The U.K.’s Serious Fraud Office (SFO) has said it will seek to prosecute BAE Systems for offenses related to overseas corruption after a deadline for the arms company to agree to a plea bargain expired.
The SFO needs to ask the attorney general, the government’s chief legal adviser, for formal consent before it can start a prosecution. It said it will prepare the necessary paperwork for that request when “it is ready to proceed”—an indication that BAE still has a small window to plea bargain.
This latest twist in the SFO’s long-running investigation into the arms company is a major test of the agency’s determination to get tough on corruption, and to use plea bargains to settle cases early.
The current investigation relates to allegations of corruption by the company in Africa and Eastern Europe. But the SFO’s past failure to pursue corruption allegations involving BAE dealt a major blow to the agency’s credibility.
In 2006, the U.K. government made it drop an inquiry into corrupt deals by the company in Saudi Arabia, citing national security concerns—a move that prompted widespread criticism of the U.K.’s commitment to dealing with overseas corruption. A court subsequently ruled that the decision to drop the case was unlawful.
In a statement, BAE said it “continues to expend considerable effort seeking to resolve, at the earliest opportunity, the historical matters under investigation by the SFO.” It said the company had acted responsibly in its dealings with the SFO and had taken into account the interests of its shareholders and employees and the legal advice it had received.
It concluded: “If the Director of the SFO obtains the consent that he seeks from the attorney general and proceedings are commenced, the company will deal with any issues raised in those proceedings at the appropriate time and, if necessary, in court.”