DPAs remain popular enforcement mechanisms around the world, but questions linger
If it's possible for something to be "all the rage" in the financial regulatory space, it's deferred prosecution agreements, or DPAs. They've become a standard feature of anti-corruption legislation around the world. France's Sapin 2, adopted in 2016, uses them. Brazil's Clean Company Act, which went into effect in 2014, uses them. America's Foreign Corrupt Practices Act, or FCPA, also uses them.
In 2010, the UK's anti-corruption law went into effect: The Bribery Act. DPAs came into use under it in 2014. Since then, four major companies have entered into DPAs with the UK's Serious Fraud Office. And now The Wall Street Journal is reporting that UK lawmakers are "conducting a formal review of the Bribery Act of 2010." Part of that review will include examining "the impact of deferred prosecution agreements on corporate conduct."
The idea behind a DPA is, a prosecutor and an organization come to an agreement to defer, i.e., suspend, criminal prosecution for an organization found to have broken the law in return for that organization meeting certain criteria. This may include fines, compliance program requirements, or disgorgement: the paying back of ill-gotten gains.
While a formal review of the UK Bribery Act is standard practice whenever there's been a notable change to the law, which the introduction of DPAs certainly qualifies as, DPAs are also viewed with suspicion in general by some watchdog organizations. These independent observers fear DPAs let organizations and the individuals who work for them too easily off the hook for breaking the law.
This concern regarding lack of criminal accountability for misconduct appears to be a significant factor in Parliament's decision to conduct a review, or at the very least enough of one to make DPAs a notable focus.
In May 2018, the House Of Lords also announced an enquiry into the UK Bribery Act, though through a very different lens: that the law might be placing too much of a regulatory burden on businesses. At the time, there was concern the Lords enquiry might seek to water down important provisions of the law.
At less than a decade old, the UK Bribery Act is very new. The use of DPAs is even newer. With just four cases having been resolved using DPAs, it may seem like there's not much to review, and there really isn't. Under the FCPA, there have been 25 related enforcement actions in 2018 alone. But to say suspicion of large corporate entities is on the rise since the financial crisis is an understatement. Anger and resentment that big companies and the people who run them are getting off scott free, or with just a slap on the wrist, for gross violations of the public trust is helping drive politics in the UK and elsewhere to a significant degree.
Theresa May's Conservative government isn't nearly as pro City as David Cameron's was. And it's safe to say Jeremy Corbyn's very left-leaning Labour Party—perhaps just one election away from power in a highly volatile UK political scene—would be no great friend to the City either. Always a space filled with competing interests, financial regulation and enforcement has become a space filled with even more divergent viewpoints. And with politics no longer the reliable predictor it once was, expect more once-reliable predictors to become less predictable.