The much heralded Corporate Co-operation Guidance published by the Serious Fraud Office recently offers little comfort to corporates struggling with the dilemma of whether to self-report wrongdoing. Instead it offers a lengthy series of minimum expectations on the part of the part of the SFO, imposes significant and unwarranted extra dimensions and associated costs to corporates and does little to alleviate concerns relating to privilege and in addressing HR and internal corporate governance issues.


The SFO has issued last month its much heralded Guidance on corporate co-operation. There are very few welcome surprises and one or two unwelcome ones. Although the majority of the guidance will be unsurprising to those operating in the white-collar area, there are some new points to be aware of and some old points which deserve to be reinforced.

The Guidance provides essentially a mandatory guide of minimum expectations and a useful checklist for any corporate considering reporting any wrongdoing to the SFO. But almost all of it is a statement of the obvious. Before embarking on such a course, a corporate will need to ensure, with its lawyers, that it has complied with all parts of the Guidance and, if for any reason, it cannot or has not complied with any part it will need to be in a position to explain and justify why it has not.

In line with previous policy, the SFO requires corporates to adopt a “genuinely proactive approach” when they learn of any wrongdoing. As a starting point, the SFO’s position is that co-operation means “ providing assistance to the SFO that goes above and beyond what the law requires”. Corporates must identify suspected wrongdoing and criminal conduct together with the people responsible, “regardless of their seniority or position in the organisation”; and self-report to the SFO within a “reasonable time of the suspicions coming to light”.

The SFO Guidance sets out its expectations in terms of preserving, gathering and producing digital evidence. These, it should be said, are no more than a reflection of best practice in any investigation and are neither surprising nor particularly onerous. However, it is clear that these expectations are informed, not by the fact that the settlement might have to be approved by the Court but, by the clear aim of obtaining the material so that its provenance and integrity cannot be questioned if the matter proceeds to trial.

The fact that the SFO has published Guidance is to be welcomed. However, the Guidance misses a vital opportunity to demonstrate that the SFO will itself co-operate with corporates who self-report wrongdoing both in its failure to mirror the US Department of Justice’s Foreign Corrupt Practices Act Enforcement Policy (in relation to the reassurance that it provides to companies who are contemplating self-reporting) and in its unjustifiable demand for independent certification of privilege.

It creates both a practical obstacle and an unnecessary and unjustifiable expense to companies in asserting privilege. What is both noteworthy and disappointing is that the guidance provides no reassurance that such co-operation will result in a Deferred Prosecution Agreement and does not explicitly state what form any leniency would take. The fact that it is not prepared to offer any meaningful reassurance to corporates that, absent aggravating features, a decision to defer prosecutions will not be presumed will act as a significant deterrent to corporates in self-reporting wrongdoing.

How does the Guidance compare to the DOJ’s FCPA Corporate Enforcement Policy?

The SFO’s Guidance is broadly similar to the DOJ’s Policy. However there are some differences relating to the provision of exculpatory material and significant divergence in relation to the treatment of privileged material and the overall issue of what the corporate might legitimately expect by co-operating.

The SFO Guidance says that it is a good practice for companies to “[a]ssist in identifying material that might reasonably be considered capable of assisting any accused or potential accused in undermining the case for the prosecution.” This requirement is very much an England and Wales requirement but is none the worse for that. Its origin lies in the prosecutor’s disclosure obligations as set out in the Criminal Procedure and Investigations Act 1996 and the Attorney General’s Guidelines on Disclosure. There have been far too many instances where a failure to provide disclosure in cases here have caused injustice.

While this may not be a necessary ingredient of cooperation in the US, it should not cause any difficulty for a corporate seeking to cooperate in both jurisdictions. Indeed, one would hope that any thorough investigation and review should highlight both inculpatory and exculpatory material.

While the SFO’s Guidance provides greater specificity on the matters that companies should address, the principal and a highly significant difference lies in what a corporate might expect from the prosecuting authority. The DOJ helpfully sets out that “there will be a presumption that the organisation will receive a declination (no further action) absent aggravating features.” That is exactly the sort of reassurance that any corporate considering self-reporting needs.

On the other hand, the SFO emphasises, “It is important that organisations seeking to co-operate understand that co-operation – even full, robust co-operation – does not guarantee any particular outcome.” This coyness on the part of the SFO may lead corporates to question the wisdom of self-reporting. It is difficult to see why the SFO would not want to mirror what the DOJ has done (and has done so successfully).

The thorny issue of privilege is considered below.

Internal Investigations and interviews with individuals/employees

One noticeable area of improvement of the SFO Guidance is the apparent willingness of the SFO to allow corporates to undertake internal investigations. The SFO does now appear to be willing to work alongside corporates to obtain and preserve evidence. However, corporates should be live, as we discuss below, to the risks that the SFO’s involvement brings.

The SFO is also seeking to insert itself in a corporate’s internal investigation at a much earlier stage than has previously been required. It now expects to be consulted “in a timely way” before corporates interview potential witnesses or suspects or take employment actions or other such steps. This means that corporates will need to find the balance between obtaining as full an understanding of the facts as possible without, in the SFO’s eyes, prejudicing the investigation. Obviously, once corporates do consult with the SFO, they may find that they lose control of the investigation. The need to self-report in a reasonable time sits uneasily with a corporate’s desire to understand exactly what it is reporting. It also conflicts with other regulators’ (especially those in the USA) expectation that investigations will be conducted expeditiously.

Under the section regarding individuals, the SFO Guidance requires companies to consult with it before interviewing potential witnesses and “refrain from tainting a potential witness’s recollection for example, by sharing or inviting comment on another person’s account or showing the witness documents that they have not previously seen”. This is obviously desirable, but in reality it is not always achievable.

There will clearly be occasions, where a corporate, in order to understand precisely what the issues that it faces are, will have to make enquiry of individuals who will need to see documents. The fact that there are being shown those documents does not mean that their recollections will be ‘tainted’ rather than simply prompted. Any properly conducted internal investigation will recognise the difference between proper prompting and improper tainting.

The Guidance appears, unfortunately, to be in conflict with the DPA Code of Practice. The DPA Code of Conduct expressly recognises at paragraph 2.8.2.i that witness accounts will have been taken prior to self-reporting. (How else is a corporate able to establish whether it has an issue which requires reporting?) The Guidance is a great deal more prescriptive in insisting that a corporate should, “To avoid prejudice to the investigation, consult in a timely way with the SFO before interviewing potential witnesses or suspects, taking personnel/HR actions or taking other overt steps.” In reality, a number of those steeps are likely to have been taken by a corporate before it is in a position to determine whether it should self-report to the SFO.

While this may be a slight softening of the previous SFO Director’s insistence that corporates should not go “trampling over the crime scene” one would hope that any corporates being properly advised will understand the difference between such trampling and proper internal investigation.

The SFO’s expectations will require a fine judgement call to be made by corporates to ensure that they remain within the spirit, if not the letter, of the Guidance.


The need to go beyond what the law requires will be of no surprise to those who have followed the SFO’s forays against privilege. Despite its importance, A corporate’s ability to claim privilege over material, whilst also being adjudged to have co-operated with the SFO, has been steadily eroded over the years. The recent DPA judgments have added to this encroachment on the right to privilege. Co-operation is a prerequisite for a DPA and, in turn, waiving privilege is virtually a prerequisite for co-operation.

The SFO’s guidance is careful not to attempt any kind of blanket ban on the proper assertion of privilege. However, it is clear that the expectation is that corporates must be willing to provide evidence obtained by them in internal interviews including recordings, notes and transcripts i.e. waive privilege over such material.

However, the most puzzling part of the SFO Guidance is where it says that an organization that does not waive privilege and provide witness accounts “does not attain the corresponding factor against prosecution” in the DPA code, but “will not be penalised by the SFO.” What, in reality, does that mean?

Privilege, its assertion and waiver, has long been a contentious issue between the SFO and external lawyers. The SFO seeks to address that tension, in our view, unsuccessfully, in its demand that if privilege is claimed, the SFO will require certification by independent counsel that the material is privileged. Here the SFO has tried to mirror the procedure used when it seizes material over which privilege is claimed. But by then, the material is in the possession of the SFO and not released to the investigators until it is established, through independent counsel, that privilege is not applicable. The position is very different where the corporate continues to hold the material and claims privilege over it. Why the SFO cannot accept the assertions of solicitors who, after all, are officers of the court, but require the certification of independent counsel, is not at all clear. Is it really justifiable to impose a requirement to incur further and, usually, considerable expense to corporates who are trying, with their lawyers, conscientiously to comply with the SFO’s requirements but in a manner which is not prohibitively costly?

In any event the position is very different in the US. The DOJ Policy expressly acknowledges and respects that material covered by attorney client privilege is not required to be disclosed. One further consideration when it comes to providing privileged material is whether other regulators or enforcement agencies (for example in the US) could then obtain it via the SFO. It is likely that the SFO would acquiesce to such a request and so corporates will need to be alive to this risk.

The SFO Guidance appears to suggest that while the failure to waive privilege is something that the SFO cannot ‘tick off’ as a marker of co-operation and so may be a factor in determining whether a prosecution rather than a DPA is appropriate, nonetheless the SFO will not penalise a corporate if it asserts privilege. This is a difficult stance for a corporate (or a lawyer) to understand. Ominously, the SFO footnotes a reference to the judgment in SFO v ENRC [2018] EWCA Civ. 2006 and comments that “the Court of Appeal has not ruled out a court’s consideration of the effect of a corporate’s non-waiver over witness accounts as it determines whether a proposed DPA is in the interests of justice.”

It is difficult to think that the message is meant to be anything other than ‘a corporate can assert privilege over materials and witness accounts while asking to be considered for a DPA, but does so at its peril.’

While the Guidance is superficially helpful, closer analysis reveals that it is a flawed document which wastes a valuable opportunity by the SFO itself to demonstrate that it is prepared to co-operate with corporates that self-report wrongdoing. The Guidance contains substantial pitfalls of which corporates must be wary of and, ultimately, does not offer any tangible comfort to those that do co-operate. The recent, very public, stumbles by the SFO in the courts will only add strength to views that co‑operation is not always in a corporate’s best interests.