Civil Settlements for bribery offences

COPFS and CRU are committed to publishing details of civil settlements reached for bribery offences.

Civil settlements are agreed by the Civil Recovery Unit on behalf of Scottish Ministers. The Joint Minutes of Agreement are a matter of public record and are registered with the Registers of Scotland in the Books of Council and Session.

The Civil Recovery Unit recovered £5.6 million under Proceeds of Crime legislation on 23 November 2012 after an Aberdeen drilling company accepted that it had benefited from unlawful conduct.

Abbot Group Limited (“Abbot”) was the first company to enter into a civil settlement under the self-reporting initiative since it was introduced in 2011.

Abbot admitted that it had benefited from corrupt payments made in connection with a contract entered into by one of its overseas subsidiaries and an overseas oil and gas company.

The contract was entered into in 2006 and the payments were made in 2007. The sum paid by Abbot represents the profit made by the company under the contract.

The corrupt payments were brought to light in May 2011 following enquiries by an overseas tax authority which resulted in an investigation by a firm of solicitors and a firm of accountants instructed by Abbot itself.

Abbot reported the results of the investigation to the Crown Office and Procurator Fiscal Service in July 2012 under the self-reporting initiative.

Thomas Gunn Navigation Systems Ltd (TGNS) was an Aberdeen-based technology company operating in the shipping sector. When it was acquired by a larger company it transpired that, between 2003 and 2012, staff at TGNS had paid bribes totalling £30,000 to executives at a London-based shipping firm, in return for the award of contracts worth £138,000. The new board of directors initiated an investigation and made a self-report to COPFS. Following a full investigation instructed by COPFS, in 2013 the company reached a settlement with the Civil Recovery Unit in the sum of £138,000, representing the value of the contracts corruptly obtained. The managing director of TGNS, Thomas Gunn, was prosecuted separately for his involvement.

The Civil Recovery Unit recovered £172,200 under Proceeds of Crime legislation on 17 December 2014, after a Scottish company accepted that it had benefited from unlawful conduct.

International Tubular Services Limited (ITS), which is based in Aberdeen and supports activities for petroleum and natural gas extraction, admitted that it had benefited from the corrupt payment of $17,000 made by a former Kazakhstan-based employee in 2012, to secure additional contractual work from a customer in Kazakhstan.

The bribery and corruption was discovered when the company was being sold. Parker Drilling Company, which acquired ITS, took steps to implement comprehensive anti-bribery policies and training to ensure no further unlawful conduct.

ITS reported its discovery of the corrupt payment to the Crown Office and Procurator Fiscal Service in November 2013 under the self-reporting initiative.

The recovery represents the total profit made under the corrupt contract in Kazakhstan.

The Civil Recovery Unit recovered £212,800 on 25 September 2015 under an agreed civil settlement with a Glenrothes based company which accepted that it had benefited from unlawful conduct by a third party.

In June 2015, solicitors acting on behalf of Brand-Rex Ltd, a developer of cabling solutions for network infrastructure and industrial applications, contacted the Crown Office to disclose an instance of failing to prevent bribery by a third party associated with the company.

Between 2008 and 2012 Brand- Rex operated an incentive scheme known as “Brand Breaks” for UK distributors and installers. An independent installer of Brand-Rex products offered his company’s tickets for holidays abroad to an employee of one of his customers.

The individual who ultimately received the tickets was in a position to influence decisions as to which company they purchased cabling from. Personnel from this company and individuals connected to them used these tickets for foreign holidays in 2012 and 2013.

Brand-Rex became aware of this issue through an internal review and launched an extensive investigation conducted by external solicitors and forensic accountants. As a consequences of the investigation, Brand Rex made a self-report to Crown Office and accepted that they failed to prevent this when they should have done, accepting responsibility for a contravention of Section 7 of the Bribery Act 2010.

The value of the settlement reflected the benefit that the company derived from the unlawful conduct.

The Civil Recovery Unit recovered £2.2 million on 29 March 2016 under an agreed civil settlement with a Glasgow-based company which accepted that it had obtained business through unlawful conduct.

The company, which has a number of subsidiaries, specialises in freight and logistics. In 2012, the company became aware of potentially dishonest activities in relation to two freight forwarding contracts entered into by a subsidiary. The company initiated an investigation, which revealed there had been breaches of the terms of the Bribery Act 2010.

The first contract related to an agreement between an employee of the company, and the employee of a customer company. An account was used as a means for unauthorised personal expenses amounting to £475,000 to be incurred by the customer’s employee between 2007 and 213. This was funded by the dishonest inflation of invoices provided to the customer.

During the investigation into the above contract, separate bribery offences in relation to a second customer were discovered.

A profit sharing arrangement with a director of the customer company had been operated, where the profit achieved on services provided to the customer was split, in return for orders continuing to be placed with the company. This occurred over a number of years, with the last instance being in September 2013.

As a consequence of the investigation, the company voluntarily made a self-report to the Crown Office and accepted that they failed in their responsibility to prevent this happening, similarly accepting responsibility for a contravention of Sections 1 and 7 of the Bribery Act 2010. The settlement reflected the value of the benefit derived by the company from the unlawful conduct.

The Civil Recovery Unit reached a settlement to recover £6.46 million under Proceeds of Crime legislation after an Aberdeen company accepted it had benefitted from unlawful conduct.

WGPSN admitted one of its subsidiaries, PSNA Limited, had benefitted from payments made to Unaoil to secure contracts in Kazakhstan. WGPSN’s ultimate holding company is John Wood Group PLC (Wood).

The payments to Unaoil were made in connection with three contract tenders, two of which were successful, to provide services for the operation and maintenance of onshore and offshore oil and gas, chemical and petrochemical facilities in Kazakhstan.

The successful contracts were entered into in 2008 and 2010 by a joint venture in which PSNA Limited held an interest. Between 2012 and August 2015, a total of 1,358 million Kazakhstan Tenge (then approximately US$8.74m), was paid by the joint venture to Unaoil but there was limited evidence of legitimate services having been provided.

The contracts were entered into before the PSN business was acquired by Wood and the potential misconduct came to light in March 2016, when media reported on widespread corruption by oil and gas consultants Unaoil. The reports said Unaoil had worked with WGPSN in Kazakhstan.  

Wood conducted an internal investigation and, in May 2017, the results of the investigation were submitted to the Crown Office and Procurator Fiscal Service (COPFS). WGPSN went on to submit a formal report under the self-reporting initiative in September 2019. After consideration, COPFS referred the case to the Civil Recovery Unit for investigation. Wood and WGPSN fully co-operated with the Civil Recovery Unit's investigation.

WGPSN agreed to pay £6,465,564, which represents the dividends and retained profits from the two contracts.

Wood and WGSPN have taken steps to develop and improve its policies and training to try and prevent similar events taking place in the future.