Context, scope and overview
- This policy provides guidance to workers concerning the relevant legislative requirements of the Fraud Act 2006, the Bribery Act 2010 and the Criminal Finances Act 2017. It also sets out the expectations of employees and others working on behalf of Warren Services Ltd (the Company, we, us) and provides a framework for reporting and responding to suspected misconduct. It is our policy to conduct all our business in an honest and ethical manner. We take a zero-tolerance approach to financial misconduct, malpractice, fraud, bribery and corruption and are committed to acting professionally, fairly and with integrity in all our business dealings and relationships wherever we operate and implementing and enforcing effective systems to counter non-compliance.
- We will uphold all laws relevant to countering financial misconduct or malpractice in all the jurisdictions in which we operate. However, we remain bound by the laws of the UK, including the Fraud Act 2006, the Bribery Act 2010 and the Criminal Finances Act 2017, in respect of our conduct both at home and abroad.
- This policy should be read alongside other key policies. In particular, the Company’s Whistleblower policy.
- Any breach of this policy will be taken seriously and may lead to disciplinary action, which could include summary dismissal, under the Company’s Disciplinary Procedure.
- The purpose of this policy is to:a) set out our responsibilities, and of those working for us, in observing and upholding our position on financial misconduct, malpractice, bribery, fraud and corruption; and
b) provide information and guidance to those working for us on how to recognise and deal with financial misconduct, malpractice, bribery, fraud and corruption issues.
- Fraud, bribery and corruption are punishable for individuals, by up to ten years’ imprisonment in some cases, and if we are found to have taken part in corruption we could face an unlimited fine, be excluded from tendering for public contracts and face damage to our reputation. We therefore take our legal responsibilities very seriously and are committed to preventing the facilitation of any form of corruption or financial misconduct.
- In this policy, third party means any individual or organisation you come into contact with during the course of your work for us, and includes actual and potential clients, customers, suppliers, distributors, business contacts, agents, advisers, and government and public bodies, including their advisors, representatives and officials, politicians and political parties.
Who is covered by this policy?
- This policy applies to all individuals working at all levels and grades, including senior managers, officers, directors, employees (whether permanent, fixed- term or temporary), consultants, contractors, trainees, seconded staff, homeworkers, casual workers and agency staff, volunteers, interns, agents, sponsors, or any other person associated with us, or any of our subsidiaries or their employees, wherever located (collectively referred to as workers or you in this policy).
What is bribery?
- The Bribery Act 2010 introduces the central concept of ‘improper performance’ in relation to any ‘relevant function or activity’. This is effectively designed to cover all the public functions or business activities of an organisation.
- A bribe is an inducement or reward offered, promised or provided in order to gain any commercial, contractual, regulatory or personal advantage and can be further defined as “the receiving or offering of an undue reward by or to any holder of public office, private employee, colleague, or representative of another organisation, designed to influence them in the exercise of their duty and to incline them to act contrary to accepted standards of honesty and integrity”.
- Four key offences exist within the Act:a) active bribery (the offence of offering to bribe another);
b) passive bribery (the offence of accepting or requesting a bribe);
c) bribery of a foreign public official;
d) failing to prevent bribery (the offence by a commercial organisation of failure to
prevent bribery by any person associated with it).
- The penalties that can be imposed under the Act are severe, including a maximum sentence of 10 years for individuals and an unlimited fine for organisations. The Act has a very broad geographical reach, including the international activities of organisations and encompasses agents or associates acting on the organisations behalf.
- Examples of bribery include:a) Offering a bribe – a worker offers a potential client tickets to a major sporting
event, but only if they agree to do business with the Company. This would be an offence as the worker is making the offer to gain a commercial and contractual advantage. The Company may also be found to have committed an offence because the offer has been made to obtain business for it. It may also be an offence for the potential client to accept the offer.
b) Receiving a bribe – a supplier gives a worker’s nephew a job but makes it clear that in return they expect the worker to use their influence in our organisation to ensure the Company continues to do business with them. It is an offence for a supplier to make such an offer. It would be an offence for the worker to accept the offer as they would be doing so to gain personal advantage.
c) Bribing a foreign official – a worker arranges for the Company to pay an additional payment to a foreign official to speed up an administrative process such as clearing company goods through customs. The offence of bribing a foreign official has been committed as soon as the offer is made. This is because it is made to gain a business advantage for the Company. The Company may also be found to have committed an offence.
Gifts and hospitality
- The Act is not simply about paying or receiving bribes or other corruption in public office: it also considers corporate hospitality, gifts and incentives.
The Act is not simply about paying or receiving bribes or other corruption in public office:
it also considers corporate hospitality, gifts and incentives.
- This policy does not prohibit normal and appropriate hospitality (given and received) to or from third parties and the giving or receipt of gifts is not prohibited, if the following requirements are met:a) it is not made with the intention of influencing a third party to obtain or retain business or a business advantage, or to reward the provision or retention of business or a business advantage, or in explicit or implicit exchange for favours or benefits;
b) it complies with local law;
c) it is given in our name, not in your name;
d) it does not include cash or a cash equivalent (such as gift certificates or vouchers);
e) it is appropriate in the circumstances. For example, in the UK it is customary for
small gifts to be given at Christmas time;
f) taking into account the reason for the gift, it is of an appropriate type and value and given at an appropriate time;
g) it is given openly, not secretly; and
h) gifts should not be offered to, or accepted from, government officials or
representatives, or politicians or political parties, without the prior approval of your manager.
- We appreciate that the practice of giving business gifts varies between countries and regions and what may be normal and acceptable in one region may not be in another. The test to be applied is whether in all the circumstances the gift or hospitality is reasonable and justifiable. The intention behind the gift should always be considered.
- It is not acceptable for you (or someone on your behalf) to:
a) give, promise to give, or offer, a payment, gift or hospitality with the expectation or
hope that a business advantage will be received, or to reward a business advantage
b) give, promise to give, or offer, a payment, gift or hospitality to a government official,
expectation that it will obtain a business advantage for them;
d) accept a gift or hospitality from a third party if you know or suspect that it is offered
or provided with an expectation that a business advantage will be provided by us in
e) threaten or retaliate against another worker who has refused to commit a bribery
offence or who has raised concerns under this policy.
Facilitation payments and kickbacks
- We do not make, and will not accept, facilitation payments or “kickbacks” of any kind. Facilitation payments are typically small, unofficial payments made to secure or expedite a routine government action by a government official. They are not commonly paid in the UK but are common in some other jurisdictions.
- If you are asked to make a payment on our behalf, you should always be mindful of what the payment is for and whether the amount requested is proportionate to the goods or services provided. You should always ask for a receipt, which details the reason for the payment. If you have any suspicions, concerns or queries regarding a payment, you should raise these with your manager.
- Kickbacks are typically payments made in return for a business favour or advantage. All workers must avoid any activity that might lead to, or suggest, that a facilitation payment or kickback will be made or accepted by us.
- We do make contributions to political parties, but these are never made in an attempt to influence any decision or gain a business advantage and are always publicly disclosed. We only make charitable donations that are legal and ethical under local laws and practices. No donation must be offered or made without the prior approval of the Managing Director.
- All cases of suspected bribery, or attempted bribery, or any act in contravention of the rules set out here will be thoroughly and promptly investigated. Any Company worker against whom evidence of bribery is found, will be subject to the Company’s disciplinary procedures which may result in dismissal. In such cases the Company will normally involve the police and may also institute civil proceeding to recover any losses.
What is fraud?
- The Fraud Act 2006 defines fraud as the intention to obtain a gain for oneself or for another, or to cause or expose another to the risk of a loss by:a) dishonestly making an untrue or misleading representation; or
b) dishonestly failing to disclose information which you are legally bound to disclose;
c) dishonestly abusing a position of trust, in which you are expected to safeguard, or
d) not to act against, the financial interests of others.
- Gains and losses are restricted in the Act to gains and losses of money or property.
- The Company takes all reasonable steps to ensure that there are appropriate financial and management controls in place to safeguard Company funds and assets and to prevent and detect fraud such as:a) identifying the risks to which systems and procedures are exposed;
b) ensuring that an adequate system of internal control exists and that controls
operate effectively and are complied with;
c) undue reliance on specific individuals is avoided;
d) workers are adequately trained for the role they perform.
- All cases of suspected fraud, or attempted fraud, will be thoroughly and promptly investigated. Any Company worker against whom evidence of fraud is found, will be subject to the Company’s disciplinary procedures which may result in dismissal. In such cases the Company will normally involve the police and may also institute civil proceedings to recover any losses.
What is criminal finance?
- The Criminal Finance Act 2017 came into force with effect from 30 September 2017, the 3 main parts of which are:a) Part 1 Proceeds of crime
b) Part 2 Terrorist property
c) Part 3 Corporate offences of failure to prevent facilitation of tax evasion
- Part 3 of the Act introduces a new Corporate Criminal Offence of failure to prevent the facilitation of tax evasion. The legislation applies to all businesses and all taxes. This particular offence is not about the Company itself avoiding, evading or underpaying tax, but about the Company failing to prevent its workers from facilitating the evasion of tax by another party. All corporates are affected and can be subject to prosecution for the facilitation of tax evasion by ‘associated persons’.
- It has always been a criminal offence for anyone to assist a third party in criminal tax evasion; the corporate offence of failure to prevent the facilitation of tax evasion is when all of the following circumstances apply:a) Stage 1: There is criminal evasion by a taxpayer;
b) Stage 2: There is the criminal facilitation of that evasion by an ‘associated person’
(e.g. a worker) acting for or on behalf of the ‘relevant body’ (the Company); and
c) Stage 3: The ‘relevant body’ failed to prevent that facilitation.
- Examples of Corporate Criminal Offence are as follows:a) Making a payment overseas, for example to an overseas third party, in the
knowledge that the third party intends to use the method of payment to evade tax;
b) Allowing a payment for goods/services to be described as a donation so that the
donor can claim tax relief;
c) Agreeing to misdescribe an income stream to take the payment outside with-
holding tax obligation;
d) Accepting a request to pay one entity knowing that the goods/services have been
provided by another entity and that the purpose of the change is to evade tax.
- If any worker is found guilty of assisting a third party to evade tax in the course of their duties, the Company will automatically be charged with ‘facilitating criminal tax evasion’, and be liable, if found guilty, to unlimited fines, damage to reputation and loss of rights to bid for government contracts.
- All cases of suspected criminal finance, or attempted criminal finance, will be thoroughly and promptly investigated. Any Company worker against whom evidence of criminal finance is found, will be subject to the Company’s disciplinary procedures which may result in dismissal. In such cases the Company will normally involve the police and may also institute civil proceedings to recover any losses.
- Workers must read, understand and comply with this policy.
- Workers must be alert to the potential ‘red flags’ that may arise during the course of their working for us and which may raise concerns under various financial conduct, anti-bribery and anti-corruption laws. The list is not intended to be exhaustive and is for illustrative purposes only. If workers encounter any of these red flags while working for us, they must report them promptly to their manager:a) you become aware that a third party engages in, or has been accused of engaging in, improper business practices;
b) you learn that a third party has a reputation for paying bribes, or requiring that bribes are paid to them, or has a reputation for having a “special relationship” with foreign government officials;
c) a third party insists on receiving a commission or fee payment before committing to
sign up to a contract with us, or carrying out a government function or process for
d) a third party requests payment in cash and/or refuses to sign a formal commission or fee agreement, or to provide an invoice or receipt for a payment made;
e) a third party requests that payment is made to a country or geographic location different from where the third party resides or conducts business;
f) a third party requests an unexpected additional fee or commission to “facilitate” a service;
g) a third party demands lavish entertainment or gifts before commencing or continuing contractual negotiations or provision of services;
h) a third party requests that a payment is made to “overlook” potential legal violations;
i) a third party requests that you provide employment or some other advantage to a
friend or relative;
j) you receive an invoice from a third party that appears to be non- standard or
k) a third party insists on the use of side letters or refuses to put terms agreed in
l) you notice that we have been invoiced for a commission or fee payment that
appears large given the service stated to have been provided;
m) a third party requests or requires the use of an agent, intermediary, consultant,
distributor or supplier that is not typically used by or known to us; or
n) you are offered an unusually generous gift or offered lavish hospitality by a third
- The Company expects workers to conduct themselves at all times having regard to the very highest standards of conduct, probity and confidentiality. Workers must not only be honest in fact but must also take reasonable measures so as to not lay themselves open to suspicion of dishonesty or perception of conflict of interest and/or of impropriety.
- Workers with any involvement in financial transactions are also responsible for familiarising themselves with, and complying with, the Company’s financial regulations and procedures. Financial transactions include, and are not limited to, ordering, receiving and approving payment of invoices in relation to the purchase of goods and services, initiating sales invoices, payment and receipt of monies.
- Additionally all workers are encouraged to bring to the Company’s attention areas of weakness that they may have identified in the procedures they use which could allow opportunities for fraud, and to suggest improvements to these procedures to reduce the possibility of fraud.
- The prevention, detection and reporting of bribery and other forms of corruption or financial misconduct are the responsibility of all those working for us or under our control. All workers are required to avoid any activity that might lead to, or suggest, a breach of this policy.
- Workers must notify their manager as soon as possible if they believe or suspect that a conflict with this policy has occurred or may occur in the future. For example, if a client or potential client offers them something to gain a business advantage with us or indicates to them that a gift or payment is required to secure their business. Further “red flags” that may indicate bribery or corruption are set out in paragraph 21.34.
- Any worker who breaches this policy will face disciplinary action, which could result in dismissal for gross misconduct. We reserve our right to terminate our contractual relationship with other workers if they breach this policy.
- We must keep financial records and have appropriate internal controls in place which will evidence the business reason for making payments to third parties.
- You must declare and keep a written record of all hospitality or gifts accepted or offered, which will be subject to managerial review.
- You must ensure all expenses and claims relating to hospitality, gifts or expenses incurred to third parties are submitted in accordance with our expenses policy and specifically record the reason for the expenditure.
- All accounts, invoices, memoranda and other documents and records relating to dealings with third parties, such as clients, suppliers and business contacts, should be prepared and maintained with strict accuracy and completeness. No accounts must be kept “off- book” to facilitate or conceal improper payments.
How to raise a concern
- You are encouraged to raise concerns about any issue or suspicion of malpractice at the earliest possible stage. If you are unsure whether a particular act constitutes malpractice, fraud, bribery or corruption, or if you have any other queries, these should be raised with your line manager. Concerns should be reported by following the procedure set out in our Whistleblowing Policy at section 12.
What to do if you are a victim of bribery or corruption
- It is important that you tell your manager as soon as possible if you are offered a bribe by a third party, are asked to make one, suspect that this may happen in the future, or believe that you are a victim of any other form of unlawful activity.
- Workers who refuse to accept or offer a bribe, or those who raise concerns or report another’s wrongdoing, are sometimes worried about possible repercussions. We aim to encourage openness and will support anyone who raises genuine concerns in good faith under this policy, even if they turn out to be mistaken.
- We are committed to ensuring no one suffers any detrimental treatment as a result of refusing to take part in bribery or corruption, or because of reporting in good faith their suspicion that an actual or potential bribery or other corruption offence has taken place, or may take place in the future. Detrimental treatment includes dismissal, disciplinary action, threats or other unfavourable treatment connected with raising a concern. If you believe that you have suffered any such treatment, you should inform your manager immediately. If the matter is not remedied, and you are an employee, you should raise it formally using our Grievance Procedure at section 9.
Training and communication
- Training on this policy forms part of the induction process for all new workers. All existing workers will receive regular, relevant training on how to implement and adhere to this policy.
- Our zero-tolerance approach to financial misconduct must be communicated to all suppliers, contractors and business partners at the outset of our business relationship with them and as appropriate thereafter.