Download Criminal liability for corruption

Trade Capacity Vietnam
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Risks in Doing Business
Overview Modules 1 - 3
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Risks for individuals and organizations
Involvement in corruption is dangerous for you and your organization:
For you
For your organisation
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Criminal liability, possible fine or prison Criminal liability and possible fine
sentence
Civil liability and paying out of
damages
Civil liability and paying out of
damages
Loss of reputation
Loss of reputation
Loss of employment
Loss of business
Dismissal from membership of any
professional association of which you
are a member
Financial loss where your organization
has been the victim of corruption
Debarment from projects
What is Corruption
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Criminal liability for corruption (1)
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How does an individual incur criminal liability for
corruption?
• Those directly involved: An individual who is directly involved in
committing a corruption offence may be liable for the offence
• Those indirectly involved: An individual may be liable for a corruption
offence where he is indirectly involved in committing the offence
• Those in authority: A person in authority (e.g. chief executive, director,
financial manager or commercial manager) may be liable for a corruption
offence even where he was not directly involved in committing the
offence, but where he either expressly authorised the offence or that type
of offence, or knew of the offence and either consented to it or was
wilfully blind to it
• Aiding and abetting: An individual may also be liable for aiding and
abetting where he has aided or assisted in the committing of the offence
What is Corruption
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Criminal liability for corruption (2)
Intention
 To be criminally liable for a corruption offence, you will
normally need the necessary criminal intention.
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 In the case of bribery, this will normally require that you
knew of the corrupt circumstances, or that you were
wilfully blind to the corrupt circumstances.
 You may be liable for fraud if you make an oral or written
statement which you do not honestly believe to be true.
What is Corruption
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Criminal liability for corruption (3)
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How does an organization incur criminal liability for
corruption?
• Through the corrupt acts of its officers or employees: if he/she was
acting within the course of his/her employment
• Through the corrupt acts of its agents: through the corrupt act of an
individual or organisation which has been appointed to act on the
company's behalf, and where the corrupt act is committed in the
course of that appointment
• Through the corrupt acts of its related companies or business
partners: by a subsidiary or associated company, joint venture or
consortium partner, sub-contractor or supplier, where that corrupt act
could benefit the company's business
What is Corruption
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Criminal liability for corruption (4)
“Turning a blind eye”
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 It occurs where a person in authority suspects that there is a
risk of corruption in relation to a business transaction in which
the company is involved, but deliberately avoids making
inquiries and taking reasonable preventive action.
 It is, therefore, important for managers to make proper
inquiries should they suspect corruption, or the risk of
corruption, in relation to the company's affairs, and to take
reasonable steps to prevent or stop the corruption. If they fail
to do so, their inaction may make both them and their
company liable.
What is Corruption
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Voluntary vs. coerced corruption
Voluntary corrupt act:
The act undertaken by the relevant party with the deliberate
intention of gaining a competitive advantage or obtaining
additional unjustified compensation
Coerced corrupt act:
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The act undertaken so as to “level the playing field”
Some offences are committed in the mistaken belief that
practices, such as the inflation of claims, or the wrongful
withholding of payment, are normal business acts and do not
constitute criminal offences
What is Corruption
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