Financial Services Authority fines Willis for failings in its anti-bribery and corruption systems and controls
The Financial Services Authority has today fined Willis Limited, the insurance broker, £6,895,000 for failings in its anti-bribery and corruption systems and controls. This was not an action under the Bribery Act 2010; the FSA is not an enforcement or prosecution agency in relation to that Act. Rather, this action was taken under the FSA’s powers in relation to the systems and controls of firms that it authorises. The FSA press release explains that:
“These failings [of Willis's anti-bribery and corruption systems and controls] created an unacceptable risk that payments made by Willis Limited to overseas third parties could be used for corrupt purposes. This is the biggest fine imposed by the FSA in relation to financial crime systems and controls to date.
Between January 2005 and December 2009, Willis Limited made payments to overseas third parties who assisted it in winning and retaining business from overseas clients, particularly in high risk jurisdictions. These payments totalled £27 million. The FSA investigation found that, up until August 2008, Willis Limited failed to:
- ensure that it established and recorded an adequate commercial rationale to support its payments to overseas third parties;
- ensure that adequate due diligence was carried out on overseas third parties to evaluate the risk involved in doing business with them; and
- adequately review its relationships on a regular basis to confirm whether it was still necessary and appropriate for Willis Limited to continue with the relationship.
These failures contributed to a weak control environment surrounding payments to overseas third parties and gave rise to an unacceptable risk that these payments could be used for corrupt purposes, including paying bribes.”
The FSA’s powers over authorised firms in relation to their systems and controls in relation to bribery prevention include the following provisions of the FSA Handbook:
- Principle 1 of the Principles for Business: A firm must conduct its business with integrity;
- Principle 3: A firm must take reasonable care to organise and control its affairs responsibly and effectively, with adequate risk management systems; and
- Senior Management Arrangements, Systems and Controls 3.2.6R: A firm must take reasonable care to establish and maintain effective systems and controls for compliance with applicable requirements and standards under the regulatory system and for countering the risk that the firm might be used to further financial crime.
The FSA Final Notice on Willis is here. A press release from Willis, noting that the FSA has made no finding that Willis Limited or third parties were engaged in any unlawful acts, is here.
Information about the Bribery Act 2010 can be found by clicking on our “Compliance and risk management” category.
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