Author: Syedur Rahman 16 January 2020
Syedur Rahman of Rahman Ravelli outlines the DPA that was concluded with Guralp Systems and announced shortly after three senior figures at the company – including one he successfully represented – were acquitted.
Three senior figures at British seismic equipment company Guralp Systems Ltd (GSL) were cleared of conspiracy to make corrupt payments - minutes before it was announced the firm had concluded a deferred prosecution agreement (DPA).
A jury at London’s Southwark Crown Court acquitted GSL founder Cansun Guralp, sales head Natalie Pearce and former finance director Andrew Bell of conspiracy to make corrupt payments between 2002 and 2015 in order to secure contracts for the company. The Serious Fraud Office (SFO) then made public the DPA the firm had agreed with it two months earlier.
The chain of events began when the company’s new chairman became suspicious about payments to Heon-Cheol Chi, who was employed at the Korea Institute of Geoscience and Mineral Resources. The chairman notified the SFO and the US Department of Justice.
Chi was convicted in the US of laundering bribes through the US banking system in 2017. The SFO charged the three GSL defendants in 2018. In reaching a DPA with the SFO, the company had accepted charges of conspiracy to make corrupt payments and failure to prevent bribery and had agreed to pay £2M for disgorgement of profits and to improve its internal controls.
This DPA was the first in the UK where the final approval hearing was heard in private rather than public and the first where the company paid no financial penalty at all, only a disgorgement. While GSL has agreed to pay the disgorgement of profit, no timetable was set for payment. There is only reference to the fact that the disgorgement will be paid by the fifth anniversary of the date of the agreement – and the terms of this DPA allow for this to be amended if GSL cannot meet the repayments.
But while the GSL DPA has some unique features, questions have been asked about whether the acquittal of the individuals, in this case, undermines the idea that there is an incentive for companies to self-report.
This article was also featured on Lexology.com.
Syedur Rahman is known for his in-depth experience of serious fraud, white-collar crime and serious crime cases, as well as his expertise in worldwide asset tracing and recovery, civil recovery, cryptocurrency and high-stakes commercial disputes.