First deferred prosecution agreements to be finalised before end of 2015, says SFO head

Out-Law News | 09 Nov 2015 | 11:14 am | 1 min. read

The first deferred prosecution agreement (DPA) to be reached in the UK is "imminent", the head of the Serious Fraud Office (SFO) has said.

On Thursday David Green, director of the SFO, told delegates at a regulatory conference hosted by Pinsent Masons, the law firm behind,  that a further DPA is also likely "to be signed by the end of this year" by the authority.

DPAs are deals that UK prosecutors have had the ability to put in place with corporate offenders since February 2014. They are designed to encourage businesses to self-report wrongdoing in the hope of more lenient treatment.

Depending on the circumstances of the case, a DPA may require an offender to pay a substantial fine and/or to compensate victims, to submit to regular reviews and monitoring, and to undertake reforms to prevent the conduct in question from occurring again. Courts have final sign-off powers over DPAs put in place between companies and prosecutors. Companies that fulfil their obligations in the agreements within the specified timescale will avoid prosecution for their wrongdoing, according to guidelines published by the SFO and Director of Public Prosecutions last year. 

Green said that the SFO is receiving a "surprisingly high" number of self-reports from UK companies. He said companies are likely to be more comfortable engaging in the DPA process once they have seen them work in practice.

"We wait with baited breath now the SFO have promised to deliver two DPAs before Christmas," anti-corruption expert Barry Vitou of Pinsent Masons said. "Their detail will be scrutinised by companies, advisers and NGOs and should provide a useful benchmark for anyone who might contemplate self reporting and a possible DPA."

In his speech at the conference Green said that DPAs are not a vehicle for companies to "buy themselves out of trouble". He said that the "bar has been set high" and that DPAs will only ever implemented if considered to be "in the interests of justice". Green also said that DPAs would be effective in preventing the "collateral damage" parties such as investors and employees can be victims of in the event of corporate prosecutions.

Green said that the SFO is seeing strong whistleblowing activity and advised companies to consider that point when deciding whether to self-report wrongdoing to the agency. Companies which opt to keep matters quiet but whose wrongdoing is exposed by whistleblowers face potentially greater sanctions than those that self-report, he said.