Prosecute over bribes allegedly paid in far-flung lands years before you banned such practices?
That’s the bluff from Britain’s Serious Fraud Office and its biggest defence firm, BAE Systems, is having none of it.
The Lockheed scandal of the 1970s forced the United States to toughen its anti-bribery laws but the British quietly left their laws wide open for decades.
It worked a treat.
UK firms enjoyed a competitive advantage over U.S. rivals and were able to do battle in arms exports versus freewheeling rivals from France, Germany, Russia and beyond.
BAE is now Europe’s biggest defence company and has even cracked the Top 10 in sales to the Pentagon.
Britain’s economy has profited too, especially from the Al Yamamah arms-for-oil export pact with Saudi Arabia – at an estimated 43 billion pounds ($69 billion) by far the country’s biggest ever export deal.
Remember it? It’s the one the Serious Fraud Office probed until late 2006 when then Prime Minister Tony Blair, under pressure from the Saudis and citing national security, quashed it.
Turning a blind eye is sometimes hard, but a 43 billion pound eye patch does wonders.
The Serious Fraud Office has been smarting ever since.
So it is back, mounting a stand, hoping to reassert its authority with a case involving BAE and far smaller defence deals done in South Africa, the Czech Republic and Tanzania.
It’s true, regulation is back in vogue, with politicians busy talking the world back out of recession and vowing tougher rules to avert another financial meltdown.
Little about how they all missed this crisis, but a lot on the great ideas they have for spotting it next time.
The Serious Fraud Office’s sleight-of-hand is even more breathtaking.
They want time travel — to use today’s laws to prosecute yesterday’s crimes.
Can they be serious?
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5 comments so far
This is just another example of a government quango spending money that the UK economy quite clearly cannot afford.
How much did the last enquiy cost before Tony Blair quashed it?
How much will be wasted on this enquiry?
It’s about time the judiciary stood up to this waste of tax-payers’ money with a new process of a quick “one day hearing” to determine whether the prosecution will be based on legislation in place at the time. If not, the SFO should be fined for wasting tax-payers’ money and then get on with tackling current corruption… maybe starting at the houses of parliament!
Legislate for the future by all means, but don’t try and “re-legislate” the past.
- Posted by Ian JTime travel aside, this case does appear to highlight one of the conceptual problems with corporate prosecutions. Suppose you have a hypothetical company which has been doing this in the past but has stopped and is determined to wipe it out for good. You want to persuade new management to come in and sweep out the cobwebs, and you want shareholders to back the new management. But if there’s the threat of a corporate prosecution ten years down the line taking up to a billion quid out of your profits — who are you going to find to take on the job of cleaning up the company? Nobody in their right mind will want it.
Isn’t the Law of Unintended Consequences going to mean that, in practice, the threat of delayed corporate prosecutions is going to make it harder and slower to clean up badly behaving companies? By all means go after the individuals who made the mess in the first place, but not those trying to clean it up.
- Posted by Ian KemmishI suggest everyone looks at the information stopcp.com and then this activity will fall into sharp focus - be worried - be very worried…..Common Purpose is a change agent being used to recruit and train the commissars and apparatchiks needed to implement New Labour’s hidden Communitarian agenda…..now are you worried?
- Posted by LarryIn modern days and age of globalisation it is hard to force your own moral values on the societies which are different from your own. When others are willing to do business on their terms,better you stay where you are and suffer stagnation. Other societies look to corruption in their own prospectives.
- Posted by PurewalThe UK has gone completely bonkers.
This is why a 71 year old lady is hauled into court on an assault charge for prodding a yob who had been throwing stones at her windows.
The UK has a blame culture someone has to be brought to book for everything no matter what.
Well it is time the SFO and the UK government answer to the UK public over wasting tax payers money over this nonsense.
Time travel not withstanding !!!
- Posted by Phil