By John Hasnas
Given that Enron's cave in in 2002, the government has stepped up its crusade opposed to white-collar crime. during this well timed publication, John Hasnas finds how the government's attempt to implement criminal principles has created a Catch-22 felony setting during which businesspeople needs to both act unethically or illegally.
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Additional info for Trapped: When Acting Ethically is Against the Law
I]t would be difficult indeed, and to no purpose, for the government to have to take issue with elaborate factual and theoretical arguments concerning who, why and what went wrong. . 44 In addition to public welfare offenses, Congress authorized and the courts endorsed the imposition of substantial criminal punishment for regulatory violations resulting from ordinary, as opposed to criminal, negligence. This development has allowed the criminal prosecution not only of employees who are themselves negligent, but also of their supervisors.
1 The Organizational Sentencing Guidelines are designed to govern the sentencing of corporate entities convicted of violating federal law. ’’ Although the guidelines are complex, the aspects that are relevant to our present concerns are reasonably straightforward. 6 Three of those factors are of particular relevance to our present consideration. 8 And the third is the mitigating factor for cooperation, which deducts five points [i]f the organization (A) prior to an imminent threat of disclosure or government investigation; and (B) within a reasonably prompt time after becoming aware of the offense, reported the offense to appropriate governmental authorities, fully cooperated in the investigation, and clearly demonstrated recognition and affirmative acceptance of responsibility for its criminal conduct.
This development has allowed the criminal prosecution not only of employees who are themselves negligent, but also of their supervisors. 46 The roadmaster, who was charged in keeping with ‘‘the stated policy of prosecutors in the past several administrations to seek to hold liable the highest level culpable officials of an entity that commits [white-collar] criminal violations,’’47 appealed, arguing that the government had to prove criminal, rather than ordinary, negligence. ’’48 Finally, consider the recent creation of new ‘‘secondary’’ offenses, which consist entirely of actions that make it more difficult for the government to prosecute other substantive criminal offenses.