SFO New Corporate Crime Policy Seeks to Incentivise Self-Reporting

Key takeaways:

1. 1. The SFO all but guarantees that a company self-reporting criminal conduct will be invited to negotiate a DPA;
   2. Even those companies that do not self-report can get a DPA if they provide exemplary cooperation; and
   3. The SFO has committed itself to strict time frames: it will get back to a company within 48 hours, and will decide whether to open an investigation within six months.

Dealing with corporate crime is a difficult task for a prosecutor. Because the crimes may be difficult to discover and investigate, and because large corporations have resources that dwarf those of most prosecutors (outside the United States, at least), prosecutors often need the help of corporates to investigate and report crimes. But since prosecutors need to be professionally sceptical about criminal suspects, and because the public dislikes apparent “sweetheart deals”, prosecutors do not want to work too closely with companies.

Hence the sometimes tortured process by which prosecutors and governments work out how a corporate should behave where crime is an issue, and how they should be rewarded or punished.

So the Serious Fraud Office (the “SFO”), like many other prosecutors, puts out a corporate crime policy from time to time. Sometimes the new policy reverses previous policies, sometimes it is an evolution. The latest policy, released on 23 April 2025 (see SFO Corporate Guidance – GOV.UK), is a combination of both. And it is largely to be welcomed.

The key elements of this policy are:

1. 1. An attempt to provide certainty to corporates considering self-reporting;
   2. A greater use of the carrot to incentivise cooperation; and
   3. A commitment by the SFO to act expeditiously – which would be a very welcome change.

The policy must be considered against the backdrop of two issues.

First is the use of deferred prosecution agreements (“DPAs”) in the UK to deal with corporate crime, introduced in 2014, along with a code of conduct to be followed by the SFO (the “Code of Conduct”).

Second is the fact, according to the SFO, that self-reporting has fallen, and the SFO needs it to pick back up. (That helps explain why there has been no new SFO DPA since 2021.)

The latest policy seeks to incentivise self-reporting, which it does principally through the offer of DPA negotiations, rather than prosecution.

The SFO now promises that if a corporate self-reports suspected criminal conduct promptly, and co-operates fully, the SFO “will” invite it to negotiate a DPA, unless exceptional circumstances apply.

This firm promise of an invitation goes much further than the Code of Conduct, which just sets out when a prosecutor “may” start negotiations. Indeed, it appears like a guarantee, which the SFO has not provided since the pre-2011 term of Richard Alderman as director (and then in different terms).

There have been complications in recent years where a company has not self-reported promptly, and the SFO or prosecutors have found out about criminal conduct through other means, or belatedly. This was the case with two very large and important cases of bribery: Rolls-Royce and Airbus. Neither self-reported promptly, which would have suggested, based on the Code of Conduct and the policies in force at the time, that they should not have been able to enter into DPAs – yet both did.

The SFO has now officially accepted this reality: it says that it “will consider” inviting a corporate to negotiate a DPA even if it has not self-reported, if the corporate’s cooperation with an ensuing investigation is “exemplary”.

That is:

• • If a corporate self-reports and provides “full” cooperation, it will be invited to negotiate a DPA;
  • If a corporate does not self-report but then provides “exemplary” cooperation, it may be invited to a DPA.

The other major change is an organisational one, and also to be welcomed. The SFO is committing itself to certain quite strict timeframes in dealing with companies:

• • Contacting a self-reporting corporate within 48 business hours of a self-report or other initial contact.
  • Deciding whether or not to open an investigation within six months of a self-report.
  • Concluding DPA negotiations within six months of sending an invite.

These would all be significant improvements on what has been the norm so far. Indeed, this kind of speedy time frame, and clear commitment by the SFO to operate efficiently, may have a greater effect on encouraging corporates to self-report, since the uncertainty and delay around dealing with prosecutors and other government agencies is one of the biggest headaches for business.

The policy is worth reading (it is quite short), in particular, the examples the SFO provides of cooperative behaviour. Here are some other interesting points:

• • • Companies frequently report suspicions of money laundering to the National Crime Agency to establish a defence under the Process of Crime Act, or, if they are regulated, to the Financial Conduct Authority, pursuant to their obligations to keep their regulator informed. Such reports will not count as a self-report to the SFO – unless the corporate reports to the SFO at the same time or immediately thereafter.
    • A vexing issue over the years is whether corporates are required to disclose privileged material to get full credit for cooperation. Unfortunately, the SFO has once again reiterated what is an incoherent policy: a company cannot be penalised for maintaining a valid claim of privilege, but waiving that claim will be “a significant cooperative act” and will “weigh strongly in favour of co-operation”. Logically, there is no difference between receiving a benefit and not being penalised.
    • Three of the five examples given of uncooperative behaviour seem to be aimed at lawyers:
      • • Reporting offending to another jurisdiction for strategic reasons;
        • Seeking to exploit differences between international law enforcement agencies or legal systems; and
        • Providing unnecessarily large amounts of material in disclosure.

• • The other two are hiding the full extent of offending and delaying providing information.