Explainer: Why and when are companies subject to criminal liability?

Explainer: Why and when are companies subject to criminal liability?


New York (AP) — A lawyer representing former President Donald Trump’s company says the District Attorney Manhattan will ask a state grand jury to prosecute the Trump organization for an investigation that includes fringe benefits paid to employees. He says he believes.

They do not expect Trump himself to be prosecuted at this stage.

Billing a business entity rather than an executive is not unprecedented. State and federal prosecutors have a long history of criminal accusations against businesses for much the same reasons that individuals are prosecuted.

Criminal accusations can result in fines and fines (sometimes billions of dollars) and can change the way businesses operate. And in some cases, they can lead to business destruction.

It can also be used to encourage corporate cooperation with individuals who violate the law or to send a message to the industry that corporate crime is unacceptable.

What charges are being considered?

The grand jury procedure is confidential and the Manhattan District Attorney’s Office declined to comment. However, Trump Organization lawyer Ron Fishetti told The Associated Press that prosecutors are interested in benefits paid to some corporate executives, such as free use of cars and apartments and payment of school tuition. He said there was.

It’s not uncommon or illegal for a company to give such benefits to important executives, but in some cases these benefits may be counted as tax revenues.

If an employee does not pay income tax on these benefits and the company recognizes it and takes steps to help the person evade the tax, it may be illegal.

Former Republican presidents say he hasn’t done anything wrong and has been unfairly targeted by Democrats to politically undermine him.

The Trump Organization is a vast entity with executives overseeing hundreds of companies and partnerships that manage real estate, licensing and hospitality companies around the world. These range from golf clubs to the luxurious Trump Hotel Washington.

Why do you charge the company instead of the person who runs the company?

Pursuing individuals is often a priority for prosecutors seeking to stop illegal activity within the enterprise.

However, prosecuting a company may be able to accelerate change within the industry and force prosecutors to work together to help track certain people.

Prosecutors may also find that other businesses, businesses, their employees, and the general public have been harmed by the illegal activities of an organization.

Why are companies not prosecuted more often?

Prosecutors may hesitate to do so because they can harm innocent employees and other businesses.

For example, simply announcing a complaint against a company could close the company and cause people to lose their jobs.

How does the prosecutor decide whether to charge the company?

One of the biggest reasons to prosecute a company is the discovery that illegal activity is so widespread and widespread that it is difficult to treat without criminal accusation.

Also, consider: how bad people are doing and what companies have done to stop it.

Companies often decide to work together to avoid prosecution, identify and expel the offender, and suggest ways to prevent future criminal activity.

Prosecutors may be prosecuted if the company decides not to cooperate and resists making changes.

Is the company prosecuted frequently?

Not as much as people. However, being prosecuted can be costly to the enterprise, if not catastrophic.

In 2013, BP pleaded guilty to manslaughter and agreed to pay a record $ 4 billion fine and fine in connection with the 2010 deadly explosion on a Deepwater Horizon drilling rig. The explosion killed 11 workers and dumped 134 million gallons of oil into the Gulf of Mexico. The spill, in turn, polluted the beach, killed hundreds of thousands of marine animals, and ruined the tourism-based economy from Louisiana to Florida.

In 2016, a federal judge approved the settlement of a civil proceeding that cost the company more than $ 20 billion. The Justice Department called it the largest environmental reconciliation in US history and the largest civil reconciliation in history by a single organization.

BP’s prosecution is as steadily reduced corporate prosecution after 85,000 workers lost their jobs when Chicago-based accounting firm Arthur Andersen was convicted of a criminal offense in 2002. Occurred after being seen. Eventually, the US Supreme Court overturned Arthur Andersen’s conviction.

In a 2014 speech, U.S. federal prosecutor Preet Barara of Manhattan at the time said JPMorgan Chase related to Bernie Madoff’s massive fraud, a jury verdict against the Bank of America for reckless mortgage lending practices. Cited the results of corporate prosecutions, including postponed criminal charges and postponed charges against And Company, which to plead for guilty by SAC Capital in the case of rapid acceleration of some vehicles and unprecedented insider trading. To Toyota Motor Corporation in relation to how it dealt with.

“We are becoming more and more skeptical and more and more skeptical of the breathtaking claims that big and small businesses have catastrophic consequences,” Barara said. “Effective deterrence sometimes requires an institution to be punished because it is a failed institution.”

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