A couple of weeks ago I had the opportunity to enjoy a day of fabulously sunny weather in London and, more importantly, have lunch with Barry Vitou, one of the two founding partners of the Blogsite, thebriberyact.com. So I am able to present the next installment of Lunch with the FCPA Compliance and Ethics Blog. Just as sometimes my inspiration, Lunch with the FT, travels to the US to interview a noteworthy person, this edition comes from the UK. Over a lovely entrée of some grilled white fish whose name in French I could neither understand nor repeat, we chatted about all things Bribery Act, Foreign Corrupt Practices Act (FCPA) and generally anti-corruption and anti-bribery.
For those of you who do not know him, Barry, together with Richard Kovalevsky QC, founded thebriberyact.com site after, in 2009, they began to follow the legislative meanderings for the UK Bribery Act and decided to start a website to highlight the legislation and bring commentary and analysis to the new law. As I have previously stated, “If you only have one resource for all things UK Bribery Act related, you could not find a better site. Barry Vitou and Richard Kovalevsky have put together that rarest of all blog sites, one that covers an entire subject in-depth, with both practical insight and analysis. Their interviews of the relevant players allow all compliance practitioners to develop insight into what the top UK regulatory officials are thinking about on the Bribery Act.”
Barry has practiced law for nearly 20 years and is a partner at the firm of Pinsent Masons LLP. At Pinsent Masons, he heads the firm’s corporate crime team specializing in corporate risk and cross border corporate crime issues. As Barry puts it, he helps companies with ‘tape at the top’, prevention advice as well as offering ‘the ambulance at the bottom’ when accidents happen. Barry’s busy.
While the topics we discussed at lunch were wide-ranging, one of the issues I was most interested in was Barry’s take on the GlaxoSmithKline PLC (GSK) corruption investigation in China. As my readers will recall, I believe that the GSK matter will be a true game-changer in compliance because of the entry of China onto the international stage for the prosecution of western companies for corruption and bribery in China. With typical British reserve Barry explained to me that he did not view the situation was as unexpected or draconian as I have opined. While neither of us could discern the true motives behind the Chinese government’s aggressive pursuit of GSK, Barry believed that the issue of corruption in China has been present and indeed well known for some period of time. So he was not surprised an issue did arise.
However, from his perspective what was perhaps different was the very public way that investigation has played out. Particularly, when GSK publicly tried to distance itself from its Chinese operations (read: rogue employees); the Chinese government simply upped the ante by announcing its investigation had found evidence that the alleged bribery involved was coordinated by the GSK management and was not simply the work of rogue employees. In this war of words it’s too early to know what went on. But, one thing is for sure. Unlike the US anti-corruption regulators the Department of Justice (DOJ) or Securities and Exchange Commission (SEC) or UK Serious Fraud Office (SFO), none of which will comment about ongoing investigations, the Chinese government has no such compunction. Indeed there is certainly no jury panel to prejudice in China. But the point is that there is no way to win in any such battle. True or not. Damage is done.
We also talked about the ongoing JP Morgan hiring program which is under FCPA scrutiny now. Once again we turned to the more general point that this matter may have mushroomed outside the original area of concern regarding the hiring of Chinese government officials sons and daughters in China to a wider review across Asia. Here I have to credit Barry with one of the great lines of British compliance understatement. He said that when any program comes under such intense scrutiny, you may well find other “imperfections” in your compliance process. But his take was not simply on this understated way of looking at things but to the larger point that the key question is what actions did you take when you found such imperfections? Barry went on to explain that when he lectures, trains or meets with companies one of the things that he tries to get across is that regulators on both sides of the Atlantic will measure you in large part on your response so it is far better to begin remediation as soon as you can do so rather than to wait.
We also talked about the SFO and where it might be in any Bribery Act investigation and prosecutions. He believes a key is that the SFO is reverting to type and will focus on prosecution of Serious Fraud. Barry opined that the SFO has several open, high profile investigation ongoing. Further, although the SFO Director, David Green, would certainly like to bring a high profile prosecution, he would not rush to do so out of expedience. Barry also said that it was his opinion that non-English companies which come to London to be listed on the London Exchange will certainly have to follow UK law if they wish to avail themselves of the benefits of UK registration.
Unfortunately our lunch had to end as Barry had to return to his office. But the meal, company, conversation and weather were all first rate. Until my next installment of Lunch with the FCPA Compliance and Ethics Blog, bon appetite.
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© Thomas R. Fox, 2013