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SFO could snoop on communications to uncover evidence of corruption, says director

The director of the Serious Fraud Office (SFO) has warned that the agency may use powers of surveillance to uncover evidence of corruption within corporates.

David Green told an audience at the Pinsent Masons and Legal Week Regulatory Reform and Enforcement Conference that the SFO could use powers it has under the Regulation of Investigatory Powers Act (RIPA) as part of its evidence-gathering procedures.

"David Green is upping the ante when it comes to bribery and fraud enforcement," anti-corruption law expert Barry Vitou of Pinsent Masons, the law firm behind Out-Law.com, said. "Companies need to understand that the UK, just like the US, will consider wire tapping and bugging in appropriate cases to obtain evidence. These are not idle threats and companies ignore them at their peril."

Under RIPA law enforcement agencies, including the police and MI5, can tap phone, internet or email communications to protect the UK's national security interests, prevent and detect terrorism and serious crime or to safeguard the UK's economic well-being, subject to the interception being lawful.

One of the grounds on which it is lawful to intercept communications is where the Home Secretary authorises the activity. The Home Secretary has to assess whether the request to intercept communications is necessary and proportionate in order to protect the UK's national security interests, prevent and detect terrorism and serious crime or to safeguard the UK's economic well-being.

The Home Secretary must consider certain factors relating to the necessity and proportionality of any interception before authorising the interception, including "whether the information which it is thought necessary to obtain under the warrant could reasonably be obtained by other means". The Act can be used by law enforcement agencies to force telecoms companies to hand over customers' details in order to tap phone, internet or email communications.

Under RIPA the SFO's head of intelligence can also sanction the acquiring of 'communications data' – information that relates to communications, such as the time and duration of calls, and the email address communications are sent to as well as the location of the person initiating the communications, amongst other examples. It does not include the content of those communications.

The SFO has outlined a procedural checklist (19-page / 1.56MB PDF) around the application and sanctioning of communications data acquiring to ensure the activity is justified and in accordance with privacy safeguards.

In his speech at the event hosted by Pinsent Masons, Green said that businesses should be encouraged to self-report to the SFO if they uncover corruption that they or their staff have been involved in. He said that a tougher stance against companies in respect of their liability for fraud by employees could encourage more self-reporting. He said that self-reporting is not viewed favourably by some because of the difficulties involved in prosecuting companies for fraud carried out by staff.

"I would argue that prosecution of a corporate would be appropriate where, for example, the company profited from fraud by its employees; where a particular illegal practice was common and tolerated in a particular sector; where deterrence was needed in a sector; or where a company has brought in a compliance regime but senior management had failed to ensure enforcement of that regime," Green said.

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