Deferred Prosecution Agreements in the UK: The New Frontier for Employers

by NAVEX Global
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Deferred prosecution agreements (DPAs) are a relatively new law-enforcement tool in the UK, only becoming effective this past February under the Crime & Courts Act 2013.

In the opening of his speech at the Annual Employed Bar Conference last month, the Serious Fraud Office (SFO) General Counsel  Alun Milford, proclaimed that “much has changed within the last three years” in regards to corporate criminal liability and DPA for UK Bribery Act violations.

No DPAs have been issued as of yet, but if Milford’s speech is any indicator, we may see increasing use in the coming months. 

Recent Guidance Helps Determine When a DPA Can Be Used in the UK

The SFO has also recently issued the Code of Practice, which provides guidance to determine whether or not a DPA can be issued.

In the first evidential stage, there must be, “sufficient evidence to provide a realistic prospect of conviction.” Guidance says that prosecutors should consider whether or not the evidence can be used in court, is reliable and is credible.

In the second public interest stage, prosecutors must decide if prosecution is in the public interest, offering a series of questions for prosecutors to consider, including the seriousness of the offence, the level of culpability and how proportionate the response is.

What Does This Mean for UK Employers?

Preparing for the worst may be the best way to ensure that the worst will never happen. Taking what we know about DPAs in the U.S., where they have been around for much longer, compliance programmes are expected to be robust in order to satisfy the DPA, essentially spelling out what government expectations are when it comes to effective ethics and compliance programmes.

Download NAVEX Global’s Bribery & Anti-Corruption Compliance in the UK & Europe e-Book.

To Prepare, Conduct a Risk Assessment or “Stress Test”

A risk assessment or compliance “stress test” will help determine how your programme would fare under investigation.

At a minimum, the program risk assessment should include a review of whether the following items are up to date, cover all key areas and are in full compliance with regulations:

  • The existing—or a new—ethics and compliance risk assessment
  • Standards, policies and procedures
  • Oversight, structure and leadership
  • Alignment with HR practices
  • Communications and training
  • Reporting and response
  • Monitoring and assessment
  • Corporate culture

You can use the results to create a prioritised list of improvements to proactively address gaps. This approach will also help to centralise documentation, which is often scattered throughout HR, audit, security, legal and other departments. Organisations can use this documentation if they are investigated to prove what programme elements they have in place and what steps they have taken.

Preparation Is Key

Only time will tell how many UK Bribery Act prosecutions and DPAs the SFO will issue and at what pace, but for employers doing business in the UK, now is the time to shore up your ethics and compliance programmes to make sure you are prepared in advance of any legal challenges.

For more insights on creating a culture of compliance, download NAVEX Global’s free Bribery & Anti-Corruption Compliance in the UK & Europe eBook.

 

 

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