How Fines Became "The Cost of Doing Business"
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- Опубліковано 29 вер 2024
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In 2012 the Hong Kong, Shanghai Banking Corporation best known simply as HSBC was charged by authorities for aiding and abetting the operations of some of criminal cartels between the US and Mexico.
Corporate personhood is the legal notion that corporations have many of the same legal rights and responsibilities enjoyed by natural flesh and blood people. They can own property, sue and be sued, donate to political campaigns, and even have defended religious beliefs…
… but if a normal person was found laundering money for cartels and the North Korean Nuclear Program, they would be living it up, here in ADX Florence IF THEY WERE LUCKY.
HSBC on the other hand still operates across the world, and their punishment for these crimes would be like a normal person getting a fine for roughly 2 months of their wages…
So if corporations are legally people… why can’t they be arrested?
If companies see fines as “just the cost of doing business” what reasonable punishments are there for organizations that break the law which DOESN’T just end up punishing innocent employees and the wider economy more than it does the people with actual discretion over how these companies act?
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Commentaries on the Laws of England: Book I: Of the Rights of Persons
By Sir William Blackstone:
IV. We come now, in the last place, to consider how corporations may be dissolved. Any particular member of a corporation may be disfranchised or lose his place therein, by acting contrary to the laws of the society or the laws of the land; or he may resign it by his own voluntary act (f). But the body politic may also itself be dissolved in several ways-which dissolution is the civil death of the corporation: and in this case their lands and tenements shall revert to the person, or his heirs, who granted them to the corporation; for the law doth annex a condition to every such grant, that, if the corporation be dissolved, the grantor shall have again the lands, because the cause of the grant faileth (g). The grant is indeed only during the life of the corporation, which may endure for ever-but when that life is determined by the dissolution of the body politic, the grantor takes it back by reversion, as in the case of every other grant for life.] The debts of a corporation aggregate, either to or from it, are totally extinguished by its dissolution (h); for it has no longer a corporate character in which to sue or be sued, and as during its existence the members of it could not recover or be charged with the corporate debts in their natural capacities, so neither can they when it has ceased to exist.
A corporation may be dissolved-1. By the loss of such an integral part of its members as is necessary, according to its charter, to the validity of the corporate elections; for in such cases the corporation has lost the power of continuing its own succession, and will accordingly be dissolved by the natural death of all its members (k). 2. [By surrender of its franchises into the hands of the sovereign, which is a kind of suicide. 3. By forfeiture of its charter, through negligence or abuse of its franchises; in which case the law judges that the body politic has broken the condition upon which it was incorporated, and thereupon the incorporation is void (1). And the regular course, in such case, is to bring an information in the nature of a writ of quo warranto; to inquire by what warrant the members now exercise their corporate power, having forfeited it by such and such proceedings. The exertion of this act of law for the purposes of the state, in the reigns of King Charles and King James the second,-particularly by revoking the charter of the city of London,-gave great and just offence; though perhaps, in strictness of law, the proceedings in most of the cases that occurred were sufficiently regular. But the judgment against the charter of London was reversed by act of parliament after the Revolution; and by the same statute it is enacted, that the franchises of the city of London shall never more be forfeited for any cause whatever.
Commentaries on the Laws of England: Book I: Of the Rights of Persons
By Sir William Blackstone:
IV. We come now, in the last place, to consider how corporations may be dissolved. Any particular member of a corporation may be disfranchised or lose his place therein, by acting contrary to the laws of the society or the laws of the land; or he may resign it by his own voluntary act (f). But the body politic may also itself be dissolved in several ways-which dissolution is the civil death of the corporation: and in this case their lands and tenements shall revert to the person, or his heirs, who granted them to the corporation; for the law doth annex a condition to every such grant, that, if the corporation be dissolved, the grantor shall have again the lands, because the cause of the grant faileth (g). The grant is indeed only during the life of the corporation, which may endure for ever-but when that life is determined by the dissolution of the body politic, the grantor takes it back by reversion, as in the case of every other grant for life.] The debts of a corporation aggregate, either to or from it, are totally extinguished by its dissolution (h); for it has no longer a corporate character in which to sue or be sued, and as during its existence the members of it could not recover or be charged with the corporate debts in their natural capacities, so neither can they when it has ceased to exist.
A corporation may be dissolved-1. By the loss of such an integral part of its members as is necessary, according to its charter, to the validity of the corporate elections; for in such cases the corporation has lost the power of continuing its own succession, and will accordingly be dissolved by the natural death of all its members (k). 2. [By surrender of its franchises into the hands of the sovereign, which is a kind of suicide. 3. By forfeiture of its charter, through negligence or abuse of its franchises; in which case the law judges that the body politic has broken the condition upon which it was incorporated, and thereupon the incorporation is void (1). And the regular course, in such case, is to bring an information in the nature of a writ of quo warranto; to inquire by what warrant the members now exercise their corporate power, having forfeited it by such and such proceedings. The exertion of this act of law for the purposes of the state, in the reigns of King Charles and King James the second,-particularly by revoking the charter of the city of London,-gave great and just offence; though perhaps, in strictness of law, the proceedings in most of the cases that occurred were sufficiently regular. But the judgment against the charter of London was reversed by act of parliament after the Revolution; and by the same statute it is enacted, that the franchises of the city of London shall never more be forfeited for any cause whatever.
Fun fact: in America corporations have even more rights than citizens, like being able to buy machine guns manufactured after 1986.
Please don't replace a sustainable natural loofah with one of these plastic things.
Yes. If corporations are going to insist they’re people, they should “enjoy” the consequences of their actions.
I would start supporting capital punishment 😅😅😅
_No pun intended_ 😅
I've said it before, we need to pierce the corporate veil when fraud is involved.
@@WanderingExistence Came here to say this. If a company’s actions result in death of humans, and this is found to be willful, then they should be eligible for capital punishment.
Wouldn't executives be accessories to the crime?
this!!!
Any rule where punishment is monetary is just poor tax.
if you must do a fine, it should be a percentage of your yearly income / gross profits
Legal for a price
A "cost of doing business" is the phrase often used.
@@ohiasdxfcghbljokasdjhnfvaw4ehr
That still won’t work as flat taxes are still regressive and favor the rich. 10% of $200 can be way more impactful than 10% of 2,000,000 despite the latter being 10,000 times higher.
"If the penalty for a thing is a fine, that thing is only a crime for the poor"
Funny inside story about HSBC…
I was working with an employment agency who employed one of its formers directors as a coach - and that person was involved in my search for AML roles.
They explained that when the US Treasury fined HSBC it actually (excuse me if I translated wrong here) indebted HSBC that amount and “structured” that debt for the Bank. What this ended up meaning was that HSBC could only use the money it would have paid its director’s bonuses. Directors started dropping one after one, and this apparently made the burden on the remaining of them larger until they were paying the bank to work there. Only once they all got out that the Treasury only graciously let them pay with other means…
Don’t f!%$ with the US Treasury is the ‘long story short’ version of it!
That's actually quite interesting, so the people at the top were getting some sort of penalty even if it wasn't a on a level that could be seen as justice for the actual crimes.
So how I interpret this… HSBC was only fined the amount they paid in Directors bonuses. So to get around this, the Directors took early retirement (and they get a good redundancy payout!) So that HSBC had less and less of a fine to pay. I bet the Directors retired on a Friday and became a “freelance advisor” or “ambassador” that’s “sub contracted” by HSBC on the Monday.
If a company repeatedly and consistently breaks the law, the government should step in and claim the business. Keep it's doors open, but remove the needed personnel. Make the changes to get the company to comply, and then hire a new set of executive/management who won't make the same mistakes.
How would you sell that to the public though?
Yeah, the Feds firing people and cutting bloat. They're so good at that.
@@bojackhorseman4176 the public will get residual checks.
That's basically how they deal with banks that go under. This just broadens the horizons on our social insurance
Lol, heck, fing NO. Government, anything is worse and more corrupt.
With the case of wage theft for example, why do they have to go for the corporation as a hole? can't they go for the specific individual witch is responsible for those actions?
just because one is part of a group, it shouldn't be a justification to be invincible :/
This is covered with the idea of corporate obfuscation. HMW briefly mentions this idea in the section about the ability for corporations to defend their actions from outside prosecution.
We really need an app that has an executive blacklist, and if you try to buy things from a company who's employing someone on the blacklist, then it informs you it's blacklisted. This could be as simple as pointing a camera at shelves, it detects the brands, and then outlines them in red or writes "blacklisted" over it. You can then tap it and see what executive, and what company they were working for, and the crime committed and whether they evaded punishment or not. If obfuscation was used or someone was made a scapegoat, then all the executives are added to the list. If evidence comes out about which executive was responsible and it went to court and they were punished, then only the executives involved would be added.
Their perception of invincibility stems from the ease with which a corporation can distance themselves from a "bad apple" employee who commits something like wage theft. You did exactly that with your statement by asking why go after the corporations if you can just go after the "bad apples" that actually commit the crimes?
Ask yourself, what if the reason those bad apples got to do such things is because the company's corporate policies and demands from investors created a culture that promoted and allowed it to happen in the first place? A corporation can easily just publicly fire a couple of people and wash their hands of the issue because they "dealt with it."
RICO was specifically invented to PREVENT organized crime from structuring their criminal liability like this. It's a terrible idea.
I love how we have to think about the companies so hard but when a family gets a fine (sometimes for things they didn't even have a hand in) it's "tough luck" pay up, even if it costs you your house. And then the companies fire/lay off people anyways... 🙃
12:34 I mean, I think we should just take their private company and make it public, but this is a start
The big issue causing so much misery for so many people now was again touched on in this video: Corporations being beholden to their shareholders above all else. Get rid of that, get rid of the power to siphon value off for essentially nothing put in, and you'll fix the majority of the problem.
The problem with any corporate punishment is that the people inside the corporation who made those decisions can still leave and conduct their business elsewhere possibly committing more crime in the process. Meanwhile they leave behind rank and file workers at the old corporation to face the wrath of whatever bureaucrat lands inside that boardroom. At some point, it's the government's responsibility to find the individual(s) responsible for corporate crime.
Considering the purpose in forming a corporation, it may be worth certain offenses voiding the corporate veil as part of the punishment.
What is dumb is that there is a clear middle ground; a fine that is so large that is not worth breaking the law but small enough that it wont make a healthy business collapse would work at preventing most law breaking.
I say we treat companies like people. So if the company commits crimes that would put a normal person in jail, fine. We give the C-Suite a choice. You go to jail and we impose a fine on the company, or we nationalize your company for the term of the sentence and replace you with our own people. If nationalization is not possible then the C-Suite just goes to jail and the company pays a fine. No more shielding those responsible for running the company. If the company was nationalized then when that sentence expires the company will be de-nationalized. So companies like HSBC won't necessarily be "taken down" but they will fall under new management, one way or another.
Fines should really be escalating tbh. Increased by 1000 % *EACH* time the same law is broken. Like: OSHA violation? 2000. Again? 20000. Again? 200000. Too expensive? Well, better start following the rules then? Similar with theft. Just apply treble damages. Bank steals 15 millions? Well, get ready to pay back 45 millions, instead of keeping 98 of the loot %.
I think companies that are publicly traded should be “fined” in shares; break the law and hurt people and 20% of your company now belongs to the government. This means that shareholders get hit for a significant chunk right off the bat as more shares exist so the shares they have are worth less, since the company is beholden to the shareholders, they now have a fiduciary responsibility to the government directly, and since shareholder value has been reduced by a significant chunk, C-suite people have a duty to avoid anything that would get them in trouble because it would reduce the short term gains they’ve been trained to maximize. Of course, repeated fines would result in the company being owned by the government, so to reduce the probable misuse, there would have to be a specific branch restrained by specific rules to handle the influence of the shares owned by the government. Kinda like the dealer in blackjack, there would be specific actions proscribed for the handlers of the shares to take.
Some of these companies genuinely are “too big to fail.” The question should be: how did we let them get this way, and what can we do to break them up without disrupting regular people?
If these companies weren't in my index funds I would be outraged.
the richer a company gets, the less tax, wages, and legal settlement costs. You can only fail upward. Organizations don’t exist in a vacuum. If we continue to pretend the people in these organizations don’t deserves jail time, the system will keep working as intended
Corporate personhood shouldn't be a thing. Yes, they need to be able to enter into contracts and be able to enforce them via civil courts. Beyond that, not much. No political donations (conflict of interest right there). No PACs. No hiring of politicians leaving office. Basically get rid of the stuff that makes corporations seem to have more rights than natural people.
I like how a lot of these videos' solutions come down to "we need better regulation", which flies directly in the face of two of the three prevailing political ideologies in the U.S.
Corporations are people: people that too often spit in your food, stand up from the table, loudly fart, leave no tip, and leave as you sit there in their fouled atmosphere.
Damn, company parole officers, along with fines is actually pretty good idea. That said, personally I would just want both fines, and all decision makers, or controlling investors that can be proven to be responsible for a crime, be put in jail. Even if responsibility is distributed, and you can't give more than few months. Being put into jail is going to o be pretty impactful anyways. Especially if large number of people go there at once.
if fines are the best way, make repeat offenders fines exponentially higher, until they stop, first time, 1 million, second time 10, third 100, fourth 1B, etc(example), and check them more often to make sure they changed their ways or go bankrupt, their choice
How would they go about that... Like if a company is Imprisoned or dissolved what happens to the liability of the company
Maybe that's a stupid idea but wouldn't a fine payable in stocks protect the workers without giving impunity to the shareholders who ultimately make the decisions ? Moreover that is easily reverted by an appeal.
wells Fargo was under surveillance control of US regulator from March 2022 to Feb 2024. We see if having people on the inside makes any difference.
Removing the company’s charter sounds like a good first step. That should be the default, it’s up for the company to seek leniency during the trial.
The prosecutor coming out and saying he’s not going to prosecute to the full extent of the law from the beginning is a conflict of interest to plaintiff.
**The law is a deterrent not a chain.** If the fear of charter removal is always on the table it deters all future transgressions.
Fine comes out of executive bonuses. The reason for those bonuses is supposed to be motivation, right? And the reason why they're so large is because those are supposed to be the people in charge, right?
I would just ban private equity from acquiring certain businesses in certain industries like healthcare and establish minimum requirements for all facilities operating in life or death situations. That sounds like it would solve the problem.
If corporations are "too big to jail" and no punishment seems to lead to reform, then nationalization is the only solution for essential services. ; )
Yes, but instead of the company physically going to jail, it should be taken over by the state or federal gov (depending on the conviction) for the duration of the sentence. The gov would then be able to suspend the board and operate the company until the sentence is over, at which point the original owners regain control. Of course this should come with limitations such as the government cannot change the status of the company (like making it into a nonprofit or charity if its for profit, and vice versa), it cannot sell the business or acquire other companies, and most importantly, it has to operate the company with respect to its mission and vision. So things like appointing a temporary ceo and other temporary officers to run the business should be the standard. While this sounds like some kind of fascist or tyrannical system, you have to remember that the state currently has the powers to imprison and suspect certain rights of convicted criminals, so a similar system should exist for businesses. The idea of an incarcerated business being taken away from the owners temporarily would encourage shareholders to hold the executives more accountable for potential criminal behavior as well as enact safeguards to discourage illegal schemes.
putting people from government in the board of a company just creates an incentive structure to make companies partisan. not a good idea. the best solution is to beef up the judicial system and go after specific people with specific responsibilities that caused damage in the organization, there is probably no other way
8:30 they did break laws, overturning a conviction doesn't mean no laws were broken.
Yeah you are right bad wording on my part. I should have said “a company that wasn’t technically convicted of any crimes”
Some kind of threat of nationalization would do it. Or putting company leadership in jail.
Medical service organizations should be required to be organized as not-for-profit.
We are living in a dystopic oligocracy.
I love how corporations can just argue "but that could cost me money" in a courtroom and that apparently trumps everything
As HMW said in the video, too much, and it could cause them to go under.
If you wrongly execute an individual, only a (relatively) small number of people (the individual executed plus their close friends and family) are impacted. But if you wrongly shut down a corporation, you harm hundreds-if not thousands or millions-more, from shareholders (who also might have actually been trying to stop them from doing said illegal actions) who lose their investment to employees who lose their job (and possibly livelihood) to customers (who lose whatever the business was providing).
@@jwil4286 if they're killing people by doing what they're doing and that's the only way they survive then they have no more right to be an acting company than a mob and I don't think anyone would oppose shutting down the mob despite the loss of jobs for all the mobsters and the people who work for them or get great tips from them would they?
@@pedromoura1446 how many innocent victims of a wrongful prosecution would be too many to you then? Or are you saying that it doesn’t matter how many innocents and bystanders are adversely impacted by a wrongful conviction just so we can take down the bad actors?
@@jwil4286 how many innocent victims of a malicious corporation would be too many for you then? Or are you saying that it doesn't matter how many innocents and bystanders are adversely impacted by a malicious corporation just so some jobs stay open?
@@jwil4286 of course not. i'm not advocating for a "kill 1 person to save millions" situation but we dont even need to go there.
we ALREADY dont allow the mob to run unimpeded because imprisioning them would put jobs at risk do we?
And dont we fine people for speeding despite people's lives being sometimes at risk if they dont reach a place quick enough (like a hospital)?
we also jail people for stealing despite the majority of theft being done by people who were pushed to doing so because they NEED that money to survive dont we?
Should we allow premeditated murder if the murderer has a family to sustain?
without effective court rulling those very "innocent" people would also be forced into doing illegal things all day every day, and even causing death of others for the company's benefit having no choice in the matter other than starve or screw others which, in the case of the health and insurance companies, already reaches several thousand deaths each year in the US.
Are those not "innocent victims"?!
EVEN IN WAR there's crimes we CANNOT condone wateaver the cost, so why should companies get away with that logic as defence?!
rants aside..all of these have systems in place to protect the people that might suffer inadequately from systemic problems caused by the process of punishing someone who caused harm to others.
in first place a social security system which offers free professional oriented training should be a must even outside of this conversation.
secondly we're talking about a company. no matter how massive (ESPECIALLY IF it's massive) it's assets WILL be bought, even if only the physical assets, and some, if not most, of their employees maintained.
I can even give you a real example of a, somewhat, successful way to deal with these situations.
We had a massive bank go bankrupt due to negligence here in my country and what we did was separate the toxic assets from the non toxic assets by their market valuation, we left the bad assets with their old stakeholders and CEO's and nationalized the viable part of the bank which was then reestructured and those assets sold to the highest bidder.
Almost none of their employees lost their jobs as their local branch buildings were bought by other banks and the branch employees maintained by contract with the state, not that it was absolutely needed as the buildings still required to be crewed and maintaining and older and already trained staff was cheaper than training a new one.
The CEO's were then prossecuted by the shareholders for their mismanagement.
i say SOMEWHAT successful because the process was both rushed and some power moves were done in the middle which reduced the success.
outside pressure from the richer shareholders (which ended up with them still receiving some baillout money for a bankrupt company ) and a lot of retirees lost a lot of money after being scammed by that bank into investing their life savings in it (which was now mainly composed of toxic assets) and went knocking on the state's doors trying to recover their money instead of prossecuting the old bank's CEO's (banks have both a refund insurance of at least 50.000€ per person and CEO's have a mandatory insurance for mismanagement, which the bank pays by taking it from you in their account management rates so it was not the state's problem by this point. though their actions were at least partially justified as we had an ex-prime minister tell the country on the news that the bank was fine and people believed that lying prick).
BUT in the end the CEO's were still prossecuted, the richest shareholders responsible for mismanagement still lost money and people still kept their jobs so yeah...i'd say it's more than possible.
And of course this is not the end all of legislation for these things.
Companies (and ESPECIALLY banks) simply shouldnt be allowed to reach such massive sizes, and antitrust laws were already put in place before (by laissez faire economic liberals, like Bush Sr. of all people!) to guarantee economic stability and worked very well to guarantee economic stability, before being taken down by more neo-liberal thinking people (definition: people who think the state should not interfere in the economy but then need to have the state interfere in the economy constantly to save major companies because otherwise we get mass unemployement)
Companies getting too big are a risk for the economy, reduce competitivity, (thus increasing prices) and are harder to audit due to their enormous complexity thus their size should be capped. If they dont like it too bad...better THAT be the cost of doing business than constant unchecked illegal behaviour and whole societies going bankrupt trying to save something that built itself too large and now wants everyone to pitch in.
If a private company cannot be allowed to go bankrupt it shouldnt exist in the first place, that's the nature of a free market.
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How about nationalising the offending business? That is like death penalty for investors, so they will do all they can to avoid it. In the end if company still does that, gets nationalised and then state can sell it, recovering some of the damages back. A lesser punishment could be partial nationalisation, or fine equivalent to some amount of company value (say 30%) and jailing executives who have both failed to prevent it from happening and mislead investors about real business practices. In such case both investors would be incentivised to looks at what executives are doing more carefully and executives would be incentivised to be as transparent as possible.
it's a radical idea but it would get businesses to behave themselves and would heavily incentivise directors to keep a close eye on company management.
Depends on how you do the nationalisation. If you do a buyout it might actually be targeted.
That's only if you think governments are any better than corporations.
100% this, but also, the feds should stop doing free bailouts and instead only give money in exchange for controlling shares. If a business is "to big to fail", or "too important to the economy", then its too big and important to be privately owned.
@@agodelianshock9422 You are right IF the government is aiding and abbetting the corporations in violating the law by turning a blind eye (thanks to large campaign finance donations from them). IF not, then the corporations CEO and senior executives, would fear breaking the law.
I love how the excuse of "not wanting to destroy jobs," is used by an industry that does just that. Why are they immune from the same treatment?
It's because private companies are much better at PR than the government. In Australia the government wanted to introduce a mining supertax, which only affected companies earning ludicrous profits to a quantity of about 20c on the dollar.
Well the mining lobby ganged up in a PR campaign lying that this would hurt the average Australian & those poor miners (whose jobs were never at risk because again, super profits tax). Because the average voter is an idiot, the government was kicked out and the new government immediately scrapped the tax.
Basically this was a long way to say: don't underestimate the power money has in being able to brainwash the average voter.
@@m136dalie Nothing new about people voting against their own best interests. Over here in the states people voted to cap the pay out of tort suits so now you can get permanately disabled at work and the max payout you can receive after suing is 250k which is not enough money to support you for the rest of your life so its putting a huge burden on the rest of society while also protecting the interest of private corporations.
@@m136dalielet alone ties with lobbying
If companies are people then the people in charge should be denied the protections of incorporating.
The 'people in charge' must make decisions to benefit the shareholder; it is their very job and purpose. It is the shareholder that constantly demands a profit on their investment that is ultimately responsible. This is why I believe the very concept of 'investing' will soon be challenged.
Fair, but the whole concept of "corporate personhood" exists under the premise that it's impossible to prosecute every single shareholder for every crime the whole company may have committed. That said, there are instances where courts can "peirce the corporate veil" and prosecute individual executives directly and put them in jail. Regrettably, I don't know much about how this process works as of yet.
@DistrustHumanz Constantly getting the company sued or fined is not in the interest of the shareholders. Corporations are legally obligated to act in their interests of their shareholders, but they are also legally obligated to follow the law. If the two are in conflict, then "bringing value to shareholders" is not an excuse - that one must be suspended in the case of illegal or irresponsible activities.
@@jeffbenton6183 Corporations are not legally obligated to act in the interest of their shareholders, although it is usually a pretty good idea if you don't want to lose your job. The "interest of their shareholders" is a very nebulous term that can mean almost anything so legislating around that is impossible.
Criminal liability should be unlimited in "limited liability" corporations. It isn't currently.
You can't jail the corporation, but you should be able to jail the executives who made the illegal decisions. Also, what is and isn't illegal needs clear definition. Did a bank knowingly launder money for a cartel, or did the cartel set up accounts and the bank didn't have the security apparatus to sort out which of their clients were law abiding and which were cartels.
Private equity firms who destroy healthcare for profit.. are not breaking any laws. If America clearly writes out in law what is and isn't allowed by a private equity firm, that would be a useful first step.
Also, corporations are chartered by the state, so the state can also dissolve the corporation
Can't jail the corporation? Why not? Are you telling me a corporation is a fiction of law, an artificial being, intangible, invisible, incorporeal, existing only in consideration and contemplation of law?
Can't jail the corporation? Why not? Are you telling me a corporation is a fiction of law, an artificial being, intangible, invisible, incorporeal, existing only in consideration and contemplation of law?
It's the latter, the bank lacked controls, but banks are required to have those controls and negligence can also be prosecuted. Someone working at the bank was responsible for ensuring the bank had adequate controls, and auditors signed off reports saying they had adequate controls to prevent fraud.
@@matt69nice I think you are taking his example too literally. Of course if there are specific laws requiring specific action by the bank to prevent certain actions then the bank will be liable. Often that is not the case. I would not hold a bank liable for money laundering if they were not legally required to have protections against such actions.
If fines are the only punishment, then the fines need to be meaningful. Like, if the fine for a person would be a years income to the average person, it should be a years income for the company. If they can't pay it in cash, let the government take it in stock, if it takes a lot of stock, then the company is nationalised.
I think this last part is a good idea conceptually. There is a risk though that the circumstances of the company's conviction makes it a real dead weight as government asset. Which probably wouldn't be too popular with taxpayers (but still better than a bailout). I would say that for any such company that the government didn't want on as a going concern a second stage of 'managed decline ' should be legislated for where employees receive enhanced social security and re-skilling support.
I support nationalisation and socialisation
Companies, like governments, don't exist as a single entity. Only our minds make them so. They are organisations of individuals. If a company does evil, it did so because individuals in the company did evil, and must be punished.
Lol this just in, "your" gubment is a corporation (see: Chisholm v. Georgia, 1793 and Charles Boone's "Manual of Corporations").
Why can't it be both? It is what it does
So jail time for executives? Sounds good.
If the US govt committed war crimes, should all the US citizens be punished for that?
It’s not that simple. The ppl in the companies will be tied to contracts with legal repercussions if they don’t comply.
They don't want to risk wrongfully shutting down a company, but they are more than happy to wrongfully imprison someone for years, ruining their entire life going forward. Again, corporations are given special treatment.
They have the same rights they should pay their dam taxes and be charged as criminals if evidence is found to aided and abetted money laundering. Private equity is killing businesses and in extreme cases asset stripping of the assets.
Can i register myself as a "moral person" and act as if i were a faceless company with 1 employee? Then if i mess up i can say it wasnt me, it was the company 👀
Yes but with your company only having one employee it would be easier for the justice system to pierce the corporate veil (i.e. ignore the incorporation and pursue you personally).
@@matt69nice sadge :(
The right thing to do when a company breaks laws, is to do an _actual investigation_ and hold the individual people responsible.
Fine the company as an entity, only to pay back damages caused.
Imprison the employees and executives who were knowingly breaking the law.
This isn't complicated.
The problem is that rich people can pay off lawyers or threaten other members of the judicial system. There's also the black market: rich people can pay some criminals who don't fear dying or going to prison to do things to lawyers, judges, police officers, or just people they don't like.
Yeah, I've always wondered, why not jail the decision makers of the company? Like CEO's CFO's Majority stake holders, etc.
Mostly because those individuals have apparatuses behind them which prevent such actions. Sort of like how the head of America’s first central bank (decades prior to the Federal Reserve) refused a direct order from President Andrew Jackson. Andrew Jackson thought that his position as President, where surely he could just order the military to arrest the head of the central bank, but he couldn’t, for complicated power politics reasons related to Congress writing that bank into law and having a lot of allies in Congress.
@@evannibbe9375Andrew Jackson Btfo. Central Bank +1
Because they have plausible deniability, lawyers and aren't like James Bond villains.
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How about a floating fine, "all net profits for X years." All money earned above operating costs must be turned over to the US government and any change in operating costs must be audited by a financial team to ensure they're not just trying to shift money. A company will find their stock crashing if investors know that not only will there be no dividends but the company is not legally allowed to turn a profit as part of their punishment. Also have the punishment roll upwards, if a company commits a crime not only should it be held liable but any parent companies can as well. Should the company fail during the punishment then the profits they've turned over are used to create projections for what they would have paid and is levied as a fine on the liquidated assets of the company.
Money raised in this way could be used to settle any injured parties first, then perhaps focused on encouraging creating new businesses and growing small ones through different programs.
And the US government will funnel most, if not all, that money to different gigacorps in the M.I.D.
This video reminds me of a documentary movie from 2003 called "The Corporation" that studies the criminal behavior of corporations. In this documentary it is also mentioned how corporations, if they were actual people, would check every personality trait associated with psychopathy.
I would love to see this channels take on what that documentary says.
To be fair, that's any large group of people that feel somewhat immune from the consequences of their actions. Be it the government, an angry mob, etc. It takes 1 large group to keep another large group in check.
I had worked as a contractor for a company for two years.
Ended up going back to school. Summer rolls around and they need assistance, so I start contracting again for the summer.
An overtime situation comes up that I have been paid overtime before to work the shift required.
Work the shift, supervisor won't approve overtime "that's not overtime eligible because xyz reason"
Me - Ok, but it was before, nothing has changed, and I sure as shit wouldn't have worked it if it wasn't OT eligible
Them - Oh well
Me - Lol kbye, have fun paying overtime the next 6 months while doing the mandatory training for the new hire
I've said it before and I'll say it again: Private equity ruins everything. First step is heavy regulation of that industry.
2008 was caused by publicly traded companies
Come to think of it, private equity is kind of like war in that regard.
It's great for the economy... until it spills out onto your own territory and starts ravaging your vital infrastructure.
It doesn't ruin _everything,_ but it ruins enough stuff to be a noticeable problem.
Most businesses aren't robust enough to constantly maximize shareholder value, so they don't go through the IPO process.
Circumventing that and bringing the company into the public sphere through an intermediary might look like free money with no obvious drawbacks, but in the long term it just exposes you to the same risks as a publicly traded company.
@@tomlxyz He didn't say that private equity is the reason behind everything bad. He said that private equity ruins everything it touches.
If we're going to insist on fining these offending companies, then we cannot allow them to account for them as "business expenses." The solution? Make the fines astronomical AND have the payments come from the top officers and investors first! Those golden parachutes won't look so tempting if they're used to pay off fines caused by bad practices, and investors will demand better behavior from their investments
Fines aren’t deductible
@@badart3204 I know that, but most big companies have profit set aside to handle any legal matters that crop up. It's factored into their budgeting
Fine the company in terms of market cap and make the shareholders pay based on the value of the shares they hold. If you had 50 shares worth $100 each, and the company got fined 10% of market cap, then you owe the government $500 to cover the company's fine.
Just seize company assets when they step outta line. Like the other guy said nationalizing them would make sense.
e.g. we all pretty much have the same idea what happened to certain whistle blowers of a certain company that buildw aeroplanes.
If they're guilty, the investors should be told to f off and the government just takes over. Board can go to jail too.
Intellectual property should be absolutely seized, it's why these companies are so big to begin with. Seized IP should be public domain.
That's (about) the dumbest thing. Company assets are the assets of shareholders, and shareholders are the public. Grammas with retirement funds.
Nationalization is the dumbest thing period. Govts are inefficient at handling everything. Only critical infrastructure like a bank, or railways should be nationalized.
You can go to jail too by this logic.
And what's wrong with that? We need to stop acting like corporations and rich people don't need a heavy hand to stop them from abusing their authority and influence.
😂 trump is big and still not in jail. If it were any commoner they would be sent to jail within seconds
Ah yes, private equity firms. The house flippers of the corporate world. Where would we be without them? Oh yeah, the future.
Parole officers for corporations is such a good idea. One such entity is already dropped on Infowars. Which means we not only have the will, we also have the precedent for the means.
No.
@@MatterMadeMootYes corpo shill
Y..yes..? Why isn't this already a thing..? If a company does something illegal, there has to be tons of people in that decision-making process, and that means they need to be treated like PEOPLE. Cus they are??? A company is literally a bunch of people..
It's great to see a UA-cam video where people are coming up with actual solutions rather than just ranting about the problem
I have an idea. Put the c suite in jail since they did the crimes. Strip the shareholders of everything since they're the owners and the buck stops with them, and then run the company at cost, providing better prices for consumers and better wages for workers. We're just not generating surplus here. Operate this way for however long they were sentenced, and afterward, there can be a new public offering where shares can be sold, and the workers get even more!
so if your 401k includes shares in said company your shares just evaporate out of your retirement fund? that will go over really well.
@@ronblack7870 You shouldn't put more money in one business than you can afford to lose.
@ronblack7870 It'd be an incentive for shareholders to ensure those running their business are following the law. But perhaps there is a carveout for employees. At the same time those still working there are getting a substantial raise since the c suite and the shareholders won't be sucking most of the value out of their work.
Giving corporations the rights of individuals was the single dumbest decision this country ever made. This happened in the 70’s and you notice that is when all the wage issues and political divergences from what the people want began.
Here is an idea:
Bring back "Taxable Offence."
Not only does it cost your company a % of your profits, but it is applied for *Decades* to come.
Another is to exploit the loophole in the 13th:
Imagine if these big companies where forced to carry out government contracts... for free!
Ooh! I like that last one. Make the minimum period of providing free products and services 100 years, AND make it a poison pill, so that if the offender gets bought, the new parent company takes on the burden for the remainder of its period as well. If they're bought out after 20 years, the new owner owes 80 years of free products and services.
For context, when were taxable offenses stopped in the US? What were famous examples of them being used?
Wage labor is renting yourself via "self ownership". Employment is literally renting another human being as if they're property. The employer-employee relationship is a very insidious dynamic. Employment is a rental contract, like if you rented capital (say, a chainsaw from Home Depot), you pay rent for the "time preference" (basically the cost of time) for a piece of property. Capitalism is based on a principle of self ownership, which sounds empowering, until you realize that most people don't own capital goods other than themselves, and must rent out the authority over themselves as pieces of "human capital". This is a process of dehumanization where human beings are valued for their return on investment as capital goods. This is why, at the very least, capitalism needs unions and safety nets (or abolishment), or else the system won't value people for their human value. Importantly we must also think about our sick, elderly, and disabled people, as they can't provide competitive economic return for the investor class to value. We must figure out a way to change this economic system if we wish to value each other.
Thank you for you time. For some reason that seems funny to me. But seriously.... that was all well said.
@@clintholmes2061 I appreciate that very much. If you are interested in learning about possible solutions you might think about 'cooperativism' or the general practice of economic' democracy'.
I think of it more as "I'm an entrepreneur providing a service for an hourly fee". The trajectory being basic life skill building as a teen, apprenticeship during and after post-secondary, experience during 20's, then spending the 30's and 40's building off that experience. Whether it be through starting a business of your own, or a senior leadership position (Most of the rewards of business ownership with none of the consequences), or early retirement. The second you can do the work faster and cheaper than your employer takes off the top, you have the competitive edge. Spend your early career doing work that is essentially subsidized by your employer while you train and get up to speed, then break off once you can do it better.
@@agodelianshock9422 Ownership of the equity is not an hourly fee 🤦
Don't start with those disingenuous lines of "reasoning".
'If we wish to value each other.' That's gonna be a hard one. I think that's a wish a small number of people have. I'd wager common decency in public is a survival strategy rather than a genuine act of kindness.
If you have a child, and it commits a crime, the parrent can be held responsible. If you have a dog, and it commits a crime, the owner can be held responsible. If you have a company, and it commits a crime, the owner should be held responsible, not just the director.
@3:12 white man jumpscare
9:10 That bit about the fines being the politically safe option.... could this be an extremely mutated version of political correctness?
All the parts are there, you're essentially softening a traditionally harsh measure for the sake of not hurting a minority/vulnerable group, and the outcome is a convoluted system that we all end up paying for with mental effort or money.
I… hmm. Rich people are an actually protected class in the US, while minorities are like, technically protected, but to get any of those protections is like pulling teeth. Meanwhile, if your bottom line gets harmed, the US government will trip over itself to punish those responsible.
Favorite financial channel on UA-cam!
Back in the 40s. Brazil had the idea that if a company had been criminal before. It would have its assets or stocks given to the government. That is a great way to increase government revenue and make stock holderw scared of fucking up. (As their shares would be deluded and their companies branded as criminals forever).
Ummm, ya know this is and sounds like straight up CORPRATE/FEDERAL Corruption right?
No, the reason they are artificial people(not actual people), is for the flash and blood humans to avoid punishment. How about just making the person who has authority, responsible.
Prosecutors overstepping their bounds, ignoring the law, destroying companies? Never!
How about getting private equity completely out of emergency health-care systems? Yes, it would create a shock to industries, but a shock is what the US needs ultimately.
This is why the new EU fining method is far more devastating for corporations
The fine starts at 10% of global revenue
Right wingers: Corporations should be considered people
Everybody: People can go to jail
Right wingers: Not like that!
Keep voting for sub human living standards, lefty.
It's nearly all U.S. politicians, regardless of party. The right vs. left is the political/investment class distracting useful idiots. It worked on you.
@@brentgauspohl9779 would you care to go back and see who proposed this law and who voted for it?
If a human would go to jail for an equivalent time, split the jail time among all shareholders. This could mean a mandatory ethics course for small investors. After a few sessions, people would seek out ethical investments.
Dude arresting some semi senile 80 yo who barely watches a mutual fund is moronic. The whole point of corporations is limited liability. If you remove that then they are quite literally pointless and you may as well not have them
@@badart3204 You could have ethical mutual funds where the fund manager is liable.
@@badart3204 wow kinda like detaching consequences from actions is a net drain on society. Who woulda guessed.
They do in China! Government still has control there. In the US government is owned by the corporations.
I wonder if, like the workers declaration that they have been convicted of a crime, the company should be forced to add a statement to the same effect onto all marketing/advertising etc. If a Facebook add, like a smoking add, had a banner across the bottom saying "we have have been convicted of systematic privacy violations and we're fined $5B", it would certainly help consumers to make better choices.
Here in California a major utility company Pacific Gas & Electric was charged with manslaughter a few years ago for it's role in causing a huge wildfire.
But uh... none of us know what it even means for a company to be guilty of manslaughter lol.
Corporations could put in jail by prohibiting them from doing business during the period of the jail time. If some of the employees don't get paid during that time, well, that is the incentive for employees not to engage in any illegal transactions. Of course there will be innocent employees who had no knowledge of a companies illegal behavior, but the judge could order the corporation to continue to pay those employees for the duration of the sentence. This method of punishing corporations could work if there was enough public support.
God I love this channel. Idk if you’ve ever thought about it but if you had a podcast where you just talked about current events in the financial world, I’d listen religiously
Go after the board of directors and the CEO. They are at actually responsible and it does not matter if they are new to the position or have been there for years.
Maybe they should do to companies what they did to Gary Bowser, garnish their income for the rest of the company's life. That way if they keep stacking up on crimes, the company will enter a slow decline and be replaced by other newer companies without rocking the industry.
Until CEOs, Board of Directors & other executives are held specifically accountable with long jail terms and a forfeit of all stock holdings where the government takes ownership of their equity.
Regulations and fines as cost of doing business means legal for a fee for big business and bankruptcy foe competition
Why can't a corporate equivalent of liens be placed on the books? Or what about putting the market equivalent fine amount of stocks into government's hands?
Do too much bad, and you'll just be handing your profits over to the (hated by shareholders) government.
That'll align all the stakeholder-hood real fast.
About the excuse that "we were just following our mandate to maximize shareholder value", how is that an excuse to knowingly and willingly commit a crime? I couldn't say that I robbed a bank because I had a mandate to feed my family and keep a roof over their head - they'd tell me I should get an honest job instead. So why aren't corporations required to find an honest job instead of using illegal means to increase profits?
"Only following orders"? That's the oldest excuse in the book.
Okay I actually don't mind this solution. It's very long term, but say. For every major case a corp lost, in addition to the fines to cover damages, they had to accept another board member from the govt.... That would be a round about way of slowly nationalizing any corporation that acts in opposition to the public's well-being. You wouldn't even need to entirely nationalize them, just like nationalized ~enough~ to rein in their corruption. Sure, you could say that the corp would just corrupt/buy out the new board member, but the extant board members were already corrupt (literally evidently). This would reduce the power of the C-Suite by bloating their numbers as well and the outside influence could actually tank their ridiculous compensation packages by virtue of there being less corruption and their "work" being divvied up more. It's like socializing a corp from the top down instead of/in addition to the typical worker-led movements. Also I love the irony of micromanaging the people at the very top. That's just karma lmao
Healthcare and for profit businesses are in direct conflict with each other...
Reforming criminals is only one aspect of prison. Another is separation to keep criminals from doing more harm. Retribution is another, critical role - to make the aggrieved parties feel that justice was done so that justice isn't taken into their own hands.
shareholders own a portion of a company, shareholders do a portion of the jail time.
Yes. And if they do something bad enough, they should get the "death penalty," which would mean getting dissolved and having their assets seized. Why should companies get all the benefits of a person but none of the punishments?
The CEO is ultimately responsible for EVERYTHING the company does. I'm tired of a huge scandal and illegal activity happening just for the company to claim they don't know who is responsible for the action. Not acceptable.
Yeah. Courts should abide by the "doctrine of the omniscient boss", where the boss is assumed and expected to know every single detail of everything that goes on below them, and anyone who claims or acts otherwise gets an immediate ten years in prison and full asset confiscation.
I agree it makes me sick
Accountability is key, and the idea of a "parole officer" is fascinating. It's a shame, though, that in this country, our regulation requires regulation.
Been saying for years if they are people then they have to serve time. As in the ceo, board memebers, etc. they all go to jail
My first thought on companies being too big to fail or jail is “clearly they’re not being taxed enough”-but I am anti-monopoly.
Making it easier to prosecute companies is a good first step, but I think that “if corporations insist their people” can be taken a liiittle farther. Like requiring more preemptive transparency about their actions and requiring them to publicize their work and the consequences of their own actions instead of lionizing their reputation.
Fking hell I got a HSBC ad right after this video
Having a "parole officer" on the board? Don't we kind of have that already in the banking industry? There are regulators assigned to the banks that approve or deny certain operations. It has done nothing to prevent systemic issues in banking.
How about giving them more authority and making it more punishable to hide things from them?
This is just like when people bring up Veterans' Affairs in the discussion about socialized healthcare. Yes, attempts at similar policies may have failed in the US, but is giving up really the best solution? Would it not make more sense to investigate why the previous solutions don't work as intended, and enacting newer, more informed solutions?
I would love to go free-market, capitalist economics in the US, but all I have seen in my lifetime is corporations appealing to free-market economics when it benefits them, and encouraging regulation to stamp out smaller competitors. I'm tired of the BS regulations are going to be added anyways; why not make them work for the general public rather than exclusively for members of said corporations?
@@onpoint2292 - That was my point. The regulators at the banks had the authority and it did jack shit.
The very idea, that corporations are people, is ludicrous... Corporations are not people, they are embodiment of agreements between people. Owners and executives have to be held accountable with fines and those directly responsible for a decision and the very high top managment shoud face jail time on top of a fine and ban to work in industry.
This is obvious. However, the USA law does make them people.
Absolutely YES. It's bad enough companies can get out of paying out fees/fines through bankruptcy court and no one gets held accountable. Hold these presidents/ceos/board members accountable for the intentional and malicious actions. Monetary punishments do nothing anymore.
I don't get the point of this video... you don't have to put "the corporation" in jail, you need to put the people in charge in jail.
Whatever remains of the corporation's leadership and/or a court appointed board, can then figure out how to move on next.
I guarantee you that if a few white collar CEOs wind up in jail with real sentences (10+ years); corporations will be that much less likely to attempt crimes... At the moment, it literally means nothing to the individual