Disclosure-Driven Crime

97 Pages Posted: 25 Feb 2019

See all articles by J.S. Nelson

J.S. Nelson

Villanova Law School; Villanova School of Business; The Wharton School, University of Pennsylvania; Institute for Corruption Studies

Date Written: February 6, 2019

Abstract

As illustrated by the recent Volkswagen emissions scandal and other large-scale corporate wrongdoing, business organizations and top executives with disclosure duties learn to be willfully blind to what is happening inside their organizations. Under pressure for results without inquiry into methods, middle management coordinates large-scale wrongdoing without consequence. The resulting insulation and entrenchment of middle management to coordinate large-scale wrongdoing is a problem that our enforcement approach must better address.

The Article describes the mechanisms of this harm. It then investigates developments in two proposed fixes — conspiracy prosecutions and especially willful blindness instructions — before advocating as more meaningful encouraging the engagement of individuals at all levels of a company to combat widespread corporate wrongdoing.

Keywords: Volkswagen, criminal conspiracy, willful blindness, willful blindness instructions, middle management, disclosure, widespread wrongdoing, corporate crime, emissions control, top executives, employee engagement

JEL Classification: K22, K14, K29, K42, L14, L21, L23, L43, L52, L53, L9, L91, L98, L99, M10, M12, M14, M16, M19, M38, M

Suggested Citation

Nelson, Josephine, Disclosure-Driven Crime (February 6, 2019). UC Davis Law Review, Vol. 52, No. 3, 2019, Available at SSRN: https://ssrn.com/abstract=3330314

Josephine Nelson (Contact Author)

Villanova Law School ( email )

299 N. Spring Mill Road
Villanova, PA 19085
United States

Villanova School of Business ( email )

800 Lancaster Avenue
Villanova, PA 19085-1678
United States

The Wharton School, University of Pennsylvania ( email )

3730 Walnut Street
Room 668 Jon M. Huntsman Hall
Philadelphia, PA 19104-6340
United States

Institute for Corruption Studies

Stevenson Hall 425
Normal, IL 61790-4200
United States

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