It has taken an extraordinary amount of time for the Serious Fraud Office to bring a Deferred Prosecution Agreement against a subsidiary of Serco Group Plc.
Serco Geografix Ltd were given a 50% discount for co-operation which reduced the fine to £19.2 million. It has also agreed to pay costs of £3.7 million. It was accepted that Serco had "understated the level of profitability of its Electronic Monitoring contract in its reports to the Ministry of Justice", and had previously been fined £70 million in 2013 for similar offences. There does seem to be an acceptance that Serco has now got its house in order.
Only yesterday the Fraud Advisory Panel issued a booklet entitled "Hidden in plain sight: domestic corruption, fraud and the integrity deficit" in which it highlighted that one of the many risks of increased corruption domestically is austerity.
The booklet states "In many areas it is easy to make a compelling argument that sharp public spending cuts, hasty implementation and limited oversight since 2010 have made corruption risks significantly worse." It also reminds us that there are six priorities in the UK anti-corruption strategy of which three apply here: promote integrity across the public and private sectors; reduce corruption in public procurement and grants, and reduce the insider threat in high risk domestic sectors.
However questions will be asked, which the SFO should answer, about why it has taken so long to bring this matter to conclusion. Of course the Court needs to ratify the DPA, and perhaps the judge will raise questions too.
No damages or disgorgement of profit will be payable to the MoJ because the SFO has agreed that Serco has already fully compensated the Department in respect of the offences as part of a £70m settlement paid by Serco to the MoJ in December 2013.