£2m Smith & Ouzman fine funds African development

The £2m penalty imposed on security printer Smith & Ouzman has been used to fund a social development project in Africa, in what is a UK government first.

Money that was recovered from the Eastbourne-based firm after a Serious Fraud Office (SFO) investigation that saw one of its directors jailed, has funded seven ambulances, which have been handed over by foreign secretary Boris Johnson in Nairobi, Kenya.

The UK government had earlier promised to commit the money recovered to social development projects in Kenya, which eventually totaled £2.2m (£1.3m in fines, £881,158 in confiscation fees and £25,000 in costs).

The SFO's joint head of bribery and corruption Matthew Wagstaff said he was delighted that the repatriation of funds in the form of ambulances had taken place.  

Wagstaff said: "This repatriation was the first of its kind arising from the SFO’s first conviction, after trial, of a corporate for offences involving bribery of foreign public officials. 

"We welcome the co-operation of the Department for International Development (DfID), the Foreign Commonwealth Office (FCO) and the Kenyan authorities in making this happen.”

Dubbed "chickengate", due to the term "chicken" being used in place of "bribe" in correspondence between officials, the case against Smith & Ouzman, which related to payments between 2006 and 2010, was the first brought under the newly-passed Bribery Act 2010. 

Smith & Ouzman was found guilty in January 2015 of paying £395,074 to foreign public officials in Kenya and Mauritania, disguising the bribes in the form of inflated commission. The company was charged, along with its former chairman Christopher Smith and sales director Nicholas Smith, the former receiving a suspended two-year sentence, the latter a three-year jail sentence. 

The two other defendants charged by the Serious Fraud Office (SFO), international sales director Timothy Forrester and sales agent Abdirahman Omar, were both acquitted of corruptly agreeing to make payments.

Last month, Reuters reported on three Kenyan officials being arrested in the wake of the scandal, including the former chief executive of the electoral commission James Oswago, who was charged in court with receiving bribes from Smith & Ouzman’s agent Trevy Oyombra.

Smith & Ouzman was unavailable for comment at the time of writing.