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ACCA Applied Skills · Corporate and Business Law (Global) · Fraudulent and criminal behaviour

Under a typical modern anti-bribery statute, a company's employee bribes a foreign official to win business for the company. The company had no adequate procedures to prevent bribery. What is the company's position?

The company may be guilty of failing to prevent bribery. Liability arises from the employee's bribe made for the company's benefit, and board knowledge is not required. The company's defence would be adequate procedures, which it did not have.

  1. AIt may be guilty of a corporate offence of failing to prevent bribery, even if its directors knew nothingCorrect
  2. BIt is not liable, because only the employee committed the act
  3. CIt is liable only if the board formally approved the bribe

Explanation

Statutes modelled on the UK Bribery Act create a corporate offence of failing to prevent bribery by associated persons. Liability does not depend on board knowledge or approval. The company's defence is to show it had adequate procedures in place, which it lacked here.

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