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Deferred Prosecution Agreements - New SFO Guidance

Author: Syedur Rahman  20 November 2020
3 min read

Syedur Rahman of Rahman Ravelli examines the value of the Serious Fraud Office’s DPA guidance

In a move that coincided with the announcement that it had agreed a deferred prosecution agreement (DPA) with Airline Services Limited, the Serious Fraud Office (SFO) published internal guidance on its approach to DPAs.

A DPA is a court-approved agreement between a company under investigation and a government prosecutor that allows for the suspension of prosecution provided the company meets certain conditions. DPAs became an alternative to prosecution in the UK on 24 February 2014 when Schedule 16 to the Crime and Courts Act 2013 came into effect. So far, the SFO is the only UK law enforcement agency to have negotiated DPAs. The Airline Services Limited DPA was the ninth.

The latest guidance is helpful but does not appear to provide anything new or represent any substantial change to the existing procedure. But as it pulls together into one place the rules and requirements for a DPA it can be seen as a welcome confirmation of the SFO's approach and its priorities.

The Main Aspects of the Guidance

Admissions of guilt: The guidance confirms that a company entering into a DPA is not required formally to admit guilt in respect of the offences charged in the indictment, although it will need to admit the contents and meaning of key documents referred to in the Statement of Facts that accompanies the DPA. This is at odds with the statement released alongside the published guidance by Lisa Osofsky, the Director of the SFO, where she states that “DPAs require the company to admit to the misconduct.’’ It would seem in practice that, as before, companies are more likely to obtain a DPA if admissions are made.

Co-operation (and approach to privilege): The fact that co-operation is a “key factor to consider when deciding whether to enter into a DPA” is emphasised in the new guidance. It confirms that co-operation includes, among other things, the well-established steps of self-reporting the wrongdoing to the SFO, taking remedial action and preserving evidence. There remains, however, no guarantee that co-operation will lead to a DPA. The approach on waiving privilege is even less clear: while the guidance does indicate that companies who choose not to waive privilege and produce witness accounts “will not be penalised by the SFO’’, it also states that they will not “attain the corresponding factor against prosecution that is found in the DPA Code’’. From this, it appears that failing to waive privilege will not result in any penalising of a company, yet adopting such a practice may mean that a company does not succeed in meeting the requirements of co-operation for a DPA.

Identification of third parties: The latest guidance appears to indicate (at last) that the SFO may be moving away from the previous habit of identifying individuals in a DPA. The guidance says that consideration must be given to compliance with the Data Protection Act 2018 and the European Convention on Human Rights when considering whether to identify third parties. We should, therefore, expect more anonymisation of individuals in future DPAs.

Financial penalty: The guidance makes it clear that a DPA should provide for a financial penalty and, where possible, compensation to victims, disgorgement of profits, payment of prosecution costs and donations to charities which support the victims of the offence. The approach to the financial terms should be transparent, consistent and should match the sentencing framework for setting fines. The guidance confirms the established principle that any discount on a financial penalty under a DPA should be comparable to a fine imposed as a result of a guilty plea in a prosecution. It goes on to acknowledge the precedent that has been set in the majority of previous DPAs for awarding a 50% discount in recognition of the level of cooperation offered to the SFO; although the financial penalty can be adjusted in cases where the company can demonstrate substantial financial hardship.

Parallel investigations: The guidance also provides a list of the considerations the SFO will take into account where there is a parallel investigation being conducted by an overseas agency and/or another UK agency. These include, among other things, early communication and de-confliction in regards to the company’s approach to the SFO and other agencies - including on matters such as privilege - consistency by the company on admissions of fact or liability made in the respective jurisdictions, co-ordination of market announcements for public companies in the different jurisdictions and co-ordination of court listing dates to ensure simultaneous resolutions where possible.


While the guidance offers a framework with which to challenge the SFO on its use of DPAs. It fails to provide sufficient clarity over key fundamental issues that companies have to consider when contemplating self-reporting. Notably, the guidance does not include what a company may or should take into account in its own internal investigation before making a decision to self-report. As mentioned earlier, its advice on privilege is contradictory.

The revised guidance does provide some welcome clarification and much-needed transparency on the SFO's approach to DPAs. The recognition that the statement of facts may need to be anonymised in certain situations is also welcome and addresses concerns about individuals being exposed to reputational harm; especially when they are not ultimately convicted of any crime.

But the guidance does not materially assist companies to understand what the SFO expects in terms of co-operation beyond what was previously published.

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Syedur Rahman


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Syedur Rahman is known for his in-depth experience of serious fraud, white-collar crime and serious crime cases, as well as his expertise in worldwide asset tracing and recovery, international arbitration, civil recovery, cryptocurrency and high-stakes commercial disputes.

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