The UK has recently enacted legislation underpinning a major policy shift in its fight against fraud and corruption. Hopes are raised that the adoption of Deferred Prosecution Agreements (DPAs) into the UK legal framework will be a new and successful means for authorities to combat serious economic crime. The UK Attorney General’s office has already declared that they will be a new “weapon in the prosecutor’s armoury which will provide them with greater flexibility to pursue an alternative outcome in appropriate cases”.

Already operating in the United States, DPAs allow corporations involved in serious economic crime to avoid a criminal conviction by entering into an agreement with the authorities to defer prosecution. In return, corporations agree to commit to reform and restitution, which will often include the payment of financial penalties.

For Australia, the introduction of DPAs in the UK raises new possibilities for them to be similarly adopted here. Previous fears that DPAs would not be appropriate within the Australian constitutional setting are largely ameliorated by a series of legislative amendments adopted in the UK which could be mirrored in an Australian context. If adopted, DPAs would be a revolutionary tool for Australian prosecutors addressing fraud and corruption issues.

DPAs in the US

Since about 1999 in the US, the attractiveness of using DPAs as an alternative to criminal prosecution grew largely from the need to find a mechanism to bring corporates to account for criminal violations without inflicting harm on innocent victims. These victims included workers left unemployed as a result of a company being found guilty of an economic crime, as well as affected investors and markets. 

Jul-Sep 2014 issue

Norton Rose Fulbright