Sweett Group admits bribery and now faces SFO prosecution

This would be the first case where a company has been prosecuted for failing to put in place adequate measures to prevent bribery

The Serious Fraud Office has investigated Sweett's dealings in the Middle East (Francois Nel/Getty Images)

A construction company, Sweett Group, looks set to become the first UK firm to be prosecuted for failing to prevent bribery.

The AIM-listed group, which admitted to bribery relating to two contracts in the Middle East, said it is expecting prosecution and a fine, adding: “the quantum of which cannot be ascertained at the present time”. Sweett will still be allowed to bid for public contracts in the EU and UK, unless public bodies decide to ban it from tenders.

This would be the first case where a company has been prosecuted for failing to put in place adequate measures to prevent bribery.

Section 7 of the Bribery Act, “Failure of commercial organisations to prevent bribery”, was introduced in July 2011, to make it easier to convict companies. However, the Serious Fraud Office (SFO) had come under pressure for not having prosecuted a single company in the four years since the changes were brought in.

Earlier this week, the London arm of Standard Bank struck a deal with the SFO to avoid prosecution for bribing Tanzanian officials in the first deal of its kind.

Neill Blundell, head of the fraud and investigations group at law firm Eversheds, said: “There has been criticism from some commentators that the SFO has failed, to date, to successfully prosecute a corporate for the ‘failing to prevent’ offence … so David Green [the SFO director] will see this as very welcome news.”

Alison Geary, a lawyer at WilmerHale focusing on white-collar crime, said that before the introduction of the Bribery Act “it was challenging to convict corporates of bribery offences” in the UK, as prosecutors had to prove that the involvement in the bribery went “all the way to the top”, unlike the much simpler US system.

She explained: “The section 7 offence makes it easier to prosecute companies for bribery. It means that prosecutors need only prove that bribery was happening at a junior level of the organisation and the company did not have adequate procedures in place to prevent it.”

The SFO launched an investigation last year when Sweett admitted to allegations in The Wall Street Journal, which claimed a former executive paid a bribe to complete a deal in Morocco.

Sweett’s own investigation uncovered two related offences which were reported to the SFO.

A spokesman for the SFO confirmed its investigation into the company had ended, but said it was investigating individuals who were no longer at Sweett.