How To Avoid Criminal Liability For Errant Employees


Originally published in Law360, New York (September 07, 2012, 1:30 PM ET)

A corporation is vulnerable to criminal exposure for illegal acts of its employees. If a corporation ultimately avoids prosecution for fraud or some other wrongful employee act, it still finds itself in the unenviable position of having been victimized and likely bearing economic and reputational wounds.

At the most fundamental level, the organizational structure of a corporation, its policy and procedures, and its overall culture can be designed and maintained to protect it from criminality and stand it in good stead with law enforcement authorities. Organizational shortfalls that have allowed or hidden employee criminality or misconduct should be addressed as a hedge against corporate liability and loss.

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