Earlier this week Dr David Turner a former sales and marketing director at Innospec, a fuel additives manufacturer, pleaded guilty to two charges of conspiracy to make corrupt payments to officials in Indonesia and Iraq. See The Daily Telegraph of 17th January 2012, for example. Also here is the Serious Fraud Office’s own press release dated 17th January 2012.

Dr Turner pleaded guilty to bribing officials in Iraq in order to induce them to ensure tests on a competitor product to Innospec’s lead additive in fuels were not favourable.

Two other Innospec former executives, Dennis Kerrison and Paul Jennings, had their cases adjourned until 4 April 2012.

Innospec itself has already been prosecuted by the US and the UK authorities in a joint investigation and Innospec has paid heavy fines and legal costs.  In addition, it has had to settle a civil suit brought by its former joint venture partner, NewMarket Corporation, in related US proceedings.

Innospec remains under a court monitorship agreed with the US and UK prosecutors.  This apparently was the first case where the US and UK judges talked directly to each other about sentencing.

We have blogged on this story here on 28th October 2011. This story has been in the media a lot for a variety of reasons not least because the deal agreed between Innospec and the Serious Fraud Office was criticised by the judge handling the case, although the deal was in fact allowed to stand.

It is reported that Dr Turner has previously agreed to pay around £25,000 ($40,000) to settle a case brought against him by US prosecutors.  In terms of the scale of the fines and legal costs paid by his employers, Innospec, this was of course an extremely modest amount.

Dr Turner will be sentenced at a later date by the court.  We await the sentencing with interest as the courts have in previous cases indicated that punishment for corruption will be more severe than hitherto, and that corruption is not a white collar crime, and those convicted are “common criminals”.  By way of comparison: in the case of the court clerk who pleaded guilty to corruption last year, Munir Patel, he received a sentence of 3 years for corruption and 6 years for misconduct in public office. See our blog post on this story.

There will be more on this story when the other two individual defendants come back before the court in April.

One question is: will the Serious Fraud Office now pursue the shareholders of Innospec for dividends paid out as the proceeds of the corrupt activities, under the Proceeds of Crime Act, in the same that they did against the shareholders of the defendant in another long running corruption case involving the British bridge building company, Mabey & Johnson? See my colleague Vivian Robinson QC’s post on this dated 19th January 2012. That was a very important development in this prosecutor’s armoury and there is much debate in legal circles about how far the SFO might pursue this new strategy.