Vicarious Snitching: Crime, Cooperation, and 'Good Corporate Citizenship'
Michael A. Simons
St. John's University School of Law
September 25, 2008
St. John's Law Review, Vol. 76, 2002
With increasing frequency, prosecutors are demanding that corporations act as "good corporate citizens" - which, to prosecutors, means cooperating fully in any investigation. These demands for cooperation present corporation with a dilemma. These prosecutorial demands for cooperation can place a corporation (or, more accurately, its officers and directors) in an extraordinarily difficult position. On the one hand, the cost of cooperating can be significant: the cooperating corporation may be required to terminate employees, disclose confidential documents, and waive privileges - all of which may expose the corporation to substantial civil liability. On the other hand, the cost of not cooperating can be even more devastating, as few firms can survive in indictment. This Article examines corporate cooperation and the difficulties it can create for corporate decision-makers.
The Article first describes the principles of vicarious guilt that give prosecutors the power to demand corporate cooperation, and then examines how prosecutors exercise their discretion in deciding whether to charge corporations with crimes. Next, the Article examines the cooperators. Just as a corporation's guilt is only vicarious, so too its cooperation can be only vicarious. In the end, it is not the corporation that cooperates, but its officers and directors - the men and women who make decisions for the corporation. For these vicarious snitches, the process can be a minefield, filled with conflicting loyalties and inevitable self-interest. After examining a series of recent high-profile corporate prosecutions or investigations, the Article reaches two conclusions: first, a corporation's best hope to avoid indictment is to engage in "super cooperation" that will convince prosecutors of its "good corporate citizenship"; and second, that "super cooperation" may be irrevocably hampered if the firm does not quickly change its top management.
Number of Pages in PDF File: 41
Date posted: September 29, 2008 ; Last revised: October 1, 2008