SFO Sentences Sweett Group for Bribery Act Violation
The UK Serious Fraud Office (SFO) has issued its first conviction under section 7 of the Bribery Act and ordered Sweett Group plc, a construction services company; to pay ￡2.25 million ($3.15 million) for bribing an official in the United Arab Emirates.
The investigation was triggered when the Wall Street Journal reported allegations in June 2013 that a former Sweett Group director offered to award design work on a $100 million hospital construction contract in Morocco to a New York-based architecture firm, if the architects agreed to pay a bribe of 3.5% of contract value to a United Arab Emirates official. The WSJ said the target of the bribe was an official inside the United Arab Emirates president's personal charitable foundation, which was funding the Morocco project. The matter was never reported to U.S. authorities. A Justice Department official declined to comment.
The SFO opened an investigation back in July 2014 into Sweett Group in relation to its activities in the United Arab Emirates and elsewhere. The investigation found that a Sweett Group wholly-owned subsidiary registered in Cyprus, Cyril Sweett International Limited, made corrupt payments to the vice chairman of Al Ain Ahlia Insurance Company (AAAI) and who chaired AAAI's real estate and investment committee. The payments were intended to secure a $100 million contract with AAAI for the building of the Rotana Hotel in Abu Dhabi. The offenses occurred between December 2012 and December 2015.
The court fined London-based Sweett Group ￡1.4 million ($2 million), and assessed about ￡851,000 ($1.2 million) in confiscation. The court also awarded the SFO costs of about ￡95,000 ($136,000). The SFO said it’s investigation into individuals continues.
David Green SFO director said: “Acts of bribery by UK companies significantly damage this country’s commercial reputation. This conviction and punishment, the SFO’s first under section 7 of the Bribery Act, sends a strong message that UK companies must take full responsibility for the actions of their employees and in their commercial activities act in accordance with the law.”
The company’s shares are now worth less than a third of their peak prior to the bribery allegations. Sweett Group has announced in December 2015 that it is pulling out of the Middle East market after admitting to a bribery offense that was committed in the region. The company, which employs 90 staff at offices in Dubai, Abu Dhabi, Muscat and Riyadh, said in a statement to the London Stock Exchange that it “has decided to exit the region and is reviewing its options”.
A recent survey by the accountancy firm EY found that only 52 per cent of companies in the Mena region have an anti-bribery or anti-corruption policy in place. “There is an urgent need at the board level to make compliance more of a focus,” said Stuart Jones Jr, the executive director at EY Mena. This case is another reminder to companies in the Middle East to have appropriate anti-bribery policy in place and to ensure its strict enforcement.
Sources:
- Sweett Group PLC sentenced and ordered to pay ￡2.25 million after Bribery Act conviction.
- SFO charges Sweett Group PLC
- Sweett Group PLC pleads guilty to bribery offence
- Sweett Group PLC admits to bribery offence
- Sweett Group Investigation
- Inside a Bribery Probe at Storied Architecture Firm HLW
- Construction consultancy Sweett Group to pull out of the Middle East