SFO Cooperation Guidance
SFO External Guidance on Corporate Co-operation and Enforcement in relation to Corporate Criminal Offending
Applies to England, Northern Ireland and Wales
Documents
Details
Overview
This guidance outlines the SFO’s key considerations under the public interest stage of the Full Code Test for Crown Prosecutors[1] when deciding whether or not to charge a corporate or invite it to Deferred Prosecution Agreement (“DPA”) negotiations.[2] It is supplementary to, and should be read alongside, the DPA Code of Practice[3] and Joint SFO-CPS Corporate Prosecution Guidance.[4]
Each case will turn on its own facts, but a factor which always weighs heavily in favour of a DPA over prosecution is a prompt self-report. If a corporate self-reports promptly to the SFO and co-operates fully, we will invite it to negotiate a DPA rather than prosecute unless exceptional circumstances apply.
We will consider inviting to DPA negotiations a corporate that has not self-reported if it has provided exemplary co-operation with our investigation (see examples at paragraph 23).
We will:
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Contact a self-reporting corporate within 48 business hours of a self-report or other initial contact.
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Inform a corporate promptly if we think another agency would be better placed to receive the referral and in the event of multi-agency interest, work proactively with the other agencies to identify who is best placed to take the referral forward.
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Regularly update a self-reporting corporate throughout the process.
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Decide whether or not the SFO will open an investigation within six months of a self-report.
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Conclude our investigation within a reasonably prompt time frame.
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Wherever possible, conclude DPA negotiations within six months of an invitation to negotiate being accepted.
The Decision to Self-Report
Whether, when and how a corporate self-reports suspected offending is a key consideration when assessing the public interest in favour of a DPA.[5]
We consider self-reporting suspected corporate criminal conduct to be a mark of a responsible organisation. A knowing failure to promptly self-report such conduct impacts our assessment of co-operation and any mitigation. Failure to notify the suspected offending within a reasonable time of it coming to light is a specific public interest factor in favour of prosecution.[6] What amounts to a reasonable time will depend on the circumstances. We recognise that responsible corporates may consider it necessary to investigate suspected offending before a self-report in order to understand the nature and extent of any offending.
We do not expect a corporate to fully investigate the matter before self-reporting. If there is direct evidence of corporate offending, we would expect a corporate to self-report soon after learning of that evidence. If the position is less clear-cut, we recognise that some further investigation may be necessary.
Where a corporate has not self-reported, we will have regard to whether it was aware of the suspected offending before our investigation began.
How to Self-Report
A corporate self-report should ordinarily be made directly to the Intelligence Division.[7] Initial contact can be made via email to intelunit@sfo.gov.uk. Intelligence Division personnel include a legal team, headed by a senior lawyer, who will manage initial engagement with the corporate and/or their legal representatives.
A self-report should identify all relevant known facts and evidence concerning the suspected offences, the individual(s) involved (both those inside and outside the organisation), and the relevant jurisdiction(s). The information provided to us should enable us to understand the nature and extent of the suspected offending.
We also expect at this stage to be told about the whereabouts of key material and any risks associated with the destruction of key evidence or the dissipation of relevant assets.
Before any digital material is provided, a corporate should agree with us the correct digital format in which such material should be received.
Reporting offending through a Suspicious Activity Report or to another agency, whether domestic or foreign, is not considered a self-report to the SFO unless the offending is also reported to us simultaneously or immediately thereafter.[8]
Intelligence Division personnel will establish contact within 48 business hours of a self-report or query and provide regular updates on the status of the self-report.
A decision on whether or not to open an investigation will ordinarily be taken within six months. If we open an investigation, we will conclude it within a reasonably prompt time frame. The time required will be affected by the level of proactive co-operation we receive from the corporate, as well as by other factors such as the existence of relevant material held in foreign jurisdictions.
We will, wherever possible, conclude DPA negotiations within six months of an invitation to negotiate being accepted.
Should corporates or their legal representatives have any questions about the reporting process prior to making a submission, they can contact the Intelligence Division senior lawyer via intelunit@sfo.gov.uk, marking the email “SELF REPORT QUERY FAO Intelligence Division Senior Lawyer”.
Alternatively, in circumstances where a corporate is considering whether to submit a self-report, the corporate’s legal representatives may contact the SFO’s Director of Legal Services via GeneralCounsel@SFO.gov.uk. We recognise that the corporate may wish to remain anonymous at this stage. The legal representative will be invited to a meeting with the Director of Legal Services to discuss the potential self-report, including whether the SFO is the correct agency to receive the self-report A note of any such contact will be made and shared with the Intelligence Division.
Co-operation
The degree to which a corporate co-operates with our investigation is a key factor when deciding how a case is resolved and the level of penalty.[9] Only a genuinely co-operative corporate will be invited to engage in DPA negotiations.
A prompt self-report is a strong factor indicating co-operation, but having self-reported and being co-operative are not one and the same:
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A self-reporting corporate must go on to provide genuine co-operation to be eligible to be invited to negotiate a DPA.
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Conversely, a corporate which does not self-report can provide exemplary co-operation with our investigation to become eligible to be invited to negotiate a DPA.
A corporate which maintains a valid claim of legal professional privilege (“LPP”) over relevant material will not be penalised for doing so.[10] However, we consider a waiver of LPP to be a significant co-operative act, and it can help expedite matters.
Co-operation during the course of our investigation means providing assistance to us that goes above and beyond what the law requires.[11]
The following examples are a non-exhaustive list of co-operative conduct. Corporates which take all these steps are likely to be assessed as providing exemplary co-operation:
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Proactively and promptly preserving all digital and hard copy material likely to be relevant to our investigation.
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Collecting and identifying to us documents and information likely to be relevant to the investigation. This includes but is not limited to:
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Providing a list of relevant document custodians and the location of material (whether hard copy or digital).
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Identifying and/or producing relevant overseas documents within its control.
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Identifying potentially relevant third-party material.
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Providing translations of relevant foreign language documents.
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Presenting the facts on the suspected criminal conduct, including identifying all persons involved, both inside and outside the organisation.
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Making current and, where possible, former company officers, employees, agents and consultants, whether based in the UK or overseas, available for interview as required and, where appropriate, ensuring independent legal advice is made available to them.
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Proactively considering key areas of risk across the scope of its business, including, where appropriate, taking proportionate steps to reassure itself and us that the full extent of any potential criminality has been reported.
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If the corporate undertakes an internal investigation:[12]
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Early engagement with us as to the parameters of the investigation.
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Informing us in advance of any witness interviews or other investigative steps proposed as part of any ongoing internal investigation to allow a deconfliction process to take place to avoid unnecessary prejudice being caused to the SFO investigation.[13]
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Providing timely updates on any ongoing investigation including any key findings.
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Providing the facts gathered during that investigation.
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Providing non-privileged records of interviews. If the interview records are subject to legal professional privilege,[14] a voluntary waiver of privilege over such records will weigh strongly in favour of co-operation.
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Refraining from interviewing employees at our request.
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Notifying us of any other regulator, law enforcement or prosecutor involvement or interest.
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Informing us of any previous relevant corporate criminal conduct and how it was resolved.
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Providing information on any disciplinary action taken and changes to personnel made as a result of the offending.
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Providing financial information regarding the benefit and/or harm the offending has caused.
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Presenting a thorough analysis of the corporate’s compliance programme and procedures in place at the time of offending and how the corporate has remediated, or plans to remediate, any ongoing deficiencies.[15]
We consider the following conduct to be unco-operative:
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A corporate “forum shopping” by unreasonably reporting offending to another jurisdiction for strategic reasons.
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Seeking to exploit differences between international law enforcement agencies or legal systems. If there are legitimate reasons for differences of approach (e.g. a “blocking statute”) they should be communicated to us.
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Attempts to obfuscate the involvement of individuals, minimise and/or withhold the full extent of the suspected offending.
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Tactically delaying the provision of information or material.
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Seeking to overload our investigation by providing unnecessarily large amounts of material that may hinder the effectiveness of the investigation. A corporate should inform us beforehand of its proposals for providing material and the expected volume of material.
The nature and extent of the corporate’s co-operation is one of many factors which we will take into consideration when determining an appropriate resolution, alongside those detailed in the Code for Crown Prosecutors, the Corporate Prosecutions Guidance and the DPA Code.[16]
As noted in the overview, we anticipate that it will only be in exceptional cases that the combination of a prompt self-report and full co-operation will result in prosecution rather than an invitation to discuss a DPA.
[1] The Code for Crown Prosecutors - The Crown Prosecution Service
[2] The level of co-operation may also be relevant to early guilty plea discussions, pursuant to the Attorney General’s Guidelines on Plea Discussions in Cases of Serious or Complex Fraud (Plea discussions in cases of serious or complex fraud).
[3] Deferred Prosecution Agreements - Code of Practice - The Crown Prosecution Service
[4] Joint SFO-CPS Corporate Prosecution Guidance
[5] See DPA Code 2.8.2 and 2.9.1
[6] See DPA Code 2.8.1.v
[7] Individuals reporting fraud are directed to Report Fraud, but we still accept reports of fraud made by corporates or their legal representatives. We also accept reports of bribery and corruption from corporates, their legal representatives and from individuals.
[8] For example, a PRIN 11 Report to the FCA would not constitute a self-report to the SFO but, if the corporate reported to us at the same time, that would constitute a self-report.
[9] See 2.8.2.i. and 8.1-8.5 of the DPA Code.
[10] See 3.3 of the DPA Code.
[11] What the law requires includes complying with section 2 notices. We understand that, for a number of reasons, production of materials may require a section 2 notice and we do not consider a request for a section 2 notice to necessarily signal a lack of co-operation.
[12] 2.9.3 DPA Code: The prosecutor will consider whether any actions taken by P by not self-reporting earlier may have prejudiced the investigation into P or the individuals that incriminate P. In particular the prosecutor will critically assess the manner of any internal investigation to determine whether its conduct could have led to material being destroyed or the gathering of first accounts from suspects being delayed to the extent that the opportunity for fabrication has been afforded. Internal investigations which lead to such adverse consequences may militate against the use of DPAs.
[13] In turn, where the SFO asks for witness interviews or investigative steps to be delayed to avoid prejudice to its investigation, it will use its best endeavours to complete the relevant aspect of its investigation as soon as reasonably practicable so as not to delay the internal investigation more than is absolutely necessary and will keep the corporate informed throughout.
[14] Where accounts of individuals taken by a corporate (or on its behalf) may be relevant, any claim to privilege concerning them will be scrutinised and recorded, so that our disclosure duties under the Criminal Procedure and Investigations Act 1996 can be discharged.
[15] See SFO Guidance on Evaluating a Corporate Compliance Programme for further details.
[16] See references given at fn. 1, 3 and 4 above.