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21 Apr 2015

Jessica Parker discusses Publicity Orders for corporate offenders

Publicity Order for corporate offenders: Read all about it

On 13 April 2015 a number of measures in the Criminal Justice and Courts Act 2015 came into force. One of which, the new offence of wilful neglect by care providers, is notable, says Jessica Parker of Corker Binning, not because of the conduct it criminalises but because included in the available penalties are Publicity Orders, an order of the court requiring a business to publicise its wrongdoing.

This is only the third time that Publicity Orders have featured as a corporate criminal penalty; they were first introduced in cases of corporate manslaughter by section 10 of the Corporate Manslaughter and Corporate Homicide Act 2007 and came into force in 2010. The introduction of Publicity Orders followed their approval in the MacRory Review of Regulatory Penalties commissioned by BIS, which was published in November 2006. MacRory noted that businesses rely on their reputation and that “when thinking about how to motivate firms to change their behaviour, reputational sanctions can have more of an impact than even the largest financial penalties.”

The first Publicity Order under the Corporate Manslaughter legislation was issued this year on 3 February 2015 against Peter Mawes Ltd, a building and joining firm. Peter Mawes Ltd was convicted following a plea to corporate manslaughter as a consequence of a fatal accident where an employee fell through a roof and died. Peter Mawes Ltd was required to take out a half page advert in the local newspaper and advertise a notice on the company’s website for a set period of time. By this Order, the Court ensured that the publicity the sentence gained was guaranteed rather than risk being jettisoned by more entertaining news items or the editorial preferences of the local journalists.

Publicity surrounding a conviction through the presence of the media at court or a press release issued by a prosecuting authority is an integral part of the punitive process. The deterrent value of ‘naming, faming and shaming’ is well recognised by both prosecutors and regulators. In light of this, it is surprising that Publicity Orders, which are common in several other jurisdictions including the US, are a relatively new feature to our criminal landscape. The advantage of a Publicity Order is that it allows the court to determine the tone of publicity and guarantee the degree of coverage all at the offending business’s cost. With the increased criminalisation of corporate activity (of which the new negligence by care providers offence introduced this week is but one example), it seems likely that the availability of Publicity Orders will increase.

Practitioners negotiating deferred prosecution agreements (DPAs) would be wise to take note of development and judicial comment on this area. While the lengthy gestation period for the first DPA is likely to have whipped up such media interest that further measures to publicise the offending will be entirely otiose, if Publicity Orders gain popularity in other areas of corporate crime they are more likely to be considered as terms of future DPAs. Currently publicity requirements do not feature on the list of potential terms for a DPA in the Crime and Courts Act (which is not exhaustive) or the Code of Practice issued by the Director of the SFO and DPP. In light of the lack of guidance and the need for judicial approval of the agreed terms, practitioners will be keen to gauge what the judicial attitude to publicity will be. Lord Justice Thomas made his views on the matter clear when he delivered an excoriating judgement in the Innospec case, in which he disproved of the SFO presenting a sentencing proposal on an agreed basis. In a self-styled ‘footnote’ he also firmly disproved of a press release to be issued by Innospec which had been approved by the SFO “Publicity Orders are very different as they are made under the direction of the Court to ensure that in appropriate cases the conviction of the company is properly publicised. It would be inconceivable for a prosecutor to approve a press statement to be made by a person convicted of burglary or rape; companies who are guilty of corruption should be treated no differently to others who commit serious crimes.” One can surmise from this comment that no degree of spin or nuance will be tolerated, nothing less than mea culpa will suffice.


Read the original article in Fraud Intelligence here.

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