On November 12, 2013, the SEC announced that it had entered into a deferred prosecution agreement (DPA) with Scott Herckis, a former hedge fund administrator who cooperated extensively with the agency in taking action against Berton M. Hochfeld, a hedge fund manager who misappropriated more than $1.5 million from the fund.  Herckis marks the first time the SEC has entered into a DPA with an individual rather than a corporation.  The SEC’s stated goal with respect to DPAs is to encourage individuals and companies to assist the agency with its investigations by voluntarily providing the agency with information about misconduct.  In exchange, the SEC agrees not to prosecute cooperators for their own violations, provided they agree to certain prohibitions and undertakings.  The government’s use of DPAs has been criticized by, among others, Judge Jed S. Rakoff of the U.S. District Court for the Southern District of New York, who decries the government’s willingness to refrain from prosecuting those who have participated in wrongdoing in exchange for their cooperation.  This article summarizes the factual background surrounding the DPA, the terms of the DPA, the implications of the SEC’s new approach for hedge fund managers and Rakoff’s critique of the government’s use of DPAs.