The court of appeal Friday upheld UK convictions against two defendants, Dennis Kerrison and Miltiades Papachristos, in the long-running Innospec bribery case.
But the justices reduced Kerrison’s sentence from four years to three. It said the trial judge should have considered the starting point for the sentence as four years instead of five before deducting 12 months to reflect personal mitigation.
The sentences of Innospec, Papachristos, and two other former executives weren’t affected.
Kerrison, 69, a former Innospec chief executive, and Papachristos, a former regional sales director, were convicted in June by a jury at the Southwark Crown Court in London of conspiracy and bribery. The court said they bribed Indonesian officials to buy the company’s gasoline additive — tetraethyl lead, also known as TEL.
Papachristos, 51, was sentenced in August to 18 months in prison.
Paul Jennings, 57, the former CEO of Innospec’s UK operations, pleaded guilty in the UK in June 2011 to two criminal counts of conspiracy to bribe officials in Indonesia and Iraq. He was sentenced to two years in prison.
David Turner, 59. a former business director at Innospec, pleaded guilty in London to three criminal counts of conspiracy to corrupt. He was given a 16-month suspended sentence and required to do 300 hours of community service.
Innospec’s British unit pleaded guilty in the UK in 2010 to bribing employees of a state-owned refinery in Indonesia to win sales of the fuel additive. It paid $12.7 million in penalties to the SFO.
In the United States, Innospec also paid $27.5 million in 2010 to settle charges of violating the FCPA and defrauding the United Nations oil-for-food program.
TEL was known to be harmful to people while Innospec was still trying to sell it in less developed countries.
In Friday’s judgment, the UK appeals court said:
This was prolonged, cynical and serious corruption of public officials in a foreign country. TEL provided the greater part of Innospec’s income during the time when corruption was being used to prolong the use of a product that damages health and the environment. Whether or not Indonesia could afford to upgrade its refineries is essentially irrelevant: bribes were used to persuade public authorities artificially to extend the life of a product that was being phased out elsewhere in the world because of its adverse impact.
The court of appeal judgment of September 19, 2014 is here (pdf).
The Serious Fraud Office’s statement of September 19, 2014 is here.
Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.