledges … Continue Reading

New MOU between the ICO and FCA following GDPR

On 18 February 2019, the UK’s Information Commissioner’s Office and FCA published an updated memorandum of understanding setting out the terms of the relationship between them, including the exchange of information in relation to potential failures of systems and controls in relation to data security and related investigations. The MOU comes in the context of … Continue Reading

OFSI’s first monetary penalty: Raphaels Bank

On 21 January 2019, the Office of Financial Sanctions Implementation (OFSI), part of HM Treasury, issued a £5,000 fine against R. Raphael Bank & Sons plc, trading as Raphaels Bank, for dealing with £200 belonging to an unidentified designated person in violation of EU sanctions against Egypt (implemented in the UK under the Egypt (Asset-Freezing) … Continue Reading

Tesco and the problem with DPAs

Deferred prosecution agreements (DPAs) have been a mainstay of the recent initiatives to deter corporate offending and change companies’ behaviour. They offer corporate offenders the chance to defer criminal charges provided they comply with financial penalties and other conditions agreed with a prosecuting authority. They are intended to broaden the range of tools available to … Continue Reading

UK Government to develop a code of practice to tackle sexual harassment in the workplace

In December 2018, the UK Government announced that it will introduce a new statutory code of practice to tackle workplace sexual harassment following a July 2018 report from the House of Commons’ Women and Equalities Select Committee (the Committee). The Committee’s report called on the Government to: Prioritise sexual harassment: The report calls on the … Continue Reading

UK Government confirms that public beneficial ownership registers will be established in the British Overseas Territories by 2023

On 28 January 2019, the UK Government (the Government) explained the timetable to the new 2023 deadline for the creation of public beneficial ownership registers in the British Overseas Territories (BOTs). The Government has explained that draft legislation will be prepared by the end of 2020, as required by the Sanctions and Anti-Money Laundering Act … Continue Reading

France, Germany and UK launch INSTEX to facilitate European trade with Iran

In a joint statement on 31 January 2019, France, Germany and the UK (together, E3) announced the creation of a payment channel SPV (Instrument in Support of Trade Exchanges, INSTEX) to offer European companies a settlement option in relation to their Iranian business activities. INSTEX aims to facilitate legitimate trade between European companies and Iran, focusing … Continue Reading

Forbes and Just Capital rank America’s largest publicly traded companies based on the ethical priorities of 81,000 Americans

890 of America’s largest publicly-traded companies have recently been ranked based on priorities gathered from polling 81,000 Americans.  The poll, coordinated by Just Capital, asked participants what they most wanted to see from the nation’s biggest businesses.  The most popular responses were that participants wanted companies to: pay workers fairly; treat customers well and protect … Continue Reading

The UK Government releases second interim report as part of the review of the Modern Slavery Act

On 22 January 2019, the UK Government (the Government) published its second interim report as part of the Independent Review (the Review) of the Modern Slavery Act 2015 (the Act), which began in July 2018 (see our previous blogpost). This is the second report for phase 1 of the Review, and it focuses on transparency … Continue Reading

Draft Business and Human Rights Treaty – impact for businesses and states

In July 2018, the United Nations’ intergovernmental working group on business and human rights released the first official draft of a proposed binding international treaty on business and human rights (the Treaty). Key features of the Treaty The key provisions of the Treaty are as follows: Scope: The Treaty applies to human rights violations in … Continue Reading

UK Government releases year 1 update on its Anti-Corruption Strategy 2017-2022

The UK Government (the Government) has recently published the first update on its Anti-Corruption Strategy 2017-22 (the Strategy). The Strategy seeks to provide a framework to guide the Government’s anti-corruption policies and actions with a particular focus on economic crime. It provides a set of objectives covering a number of different areas, including bribery and … Continue Reading

Wolfsberg Group publishes new guidance on how FIs should carry out sanctions screening

On 21 January 2019, the Wolfsberg Group published new guidance on how financial institutions (FIs) should carry out sanctions screening. The fundamentals of the guidance are derived from legal/regulatory requirements, as well as expectations and global industry best practice. It is not intended to suggest that all FIs should apply all elements in the guidance … Continue Reading

CHRB report assesses the human rights standards of 101 of the world’s largest publicly traded companies

Major international companies in the agricultural, clothing and extractive industries have recently been assessed in respect of human rights standards in their businesses and supply chains. The 2018 Key Findings Report issued by the Corporate Human Rights Benchmark (CHRB) was released on 12 November 2018. The report scored 101 of the largest publicly traded companies … Continue Reading

Business and Human Rights Resource Centre assesses FTSE 100 companies’ compliance with the Modern Slavery Act

In November 2018, the Business and Human Rights Resource Centre released its third annual assessment of FTSE 100 companies’ modern slavery disclosure under the UK Modern Slavery Act 2015 (the MSA). The MSA, requires companies with a turnover of not less than £36 million to produce an annual statement outlining the steps they have taken … Continue Reading

Link between money laundering and human trafficking (estimated to generate c.US$150bn of criminal proceeds annually) explored in new report by FATF and APG

Earlier this year, the Financial Action Task Force (FATF) together with the Asia Pacific Group on Money Laundering (APG) published a report analysing the financial flows associated with human trafficking. The report: summarises indicators of financial transactions that are laundering the proceeds of human trafficking (e.g. multiple wages being paid into one account, rapid in/out … Continue Reading

The European Commission has published a recommendation in relation to compliance with the guidelines to the Conflict Minerals Regulation

Earlier this year, the European Commission published a recommendation in relation to the non-binding guidelines for the identification of conflict-affected and high risk areas and other supply chain risks under the new Conflict Minerals Regulation.[1] The Conflict Minerals Regulation, which will apply from 1 January 2021, lays down supply chain due diligence obligations for importers of … Continue Reading

Modern Slavery Act 2015 under review

Earlier this year, the Home Office announced its plan to launch an independent review of the Modern Slavery Act 2015. Led by Frank Field MP, Baroness Butler-Sloss and Maria Miller MP, the independent review aims to strengthen the UK’s ongoing response and accelerate progress from the government and businesses in eradicating modern slavery. This review … Continue Reading

Lloyd’s of London announces that it does not consider insuring Canadian cannabis risks a breach of UK money laundering legislation

The production of recreational cannabis was legalised in Canada in October 2018. As a consequence, UK corporates and financial institutions wishing to invest or be involved in activity relating to Canadian cannabis businesses face a real obstacle: doing so could technically constitute a criminal offence under UK money laundering legislation (see our previous blog here). … Continue Reading