The Australian Law Reform Commission’s report on corporate criminal prosecutions is scathing: “[P]rosecutions of corporations, relative to individuals, are extremely rare, even in heavily regulated sectors where corporations are most active. Corporations are most often prosecuted for relatively minor regulatory offences. Smaller corporations are more likely to be prosecuted than larger corporations. Prosecutors withdraw a significantly higher number of charges against corporations than they withdraw against individuals for corporate crimes. This suggests that existing laws present real difficulties for prosecuting corporations. … There is concern that the paucity of corporate criminal prosecutions, and regulators’ frequent reliance on civil penalty provisions, have led to a mindset that the penalties imposed are little more than a cost of doing business. It should be a criminal offence for a corporation to engage in a system of conduct, or a pattern of behaviour, that leads to breaches of civil penalty provisions.” Some of the recommendations look interesting — like broader sentencing options including community service, banning companies from particular activities, or even dissolving the business — but the ALRC wimped out on recommendations [$] that would close the loophole used by executives to shield themselves from liability.
16 September 2020