Why are corporate fines for shady or illegal business practices so often less than the amount they made by doing those illegal practices? At that point, don’t the fines just become a cost of doing business?
Specifically thinking about Perdue Pharma. PBS article says they made $35billion pushing opioids, but the current court case is only seeking $6billion on fines. Ignoring the Sackler’s immunity request, this is still a net win.
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The laws were often written at a time the fine amounts were actually punitive. The laws were not written as the fines being a portion or profits or revenues.
>At that point, don’t the fines just become a cost of doing business?
If they make more money from breaking the law than the fine, then it is not a fine, it is the cost of doing business. In practice, that means for most large corporations, fines are just that.
It doesn’t help that often no one (who actually matters in terms of changing corporate behaviour) is held accountable either. There are exceptions, but often, some “expendable” employees will be the ones fired/scape goated. It was the fault of “rogue engineers”, “rogue scientists”, “bad accountants”, etc. and never of the C. suite or board of directors. Do keep in mind that having good ways of holding people accountable is not necessarily simple.
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