SFO and attorney general consult on moves to usher in US-style deferred prosecution agreements

The Attorney General's Office (AGO) is consulting on proposals to usher in US-style plea bargaining in the UK to help prosecutors crack down on white-collar crime.

The AGO has begun consulting on a form of plea bargaining called deferred prosecution agreements (DPAs), a tactic often used by prosecutors in the US to pursue fraud and corporate-wrongdoing.

The proposal is billed as potentially strengthening the UK's position in enforcing the recently-introduced Bribery Act and providing more expedient outcomes for companies under investigation.

If implemented, the agreement would allow prosecutors in the UK to grant amnesty to corporates in exchange for full co-operation with the investigation, implementation of corporate reforms and in some cases significant civil remedies like financial penalties. Fulfilment of the requirements would then result in the suspension of the charges.

The consultation is particularly relevant in light of widespread criticism over the joint prosecution of Innospec in 2010, which led to a financial penalty of £8.3m in the UK. Lord Justice Thomas described the settlement as "wholly inadequate" in relation to the gravity of the offence, though the deal was ultimately allowed.

The AGO is seeking views from practitioners, corporates and non-governmental organisations on behalf of solicitor general Edward Garnier QC and Serious Fraud Office (SFO) director Richard Alderman (pictured).

Alderman has been a longstanding supporter of introducing US-style DPAs, which are viewed as a highly successful tool for US prosecutors. Statistics from Gibson Dunn & Crutcher found the US Department of Justice imposed $2.3bn (£1.4bn) in penalties in 2010 through such agreements. Plea bargaining has rarely been used in the UK due to a lack of legislative powers, as well as judicial resistance.

The informal soundings will last until just before Christmas, with a formal government consultation due to launch in the New Year. This is likely to result in a green paper issued by the Ministry of Justice (MoJ) before the summer.

However, it still remains unclear whether the Government is yet committed to implementing the reforms. The AGO is not able to support legislation and the Home Office or MoJ have yet to give a definitive commitment to implementing DPAs.

One option being considered by the AGO is to add the proposed legislation to an existing bill, with some lawyers believing that it is likely to be added to the Home Office's bill on the National Crime Agency.

"Tools such as deferred prosecution and earlier judicial involvement will allow us to work more efficiently and cost-effectively," said Alderman. "We are in the process of convincing the Government that these changes are needed, particularly with regards to Bribery Act implementation."

Pinsent Masons white-collar crime partner Barry Vitou commented: "The present system in this country does not mesh with its US equivalent, and the Government needs to implement change. If judges are able to overturn deals struck between business and the Government, where is that certainty of outcome that business needs before it is prepared to negotiate?"