First deferred prosecution agreement imminent, says SFO, as it confirms letters sent to corporate offenders

Speaking at a mining and extractive industries conference last week Ben Morgan said that the SFO had issued its "first invitation letters" giving companies the opportunity to enter into DPA negotiations. DPAs allow businesses that admit to their involvement in corporate crime, such as fraud, bribery or corruption, the possibility of avoiding a criminal investigation and potential prosecution if strict conditions agreed by a judge are met.

Anti-corruption expert Barry Vitou of Pinsent Masons, the law firm behind Out-Law.com, said that "the race was now on" to see which company would be the first to successfully negotiate one of the new agreements with prosecutors.

"Five years have passed since the Bribery Act was passed, and since it entered into force a lot of water has gone under the bridge," he said on his blog, thebriberyact.com.

"We expect that among the first DPAs we will likely see the first disposals for violation of section 7 of the Bribery Act, failure to prevent bribery. When that happens the Bribery Act will, at long last, have come of age," he said.

Prosecutors in England and Wales have had the ability to agree DPAs with corporate offenders since last February. Based on powers available to prosecutors in the US, DPAs 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 or compensate victims, to submit to regular reviews and monitoring or to undertake reforms to prevent the conduct in question from occurring again.

Guidance by the Sentencing Council sets out the circumstances in which a DPA may be granted. Agreements will be made in open court, with details of the wrongdoing and sanctions published. If the prosecutor is satisfied that the organisation has fulfilled its obligations by the end of the deferral period then there will be no prosecution, but if the conditions are not met then the offender could still be prosecuted.

In his speech, Morgan said that the SFO "did not start from" a position of offering a corporate offender the opportunity to enter into a DPA. However, he said that the new tool had "the potential to be, by some distance, the most effective commercial outcome for a responsible company wanting to resume honest business quickly".

"A DPA responds to criminal liability – as I said, no cosy deals, so don't be under any illusion," he said. "But it has a lot going for it too - speed and certainty ... a level of compatibility that enables us to get a bit closer to that hallowed ground of a global resolution for conduct that crosses borders … and also the chance to really live your corporate values."

"We are no longer, at the SFO, in the world of having to talk up DPAs like some sort of salesmen; corporates want them and some will get them. We have issued our first invitation letters giving corporates the opportunity to enter into DPA negotiations. Where we are now is working with corporates on how best to go through that process - not 'why DPA', but 'how DPA'. And when it comes to 'how', the DPA Code is clear; we and the court need you to cooperate fully with our investigation," he said.

In particular, companies self-reporting suspicions of corrupt behaviour should not "trample over the crime scene" by carrying out their own investigations before contacting the SFO, he said.

"We expect you to engage with us early, and to work with us as we investigate, not to rush ahead and, whether intentionally or not, complicate the work we need to do," he said. "Our job is to investigate possible criminal offences and we take a very dim view of anything anyone does that makes that job more difficult than it needs to be."