The Canadian division of the anti-corruption group Transparency International (TI) has recommended that Canada join a global movement toward adopting deferred prosecution agreements for dealing with corporate crime.
In a July 12 report, the nonprofit group said the use of DPAs would have "the effect of promoting compliance and allowing for efficient use of investigative and prosecutorial resources." Using DPAs also could increase transparency in resolving corporate crime and lead to more voluntary disclosures of wrongdoing by companies, the report said.
"Our view is that deferred prosecution agreements so long as they are properly structured and include appropriate safeguards can be an important tool for increased white-collar crime enforcement and lead to greater transparency," said Mark Morrison, a member of TI Canada's board of directors who shepherded the report through the group's legal committee and then the board. Morrison is a white-collar criminal defense lawyer at Blakes, Cassels & Graydon in Calgary.
Morrison explained that "proper safeguards" would mean that a DPA include three key elements cited in the report, "financial reparations, sincere compliance reform and accountability of individual wrongdoers."
"A deferred prosecution agreement can't be seen as just the cost of doing business," Morrison added. "These safeguards assure that won't be the case."
Other recommendations in the report included:
Creating the DPA structure and implementing it through specific legislation, unlike the U.S. model that was prosecutor-created and is implemented through U.S. Department of Justice guidelines.
Avoiding the use of non-prosecution agreements because they do not include charges, are not court reviewed and are less transparent. The United States currently uses NPAs.
Using corporate monitors to oversee compliance reforms, with their reports being provided to the courts. The United States keeps monitor reports confidential.
Making DPAs available to corporations only, not to individuals.
Affording leniency to corporations only when they are willing to identify the individuals responsible for the wrongdoing.
The use of DPAs is a growing trend around the globe. Besides the United States, which pioneered the use of these agreements in the 1990s, they are already part of the law in the U.K. as well as Scotland (where they are rarely used), and are under consideration in at least two other countries.
The U.K. has used its DPA authority three times since it adopted the legislation in 2013, with the most recent DPA resolving a long-running bribery case against Rolls-Royce. Ben Morgan, the joint head of bribery and corruption at the U.K.'s Serious Fraud Office, told a group of general counsel in a March speech that DPAs are "the new normal" in the U.K.