September 9, 2011

Sample Criminal Liability of Business Corporations

Criminal Liability of Business Corporations

Criminal liability among business people give a bad impact to those committed the crimes in the industry. Many criminal activities in the business world caused many managers to lose their jobs and investments as well. It also results them to having difficulties of acquiring another jobs from the other companies. Similarly, high ranking officials and company high level managers tend to lose their human capital investments such as their work track record and skills. Aside from loosing firm- human capital resources; managers of insolvent companies suffer bad reputation in the business world. And, the tendency, no firm or client will believe or transact business with them. And, the worst thing is, even the employees who are not involved in the criminal liability in the corporation will be stigmatized by the business society. They will certainly have tough times to justify themselves as well as they will be having difficulties of finding better jobs in the industry. Moreover, there are many high ranking employees in the business who apparently involved in criminal activities such as bribing government officials, price fixing, defrauding consumers just to be able to increase their profits. Relatively, there are many business owners who taking huge risks just to remain their business liquid all the time. More often, this kind of issue leads to conflicts among owners, managers and stockholders. If the company falls down, the managers often lose their jobs. On the other hand, the shareholders in the company will be promised by the owner to have reorganization and, receive securities if the reorganization of the corporation will turn out a success. And, the companies which are convicted of a crime can lose their whole investment. Particularly, those companies that are convicted with government fraudulent acts and crimes will lose their accessibility to government business transactions. A latest study shows that corporate offenders were formally suspended from doing business with the government. The rule of thumb is that finding a new job takes one additional month for each additional $10,000 increment in salary previously earned by a manager. Criminal acts by any organization will lead to total bankruptcy.


Criminal liabilities of business corporations refer to the person who is liable for the vicarious criminal acts or omissions in a regulating corporation. In this case, there are civil laws such as injunction and payment and penalty for damages that he or she causes other party. Normally, criminal sanctions may include imprisonment, fines and community service orders from the government. In many cases, involved persons in the companies are not sent to jail, when fine is being paid. And, as long as the owner, will pay the employees’ wages and salaries, as well as the available existing profits to all shareholders of the company. The fines paid for the criminal charges, will be deducted to the total amount that will be paid to the entire workforce and shareholder of the organization. In compliance to the criminal law, formal public disapproval and condemnation; due to failure to follow the rules of law as socially accepted and codified. In this connection, police investigation can be done, however the availability of relevant capability will be restricted. With this case, prosecution will be reinforced , and respected business leaders who are liable for the charges will be called in the court, The result of the court hearing will affect greatly on the corporation’s name and reputation; as well as it will lead to a total loss of profitability in the business. Furthermore, in order to overcome the higher burden of proof, many rich companies pay their apparent fines without any effort in their part. This is in contrast to the not so affluent and stable companies that may lead to closure or bankruptcy, if they will pay the whole amount of fines charged to them by the court. However, bankruptcy protection can be availed prior to the sentencing. If the state turns always to the criminal law, it discourages self- ruling and can lead conflicts between any regulatory agencies and companies that they are regulating. The jurisdiction uses criminal and civil judgment. Political judgment is mostly used, in order to optimize the publicity of many corporate criminal cases. There are other criminal liabilities among corporations that are being proven less serious offenses. If a person or employee is found guilty of criminal acts, what ever he speaks or acts is always reflects to the company and the entire work force. Subsequently, vicarious liability does not require any proof whether he or she knows the criminal conduct. The criminal law against Business Corporation’s liability does not accept any excuse of honest and reasonable mistake.





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