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GRC Professional : GRC Spring 2011
13 A ustralia leads the world in plastic banknote technology. The world’s first polymer banknote – developed by the CSIRO and Note Printing Australia (part of the Reser ve Bank of Australia) – was the $10 commemorative note issued in January 1988 to mark the Australian Bicentenary. By 1996, all Australian banknotes were made from polymer, with many other countries around the world soon to follow. Note Printing Australia has since produced banknotes for Thailand, Indonesia, Papua New Guinea, Kuwait, Western Samoa, Singapore, Brunei, Sri Lanka and New Zealand. Blank polymer substrate is also sold to a number of countries that print banknotes using their own facilities. The material is supplied by Securency Pty Ltd, a joint venture between the RBA and Innovia Films. Of course, what we now know is that it may not have been just the revolutionary technology that encouraged overseas countries to use Note Printing Australia and Securency’s polymer banknotes. In July and August this year, the Australian Federal Police (AFP) laid bribery charges against seven individuals linked to Securency, with further questions being asked about potential corrupt practices within Note Printing Australia as well. It’s the first prosecution under Australian foreign bribery legislation that came into force in 1999. The charges have tarnished what was previously regarded as an Australian success story, and raised questions about what was known by some of the highest officials in the RBA. Securency is alleged to have paid tens of millions of dollars in commissions to agents in Malaysia, Vietnam and Indonesia, including $17.2 million to one agent. The agents then allegedly divvied out bribes to officials to win banknote-printing contracts. The AFP now has a dedicated team of up to 20 people working full-time on the investigation. The Securency scandal has raised broader questions: how did this happen to an Australian company? What compliance procedures, if any, were in place? And how can governance, risk and compliance professionals put in place appropriate anti- bribery measures in their organisations? what is a bribe? Section 70 of the Australian Criminal Code provides a definition of bribery in regards to Australians bribing a foreign official. It basically defines a bribe as a benefit that is “not legimitately due” to the other person, with the intention of obtaining or retaining business. Matthew Skinner, Partner at Allens Arthur Robinson, says that most people have a general understanding of what a bribe is, but get into difficulties in the grey areas. gifts and entertainment “One grey area is providing gifts, entertainment or travel to foreign government officials,” Skinner says. “This is frequently a challenging issue in countries where exchanging gifts and providing hospitality is a cultural expectation.X
GRC Summer 2012