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A Lloyd’s of London insurance broker has been charged by the Serious Fraud Office over alleged bribes paid to officials in Ecuador via US intermediaries to land contracts from state-owned companies in the Andean nation.
United Insurance Brokers Limited, a reinsurance broker that operates in the Lloyd’s of London insurance market, was on Thursday charged with failing to prevent bribes paid to Ecuadorean officials between 2013 and 2016.
Representatives of UIB, created in 1987 through a management buyout of Marsh McLennan’s Middle East operations, are due to appear before Westminster Magistrates’ Court on May 7 to face the charges.
The SFO, which has been investigating UIB since 2021, alleges the company paid $3.2mn out of a $6.2mn commission to US-based intermediaries to bribe Ecuadorean officials in return for the award of reinsurance contracts worth $38mn.
The contracts involved UIB providing reinsurance to Ecuadorean state insurance companies to cover them for potential losses on policies for public sector services, including state water and electricity companies.
The charges against UIB underline how the UK continues to prosecute suspected corruption by companies abroad, even after US President Donald Trump ordered a pause on enforcement of bribery cases under the Foreign Corrupt Practices Act.
Last month, the SFO announced the creation of a new task force with French and Swiss prosecutors to work jointly and share expertise on foreign corruption cases.
“The SFO remains committed to stamping out international bribery wherever it may occur,” said Nick Ephgrave, SFO director. “British companies have a duty to prevent the harm caused by bribery when doing business at home and abroad, to ensure that the UK remains a safe and fair place to do business.”
Two other UK insurers — Tysers and HW Wood — previously paid tens of millions of dollars in penalties and forfeiture as part of deferred prosecution agreements with the US Department of Justice over alleged bribes paid to Ecuadorean officials in 2013-2017.
US authorities also charged eight people in related matters, including Juan Ribas Domenech, the former chair of the Ecuadorean state-owned insurance companies. Ribas Domenech was sentenced to 51 months in a Florida prison after pleading guilty to money laundering in 2020 for his role in this and another scheme.
The allegations against UIB date back to the presidency of Rafael Correa, who was found guilty in 2020 of accepting bribes in exchange for public works contracts and sentenced to eight years in prison in absentia by a court in Quito. Correa, who is in exile in Belgium, denied the charges.
UIB Holdings, the parent company of the reinsurance broker, has 680 staff spread across 17 offices around the world, including in Miami, Colombia and Peru. It made a pre-tax profit of £17.1mn on revenues of £80.9mn in 2023, according to its latest results.
The insurer said had it started an investigation in 2021 into “reinsurance business activities undertaken in prior years” for which it had made “an appropriate accrual for expected costs to be incurred”. It also warned Brazilian authorities had “commenced proceedings in respect to activity in the aviation and broking industry against a group company”.
The UK’s charges against UIB are the ninth investigation announced by the SFO since Nick Ephgrave became its director in September 2023 when it was criticised over the collapse of a number of high-profile cases.
https://www.ft.com/content/a262c3dd-e4b2-4a86-9a7d-4348d8f4296e
