The founder and two former employees of U.K. seismic device company Güralp Systems were acquitted last week of charges they conspired to bribe a South Korean public official.

It is the latest corruption case in which the U.K. Serious Fraud Office failed to secure individual convictions after the company entered a deferred prosecution agreement (DPA) for related offenses. Other companies that have reached a DPA with the SFO in which the individuals involved were acquitted include Sarclad, Tesco, and Rolls-Royce.

In the most recent case, London’s Southwark Crown Court acquitted company founder Cansun Güralp, former finance director Andrew Bell, and head of sales Natalie Pearce of conspiracy to make corrupt payments to a South Korean public official between 2002 and 2015.

Following the acquittal, the SFO published details of the DPA it had reached with Güralp Systems in October 2019. Under that agreement, the company accepted charges of conspiracy to make corrupt payments and a failure to prevent bribery and agreed to pay a total of £2.1 million (U.S. $2.7 million) for disgorgement of gross profits to the SFO. The DPA also requires Güralp Systems to cooperate fully and truthfully with the SFO and to review and maintain its existing internal controls, policies, and procedures regarding compliance with the Bribery Act.

SFO Director Lisa Osofsky said the DPA was a result of Güralp Systems’ “timely self-reporting and full cooperation and holds the company to account whilst also promoting positive changes in corporate culture.”

In December 2014, Güralp appointed a new executive chairman, who identified wrongdoing and ordered an internal investigation. Following this internal investigation, Güralp Systems self-reported to both the SFO and the U.S. Department of Justice in October 2015. The SFO commenced its own independent and comprehensive investigation in December 2015.

SFO criticized

Syedur Rahman, legal director of law firm Rahman Ravelli, who represented Pearce, criticized the SFO’s approach and questioned the thinking behind the DPA between the SFO and the company, given that the SFO failed to convict any of the individuals it charged over the alleged wrongdoing. “As nobody at Güralp Systems—including its founder—has actually been found guilty of any wrongdoing, it begs the question why the company actually admitted to wrongdoing in order to gain a DPA,” he said.

The outcome is “yet another blow to the SFO and will raise questions yet again about the integrity of the process by which the SFO conducts itself when dealing with the thorny issues of DPAs,” Rahman said. “It is one more indicator that companies would often be better off if they hold their nerve rather than admit wrongdoing and accept a DPA simply because it is less damaging than a conviction.”

He said the firm is also “particularly interested to find out why—after everyone has been acquitted—the SFO has released the DPA, which contains the names of those blamed for the alleged wrongdoing. The names have never been included in any other DPA—all of which were made public before any trial – and it seems hugely unfair that documents are now in existence naming our client for being involved in wrongdoing when she has been cleared of all blame by a court of law.’’