The SFO boss predicts more plea deals will take place under Britain’s new fraud law

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New legislation that puts companies on the hook if employees commit fraud could lead to a significant increase in plea deals with prosecutors, according to the head of Britain’s Serious Fraud Office.

SFO director Nick Ephgrave said deferred prosecution agreements – or DPAs – could return with a “vengeance” once a new criminal offense taxing companies to prevent fraud comes into force, which is expected to be next year.

Under a DPA, first introduced in Britain a decade ago, criminal charges against a company are suspended if the company approaches the SFO and agrees to conditions – approved by a judge – such as cooperating with investigations against individuals and paying a fine and complying with certain conditions. This allows companies to avoid criminal convictions and lengthy lawsuits.

“DPAs, I think, are a very useful and helpful tool in the arsenal,” says Ephgrave, who took over a year ago this month.

“I think they could really come back with a bit of a vengeance if we have a duty to prevent fraud.” The new rules “could lead to an increase in the number of DPA-style referrals,” he added.

“DPAs. . . avoid what will often be a very costly and lengthy process, and reap the benefits for the victims. . . and/or the benefit to the country of huge fines, which then end up back in the treasury,” he added.

The SFO has previously secured a dozen DPAs against companies such as Rolls-Royce and Airbus.

Ephgrave, a former police officer and the first non-lawyer to lead the SFO, is trying to revive the agency’s reputation after a number of high-profile failures.

Under former director Lisa Osofsky, the prosecutor closed several investigations against major companies, saw convictions in cases overturned after missteps, and struggled to recruit staff.

The SFO is currently embroiled in a lawsuit with the Eurasian Natural Resources Corporation, previously the target of an investigation, which could force the organization to pay potentially millions of pounds to the mining group in compensation.

Ephgrave said the SFO was “disappointed” by the court’s decision on its liability in the case and will “resolutely engage in quantum negotiations”, but declined to comment further while the legal case is ongoing.

Ephgrave is also pushing for whistleblower payments to be introduced in Britain, which may require new legislation.

Although he has yet to discuss the plans directly with the new government, he said he hoped such an initiative would be introduced during his five-year term.

His comments come the day after the chairman of Britain’s financial regulator faced calls to resign over his mishandling of whistleblower data.

The Financial Conduct Authority’s Ashley Alder refused to quit on Thursday despite protest groups criticizing him after an internal review cleared him of wrongdoing for forwarding messages from two whistleblowers within the firm.