Why is the conviction of Paul Asplin, former CEO of legal insurance provider DAS, so important?
On Friday 13th July DAS successfully convicted its former CEO Paul Asplin and its former claims director, David Kearns, for conspiracy to defraud by using their influence in DAS to redirect business from DAS to a company they had established, Med Report. The Judge commented that the losses to DAS were "closer to £4 million".
The case demonstrates once again that threats to businesses frequently occur internally. Good anti-bribery and corruption and anti-tax evasion policies and procedures are crucial to pick up such internal threats. Furthermore they provide additional security to businesses themselves whose only defence to key Bribery Act offences is that "reasonable procedures were in place".
To drive the point home Morrisons was found vicariously liable to its customers for the theft of data by their former IT manager. An appeal against that ruling is due to be heard in October.
The DAS ccase is also another example of the Police being reluctant to prosecute cases involving frauds relating to businesses. The Financial Times recently revealed that the number of reported fraud offences have risen from 142,991 in 2011 to 641,539 in 2016. However, in the same period white collar crime prosecutions fell 26% below the number prosecuted in 2011. It has been reported that the Police are currently short of 4,000 detectives. These figures are no doubt part of the story behind this reluctance as the Police need to regard risk to life threats as their priority.
Private prosecutions give businesses the ability to redress this trend. Central Government funds are available for private prosecutors who can be reimbursed for their fees, win or lose, provided there is sufficient evidence, the prosecution is in the public interest and the fees charged are reasonable. This is a very attractive proposition compared to civil proceedings where there are Court fees and difficulties in getting the other side to fund costs.
Asplin was sentenced to seven years imprisonment and disqualified as a company director for 12 years. David Kearns, former DAS Claims Director, was sentenced to four years and three months imprisonment and was disqualified from serving as a company director for eight years. Asplin's ex-wife, Sally Jones, was also convicted and received three years and nine months imprisonment and was disqualified for eight years.
This is a great victory for DAS.
Although Ashfords' private prosecutions team were not involved in this case they are experienced prosecutors having brought 500 prosecutions in the past 3 years, including for central government.