News & what's on - Written by on Tuesday, October 23, 2012 3:27 - 0 Comments

BREAKING:86% say they want Deferred Prosecution Agreements. And they are going to get them.

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As predicted earlier today Justice Minister Damian Green today announced the introduction of Deferred Prosecution Agreements.  

The Ministry of Justice press release noted that an overwhelming 86% of respondents agreed DPAs had the potential to improve the way economic crime is dealt with in England and Wales. 

Amendments to the Crime and Courts Bill establishing DPAs were tabled today.

Under the Deferred Prosecution Agreement proposals organisations will publically face up to their wrongdoing and resolve to make things right by agreeing to comply with stringent conditions.

These include the payment of substantial penalties, making reparation to victims, undertaking reform to prevent such conduct occurring again, and submitting to regular reviews and monitoring.

In a marked difference to the Deferred Prosecution Agreement regime in the United States the process will be scrutinised by an independent judge.  The threat of prosecution will remain hanging over an organisation should it fail to comply fully with the agreement. Justice Minister Damian Green said:

“Economic crime is a serious issue. Fraud alone is estimated to cost the UK £73 billion each year, yet far too few serious cases are brought to justice. It is clear we must find new and better ways of ensuring organisations who commit criminal wrongdoing do not get away with it.

Deferred Prosecution Agreements will give prosecutors an effective new tool to tackle what has become an increasingly complex issue. It will ensure that more unacceptable corporate behaviour is dealt with including through substantial penalties, proper reparation to victims, and measures to prevent future wrongdoing.”

Solicitor General Oliver Heald said:

“I am confident that DPAs will be an invaluable tool for the Serious Fraud Office and the Crown Prosecution Service as they work to combat economic crime. In cases where a company accepts wrongdoing, and is committed to put things right, a DPA will mean that it must comply with stringent conditions to compensate and ensure there are no repeat incidents, whilst avoiding a lengthy and expensive prosecution with the prolonged uncertainty it brings for the victims, blameless employees and others dependent on the fortunes of the company.

There will always be cases where the public interest requires a full criminal prosecution and DPAs will allow prosecutors to focus more of their resources on these cases.”

The UK government has recently moved investigating and prosecuting economic crime up the government agenda.   As the Ministry of Justice press release said, economic crime is becoming increasingly sophisticated, and the complexity and global reach of corporations growing, criminal prosecutions can now take several years and cost millions of pounds. All with no guarantee of a successful outcome. Deferred Prosecution Agreements can play a vital role in overcoming these challenges.

Following a public consultation, the Government will introduce legislation in Parliament to establish Deferred Prosecution Agreements in order to help the Serious Fraud Office and Crown Prosecution Service bring more cases to justice and secure restitution for victims.

Under the proposals the final Deferred Prosecution Agreement will be made in open court and published so that the wrongdoing and sanctions for it are entirely transparent.  If, at the end of the deferral period, the prosecutor is satisfied the organisation has fulfilled its obligations, there is no prosecution. If, on the other hand, the commercial organisation fails to meet its obligations, it could face prosecution.

Deferred Prosecution Agreements are intended to be an additional tool for prosecutors and will not replace prosecutions which the new Director of the Serious Fraud office has signaled will be a key focus for the SFO in future.

Opinion

The UK Government’s proposals for US-style Deferred Prosecution Agreements (DPAs) announced today should provide a powerful weapon in the fight against white collar crime.

 DPAs act as a plea bargain, and will allow companies to publicly admit past wrong-doing while paying penalties, undertaking internal reforms, or agreeing to external monitoring, in exchange for immunity from prosecution (unless they breach the terms of the DPA).

DPAs offer a better way of dealing with corporate wrongdoing and for businesses to resolve their criminal exposure.  The present choice, either to prosecute, or not, is deeply unsophisticated.

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