1 00:00:00,120 --> 00:00:03,640 Speaker 1: The UK wants tougher laws to prosecute corrupt companies for 2 00:00:03,720 --> 00:00:07,280 Speaker 1: financial crimes. On Monday, at a conference in Cambridge, the 3 00:00:07,320 --> 00:00:11,040 Speaker 1: Solicitor General, Robert Buckland said the weaknesses in our current 4 00:00:11,119 --> 00:00:15,120 Speaker 1: law result in other jurisdictions holding British companies to account 5 00:00:15,160 --> 00:00:18,000 Speaker 1: when ours has not. Of course, it's been a dizzying 6 00:00:18,120 --> 00:00:20,920 Speaker 1: back and forth by the government. Two years ago companies 7 00:00:20,960 --> 00:00:24,279 Speaker 1: were breathing easier as lawmakers abandoned the effort to get 8 00:00:24,280 --> 00:00:28,160 Speaker 1: tougher on economic crimes, and Prime Minister Theresa May threatened 9 00:00:28,200 --> 00:00:31,680 Speaker 1: to close the Serious Fraud Office this year. Joining us 10 00:00:31,760 --> 00:00:35,640 Speaker 1: from London is Tony Aaron's Bloomberg News European team leader. 11 00:00:36,200 --> 00:00:40,320 Speaker 1: Tony tell us about the shifting opinions on widening UK 12 00:00:40,560 --> 00:00:45,640 Speaker 1: corporate liability laws. Well, in general most people are in 13 00:00:45,680 --> 00:00:49,320 Speaker 1: favor of TUPPER and governmentally turned in favor of Tupper 14 00:00:49,560 --> 00:00:52,839 Speaker 1: corporate crackdowns in these kinds of areas. Sometimes these can 15 00:00:53,000 --> 00:00:56,320 Speaker 1: get mixed up in different priorities about with the SFO 16 00:00:56,840 --> 00:00:59,920 Speaker 1: or different rules, But in general I did most people 17 00:01:00,000 --> 00:01:03,440 Speaker 1: and government support these kinds of measures. So Tony tell 18 00:01:03,520 --> 00:01:05,840 Speaker 1: us what the law is now? What can the UK 19 00:01:06,200 --> 00:01:10,240 Speaker 1: go after? At the moment. Well, I mean they can 20 00:01:10,640 --> 00:01:13,160 Speaker 1: incorporate crime the way. The two it has been strength 21 00:01:13,200 --> 00:01:15,600 Speaker 1: in the recent years have been tax evasion, which the 22 00:01:15,640 --> 00:01:17,880 Speaker 1: rule was just about to come into force. It brings 23 00:01:17,959 --> 00:01:22,640 Speaker 1: laws into more into where if corporations allow taxivation at 24 00:01:22,640 --> 00:01:27,000 Speaker 1: lower levels units, the parent companies can be fined and prosecuted. 25 00:01:27,720 --> 00:01:31,560 Speaker 1: They've also made it It started out with bribery rules 26 00:01:31,560 --> 00:01:34,520 Speaker 1: in two thousand eleven, where if they were broads being 27 00:01:34,520 --> 00:01:37,520 Speaker 1: paid and third world countries get deals done by low 28 00:01:37,600 --> 00:01:42,720 Speaker 1: level salesman or third party representatives of the company, the 29 00:01:42,760 --> 00:01:46,600 Speaker 1: whole company could be prosecuted. But just as important was 30 00:01:46,640 --> 00:01:49,560 Speaker 1: another rule that made things more like the US and 31 00:01:49,600 --> 00:01:51,960 Speaker 1: tell about two three years ago there were really no 32 00:01:52,080 --> 00:01:56,160 Speaker 1: settlement agreements in criminal cases. They're called the furred prosecution 33 00:01:56,160 --> 00:01:59,280 Speaker 1: agreements here, and that has really made things easier for 34 00:01:59,320 --> 00:02:02,720 Speaker 1: prosecutors go after British companies and even some non British 35 00:02:02,760 --> 00:02:07,960 Speaker 1: companies Tony. Under the current laws, can a company be 36 00:02:08,160 --> 00:02:12,880 Speaker 1: charged only if prosecutors can show that senior executives of 37 00:02:12,919 --> 00:02:17,440 Speaker 1: the company were involved. Oh, that's the phrase that everyone 38 00:02:17,480 --> 00:02:21,000 Speaker 1: always uses in the corporate mind. Can they prove that 39 00:02:21,080 --> 00:02:24,480 Speaker 1: senior executive company knew about the conduct and that's why 40 00:02:24,600 --> 00:02:26,919 Speaker 1: it's been very tough because typically when you go through 41 00:02:26,919 --> 00:02:29,919 Speaker 1: the evidence, the email chains draw up at the mid 42 00:02:29,919 --> 00:02:32,520 Speaker 1: manager level, and that's made it very, very hard to 43 00:02:32,560 --> 00:02:36,520 Speaker 1: go after companies on for corporate liability the way they 44 00:02:36,600 --> 00:02:41,639 Speaker 1: routinely do in the US. So prosecutors and a corruption 45 00:02:41,680 --> 00:02:46,760 Speaker 1: lobbyists been pressing pressing the government to widen corporate liability 46 00:02:46,919 --> 00:02:48,920 Speaker 1: laws to make them more like the US, as you've 47 00:02:48,960 --> 00:02:52,519 Speaker 1: been discussing. So what specific changes are at the top 48 00:02:52,600 --> 00:02:56,000 Speaker 1: of their their agenda for what they'd like to see now, 49 00:02:56,040 --> 00:02:58,000 Speaker 1: I asked. One of the questions is I think it's 50 00:02:58,040 --> 00:03:01,040 Speaker 1: good government, but good government doesn't always try it's good politics. 51 00:03:01,600 --> 00:03:05,519 Speaker 1: Right now, the treisa A, the Prime Minister is been 52 00:03:05,639 --> 00:03:13,840 Speaker 1: pushing a fairly widescale restructuring of UK prosecutors. This SFO 53 00:03:14,040 --> 00:03:17,120 Speaker 1: could be folded into the National Crime Agency, and there 54 00:03:17,120 --> 00:03:20,200 Speaker 1: are a lot of opposition to different parts of this 55 00:03:20,400 --> 00:03:23,480 Speaker 1: legislation and they send it back for review at least 56 00:03:23,480 --> 00:03:26,400 Speaker 1: a couple of times. And I think you're not going 57 00:03:26,440 --> 00:03:29,840 Speaker 1: to get clear changes in the laws about corporate liability 58 00:03:30,080 --> 00:03:32,399 Speaker 1: until we actually knew who the prosecutors will be going 59 00:03:32,400 --> 00:03:37,240 Speaker 1: down the line. The SFO recently charged Barkley's and four 60 00:03:37,280 --> 00:03:40,640 Speaker 1: of its former executives under the current laws. Is that 61 00:03:40,720 --> 00:03:44,120 Speaker 1: an argument for the business lobby to leave the law 62 00:03:44,160 --> 00:03:48,720 Speaker 1: as it is? But those are different issues. Barkley's was 63 00:03:48,720 --> 00:03:51,480 Speaker 1: was charged, but those are fairly high level executives there. 64 00:03:51,520 --> 00:03:54,320 Speaker 1: They're always restricts. But we can talk about pending trials here. 65 00:03:54,640 --> 00:03:57,240 Speaker 1: But I think it's fairly clear that those were high 66 00:03:57,360 --> 00:04:00,720 Speaker 1: level executives. So the the strict line ability your corporate 67 00:04:00,800 --> 00:04:03,880 Speaker 1: liability rules wouldn't apply there because normally when you're talking 68 00:04:03,920 --> 00:04:06,200 Speaker 1: about those kind of things, that's a unit head or 69 00:04:06,240 --> 00:04:09,360 Speaker 1: a middle manager somewhere, and because it happened at the company, 70 00:04:09,360 --> 00:04:14,680 Speaker 1: then you could go after the corporate of corporate entity Tony. 71 00:04:14,720 --> 00:04:19,039 Speaker 1: There's been some discussion so there's been some discussion here 72 00:04:19,080 --> 00:04:22,520 Speaker 1: in the US about uh, there's a memo by then 73 00:04:22,640 --> 00:04:26,479 Speaker 1: Acting Attorney General Sally Yates or or former Acting Attorney 74 00:04:26,480 --> 00:04:29,760 Speaker 1: General Sally Yates about the importance of individual liability when 75 00:04:29,760 --> 00:04:32,800 Speaker 1: it came to corporate fraud. Um, what's going on in 76 00:04:32,880 --> 00:04:36,320 Speaker 1: the UK? Is there focus on individuals or is it 77 00:04:36,680 --> 00:04:41,600 Speaker 1: more focus on ongoing after corporations. They've always going after individuals. 78 00:04:41,640 --> 00:04:43,920 Speaker 1: Shire that's been all they could. I think that's why 79 00:04:43,920 --> 00:04:47,919 Speaker 1: they want to change the laws. They can go after corporation. Typically, 80 00:04:48,080 --> 00:04:51,440 Speaker 1: the UK will prosecute fairly mid level people. Had been 81 00:04:51,440 --> 00:04:53,960 Speaker 1: saying over and over at mid level they find individual 82 00:04:54,000 --> 00:04:57,920 Speaker 1: people and the cases don't cause much of a rippone. 83 00:04:57,920 --> 00:04:59,960 Speaker 1: They don't lead the very big figns. To be honest, 84 00:05:00,040 --> 00:05:04,679 Speaker 1: the finds and joint US UK cases, the UK finds 85 00:05:04,800 --> 00:05:08,160 Speaker 1: are dwarfed by the US finds and cases, including Sceneans 86 00:05:08,279 --> 00:05:13,320 Speaker 1: and Rolls Royce. The their magnitudes are five to six 87 00:05:13,360 --> 00:05:16,159 Speaker 1: seven times higher that you'll find the US finds hard 88 00:05:16,160 --> 00:05:19,920 Speaker 1: in the UK finds in joint cases. So what happens now? 89 00:05:20,640 --> 00:05:24,640 Speaker 1: Buckland said that, um, the government's call for evidence on 90 00:05:24,720 --> 00:05:29,040 Speaker 1: corporate criminal liability is completed and now it's considering submissions. 91 00:05:29,040 --> 00:05:32,000 Speaker 1: So explain it to us, who we don't know anything 92 00:05:32,040 --> 00:05:36,160 Speaker 1: about the UK system. So it's it's it's they very 93 00:05:36,240 --> 00:05:38,920 Speaker 1: much like to make proposals. The governments will make proposals 94 00:05:39,040 --> 00:05:43,120 Speaker 1: and the last interested parties to respond to and we're 95 00:05:43,120 --> 00:05:45,720 Speaker 1: in that place where they to ask interesting parties make 96 00:05:46,520 --> 00:05:49,880 Speaker 1: submissions to the government. The government will review those submissions 97 00:05:49,920 --> 00:05:52,600 Speaker 1: and they might change law of their proposals. In light 98 00:05:52,680 --> 00:05:56,520 Speaker 1: of that or drop them or making stronger and then 99 00:05:56,760 --> 00:05:59,400 Speaker 1: the proposals to go to Parliament and Parliament and make 100 00:05:59,480 --> 00:06:04,239 Speaker 1: decisional they're going to do so looking at out, looking 101 00:06:04,279 --> 00:06:07,960 Speaker 1: ahead and at all you know, will in the next year, 102 00:06:08,040 --> 00:06:11,279 Speaker 1: will there be a difference in the in the laws 103 00:06:11,279 --> 00:06:14,360 Speaker 1: in the UK as far as a corporate financial crime 104 00:06:15,440 --> 00:06:17,960 Speaker 1: you know, as you said earlier going into this piece, 105 00:06:18,920 --> 00:06:23,479 Speaker 1: it's been two years now. Um, it hasn't been on 106 00:06:23,480 --> 00:06:27,280 Speaker 1: the top of the legislative agenda. And with bregit it's 107 00:06:27,480 --> 00:06:29,960 Speaker 1: quite unlikely that it's going to be on the top 108 00:06:29,960 --> 00:06:32,360 Speaker 1: of the legislative agenda for a little while. Trace may 109 00:06:32,480 --> 00:06:35,359 Speaker 1: very much wants her legacy to be more than Brexit 110 00:06:36,080 --> 00:06:40,080 Speaker 1: and wants to push ahead different domestic policies, but there's 111 00:06:40,120 --> 00:06:43,400 Speaker 1: only so much time in the parliamentary schedule and Brectic 112 00:06:43,480 --> 00:06:44,840 Speaker 1: is gonna be taking up an awful lot of that. 113 00:06:46,800 --> 00:06:49,360 Speaker 1: Have there been groups, there are a lot of you know, 114 00:06:49,680 --> 00:06:55,520 Speaker 1: lobbying groups in the US and especially for attorneys. Um. 115 00:06:55,640 --> 00:06:58,680 Speaker 1: Have there been a lot of lobbying groups that are 116 00:06:59,440 --> 00:07:05,120 Speaker 1: pushing it against these laws. I'm not familiar with any, 117 00:07:05,080 --> 00:07:09,760 Speaker 1: at least not that come out openly and say we're 118 00:07:09,840 --> 00:07:13,160 Speaker 1: we're against rules the crackdown peoplaying money laundering. That's one 119 00:07:13,160 --> 00:07:16,600 Speaker 1: of the big areas here, money laundering. The US has 120 00:07:16,600 --> 00:07:20,040 Speaker 1: been much much more successful at prosecuting money laundering than 121 00:07:20,160 --> 00:07:23,240 Speaker 1: the UK has, and that's been something people have been 122 00:07:23,240 --> 00:07:26,200 Speaker 1: focusing on. And it doesn't make good PR to come 123 00:07:26,200 --> 00:07:30,200 Speaker 1: out and say we're against laws that make corporate entity 124 00:07:31,360 --> 00:07:35,320 Speaker 1: more responsible for money laundering that goes on looking there 125 00:07:35,840 --> 00:07:39,720 Speaker 1: within their corporate structure. Thank you, they do some fine 126 00:07:39,800 --> 00:07:43,240 Speaker 1: ways seem to find ways here to say that. Thank 127 00:07:43,280 --> 00:07:45,800 Speaker 1: you so much for being on Bloomberg Law. That's Tony 128 00:07:45,960 --> 00:07:48,600 Speaker 1: Arran's he's Bloomberg News European team leader.