Mabey and Johnson was the first company ever convicted in the UK for overseas corruption in September 2009.
Allegations against the company first emerged in relation to Papua New Guinea in 2004 and again in late 2005 in relation to the Philippines. In 2007, the company was named in the Oil for Food enquiry led by Paul Volcker. The Volcker report alleged that Mabey and Johnson had paid bribes of $202,000 between 2001 and 2003, in return for a $3.6 million contract. In May 2007, the Serious Fraud Office started investigating the Oil for Food allegations. In January 2007, meanwhile, the company began proceedings against former employees for breach of their employment contract and fiduciary duty. One of the employees, Jonathan Danos, claimed in his defence (see DanosDefenceandCounterclaim) that it had been common practice for Mabey and Johnson to pay bribes. In particular he referred to bribes in Jamaica, the Dominican Republic and Panama. In February 2008, the company’s solicitors, Herbert Smith LLP approached the SFO and provided details that the company had engaged in corruption. Thereafter it cooperated with the SFO, including providing details of its internal investigation to the agency.
On 25 September 2009, Mabey and Johnson pleaded guilty to paying bribes in Ghana and Jamaica. The court heard that it had been common practice for the company to pay bribes in order to secure contracts. Ministers in Angola, Bangladesh, Madagascar and Mozambique were also given payments according to the court documents. The company was fined a total of £6.6 million, including fines of £2 million in relation to Iraq, £750, 000 in relation to Jamaica and £750,000 in relation to Ghana; a confiscation order of £1.1 million; and reparations of £658,000 to Ghana, £139,000 to Jamaica and £618,000 to Iraq.
Theoretically, the company having pleaded guilty to corruption is liable to be debarred under EU procurement laws (see Analysis page for more information on these laws). However, the company, now called Mabey Bridge, has been awarded several contracts since it was convicted in the UK and in Austria.