Anti-Bribery and Corruption: Perceptions, Risks and Practice for UK Banks
Corruption is a serious economic, social, political, legal and moral problem found in many contexts from sports (i.e. doping in athletics and FIFA scandals) to banking practices (i.e. LIBOR, Dark Pool) and international trade (i.e. the BAE bribery enquiries).1 Past studies in this field indicate that the risk corruption poses to society at large varies from country to country and is difficult to quantify. Such risk is generally calculated in light of public’s perception of the level of public sector corruption in a given society, but there have been studies which also indicate that economic freedom, socio-political stability, tradition of law abidance and national cultures are the major variables that dictate the degree of corruption. Past research findings both by the academia and policy makers link corruption to poor economic growth, low political stability, lack of transparency and accountability to which liberalisation, privatisation and democratisation are offered as preferred policy responses.2 The literature review also reveals that there is limited legal analysis of this phenomenon. The author takes the view that the narrow focus on developing countries has obscured more subtle yet costly manifestations of corruption in rich and democratic (developed) countries and as a result the risk of corruption in so-called developed countries is overlooked. This chapter expands the existing knowledge about the determinants of corruption as it focuses on the United Kingdom (UK) where democracy, economic liberalisation and the rule of law are arguably well-established principles in public office generally and in financial transactions particularly. Firstly, this chapter analyses how the UK’s legal instruments address the crime of corruption. Secondly, the risks that bribery and the legal compliance requirements pose for banks are commented on. Finally, a number of good practice proposals are considered and evaluated.