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SFO receives approval in principle for DPA with G4S Care and Justice Services (UK) Ltd

10 Gorffennaf, 2020 | Eitemau newyddion

Following the announcement from G4S Plc, the Serious Fraud Office can confirm that it has today received approval in principle to enter into a Deferred Prosecution Agreement (DPA) with G4S Care and Justice Services (UK) Ltd (G4S C&J), a wholly-owned subsidiary of G4S Plc. On Friday 17 July, the SFO will apply for final approval of the DPA before Mr Justice William Davis.

If approved, the DPA will result in a payment by G4S C&J of £38.5m and payment of the SFO’s full costs.  Compensation to the victim of the conduct, the UK Ministry of Justice (MoJ) has already been paid by G4S C&J as part of a £121.3m civil settlement in 2014. 

In entering the DPA, G4S C&J will accept responsibility for three offences of fraud against the UK Ministry of Justice (MoJ) arising from a scheme to dishonestly mislead the MoJ as to the true extent of its profits between 2011 and 2013 from its contracts for the provision of electronic monitoring services.  The scheme was designed to prevent the MoJ from obtaining information to which it was entitled and from using this to decrease G4S C&J’s revenues under those contracts. 

The Director of the Serious Fraud Office, Lisa Osofsky, said:

“G4S Care & Justice repeatedly lied to the Ministry of Justice, profiting to the tune of millions of pounds and failing to provide the openness, transparency, and overall good corporate citizenship that UK taxpayers expect and deserve from companies entering into government contracts.

“The terms of this DPA will provide substantial oversight and assurance regarding G4S Care & Justice’s commitment to responsible corporate behaviour.”

The SFO has agreed in principle to this resolution based on a number of factors, including G4S C&J’s disclosure of materials indicating the conduct upon which the charges referenced above are based, its overall – albeit delayed – substantial cooperation with the SFO’s investigation, its remedial efforts since the offending, and its agreement to an extensive programme of review, assessment, and reporting on its internal controls, policies, and procedures. The company’s performance against this programme of corporate renewal will be guaranteed by its parent company, G4S plc, with the wide-ranging compliance obligations providing assurance to the SFO, the UK government and the taxpayer of good corporate behaviour in the future. 

The full terms of the DPA, details of the conduct to which it relates, and the reasons for entering into the DPA will be given in open court at the public hearing of the application to approve the DPA, subject to any delayed publication of aspects of the DPA or reporting restrictions ordered by the Judge to protect potential future criminal proceedings against individuals.

The hearing will take place at 10.30am on Friday 17 July 2020.

Notes to editors:

  1. The prospective DPA will conclude the SFO’s investigation into G4S C&J in relation to this conduct. The investigation remains open in respect of individuals.
  2. If the DPA is approved:
    a. G4S C&J will accept responsibility for three offences of fraud contrary to section 2 of the Fraud Act 2006.
    b. G4S C&J will pay a financial penalty in the amount of £38,513,277 and the SFO’s reasonable costs of £5,952,711.
    c. The amount of harm visited upon the MoJ, and G4S C&J’s profit unlawfully obtained from the conduct upon which the offences referenced in paragraph 2(a) are based has been estimated to be £21,396,265. The SFO and G4S C&J agree that the compensation and disgorgement of this amount that G4S C&J otherwise would owe is fully offset by G4S C&J’s £22,115,505 payment to the Ministry of Justice in 2014.
  3. Documents suggestive of the conduct upon which the offences referenced in paragraph 2(a) were based were provided to the SFO by G4S C&J in January 2014. This followed the SFO’s launch of an investigation in 2013 into allegations that G4S C&J had improperly invoiced and been paid by the MoJ for monitoring subjects where no monitoring had taken place. Following a full investigation, the SFO determined that there is insufficient evidence to provide a realistic prospect of conviction regarding this conduct, and it does not form part of this DPA.
  4. Counsel for the SFO:
    a. Crispin Aylett QC
    b. Hannah Willcocks
    c. Raoul Colvile
  5. Counsel for G4S C&J:
    a. Clare Montgomery QC
    b. Katherine Hardcastle
    Instructed by Freshfields Bruckhaus Deringer LLP