Accounting offence settlement grudgingly allowed by Court
On 21 December 2010, BAE Systems Plc (“BAE”) was fined £500,000 (plus £225,000 in costs) after pleading guilty under a settlement agreement with the Serious Fraud Office (“SFO”), to an offence under section 221 of the Companies Act 1985 of failing to keep adequate accounting records. The offence related to the accounting of very substantial commission payments made to an overseas agent for his services in assisting a BAE company to obtain a contract from the Tanzanian Government to supply a radar defence system.
The case is a further example of the tensions between the SFO and the Courts in relation to settlements concerning corrupt conduct. The judgment includes some strikingly critical comments about the settlement agreement concluded with BAE and of the SFO’s handling of the case generally.
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