UK firm in court on charges of bribery in Africa

AUK-based printing company specialising in security documents such as ballot papers, as well as four individuals, has appeared in a London court on corruption charges. According to the UK’s Serious Fraud Office (SFO), Smith & Ouzman Limited (S&O), two of its directors, an employee and one agent have been charged and are accused of corruptly agreeing to make payments totaling nearly £500,000, contrary to Section 1 of the Prevention of Corruption Act 1906. It is alleged these payments were used to influence the award of business contracts to the company. The case against Chris Smith, former Chairman of S&O; Nick Smith, Sales and Marketing Director of S&O, Tim Forrester, International Sales Manager for S&O and Abdirahman Omar, an agent for S&O, has been heard at Southwark Crown Court in the past few weeks. All four and the company have denied the charges.hideAn SFO spokesman said summing up in the case was expected in the second week of December and a verdict is unlikely before the new year. The alleged offences are said to have taken place between November 2006 and December 2010 and relate to transactions in Mauritania, Ghana, Somaliland and Kenya. Among the organisations targeted were the Independent Electoral Commission of Kenya, the Kenyan National Examination Council, the Mauritanian Ministry of the Interior and the National Electoral Commission of Somaliland, it is alleged. The case has been dubbed Chickengate by some African media sources. Kenya’s Business Daily has reported: “Kenyan election officials pocketed millions of shillings in bribes to award lucrative printing contracts to a British company over a two-year period.” It describes the legal battle as one “that exposes one of the best documented international corruption networks in Kenya’s history”. The paper reports UK prosecutors have filed substantial amounts of written evidence implicating senior election officials in the corruption ring, including Independent Electoral and Boundaries Commission (IEBC) chairman Ahmed Issack Hassan. “The scale of the corruption alleged by the prosecution is worth £349,057.39 (Sh50 million) in Kenya,” the prosecutor Mark Bryant-Heron said in court filings. For many of the printing contracts, costs were inflated by up to 38% mainly to cater for the kickbacks—commonly referred to in the mails as ‘chicken’—to senior election officials, the UK prosecutors say. The prosecutors said: “The corrupt payments were built into S&O’s pricing of the printed materials so that the inflation in the price as a result of that corruption was passed on to those funding the institutions that contracted with S&O.” Forensic investigations by the UK’s SFO show that top IIEC officials, the predecessor of IEBC, variously asked for bribes codenamed ‘chicken’ to facilitate S&O’s winning of seven tenders to supply election materials such as ballot papers, voter registration forms, voter ID cards and nomination forms. The Kenyan media said energy secretary Davis Chirchir, who worked as a senior manager at the IIEC, tops the list of senior government officials named in the corruption racket. The list includes suspended IEBC chief executive James Oswago; former judiciary registrar Gladys Boss Shollei (deputy CEO); lawyer Kennedy Nyaundi (commissioner); Kenneth Karani (senior procurement officer) and the finance director. The SFO said this case was accepted by the SFO for investigation in October 2010 and written charges were issued in August. The value of the corrupt payments total £413,552.12. The SFO added that the OECD states corruption in the public sector hampers the efficiency of public services, undermines confidence in public institutions and increases the cost of public transactions. It adds that integrity is essential for building strong institutions resistant to corruption. S&O is one of the oldest printing firms in the UK, specialising in security documents such as examination and ballot papers. It lists some of its top customers in Kenya as IEBC, KNEC and other government agencies. CourtNewsUK reported prosecutor Mark Bryant-Heron QC as saying: “This is a case about corruption. “The company does trade in the UK but S&O has substantial interests abroad, including substantial business interests in a number of Africa states and this case concerns S&O’s business transactions in four African states or territories—Kenya, Mauritania, Ghana and Somaliland. “The prosecution’s case is that in each of these countries, directors and senior employees at S&O had agents employed on the ground, in this case agents to make corrupt payments to officials and employees working for institutions in these countries in order to obtain printing contracts and to ensure business in the future. “That is the heart of the Crown’s allegations—that is the corruption.” Mr Bryant-Heron said the scale of the corrupt payments ranged from about £330,000 relating to deals in Kenya to about £12,000 for bargains struck in Ghana, according to CourtNewsUK. “In each of these countries, S&O employed agents to assist them in making tenders for business, in pitch-ing for business and in sorting out the details that needed to be sorted out in any normal commercial relationship and there is, of course, nothing wrong with that,” said Mr Bryant-Heron. “Those agents worked on commission. The prosecution’s case is that the defendants used commission payments to those agents to mask criminal payments to public officials. “Those public officials working in the countries I have mentioned were in a position to influence the outcome of the tender for business,” he continued. “As in this country, legally when contracts awarded for publicly-funded institutions such as examination bodies or election institutions, the tender process, the bidding process, was supposed to be open and competitive. “What these payments did, the prosecution suggests, was to make it far more likely that the business and, importantly for S&O, any future business would be awarded to S&O,” said Mr Bryant-Heron. He added: “There is also evidence in particular when we come to the country Mauritania of direct payments to relatives of government, to government officials in the form of bribes.” While four men and the company stand accused, Mr Bryant-Heron is reported to have said: “There were other agents for other countries because, the prosecution says, that the agents were party to these offences—they just don’t happen to be in the dock.”

UK firm in court on charges of bribery in Africa

Want to read this article?

Read Next

AXA P&C increases premiums by 7% as rates rise at AXA XL

Hong Kong and Shanghai to cooperate on captives and ILS

Swiss broker Kessler names head of special risks

US insurers expected to increase casualty pricing as social inflation rises

Consultancy S-RM expands cybersecurity practice to APAC

AXA P&C increases premiums by 7% as rates rise at AXA XL

Hong Kong and Shanghai to cooperate on captives and ILS

Swiss broker Kessler names head of special risks

US insurers expected to increase casualty pricing as social inflation rises

Consultancy S-RM expands cybersecurity practice to APAC

Want to read this article?

Read Next

AXA P&C increases premiums by 7% as rates rise at AXA XL

Hong Kong and Shanghai to cooperate on captives and ILS

Swiss broker Kessler names head of special risks

US insurers expected to increase casualty pricing as social inflation rises

Consultancy S-RM expands cybersecurity practice to APAC

Related Articles