Criminal Liability of Corporation
It is tough to define corporate criminal liability in the present-day scenario because it covers an extensive list of offences. But to understand its purpose, it can be defined as an illegal act or commission, punishable by a criminal sanction committed by an individual or group of individuals in the course of their occupation. It can be even defined as socially dangerous acts committed in the course of occupations by people who manage the affairs of the company to further their business interest.
Corporate frauds/crime is viewed as illegal acts or omissions, punishable by the State under administrative, civil or criminal law, which is the result of deliberate decision making or culpable negligence within a legitimate formal organisation.’ Corporate crimes also refer to criminal practices by individuals that have the legal authority to speak for a corporation or company. These can include Presidents, managers, directors and chairpersons, salespeople, agents, or anyone within a company that is authorised to act on behalf of the firm. Examples of corporate criminal behaviour in most jurisdictions include antitrust violations, fraud, damage to the environment in violation of environmental legislation, exploitation of labour laws, and failure to maintain a fiduciary responsibility towards shareholders.
Corporate fraud is activities undertaken by a company or an individual that is done illegally or dishonestly and are designed to give an advantage to the perpetrating company or individual. Corporate fraud schemes go beyond the scope of an employee’s stated position and are marked by their economic impact and complexity on the business, other employees and outside parties.
It can be challenging to prevent and catch a Corporate fraud. By creating effective policies, physical security and a system of checks and balances, a company can limit the extent to which fraud can occur. It is considered a white-collar crime.