I don't agree. People should not go to prison for crimes committed by others. We should still have to show each individual is guilty, including the executives. But I don't think that would solve the problem anyway. Owners and shareholders will still be immune. They will simply hire figurehead executives to sign things and speak at events.
These people are financially motivated, so the punishment should be financial. Most criminals don't think they are going to be caught anyway, so prison isn't a disincentive. Financial punishment may not be a disincentive either (but I suspect for most shareholders it would), but it has the effect of reducing the efficacy of bad actors, leading to better outcomes overall.
The real problem is the fines are usually far outweighed by the profits from acting in this manner. Make the punishment an audit at the end of which they must pay the costs of the independent audit (whether done by private third party or government) as well as a multiplier on whatever profits were determined to stem from the elicit activity.
Why jail time? Hit them where it hurts: their company stock. Corporate malfeasance should (in part) be punished by clawing back some portion of executive stock compensation FBO the victims and/or the government. Some portion of their compensation was “earned” by decisions that violated the law and directly harmed others. Take it away.
The idea is the owners/shareholders get punished. If we punish them, they'll stop hiring criminally negligent C-suites.
I'd prefer we do both. Hold the actual bad actors accountable AND also kill the company and hurt the shareholders. Anybody involved needs to have incentive to stop the bad behavior.
I'm tired of people using corporate shells as a get-out-of-jail card when they do things that are illegal and/or knowingly bad for society/environment.
1) it’s rare, if ever, that a CEO, CFO or COO faces jail time for crimes the company committed that are similar or worse compared to jail-able offenses by individuals. So your second point doesn’t really happen in practice.
2) shareholders SHOULD be punished for the actions of the company. If my dog maims you because of my negligence to control it, I’m liable. If a corporation knowingly commits crimes, then the CEO (and everyone in the chain down to whoever performed the criminal action) is a criminal, and the board and the shareholders should be liable for not exercising proper control and guidance. When you own something you also take on responsibility for that object. Stocks are no different.
That’s fine, and I think it should be encouraged. I also think they should be fined, held liable for money damages in court, and that their executives should be investigated with the potential of resulting in jail time. You have to find ways to take the money from the company, however, not directly from the shareholders.
> go after the officers with criminal charges, and make the shareholders liable financially
Even if the officers serve a prison term and forfeit all personal fortune, companies will still put them on some comfortable position (pre-bribing other officers as a side effect) after they get out.
The executives that put these messures in place all need to face prison time and the company needs to be punished to a degree that all the shareholders feel it.
Additionally the fines collected should go towards Parkinsons research and treatment and not in the pockets of the state.
reply