FSA issues record fine for lack of bribery controls

22 July 2011

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22 July 2011 | Paul Snell

The UK Financial Services Authority (FSA) has fined professional services firm Willis Limited nearly £7 million for failing to prevent bribery.

Although there was no evidence corruption had taken place, the FSA said a lack of controls at the company meant there was an “unacceptable risk” that payments made by the firm to third-parties overseas “could be used for corrupt purposes, including paying bribes”.

The fine of £6.895 million is the largest penalty handed out for this type of offence, beating the £5.25 million the FSA fined Aon in 2009.

The regulator said that between 2005 and 2009, Willis – which advises firms on risk management - had made payments totalling £27 million to third parties who then helped the company keep and win business abroad. Up until 2008, the firm did not set out and record the reason for these payments, did not carry out sufficient due diligence on the people it was paying and did not review these relationships. Although policies were introduced to address this post-2008, the firm still failed to ensure staff were adhering to them until the end of 2009.

The FSA investigation identified “suspicious payments” of $227,000 (£139,275) relating to business in Egypt and Russia which have since been reported to the Serious Organised Crime Agency.

Willis has committed to reviewing its payments to identify if any were inappropriate.

Brendan McManus, CEO of Willis Limited, said in a statement: “When we discovered some of our businesses had not got that right in the past, we were swift to engage with the FSA towards today’s regulatory resolution. Our close co-operation has been recognised by the FSA and we are grateful to them for that. It goes without saying that our compliance framework and its application across the business are now very robust and central to the leadership of the company.”

Willis received a 30 per cent reduction in its fine, as a result of its co-operation and agreeing to make an early settlement.

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