Deferred Prosecutions in the Corporate Sector: Lessons from LIBOR

Since 2008, the global economic downturn has significantly in-creased operating pressures on major corporations. Additionally, there has been a corresponding increase in corporate tolerance for corruption, which has coincided with a marked preference by regulators in settling, rather than litigating, enforcement actions. This Article argues that the expansion of prosecutorial authority without appropriate accountability restraints is a major tactical and strategic error. It evaluates whether the mechanism can be made subject to effective oversight. It argues that the current frame-work in the United States is highly problematic, leading to settlements that generate newspaper headlines but not necessarily cultural change. It also runs the risk of privileging a form of enforcement that operates out-side appropriate legal safeguards. The approach canvassed by the British authorities offers only a partial improvement in this process. For negotiated prosecutions to be truly effective, they require a much firmer normative basis