Hello and welcome back to the Fides Weekly Update.
We’re back with the week’s trends, moves and developments in legal compliance. Scroll down to see our regular feature of Movers & Shakers of the week.
1. SFO agrees settlement with Rolls-Royce on largest DPA since UK inception
Rolls-Royce will receive penalties of £671m in the largest Deferred Prosecution Agreement (DPA) to be approved by English courts, following a five year-long investigation into allegations of bribery by the luxury British car manufacturer.
Claims of malpractice began in 2012, after which regulators across the globe teamed up to carry out investigations exploring whether Rolls-Royce paid bribes to win export contracts in several countries, including Brazil, India and China. In 2016, the Guardian published the results of an independent investigation which found that ‘commercial agents’ had been hired in 12 different countries to help Rolls-Royce secure export contracts. The settlement reached involves a pay out to both Brazilian and US regulators, as well as to the Serious Fraud Office (SFO).
The courts approved the DPA on Tuesday (17 January) and it marks the third and largest ever DPA in English law. A DPA is an arrangement between the prosecution and an organisation used in connection with fraud, bribery or other economic crime to suspend investigations in return for a fine. If the organisation committed further wrongdoing during the defined period, which in Rolls-Royce’s case is five years, it could trigger reactivation of prosecution. The previous two companies to have arranged DPAs with the SFO are ICBC Standard Bank and an anonymous UK SME.
For this probe, Rolls-Royce initially instructed Debevoise & Plimpton back in 2012 to conduct an internal investigation after the SFO requested company information, and later brought in Slaughter & May as advisers in late 2013. Slaughter & May has a long running history of defending global corporations on corruption scandals, having advised GlaxoSmithKline in 2007 during an investigation into bribery allegations in Iraq during Saddam Hussein’s regime.
The rise in DPAs in the English legal system highlights a real step up in the SFO’s action against bribery and corruption, with Robert Amaee, a former head of anti-corruption at the SFO and partner at Quinn Emanuel Urquhart & Sullivan claiming that “The SFO is now playing in the big leagues.” Alongside the DPA, the SFO continues to investigate into individuals involved in the bribery scandal, which further demonstrates its stronger stance on such misconduct.
We expect to more outcomes such as this in the coming year, both from the SFO and US regulators. The FCPA released its Corporate Investigations List this month, which details all companies that remain subjected to ongoing and unresolved FCPA-related investigations. You can find the list here.
Movers & Shakers of the week:
Senior partner Nick Thomas has been re-elected to serve a fifth term at Kennedys, which will run for a further four years
Jonathan Mellor joins Simmons & Simmons as a capital markets partners, leaving Allen & Overy after 30 years at the firm
Former Europe and Middle East managing partner at Squire Patton Boggs Peter Crossley has decided to take back his previous position as a litigation partner in the firm’s international disputes practice in London
Caroline McGrory has joined Leicester City Football Club as its first general counsel, having previously worked in Mercedes-Benz’s Grand Prix team as director of legal and commercial affairs
Ahead of the three-way merger, Paris managing partner Guillaume Kessler has moved to the French corporate practice of Orrick, Herrington & Sutcliffe
Disputes partner Clarissa Coleman joins K&L Gates in London, and denotes the fifth London disputes partner to exit Addleshaw Goddard over 2016/17
Gibson Dunn & Crutcher has hired Allen & Overy’s group head of TMT Ahmed Baladi, who brings with him Counsel Vera Lukic and associates Emmanuelle Bartoli and Adelaide Cassanet to join the US firm’s Paris office
Philip Crump leaves Gibson Dunn & Crutcher’s finance practice, having joined from Kirkland & Ellis in August 2015. His next steps are unknown
John Berriman, who previously sat as a board member at PwC, has joined the board at Norton Rose Fulbright and will serve as their global chief operating officer
Office Openings & Closings:
Mergers & Alliances: