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DEFERRED PROSECUTION AGREEMENTS: PROCEDURE, COMMON TERMS IMPOSED AND COURT ENDORSEMENT

Since 1999 in the USA, and 2014 in the UK, prosecutors have been permitted to enter into DPAs for corporate bodies and other specified organisations suspected of or under investigations for criminal offences. In the UK, under the terms of the agreement, the prosecutor agrees to defer prosecution of the offences, provided that the corporate body complies with the terms of the agreement during its period of operation. DPAs permit the prosecution to be reinstated if the corporate body fails to perform its undertakings.

Between 2000 and July 2013, the US DOJ concluded 257 publically disclosed DPAs and non-prosecution agreements. The US Securities Exchange Commission concluded six agreements in the same period. The use of DPAs is on the rise in the US and is likely to be followed in the UK1. Between 2000 and 2006, the US DOJ averaged 10 such agreements per year but, between 2007-2013, this had increased to an average of 30 agreements annually.

The financial penalty that can be extracted as part of a DPA is a powerful motivation for prosecutors to adopt DPAs as a prosecution tool. In the USA, between 2000-2013, a total of $37.2 billion was recovered from companies seeking resolution of cases by this mechanism.

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