SFO Secret Settlements, Wells Fargo, Confirmations: Compliance – Bloomberg
Britain’s Serious Fraud Office, which prosecutes corporate bribery, uses too many secret settlements in foreign corruption cases, the Organization for Economic Cooperation and Development said.
The SFO is using more so-called civil-recovery orders that require less oversight from courts and aren’t as transparent as criminal plea agreements, the Paris-based think tank said in a report March 30.
“The low level of information on settlements made publicly available by U.K. authorities often does not permit a proper assessment of whether the sanctions imposed are effective, proportionate and dissuasive,” the OECD said in a summary of the 79-page report.
The study praised Britain’s anti-corruption law, which took effect in July and is one of the strictest in the world. Under the Bribery Act, companies must prove they have adequate controls to prevent corruption in order to defend themselves if a bribe is paid on their behalf anywhere in the world, even if company officials didn’t know.
U.S. Securities and Exchange Commission investigators are considering extending the reach of enforcement actions in cases involving complex financial transactions to lawyers who provided the legal advice on fraudulent deals, an agency official said.
The SEC typically sanctions individuals who play an active role in making false statements or material omissions to investors, not the lawyers who advise them. Often, in matters involving a company and its employees, the individuals claim the lawyers signed off on the conduct in question, Kenneth Lench, head of the structured products unit in the SEC’s enforcement division, said March 30 at a law event in New York.
Lench said he’s seen some situations where advice “didn’t look like it was done in good faith,”
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