In recent days an investigation by the Daily Telegraph has alleged that bribery and corruption are at the heart of football.
The revelations have already resulted in Sam Allardyce losing his job as England manager and the suspension of Barnsley coach Tommy Wright. The paper promises more to come, with allegations of up to eight current and former Premier League managers being embroiled in corruption.
There are clear parallels with the allegations made against top football figures and the MPs expenses scandal, also broken by the Telegraph in May 2009. The picture presented is again one of a pervasive culture of corruption existing in a closed environment.
However, if the Telegraph can back its claims with hard evidence, the individuals concerned and indeed the entire business of football in the UK could face a seismic shock.
Football may be the national sport, but clubs and individuals are subject to the law as much as any other business or employee. Unfortunately for them, the law relating to Bribery and Corruption is developed, clear and amongst the toughest in the world.
The 2010 Bribery Act created offences in relation to individuals giving, promising, requesting, accepting and receiving financial or other advantages in exchange for the improper performance of a relevant function or duty. A relevant function or duty is defined extremely widely; it is any action that is: of a public nature, connected with a business, performed in the course of employment, or performed by or on behalf of a body of persons (whether corporate or unincorporate), provided that the person performing the function is expected to perform it in good faith or impartially or is in a position of trust by virtue of performing it.
However, whilst it seems obvious to suggest that an individual taking or offering a bribe might find themselves criminally liable, the Bribery Act also created a Corporate Offence of Failure to Prevent Bribery. That significantly extended the potential liability of businesses for the actions of their employees, agents and subsidiaries.
Section 7 provides that a commercial organisation is guilty of an offence if a person associated with it bribes another person intending to obtain or retain business, or to obtain or retain an advantage in the conduct of business that commercial organisation.
Companies do have a defence if they can show that they have adequate procedures in place that are designed prevent their employees from engaging in corrupt behaviour on their behalf.
S7 has been in force for some time now but it still isn’t a particularly well used provision. There have only been three concluded prosecutions. Two of those have resulted in the first Deferred Prosecution Agreements to be concluded in the UK
Sweett Group Ltd entered a guilty plea to a prosecution under s7 in December 2015 and in February this year it was sentenced to a total financial penalty of £2.2 million.
Standard Bank entered into a DPA with the SFO on 30 November 2015 relating to an allegation of bribery of Tanzanian officials by a sister company of the bank in Tanzania and agreed to pay financial penalties and compensation of $32 million.
The second DPA to be concluded in the UK was completed on 11th July 2016 with an anonymous company ordered to pay £6.5 million in fines and compensation.
Thus, if future revelations suggest that representatives have been paying bribes on behalf of clubs, then clubs need to be aware of their potential liability under s7 and of the way they can defend themselves.
A note of caution; although a DPA might be a great deal for a club in those circumstances, the lesson from the concluded proceedings is clear. Prosecutors expect full and frank cooperation from those seeking a deal. If a company is to self report, it is expected to do so as soon as possible after becoming aware that bribery may be taking place. The clock may already be ticking.
If you require advice in relation to bribery and corruption investigations or prosecutions, please call Gary Broadfield on 0161 833 1411 for a free consultation.