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The Serious Fraud Office (SFO) has announced its new strategy to combat serious fraud, bribery, and corruption. The strategy focuses on prevention, the use of AI, greater covert intelligence, and whistleblowers. The SFO says it aims to be a proactive and authoritative player in the global and domestic justice system. Plans include a pilot program to cut financial crimes at the source, increasing incentives for corporate whistleblowers, and implementing a pre-trial disclosure system. However, some senior lawyers have questioned the strategy. Louise Hodges at Kingsley Napley said: "A big question mark for me is which type of organisation the SFO sees as its target. So far the investigations opened have involved relatively small and lesser-known businesses, some already in administration and a far cry from the global giants and High Street names that the SFO historically had in its sights."

 

Global Investigations Review

The Law Society Gazette

City AM

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BNP Paribas has been ordered by a US judge to face a lawsuit accusing the bank of helping Sudan's government commit genocide between 1997 and 2011. The lawsuit alleges that BNP Paribas provided banking services that violated American sanctions, leading to human rights abuses such as murder, mass rape, and torture. The proposed class action was brought by US residents who had fled non-Arab indigenous black African communities in Sudan. BNP Paribas had previously pleaded guilty and paid an $8.97bn penalty to settle US charges of transferring billions of dollars for Sudanese, Iranian, and Cuban entities subject to economic sanctions. This is the first time a global bank has faced large-scale violations of US economic sanctions. The judge dismissed claims for punitive damages, citing applicable Swiss law.

 

Reuters

Labour has pledged to call in the National Audit Office (NAO) to investigate Teesworks if they win the General Election. The Shadow Chancellor, Rachel Reeves, made the commitment during a visit to Teesport, where she outlined plans to spend £1.8bn on upgrading Britain's ports. The Teesworks scheme, a multi-million-pound redevelopment of a former steelworks site, has faced criticism for its governance and transparency. The inquiry into the project cleared it of corruption but highlighted areas for improvement. Labour’s move has been described as a politically motivated attack by the Conservative MP for Middlesbrough South and East Cleveland, Simon Clarke. He accused Labour of conducting a smear campaign against Teesworks and Tees Valley Mayor, Ben Houchen.

 

The Northern Echo

Yorkshire Post

Home REIT has threatened to sue its former fund manager Alvarium today as it faces its own legal challenge from a group of shareholders who claim to have been misled. The scandal-hit social housing firm intends to bring legal proceedings against those responsible for wrongdoing and has issued pre-action letters of claim to Alvarium Fund Managers (UK) Limited and AlTi RE Limited. Home REIT's legal action comes as it also faces a legal challenge from shareholders represented by Harcus Parker. The shareholders allege that the company provided false, untrue, and/or misleading information. Home REIT denies the allegations and intends to vigorously defend itself. Regulators, including the Financial Conduct Authority and the Serious Fraud Office, have launched investigations into Home REIT.

 

City AM

London South East

The European Court of Justice has ruled that the name of late Colombian drug lord Pablo Escobar cannot be registered as an EU trade mark. The court upheld the decision of the EU's intellectual property office (EUIPO) to refuse a trade mark application by Escobar Inc. The court stated that the name of Pablo Escobar is associated with drug trafficking, narco-terrorism, and the crimes and suffering resulting from them, rather than any potential good deeds. Escobar Inc., founded by Pablo Escobar's brother Roberto de Jesús Escobar Gaviria, had applied for the trade mark. Gaviria spent 12 years in prison for his involvement in his brother's criminal organisation. The ruling prevents the use of Pablo Escobar's name for commercial purposes in the EU.

 

Bloomberg

Reuters

BHP has been ordered to hand over historic employment details for staff following a disclosure application on behalf of claimants affected by the collapse of a dam in 2015.

 

Financial Times

The government is to examine new curbs to protect sensitive technology developed in UK universities, Oliver Dowden, deputy prime minister, announced on Thursday. As part of moves to fine tune the National Security and Investment Act, Dowden said the government would undertake a review of export controls of emerging technologies and the risks from UK businesses investing overseas. This would include ensuring universities were not overly reliant on foreign funding and making sure their research partnerships did not threaten national security. In a speech at the Chatham House think-tank in London, Dowden warned that “the cutting-edge development in sensitive technologies” taking place at UK universities had “the potential to become a chink in our armoury.”

 

Yahoo! News

Daily Mail

Financial Times

GOV.UK

Financial firms that offer services to customers in Britain directly from overseas without a base in the country must have executives that spend an "appropriate" amount of time on UK soil, the Financial Conduct Authority (FCA) has said. The FCA's "overseas persons exclusion" allows financial firms based outside the country to offer wholesale market services to customers in the UK without authorisation. The FCA aims to ensure that foreign firms operating in UK markets meet the required standards.

 

Reuters

The Business Secretary, Kemi Badenoch, who is also the Women and Equalities minister, has called on financial services regulators to scrap plans to set diversity targets for finance companies. Badenoch argues they would amount to regulatory over-reach and place an unnecessary additional burden on businesses. The Financial Conduct Authority and the Prudential Regulation Authority have consulted on a requirement for companies to disclose demographic data, including on age, sexual orientation, religion and ethnicity, and set diversity targets to address underrepresentation. They would be required to publish their progress. “The benefits claimed are speculative, but the compliance costs will be real,” Badenoch said in a speech at TheCityUK. “There are significant concerns about likely indirect effects, such as increased barriers to entry and expansion, and the resulting impacts on innovation, competition and choice. At a time when government is focused on driving economic growth through smarter regulation, the FCA should not be adding regulatory burdens which go well beyond the legislative framework in the Equality Act.”

 

The Daily Telegraph

The Times

Widespread outages affecting customers at Deutsche Bank's Postbank unit have prompted calls for legislation to protect consumers. A consumer protection group in Bavaria is urging politicians to enact a law that would compensate customers for interrupted banking services. The group suggests that regulations similar to those governing airlines, which require compensation for flight delays or cancellations, should be implemented. Last year, glitches at Postbank resulted in customers being locked out of their accounts for weeks, leading to regulatory oversight and bonus cuts for Deutsche Bank's top managers.

 

Reuters

Efforts to unify Europe’s fragmented capital markets have been opposed by over a dozen smaller EU states concerned over ceding national control and handing more oversight and regulatory powers to Brussels.

 

Financial Times

Mercer analysis shows that the aggregate surplus of FTSE 350 defined benefit (DB) schemes increased by £7bn in March, reaching £66bn. The funding level of these schemes also rose to 111% at the end of March. Mercer's analysis is based on the consultancy's Pensions Risk Survey, which calculates the funding positions of FTSE 350 DB schemes using IAS19. The survey also found that the value of liabilities increased from £603bn to £613bn, while asset values increased from £662bn to £679bn. Mercer expressed concerns that UK pension schemes may not be willing to invest in productive assets as they continue to de-risk. The consultancy believes that without further measures, DB assets will not support UK growth as intended by the government. Instead, UK asset exposure is expected to decrease as schemes dispose of their gilt portfolios to finance buyout deals with insurers.

 

Pensions Age Magazine

Professional Pensions

Several major UK retailers, including Marks and Spencer, Next, John Lewis, Harrods, and JD Sports, have requested information from Under Armour and Columbia regarding allegations of forced labour in their supply chains. The retailers reached out to the US companies after learning about the suicide of a mistreated worker at a factory in Jordan. The worker, Tureza Akter, had been abused at the Fine Apparel plant, where dehumanising conditions and sexual harassment are said to be common. The retailers are awaiting the results of an independent investigation into Fine Apparel. Under Armour, Columbia, and American Eagle, which also works with Fine Apparel, have stated that they take the allegations seriously.

 

The i

The number of calls to the Modern Slavery & Exploitation Helpline increased by more than 19% last year, up from 9,779 in 2022 to 11,700. This is according to anti-slavery charity Unseen, which says the number of potential victims in the care sector has risen by almost a third to 918. Justine Carter, director of Unseen, said: "Modern slavery and exploitation are heinous crimes that have no place in a modern, progressive UK that cares about human rights.”

 

Sky News

The Government’s contingency plans to nationalise Thames Water, dubbed Project Timber, would see the bulk of the company’s £15.6bn debt added to the public purse as part of a taxpayer-backed bailout, the Guardian reports. Plans being overseen by the Department for Environment, Food and Rural Affairs suggest some lenders could lose up to 40% of their money - category B bondholders, who hold about £1.6bn of the company’s debt, would lose 35-40% of their money, while category A bondholders, who are owed about £13bn, would lose 5-10%. Shareholders would have their entire investment wiped out. Nationalisation would be deeply embarrassing for the government, but Whitehall and the regulator, Ofwat, remain optimistic that it may be avoided, sources said.

 

Financial Times

The Daily Telegraph

The Guardian

The UK’s Coventry Building Society has offered to buy the Co-operative Bank for £780m. The proposed tie-up, which would create a merged group with £89bn in assets, will eventually return the private equity-owned Co-op Bank to mutual ownership. The “non-binding” offer follows nearly four months of exclusive talks but both groups stressed that there was still “no certainty at this stage” that a takeover would take place. Coventry said its members would not be invited to vote on the proposed tie-up, echoing a decision by larger rival Nationwide on its £2.9bn deal to buy Virgin Money.

 

Financial Times

Reuters

City AM

The Guardian

Nestlé's shareholders have rejected a proposal to reduce the company's reliance on unhealthy foods and cut back on salt, sugar, and fats. The proposal, put forward by shareholder activists, aimed to change Nestlé's sales targets and increase the proportion of sales from healthier products. However, 88% of shareholders voted against the proposal, with only 11% in favour. Nestlé argued that there is "nothing wrong" with indulgent products in moderation and that the proposal would weaken other segments of its food and drink portfolio. ShareAction, the responsible investment charity leading the coalition, hopes that the vote will encourage shareholders to consider the public health impacts of their investments. 

 

The Times

City AM

Daily Mail

Just over a fortnight before new checks on EU imports are due to begin, the government has said they will not be implemented due to the potential for significant disruption. The Department for Environment, Food and Rural Affairs (Defra) admitted to port health authorities that “challenges” still remained within its systems for registering imports of food and animal products. Systems would be “progressively turned on” for different product groups, Defra said.

 

Financial Times

The Guardian

The European Commission is set to seek member state approval to open talks with the UK to restore the ability of young people in the EU and UK to live and work in each other’s countries. The proposal is reportedly designed to appeal to a future Labour government, but the party’s response to a scheme it sees as synonymous with free movement was cool, with a spokesperson saying: “A Labour Government would seek to improve the UK’s working relationship with the EU within our red lines - no return to the single market, customs union or free movement.”

 

Financial Times

The Daily Telegraph

Prime Minister Rishi Sunak has vowed to end Britain’s “sick-note culture” amid concerns that over-medicalising common anxieties is driving a rise in the number of people off work with mental health problems. GPs face being stripped of the right to issue sick notes, as the Prime Minister says doctors are too readily writing people off as unfit for work. Specialist teams linked to the benefits system will instead assess the sick and decide how best to keep them in work.

 

The Times

Daily Mail

Colorado Governor Jared Polis has signed into law the first measure in the US aimed at protecting the data found in a person's brainwaves. The law is a response to the increasing advancements in neurotechnology, which make scanning, analysing, and selling mental data more possible and profitable. The legislation provides a framework to protect Coloradans' personal data while allowing the development of new technologies. The Neurorights Foundation, a non-profit promoting ethical neurotechnology development, supports the bill. The law focuses on consumer products outside of a hospital setting, as medical privacy laws already cover neuratechnologies used in clinical settings. Big tech firms like Facebook, Meta Platforms, and Neuralink are developing brain activity detection technology for commercial use. The US Food and Drug Administration has approved human studies for Neuralink's brain implants. Other governments worldwide are also working on increasing consumer protections for neurotechnological products.

 

Reuters