A small firm in Rotherham could be about to make legal history by becoming the first business to strike a deferred prosecution agreement with the Serious Fraud Office (SFO), as a way of avoiding prosecution on bribery charges. If agreed, the deal would also mark the first settlement of an SFO investigation into breaches of the Bribery Act.
It would appear that Sarclad, which had revenue of less than £15m in 2014, has been in private negotiation for several years with the SFO, which has said it expects to sign the deal by the end of the year. This would be under a new scheme mirroring the system in the US, whereby a firm would admit wrongdoing for economic crimes, including fraud and bribery, but avoid lengthy and potentially damaging corporate criminal cases.
Known as deferred prosecution agreements (DPAs), the deals became available to prosecutors last year following criticism of the SFO over its previous attempts to negotiate deals with other firms in cases brought by the Ministry of Justice.
Opinions are divided over the use of DPAs, with critics calling them ways to “buy justice”. However, others believe that allowing businesses to pay their way out of a prosecution could save jobs. Since the firms would not be damaged by accepting a PDA, it would be likely that the business could carry on and employees would continue to be employed. Meanwhile, others believe that the deals would be little more than a means of raising cash for the Government and would not deter businesses from wrongdoing in future.