by Russell Mokhiber and Robert Weissman
This a well written piece by the authors of, "Corporate Predators: The Hunt for MegaProfits and the Attack on Democracy. They speak of the "fungibility of responsibility. That catchy.
EXCERPT BEGINS
-Caveat Lector-
Multiple Corporate Personality Disorder
by Russell Mokhiber and Robert Weissman
We hate to sound like your parents, but people must take responsibility
for their actions.
Steal from the grocery store, go to jail.
Double park, pay the ticket.
But why doesn't this simple principle apply to corporations and their executives?
As of this writing, of all of the corporate crimes committed that have
cost the United States hundreds of billions of dollars over the past
couple of years, only two top level executives are in prison.
That's it -- two.
Now, ask yourself, if working class people committed crimes that cost
the nation hundreds of billions of dollars -- inconceivable as it is --
how many would be in prison? The whole lot of them.
So, how is it that corporations and their executives get away with it?
It's the nature of the beast.
And perhaps that's why we should consider doing away with it -- the
corporation that is.
After all, if a corporation means a legal structure to allow human
beings to get away with wrongdoing without paying a price, then it's a
machine that produces injustice.
Let's say that a corporation is caught fixing its books, committing in
effect a $2.7 billion fraud. That would be a case very similar to the
case of HealthSouth.
Under U.S. federal law, if a health care corporation is convicted of a
serious crime, that company can no longer do business with the
government, in this case the Medicare and Medicaid program. And in
HealthSouth's case, that means life and death.
So, the company hires one of the nation's best corporate crime defense
attorneys -- Bob Bennett and says to him, "Save us from the corporate
death penalty."
And Bob goes to the U.S. Attorney prosecuting the case and says, "Hey,
look, we blew it, here's my phone number, we'll give you everything you
want. Just don't indict us. Please don't indict us."
And the U.S. Attorney indicts 16 top executives. And the company is on
the road to getting off scot free.
That's one way a corporation morphs to get out of accepting
responsibility for its sins -- blame the human beings.
But sometimes, the corporate executives say, "Hey, we don't have to take
the heat. Let's cough up a defunct subsidiary to plead guilty -- and the
government can ban that unit from doing business with Medicare. Who
cares about a defunct subsidiary? That unit never did business with
Medicare anyway."
So, there's a guilty plea, there's a corporate fine, there is a touch of
adverse publicity -- but nobody's hurt. Crime without punishment.
Or let's say that the corporation wants to plea to a lesser offense, but
not draw any publicity to the case. This too happens. The corporate
lawyer can go to the Justice Department and cut a deal where the
Department will agree not to put out a press release about the case. A
number of criminal defense lawyers have told us they have done this.
The Justice Department issued a memo earlier this year titled "Federal
Prosecution of Business Organization."
The memo gives prosecutors discretion to grant corporations immunity
from prosecution in exchange for cooperation.
These immunity agreements, known as deferred prosecution agreements, or
pre-trial diversion, were previously reserved for minor street crimes.
They were never intended for major corporate crimes.
In fact, the U.S. Attorneys' Manual explicitly states that a major
objective of pretrial diversion is to "save prosecutive and judicial
resources for concentration on major cases."
Since the memo was issued, there have been a rash of deferred
prosecution agreements in cases involving large corporations, including
a settlement with a Puerto Rican bank on money laundering charges and a
Pittsburgh bank on securities law charges.
And some corporate crime defense attorneys believe that it is possible
to enter these agreements with the Justice Department so as to avoid any publicity.
"This is a favorable change for companies," said Alan Vinegrad, a
partner at Covington & Burling in New York. "The memo now explicitly
says that pre-trial diversion, which had been reserved for small,
individual, minor crimes, is now available for corporations."
Vinegrad said that while there have been a handful of publicized
pre-trial diversion cases by corporations, it is conceivable that the
Justice Department can cut these kind of deals with companies without
filing a public document -- and therefore without any publicity to the case.
Harry Glasbeek is a professor of criminal law at York University in
Toronto. He has studied corporate crime and written a book about it
called Wealth By Stealth: Corporate Crime, Corporate Law, and the
Perversion of Democracy.
Glasbeek says that the creation of the corporation allowed for this
"fungibility of responsibility."
"Sometimes the executives plead the corporation to relieve the
executives from responsibility," Glasbeek told us recently. "Sometimes
the corporation causes the executives to plead, a couple of people take
the fall. And it is very difficult. We have created a separate entity
with separate property. So, you have multiple personalities with
different legal duties and rights that the actors are allowed to take on
at any one time. That allows a shifting of responsibility that we cannot control."
We call it Multiple Corporate Personality Disorder (MCPD).
Glasbeek says this disorder undermines our notion of responsibility,
which "supposedly depends on the individual taking responsibility for
his or her own actions."
"What we have designed is a creature that allows that responsibility to
be shifted at the whim of those people who are actually operating that
system," Glasbeek said. "That's an endemic design flaw."
Glasbeek has no illusions that criminal prosecution will bring corporate
criminals to justice.
"My notion of prosecuting more often is to bring attention to this
embedded difficulty -- it is not because I believe that this will
actually change the situation in and of itself," he said.
We believe that justice can be done -- and must be done. But only two
things work in bringing justice to corporations.
One is to criminally convict the corporate criminals and apply the death
penalty in cases of serious wrongdoing.
And the other is to criminally prosecute high-ranking corporate
executives who commit serious crimes and throw them in prison.
EXCERPT ENDS link is to site of Russell Mokhiber. Robert Weissman has a site at: http://www.multinationalmonitor.org
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