Corporate Prosecutions: American Law Enforcement in Global Markets

Abstract

Large companies are increasingly on trial. Over the last decade, many of the world’s biggest
firms have been embroiled in legal disputes over corruption charges, financial fraud,
environmental damage, taxation issues or sanction violations, ending in convictions or
settlements of record-breaking fines, well above the billion-dollar mark. For critics of
globalization, this turn towards corporate accountability is a welcome sea-change showing
that multinational companies are no longer above the law. For legal experts, the trend is
noteworthy because of the extraterritorial dimensions of law enforcement, as companies are
increasingly held accountable for activities independent of their nationality or the place of the
activities. Indeed, the global trend required understanding the evolution of corporate criminal
law enforcement in the United States in particular, where authorities have skillfully expanded
its effective jurisdiction beyond its territory. This paper traces the evolution of corporate
prosecutions in the United States. Analyzing federal prosecution data, it then shows that
foreign firms are more likely to pay a fine, which is on average 6,6 times larger.