The average joe would be in jail or face a heavy fine if they are caught doing illegal activities like tax evasion or stealing. Corporations on the other hand perform illegal activities like tax evasion, fraud, wage theft or price fixing on a MUCH larger scale, MUCH higher impact to the society, and higher frequency, yet they almost always get away with barely a slap on the wrist (i.e. a laughably small fine which is less than pocket change, and zero consequences for the c-suite). Is it because it’s easier to prosecute individual average joe’s as opposed to multiple billionaires who probably has connections with the justice system and government?
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People are answering on here as if they’ve never heard of a “corporation friendly court district” where corporations pay millions of dollars to have their court case heard in a very specific district of a state that has nothing to do with the charges all because the judges have proven that they will always side with a company.
the whole point of corporations is to create legal buffer between owners and employees and the law. Individuals break the law, like employees if they steal company resources will be arrested. Corporations break the law and no one gets arrested even for theft like wage theft because they were just working for a company and following company procedures.
It’s harder to arrest a corporation than it is to arrest a person. The worst that the government can do to a corporation is seize its assets and legally dissolve the corporation or at least force it to stop operating in that country. (Arresting the employees and/or shareholders is a different matter and sometimes legally tricky.) Corporations can hire corporate lawyers who can either negotiate with the government or force the government to go through the court system to make its case.
For all intents and purposes, having an excess of $100 million USD effectively means you have infinite resources. And when you do something illegal, if the victim either has too little capital or attention, you basically buy the “Get out of Jail” card. Sure, you pay half a million to settle, or a quarter million to drag out the court proceedings ad nauseum, but to you, that’s anywhere from 0.3%-0.5% of your company’s value (which is made up of all the current cash & assets plus the perception that you’ll generate truckloads of revenue).
Sadly, this is another reason why post IPO corporations with fund managers running the Board is a problem. To them, hurting the average person is no worse than stepping on a bug. Sure, you get gross stuff on your shoes, but it’s a trivial annoyance compared to the victim’s loss of life. It’s all about maximizing revenue, and when bad things happen, you just shrug, say “Shit happens”, and focus on making the problem go away rather than atonement.
The other challenge is that in the U.S., corporations are treated as quasi-persons. In one way, this makes life easier because you don’t need to worry about different laws for the same set of circumstances; you don’t need to worry about the law affecting a tiny business differently than a big business. But, they’re not. *Ultimately no one is liable.* The Board, Officers, and Executive Team might play the aforementioned legal games, but they individually never harmed anyone and it’s extremely difficult to trace any direct actions to them because businesses have certain “information” protections (i.e., “Trade Secrets”).
As I said before, “Corporations are People” doesn’t work. Ultimately, they’re a fundamentally different beast whose objective is to just farm captial from the populace. I’m not saying every busniess is bad and greedy. But, when you’re told, “Hey, here’s a bucket of money. Go tell this group of people what to do with it. Your responsibility is to double the bucket in two years.” Well… you can’t help but detach yourself from reality.
**TL;DR**: If your business is big enough, it’s a giant among hobits. And whoever controls it is often mandated to focus on abstract objectives instead of real-world consequences. To thwart this, the laws need to change in the U.S., but I doubt that’s going to happen any time soon.
Because usually for businesses they can’t exactly just arrest the whole company. they usually just end up charging them some huge fine and the business just pays it and moves on with their day.
Corporations don’t commit crimes. Individuals do.
If a few people on the board are committing tax fraud on behalf of the company, is it fair to punish the shareholders who did nothing wrong and simply own shares? Or the people who just work there?
The problem is, there’s “diffusion of responsibility” No individual has done anything overtly wrong that a punishment for them makes sense.
1st way is that nothing illegal was actually done. “Innocent until proven guilty” does not apply to the media. They are quick to bash big corporations because it makes headlines. Even if the business gets accused of something the media will report it, then it is found that no laws were broken the media won’t say anything.
2nd reason is in house counsel.
It’s easier to prosecute individuals than companies who have a team of accountants working to do all the loopholes they can. I can assure you the majority of people who make money in cash or stealing from the government as well. I don’t know anyone who reports all their cash tips to the IRS. Similary all the people who have a small business or who do farming can abuse all the loopholes as well that you would say they’re doing illegal activities too.
Your premise is wrong. Individuals get away with illegal activities such as tax evasion all the time. Probably more often than corporations.
To put it simply, time and money.
It’s a lot easier to incarcerate an individual for something they did than the CEO of a major company, because that CEO have the lawyers that are amazing at dragging out court dates and legal battles, which increases the likelihood of the prosecuting and investigative bodies making a technical mistake that the CEO gets off the hook for. The individual person doesn’t have that legal backing, so it’s a lot faster and easier, which costs the tax payers less money at the end of the court battle.
Also, there are ways the legal team can say that the CEO is providing a significantly higher good than the evil he is charged for, which can reduce the sentence.
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