Out-Law Guide | 10 Oct 2016 | 5:23 pm | 2 min. read
This guide was last updated in October 2016.
In contrast, in England and Wales, DPAs have effectively displaced the use of Civil Recovery Orders to resolve bribery cases short of prosecution. The Serious Fraud Office (SFO) has taken an increasingly hard line on enforcement and resolution.
Self-reporting in Scotland
The Scottish corporate self-reporting initiative was introduced on 1 July 2011, to coincide with the entry into force of the 2010 Bribery Act. It allows companies that discover problems within their organisations to come forward and disclose it to the Crown Office and Procurator Fiscal Service (COPFS) in return for gaining an opportunity to draw a line under the matter by way of civil settlement rather than full criminal prosecution.
The self-reporting regime only covers offences under the Bribery Act, or conduct that would "constitute an analogous offence under the law as it is before the Act comes into force" if it took place before 1 July 2011.
Businesses that wish to self-report potential offences must do so via a solicitor, who must then submit a report to the Serious and Organised Crime Unit (SOCU) at COPFS. The business must commit to "meaningful dialogue" with SOCU throughout its investigations, and to share the results of its own internal investigation with SOCU.
SOCU will then take a decision about whether to refer the case to the Civil Recovery Unit (CRU) for civil settlement, or whether it is in the public interest to proceed to full prosecution. This will usually depend on the seriousness of the offence.
The Scottish self-reporting regime is reviewed annually, and will continue to run in its current form until at least 30 June 2017.
DPAs in England
DPAs were introduced in England and Wales in February 2014. They allow businesses to self-report instances of economic crime in the hope of more lenient treatment, including the opportunity to avoid prosecution, if strict conditions set by a judge are met.
Depending on the circumstances of the case, the business may be required to pay substantial penalties and compensate victims under the terms of a DPA. It may also be required to submit to regular reviews and monitoring, and put processes in place to prevent the conduct in question from occurring again.
DPAs are made in open court, and details of the wrongdoing and sanctions will be published. If the prosecutor is satisfied that the business has fulfilled its obligations by the end of the deferral period there will be no prosecution, but if the conditions are not met then the organisation could still be prosecuted.
COPFS and the SFO have entered into a memorandum of understanding in relation to cases that involve both Scottish jurisdiction and English, Welsh or Northern Irish jurisdiction. As a general rule, if the SFO is presented with a report from a business which clearly relates to conduct in, or predominantly in, Scotland then it will refer the company to SOCU. The same will also apply in reverse.
The COPFS guidance states that where there are cross-border issues, cases will be considered individually. Factors that suggest that a business should report to SOCU in the first instance include where the business has its headquarters or registered office in Scotland; predominantly carries out its business in Scotland; and whether the wrongdoing identified by the business has taken place in, or mostly in, Scotland.