Jersey's deferred prosecution agreements law now in force
Deferred prosecution agreements (DPAs) have been used extensively in the US and UK, and have recently come into use in France. However, they are entirely new to Jersey.
The new law applies to companies, foundations, incorporated limited partnerships, limited liability companies and partnerships, separate limited partnerships, and other body or person that has legal personality, but which is not an individual or a corporation sole, whether established in Jersey or elsewhere. According to law firm Ogier, one of whose partners helped draft the law, it covers corporate trustees who discover potential criminal activity in the operation of a trust, such as money laundering failings.
Offences covered by the law are typical 'white collar crimes' such as fraud, embezzlement and certain offences under the Companies (Jersey) Law 1991 and Proceeds of Crime (Jersey) Law 1999. Corporate bodies that discover such wrongdoing are now able to make a private and confidential report to the Attorney General, who will then check whether the entity has satisfied the criteria for agreeing a DPA as an alternative to prosecution. The Attorney General has already issued guidance on how such agreements will be practically implemented.
The Jersey Attorney General's conclusion will then be subject to discretionary approval by the Royal Court of Jersey, which will only sanction a DPA if satisfied that it is in the interests of justice to do so and the terms are fair, reasonable and proportionate. The entity concerned will have to comply with the terms of the DPA as long as it lasts, and will be liable for prosecution for any breaches.
The published guidance on DPA policy notes that they are especially attractive in a small jurisdiction such as Jersey, as they avoid the reputational damage of a corporate conviction and the costs of a prosecution and trial, though they will be formally indicted for the offences. However, it also warns corporate entities not to expect to avoid prosecution just because it has reported itself. A DPA is 'an exceptional criminal justice tool and is not a routine measure’, says the Attorney General.
The self-reporting process is clearly not risk-free, nor is it cost-free. A request to the Attorney General to consider the self-report will be charged at between GBP7500 and GBP10,000; and will be non-refundable regardless of the outcome of the determination. Where a self-report is piecemeal or leads to further investigation and liaison, the cost could be significantly higher, says the guidance. Moreover, even if accepted, the agreement will usually impose a financial penalty comparable to a fine that the Royal Court could have imposed upon an entity that pleaded guilty to the offences. Redress or compensation may also be ordered for victims.
The law contains discretionary protections for the privacy of the entity involved, including the possibility that hearings will take place in private. However, the associated statement of facts will be a fully public record, which can then be used in subsequent criminal proceedings as an admission of the wrongdoing. Even if the DPA is not approved, some information can still be used in limited criminal proceedings, such as the prosecution of separate offences involving misleading information or statements given by the entity.
'We are likely to see the DPA Law and Attorney General's guidance put to the test before the Royal Court over the coming weeks or months', commented James Angus of Ogier. He noted that the Attorney General acknowledges he may find illustrative precedent in DPAs concluded under other regimes when establishing a body of Jersey customary law on the matter.
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