Confession Is Good For Soul And Equilibrium But Maybe Not Justice

Recently, I read this article about how the Department of Labor, the Internal Revenue Service and states are targeting pay practices of home builders. This got me thinking about how industry enforcement sweeps can be a very effective enforcement tool.

Suppose, for example, an enforcement sweep involves only two firms that do not communicate with each other. If both firms concede the regulator’s position, they will be given some credit for cooperation and fined only $10,000. If one resists and the other concedes, then the resistor is punished with a more hefty penalty of $25,000 while the other firm receives a very modest slap on the wrist of $1,000. If both firms resist, they each receive a penalty of $3,000. This is the classic “prisoners’ dilemma” and is summarized by the following table...

Please see full article below for more information.

LOADING PDF: If there are any problems, click here to download the file.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Allen Matkins Leck Gamble Mallory & Natsis LLP | Attorney Advertising

Written by:


Allen Matkins Leck Gamble Mallory & Natsis LLP on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.