The FSA has published a report of the findings from its thematic
review of anti-bribery and corruption systems and controls in
investment banks. The review consisted of a visit to 15 investment
banks of varying sizes by the FSA to examine how they mitigate
risks associated with bribery and corruption.
The report found that the investment banking sector has been
slow and reactive in managing these risks, despite the high profile
and publicity surrounding the Bribery Act 2010. As a result of
these findings, the FSA have issued a guidance consultation setting
out the amendments it proposes to make to its recently published
financial crime guide (FC) (GC12/5). The guidance proposes to
consolidate all examples of good and bad practice as well as
additional guidance following on from the findings of its
The proposed new guidance will apply to all firms that are
subject to the FSA's financial crime requirements and not just
the investment banking sector.
In conducting its review, the FSA found that most of the firms
visited had more work to do to implement effective anti-bribery and
corruption systems and controls. Common weaknesses included:
Limited understanding of the applicable legal and regulatory
Incomplete or inadequate bribery and corruption risk
Lack of senior management oversight; and
Failure to monitor the effective implementation of and
compliance with suitable policies and procedures.
As a result of its findings, the FSA in considering whether
further regulatory action is necessary for certain firms it visited
during its review. The FSA also advised that it and its successor
body will continue to focus on anti-bribery and corruption issues
in the financial services sector.
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The ramifications for those found to be in civil contempt (as presided over by the High Court), and, in particular, the court’s power to enforce such a finding against a contemnor who resides overseas, are more far reaching than many (civil) lawyers realise.
The Bribery Act has made the news again following the conviction of a would be taxi driver. Earlier this week, at Minshull Street Crown Court in Manchester, Mr Mawia Mushtaq became the second person convicted of an offence under the Bribery Act by attempting to bribe a Licensing Officer.
In the previous edition of Corporate Focus we reported that the Bribery Act 2010 (the Bribery Act) came into force on 1 July 2011 and we considered procedures that commercial organisations could put into place in order to prevent bribery.
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