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example, she cites the
misconduct by financial
institutions that led to
the stock market meltdown and to the loss of
tens of thousands of jobs
in 2008 and 2009.
Her views fly in the
face of those of corporate advocates like Albert Alschuler, a
criminal law professor at Northwestern
University. For years, he and others
have claimed that criminally punishing
companies is a mistake, and that eliminating such liability should be a priority
for law reform.
Corporations are mindless, Alschuler
argues, and there are collateral consequences—to shareholders, employees,
creditors, customers, and communities.
“The embarrassment of corporate criminal liability is that it punishes the innocent along with the guilty,” Alschuler
wrote in a recent essay.
Beale has countered with her new
article, “A Response to the Critics
Sara Sun Beale SympathizeS with in-
house lawyers’ gripes about the criminal
justice system, but don’t expect her to
push for eliminating corporate criminal
liability. Beale, a Duke University law
professor, argues that if companies commit crimes, society should punish them.
“Corporate counsel like to suggest
that there’s something abnormal about
corporate criminal liability,” Beale
says, but “corporations wield extraordinary power, and can cause serious
harm to individuals and to society as
a whole.” In her view, “They ought to
be held accountable, and we need the
full range of legal tools to do that”—
including prosecution.
Beale has just laid out her case in a
recently published article in the
American Criminal Law Review. Before joining Duke in 1979, she served in the
U.S. Department of Justice, at both the
Office of Legal Counsel and the Office
of the Solicitor General. She’s currently a
member of the International Society for
the Reform of Criminal Law.
Some business advocates maintain that corporations are a legal fiction because they only exist on paper.
But according to Beale, “Just because
corporations don’t have little beating
hearts doesn’t mean they aren’t real
in a legal sense.” They can hold property, make contracts, commit torts,
sue, and be sued. They even have
constitutional rights, Beale notes—
a point that the U.S. Supreme Court
just confirmed in its January ruling
that the First Amendment protects
corporate spending on political ads.
The power of corporations is
greater right now than at any time
in U.S. history, says Beale. As an
101
of Corporate Criminal
Liability.” She’s quick to
admit that the criminal
justice system has severe
problems: too-powerful
prosecutors, overbroad
laws, unnecessarily harsh
penalties. But Beale is not
about to seek changes that
would benefit companies while ignoring other types of criminal defendants.
“If you look at those most at risk in
criminal justice system right now, it’s
not the corporations, it’s the individual
defendants,” she says.
Most problems that companies face
are endemic to the U.S. justice system,
and not just to corporate law. For example, she says that “there is no question”
that American law imposes criminal
sanctions on corporate and individual
conduct that might be better dealt with
through civil law.
Beale, who has lectured or taught
in more than ten countries, says a comparative review shows “a surprise”—a
global trend toward more corporate liability. Other countries, she
says, are creating liability where
it didn’t exist before, and expanding it in areas where it did. Recent
reforms abroad also make it easier
to prosecute corporations.
19
And Beale thinks that the
United States should also consider tougher laws for companies.
Any agenda for reform, she writes
in her article, should “include the
question whether corporate criminal liability (and/or civil liability
and regulatory oversight) needs to
be strengthened or expanded.”
—SUe ReISINGeR
J.D. KING (TOP); U.S. DEPARTMEN T OF STATE
WAY DOWN THE LIST
In her article, Beale notes that the average penalty for fraud—the major
white-collar offense category—is “quite modest.” The average sentence
length, in months, for various offenses (statistics are from 2006):
82
77
77
46
34
Drug
Trafficking
ArsonSexual
Abuse
Source: Sara Sun Beale
Firearms Fraud Assault Man-
slaughter
QUOTED
“[She] handled delicate matters where attorney-client privilege might prove useful.”
The authors of Game Change, a new book about the 2008 presidential race, on the role that Cheryl Mills played in Hillary Clinton’s campaign.
Authors John Heilemann and Mark Halperin specifically claim that Mills was charged with monitoring Bill Clinton’s extramarital sexual activities.
Mills was general counsel at New York University from 2006 to 2008. She is now chief of staff for Hillary Clinton at the U.S. Department of State.
