Fines, Disgorgement, Injunctions, Debarment: The UK Perspective

• Published date: 08 March 2021
• Subject Matter: Government, Public Sector, Criminal Law, Money Laundering, White Collar Crime, Anti-Corruption & Fraud
• Law Firm: Cooley LLP
• Author: Mr Tom Epps, Marie Kavanagh, Andrew Love, Julia Maskell and Benjamin Sharrock

Criminal financial penalties

Financial penalties for corporate and individual fraud, bribery and money laundering offences are determined in accordance with relevant legislation and the sentencing guidelines issued by the Sentencing Council.² For corporates, the relevant guideline is 'Corporate Offenders: fraud, bribery and money laundering' (the Guideline).³ The Guideline applies to corporates sentenced on or after 1 October 2014, regardless of the date of the offence, and must be followed by the court unless it would be contrary to the interests of justice to do so.⁴

In applying sentencing guidelines to offences prosecuted under legislation that pre-dates them, the court may reflect 'modern attitudes' to historic offences and make allowance for any change in maximum sentence for that particular offence⁵ (although the court cannot exceed the maximum sentence available at the time of the commission of the offence) to ensure that the sentence passed is in the interests of justice.

The sentencing guidelines set out a step-by-step process for sentencing offenders. The Guideline contains ten steps:

• compensation;
• confiscation;
• determining the offence category;
• starting point and category range;
• adjustment of fine;
• factors that would indicate an adjustment;
• reduction for guilty pleas;
• ancillary orders;
• totality principle;
• reasons.

The steps are explained in further detail below.

Compensation

The court must first consider ordering a company to pay compensation to a victim of offending for any personal injury, loss or damage resulting from the offence,⁶ in an amount it considers appropriate. The court will have regard to any evidence and any representations made by the prosecutor or the company⁷ and must consider the company's ability to pay.⁸ If a company does not have the means to pay both a fine and a compensation order, a compensation order will take priority.⁹ Compensation orders are not mandatory, but if the court does not make one it must give reasons for the decision.¹⁰

Confiscation

The second step under the Guideline is for the court to consider confiscation. The confiscation regime is governed by the Proceeds of Crime Act 2002. The court must consider confiscation where the prosecutor asks it to proceed or where the court considers it appropriate to do so,¹¹ and confiscation must be dealt with before any other fine or financial order (except compensation).¹² The purpose of a confiscation order is to recover a sum of money equal to the benefit obtained...