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Volume 540: debated on Tuesday 7 February 2012

10. What recent assessment he has made of the implications for his policies of the successful application by the Serious Fraud Office to confiscate dividends paid by companies convicted of bribery. (93680)

The Government are committed to protecting and building on the reputation of UK business. The recent use of the civil recovery process to recover shared dividend payments derived through contracts won through unlawful conduct reinforces that. The actions of the Serious Fraud Office send a clear message to shareholders and investors, particularly institutional investors, that they must satisfy themselves that the business practices of the companies in which they invest are legal and ethical. The Serious Fraud Office has signalled its intention rigorously to pursue similar civil recovery actions, where appropriate, in the future.

It is good to see the Attorney-General being tough on bribery and he might want to have a word with the Justice Secretary about that. He will be aware that in the Mabey Holdings case, the director of the SFO said that

“the shareholder was totally unaware of…inappropriate behaviour.”

Will it be common practice for lay shareholders and pension funds to be penalised for the fraudulent activities of companies which, by definition, they will not know about, as bribery is not generally advertised?

I think it is right to say that in the case of Mabey Engineering, the company that held the dividends was a subsidiary company—that is, a holding company held the dividends. That said, I cannot give the hon. Gentleman any specific assurance as we will consider the matter on a case-by-case basis. The principle of the possibility of taking back dividends that have been paid wrongly, as they are the fruit of bribery and corruption, must clearly be kept in mind.