The corruption cases databases are a product of the staff of the International Bank for Reconstruction and Development / The World Bank. It is intended for general information purposes only. The findings, interpretations, and conclusions expressed in the Database do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. Neither the World Bank Group nor its officers or employees shall be liable for any losses that may result directly or indirectly from the use of or reliance upon such information.
Serious Fraud Office
Deferred Prosecution Agreement
Compensation (to Tanzania), Disgorgement of Profits, Financial Penalty, Legal Costs
Compensation to Tanzania (US$6 million and $1 million in interest)
According to the UK Crown Court Judgment, "the Government of Tanzania wished to raise funds by way of a sovereign note private placement. Stanbic Bank Tanzania Ltd (“Stanbic”), which is a subsidiary of Standard Bank Group Ltd (a publicly owned company registered in South Africa), was not licensed to deal with non-local foreign investors in the debt capital market and so Stanbic involved Standard Bank, another subsidiary of the same group that was licensed, and together they sought to obtain instructions to raise the funds. Negotiations did not progress until Stanbic entered into an agreement with a Tanzanian company called Enterprise Growth Market Advisors Limited (“EGMA”).
7. Two of the three directors and shareholders of EGMA were the Commissioner of the Tanzania Revenue Authority (and, thus, a member of the Government of Tanzania) and the former Chief Executive Officer of Tanzanian Capital Markets and Securities Authority (“CMSA”). EGMA’s fee was agreed at 1% of the funds raised and in order to meet the cost of that agreement, the fee for the placement was increased from 1.4% to 2.4%. In the event, although the potential for corrupt practices to affect this type of business were well known, Standard Bank, which did not have adequate measures in place to guard against such risks, relied on Stanbic to conduct appropriate due diligence in relation to EGMA; Standard Bank made no enquiry about EGMA or its role.
8. The mandate to raise the funds was placed with Standard Bank and Stanbic and US $600 million was raised but there is no evidence that EGMA provided any services in relation to the transaction. Meanwhile, EGMA had opened a bank account with Stanbic and its fee of US $6 million was paid (as agreed) via Stanbic into the account. Very shortly thereafter the vast majority of the sum had been withdrawn in cash. The withdrawals excited the concern of staff at Stanbic who referred the matter to the head office of Standard Bank Group Ltd; Standard Bank were alerted and very quickly thereafter, a law firm was appointed to investigate the matter and, within three weeks of the first report, both the Serious and Organised Crime Agency and the SFO were informed." The Judgment also makes note of Standard Bank's settlement with the US Securities and Exchange Commission. (Source: Judgment in Between : SERIOUS FRAUD OFFICE Applicant - and - STANDARD BANK PLC (Now known as ICBC Standard Bank plc), Case No: U20150854, Crown Court (Queen's Bench Division), November 30, 2015.)
Judgment in Between SERIOUS FRAUD OFFICE Applicant - and - STANDARD BANK PLC (Now known as ICBC Standard Bank plc), Case No: U20150854, Crown Court (Queen's Bench Division), November 30, 2015, at https://www.judiciary.gov.uk/wp-content/uploads/2015/11/sfo-v-standard-bank_Final_1.pdf; UK Serious Fraud Office Press Release, "SFO agrees first UK DPA with Standard Bank," November 30, 2015, which includes links to the Deferred Prosecution Agreement, Statement of Facts and Judgments at https://www.sfo.gov.uk/2015/11/30/sfo-agrees-first-uk-dpa-with-standard-bank/
Please help us ensure that StAR Asset Recovery Watch is as accurate and comprehensive as possible by sending us updated information regarding the cases currently in StAR Asset Recovery Watch, as well as information about cases for future inclusion in the database.
To report any errors or updated case information, please contact firstname.lastname@example.org. Please include the name of your organization, the country in which you reside, and "StAR Asset Recovery Watch" in the subject line.