The head of UK’s graft buster has set out the conditions under which the country’s Serious Fraud Office will pursue self-reported incidents of fraud by companies as either a civil or criminal matter.

In an open letter to New York-based lawyer Marcus Asner, a partner at law firm Arnold & Porter, Richard Alderman, the UK agency’s director, said that when considering whether to treat self-reported fraud as a civil or criminal case, it would primarily look at a number of factors. This would include the seriousness of the wrongdoing, whether it was an isolated incident, and whether the company in question had been previously warned that its internal controls were inadequate.

He also said it would depend on whether the company reported the wrongdoing in a timely and reasonable manner, and whether it provided a report to the SFO which was detailed and complete.

Mr Alderman also touched upon other topics, such as how far should companies go in conducting internal investigation to avoid additional probing by the SFO, and the circumstances under which monitors will be appointed to make sure that a company does not commit the same offense again.

He said that the SFO expects companies to present a report which allows the agency to determine whether the wrongdoing was thoroughly investigated, and discussing remediation measures.

On the latter issue, he said that the SFO will not appoint a monitor in cases where a company’s board can prove that it is committed to enforcing a culture against corruption. With serious cases, he said that the SFO will expect companies to actively propose measures to monitor compliance. He also said the agency will work with its counterparts in other countries if the wrongdoing involved multiple jurisdictions.

On attorney-client privilege, he said the SFO acknowledged that the concept of waiver of attorney client privilege was different in the US, when compared to the UK. He will not expect US companies to provide documents consisting of legal advice it received on how it should conduct an internal investigation, the types of remedial options that are open to them, or how it should negotiate with the SFO. The agency will expect companies to provide a full factual report on the investigation, including notes taken during investigation interviews.

Finally, he said that the SFO would consider closing a case, without further action, where a company self-reported violations. There would have to be “special circumstances”, and the company would have to offer to pay remediation. Alternatively, he said it could also happen if a company conducts its investigation into a suspected violation, and the report on the investigation that does not support the initial suspicions. However, Mr Alderman added that he expected such cases where cases are closed without further action to be rare.

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The US Federal Trade Commission has sued microprocessor-making giant Intel for illegally using its dominant industry position to shut out competitors and to strengthen its monopoly.

The FTC complaint alleges that Intel threw its weight around using a system of threats and rewards – called exclusive or restrictive dealing – aimed towards some of the biggest computer makers in the world, in order to force them not to buy computer chips from its rivals. Additionally, the commission also charged that Intel also secretly wrote software that stunted the performance of computer chips made by competitors, and that it is plotting to employ similar tactics as it eyes the smaller but growing competition in the adjacent market for computer graphics chips.

The commission is not suing for money, but for Intel to change the way it conducts business. It is seeking an order to prevent it from using threats, bundled prices, to encourage exclusive deals, hamper competition, or unfairly manipulate the prices of its microprocessors or graphics chips. It also wants Intel to submit some business decisions for approval by the commission before carrying them out, and to set up some type of monitoring of its practices.

“Intel has engaged in a deliberate campaign to hamstring competitive threats to its monopoly. It’s been running roughshod over the principles of fair play and the laws protecting competition on … merits,” said Richard Feinstein, director of the FTC’s bureau of competition, in a statement.

Douglas Melamed, general counsel for Intel, told the New York Times that the FTC action was “misguided and unwarranted”, and amounted to “new rules for micromanaging business conduct.” He said the FTC’s recommendations would unfairly constrain the company’s pricing and marketing, hamper product design process and innovation, and force it to give away intellectual property.

According to the FTC, Intel’s actions violated section five of the FTC Act, which prohibits unfair methods of competition, and deceptive acts and practices in commerce.

This latest complaint comes just one month after Intel reached a US$1.25 billion settlement with rival AMD, over anti-trust and patent claims. In May, the European Commission fined Intel US$1.6 billion for abusing its dominant market position – a decision which the company is appealing. Intel was also found to be anti-competitive by South Korean regulators, who ordered the company to pay a fine of US$25.5 million, and by the Japan Fair Trade Commission, which ordered the company to eliminate discounts which were discriminatory to its competitors.

The case will go before an administrative law judge in September.

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