Ross Dixon, criminal defence partner, Hickman & Rose
Crime after time
2 July 2012 | Updated: 2 July 2012 8:46 am
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Deferred prosecution agreements should not be allowed to undermine the rights of individuals
For US corporate crime lawyers dealing with investigations, a deferred prosecution agreement (DPA) is a familiar prospect. With the Government’s DPA consultation underway it seems this may become just as commonplace in the UK.
The benefits for the Serious Fraud Office (SFO) and corporate entities are highlighted in the consultation paper, but do the consequences for individuals give cause for concern?
If a commercial organisation becomes aware of the possibility that it is involved in economic crime, the consultation proposes a regime whereby the organisation engages with the prosecuting authority. The wrongdoing is identified and the parties enter into a negotiation with the aim of reaching an agreement (the DPA). This will include a statement of facts that would not subsequently be contested, and a time period during which the company agrees to abide by specific terms and conditions. In return there will be no prosecution.
So far, so good, but what about the potential erosion of established rights of the individual? The consultation acknowledges that in the US it is normal for the corporate to conduct its own investigation, which usually involves external lawyers, with the product of the investigation handed over to the state prosecutor for use in its own criminal investigation and prosecution.
The UK consultation similarly proposes that information provided by the corporate could be used in a subsequent prosecution against the individual. This is where there is cause for concern. This means that an individual employee may be the subject of an interview conducted at the behest of their employer in the course of an internal investigation. Their answers may then be handed to the prosecutor and be used as part of a criminal prosecution against them. Although there may be some argument about the admissibility of such an interview in a criminal trial, it is inevitable that disclosure to the prosecutor will affect the criminal investigation and proceedings.
It is common for suspects to be interviewed during a criminal investigation by the police, the SFO, or one of the other agencies with investigative powers, but there are established safeguards to protect the rights of the individual being questioned by a state investigator which may not be in place in an internal investigation.
An individual who is questioned by the police or SFO will be told of their right to independent legal advice and to silence before any interview begins. It is a matter of discretion for the interviewer whether an employee will be afforded the same safeguards. As an employee they will be under an obligation to answer questions raised by their employer, but they may not appreciate that the answers they give may be handed to a prosecutor and used against them in a criminal investigation.
Internal investigations by external lawyers are increasingly common in the UK. The approach to questioning employees who are potential suspects is inconsistent. There is a danger that the rights that protect an individual may be eroded as a result of a DPA regime that encourages a proliferation of investigators and no clear best practice.
To ensure a DPA regime is fair to the individual, the Government should incorporate minimum safeguards and expectations.