General Principles Governing Criminal Liability of Corporations, Their Employees and Officers
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Description
The purpose of this chapter is to provide the general framework that governs the imposition of criminal liability on those who may become defendants in business crime cases. Potential defendants in such cases are the enterprise itself (whether the enterprise is organized as a corporation or in some other form), the enterprise's managers (which can include officers and directors), and the employees who actually “did” the illegal act in question. Although these general principles apply without regard to the specific crime in question, it is important to keep in mind that these principles have evolved in the context of specific crimes. The rules that judges have chosen have thus inevitably been influenced by judicial attitudes toward the crimes in question. Criminal law, after all, is a form of regulation; when it is applied in a business context, criminal law is a form of economic regulation. To properly apply and develop these rules the overall economic regulatory environment from which the rules emerge must be understood. The chapter begins by reviewing the historical setting in which the modern rules governing entity criminal liability first developed in the United States. Next, the chapter explores the basic rules for entity liability; in addition to exploring the requirements of the “Black Letter Rule” on entity criminal liability, the chapter sets out a legal framework for dealing with the complexities of modern crimes committed in an organizational setting. The third part of the chapter deals with the legal position of the human actors in these cases-the employees who performed the acts in question, their direct supervisors, and those within the enterprise who direct policy (or fail to direct it). The fourth part of the chapter focuses on the prosecutorial policies regarding entity liability that the U.S. Department of Justice is currently following in the exercise of its prosecutorial discretion. Included in this part is a discussion of the use of non-prosecution and deferred prosecution agreements. The chapter concludes with some observations on the future direction of corporate and managerial liability. In today's very complex business and deregulatory environment, there are tremendous pressures to use the criminal law in more innovative ways to deter business conduct that produces unacceptable results. These pressures are particularly intense when manufacturing defects or unsafe working conditions result in deaths or cause extreme environmental harm; but the pressures are also strong when financial manipulation causes major economic harm. These pressures not only create the potential for expanded criminal liability but also provide an opportunity to reexamine the relevance of certain defenses. Thus, this chapter places some emphasis on emerging theories of liability and on those government and defense arguments that could find more ready acceptance in the context of business crime than they have in the context of street crime.
Source Publication
White Collar Crime: Business and Regulatory Offenses
Source Editors/Authors
Otto G. Obermaier, Robert G. Morvillo, Robert Anello, Barry Bohrer, Betsy H. Turner
Publication Date
2017
Recommended Citation
First, Harry, "General Principles Governing Criminal Liability of Corporations, Their Employees and Officers" (2017). Faculty Chapters. 608.
https://gretchen.law.nyu.edu/fac-chapt/608
