THERE is an increased risk of bribery and corruption in the oil and gas industry, a leading compliance lawyer has warned.
Pinsent Masons’ Willie Park believes a lowering of standards when work is scarce could weaken checks and procedures which prevent incidents of corruption.
Mr Park spoke out after Braid Logistics became the latest Scottish business to self-report an act of bribery to the Crown Office, in a deal which saw it pay a settlement of £2.2 million. Braid agreed to a civil settlement after an internal investigation discovered “potentially dishonest activities” relating to freight contracts.
Since this Bribery Act 2010 was implemented a self-reporting scheme has been in place, encouraging firms to disclose the extent of all bribery and corruption offences to the Crown Office.
Tubular Services and Brand-Rex have also paid out sums after self-reporting. And in 2012 drilling company Abbot Group agreed a £5.6m settlement following a self-report where it admitted having benefited from corrupt payments relating to one of its German subsidiaries.
Aberdeen-based Mr Park said cutting compliance costs was a false economy. “If lax procedures creep in to an organisation which leads to bribery or corruption, this can cause lasting financial and reputational damage.”
Writing in The Herald on April 4, Lindsey Miller, Head of the Crown Office’s serious and organised crime division, said self-reporting was not a soft option. “Courts will recognise the steps taken by the business in coming forward and admitting responsibility and credit will be given for saving the costs of investigation to the public purse,” she said.
Mr Park added: “Companies have to be on top of relationships and to monitor them with a frequency which is commensurate with the risk. The global oil and gas sector, particularly around logistics, is viewed as one of the highest risk industries in terms of potential corruption.”
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