Deferred Prosecution Agreements (DPA) – an update

Whilst the AG’s guidance addresses a number of practical issues, it also makes clear that it will not address all queries arising from DPA proceedings, and that entities should take their own legal advice before self-reporting.

Key points arising are:

1. The guidance notes that the DPA process is an “exceptional criminal justice tool”, not to be considered a routine measure. Self-reports will be considered on a case-by-case basis, and entities should not necessarily expect to avoid prosecution just because they self-report. 
2. If an entity wishes to self-report, it must submit it via secure email to ECCUadmin@gov.je (which has restricted and confidential access).
3. The requirements for a self-report are set out in paragraph 9(a) of the guidance. Perhaps unsurprisingly, the self-report should confirm whether any natural persons other than the entity are suspected to be involved (which addresses the challenge of the “Identification Doctrine” covered in our previous article, which the new legislation is intended to address).  The self-report must also satisfy Article 4(1) of the DPA Law, which includes a requirement (amongst others) to submit evidence which is reasonably capable of demonstrating that the reported offence has been committed (to which see 4 below).
4. The particular evidential considerations are set out at paragraphs 10-13 of the guidance, although it is strongly recommended that the entity takes legal advice – the guidance says that “this will require a careful analysis of the elements of the particular offences in Jersey law.”
5. The guidance contains a detailed section on the required content of a DPA (to be read in conjunction with Article 3 of the DPA Law), one of the most important features being the statement of facts outlined relating to the offence (the standards being set out at paragraph 34 of the guidance). It should be noted that this statement will be of public record (whether or not the hearing was held in private) on the basis of public interest.
6. The DPA can provide for conduct which took place before the introduction of the DPA Law, but cannot prevent an entity from being prosecuted for conduct not included in the relevant indictment or case summary. 
7. The AG will only enter into a DPA where he is satisfied that it is in the interests of justice to do so (see our previous article). This is a balancing exercise assessing “the factors which would justify a prosecution and those that militate against it” and will be determined on a case-by-case basis. The presence of certain factors (such as a high degree of harm caused to the victims of the offending, previous criminal or regulatory enforcement actions against the entity or the entity already being subject to a criminal investigation) may indicate that entry into a DPA would not be in the interests of justice.  
8. Once the AG has determined to enter into a DPA, he will issue a letter to the entity (referred to as a “commencement letter”) outlining the basis on which any negotiations will proceed and inviting the entity to accept the invitation to commence proceedings. If the entity does so, then the AG will send it a further letter setting out the manner in which the discussions will be conducted (referred to as the “negotiations letter”) to include an explanation of how the AG will use the information provided to him.
9. The AG will confirm in writing his reasons for being satisfied that i) entering into a DPA with the entity is in the interests of justice; and ii) its proposed terms are fair, reasonable and proportionate (referred to as the “AG’s certification”), before the matter is listed before the Royal Court to be approved in its final form.
10. The DPA Law contains discretionary protections for the privacy of an entity involved proceedings (for example, the guidance notes that private hearings might be necessary to avoid risk of prejudice to the administration of justice in any existing legal proceedings).
11. A DPA will ordinarily include a financial penalty, broadly comparable to a fine that the Royal Court could have imposed upon an entity if had pleaded guilty to all of the offences in the indictment and reflecting the seriousness of the offence. Because the DPA regime is new and there is no existing precedent in respect of financial penalties, the level of fine will most likely be fixed with reference to other sources (e.g. the JFSC guidance on civil penalties, the UK FCA’s civil penalty guidance, or examples of DPAs from other jurisdictions).
12. The entity will usually be required to contribute to the AG’s costs, with the amount determined by reference to the Factor A hourly rates published by the Royal Court. The AG estimates that his costs will generally be £7,500 – £10,000. However, this will depend on complexity and may be revised in the light of experience. If the self-report is not presented in accordance with the guidance (i.e. further information requests and liaison are required of the entity) the costs could well be higher. 
13. The DPA must identify the independent monitor (IM), who represents “an essential aspect of the DPA process”. The AG expects the entity to provide the IM with complete access to information when requested, given the IM’s duty to report at periodic intervals to the Royal Court and AG on the entity’s compliance with the DPA. It is a criminal offence for an entity to breach its duty to provide information to the IM.
14. The AG may make an application to the Royal Court if he considers there are reasonable grounds to suspect a breach of the DPA. If the Royal Court determines that the entity has failed to comply with its terms, it may either invite the AG and the entity to agree proposals to remedy the failure to comply, or it may terminate the DPA.
15. Entities should be aware that if the DPA is terminated in accordance with 13 above, this will have the effect of reinstituting criminal proceedings against the entity. Ensuring compliance with the terms of the DPA (to include providing the necessary information to the IM) is therefore vital, particularly given that the statement of facts will be of public record and therefore admissible in subsequent criminal proceedings.
16. Where a DPA remains in force until its stated expiry date (i.e. it runs its entire course), then following the expiry date, the AG must discontinue the relevant criminal proceedings. New criminal proceedings may not be commenced against the entity in relation to these offences unless the AG finds that the entity has provided inaccurate, misleading or incomplete information.
17. The flow chart at the appendix to the guidance is helpful, providing a simplified, high-level overview of how the process is intended to work (assuming compliance by the entity).

This article is not to be regarded as advice on any particular matter.  Specific advice should always be sought.  Please do not hesitate to contact Lydia Emery regarding the matters outlined above.