Deferred prosecution agreements (DPAs) have been used to good effect in the USA and there is now a move to introduce them in the UK to enable settlements of corporate criminal conduct for a number of economic crimes.
The Solicitor General in the UK is seeking approval from Parliament to use DPAs along the lines of the model used in the USA, where the Department of Justice has had considerable success in investigating and conducting serious fraud and particularly foreign corruption cases.
Briefly, a DPA is an agreement between a company and the prosecuting authorities to defer prosecution provided the company meets certain conditions during the term of the agreement. The USA generally uses 2 – 3 year periods.
Terms of DPAs will typically include:
an agreed fine/penalty;
co-operation in continuing investigations;
undertakings to reinforce or introduce compliance procedures;
admission of facts being the subject matter of the charges.
Generally, in the US the judge has to approve a DPA but as no conviction is recorded then there is no formal sentence.
Can DPAs work here in the UK?
The main difficulty in the UK is that at present, prosecution authorities cannot agree a sentence for a company charged with a crime. The facts and charges can be agreed but ultimately sentencing is with the courts. Judges are naturally reluctant to give way on their powers of sentencing.
It has been suggested by various legal observers that, to achieve reform in the UK along the lines of the US, there will have to be a framework where:
the prosecution authorities are given the power to agree a settlement agreement with the defendant company along the lines of the DPAs in the US; or
the judiciary is involved before any formal charges or proceedings are commenced, so that an agreed sentence can be achieved.
There will be a need for transparency both in the outcome of the sentence, so companies know where they are if they co-operate and also the publication of the outcome, so the public/business community can gain from scrutiny of the result.
None of this is without its difficulty but in the interests of fairness, cost savings and expediency DPAs are seen by many as the way forward where corporate defendants are accused of an economic crime.
This publication is intended for general guidance and represents our understanding of the relevant law and practice as at January 2012. Specific advice should be sought for specific cases; we cannot be held responsible for any action (or decision not to take action) made in reliance upon the content of this publication.
TLT LLP is a limited liability partnership registered in England & Wales number OC 308658 whose registered office is at One Redcliff Street, Bristol BS1 6TP England. A list of members (all of whom are solicitors or lawyers) can be inspected by visiting the People section of this website. TLT LLP is authorised and regulated by the Solicitors Regulation Authority under number 406297.