Instituto de Estudios Políticos y Derecho Público "Dr. Humberto J. La Roche"
de la Facultad de Ciencias Jurídicas y Políticas de la Universidad del Zulia
Maracaibo, Venezuela
Esta publicación cientíca en formato digital es continuidad de la revista impresa
ISSN-Versión Impresa 0798-1406 / ISSN-Versión on line 2542-3185Depósito legal pp
197402ZU34
ppi 201502ZU4645
Vol.41 N° 78
Julio
Septiembre
2023
Recibido el 10/02/23 Aceptado el 16/04/23
ISSN 0798-1406 ~ Depósito legal pp 198502ZU132
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Vol. 41, Nº 78 (2023), 523-540
IEPDP-Facultad de Ciencias Jurídicas y Políticas - LUZ
Corporate liability and white-collar
crime: Comparative review
DOI: https://doi.org/10.46398/cuestpol.4178.36
Anatolii Tarasiuk *
Daria Prokoeva-Yanchylenko **
Yuriy Lutsenko ***
Andrii Danylevskyi ****
Tamara Makarenko *****
Abstract
The aim of the research was to analyze academic approaches
to understanding the legal nature of white-collar crime and what
crimes it includes; based on this understanding, the model of
corporate criminal liability was investigated to place it in various
law enforcement contexts. Throughout the article, appropriate
research methods have been used, such as: comparative law
method, systemic-structural method, formal-legal method. Based
on the results of the detailed comparative analysis, it has been established
that there are no unied standards or models for both white-collar crime
and corporate criminal liability. Furthermore, it has been argued that the
concept of fraud (deception) constitutes the key element of white-collar
crime and is also the foundation of most corporate crimes. In the conclusions,
it is argued that corporate criminal liability in the United States, and to a
lesser extent in some European countries (including Ukraine), is a powerful
law enforcement tool capable of protecting society from massive crimes as
well as deterring corporations from unlawful deviations.
Keywords: corporate liability; white collar crime; money laundering;
fraud; corporate crime.
*Doctor of Law, Associate Professor, Deputy Head of the Main Investigative Department of the State
Bureau of Investigation (Kyiv, Ukraine). ORCID ID: https://orcid.org/0000-0001-9563-6922
** Doctor of Law, Director of the Interdepartmental Research Center for Combating Organized Crime
under the National Security and Defense Council of Ukraine (Kyiv, Ukraine).ORCID ID: https://orcid.
org/0000-0001-6458-5536
*** Doctor of Law, Associate Professor, Head of the Department, Interdepartmental Research Center
for Combating Organized Crime under the National Security and Defense Council of Ukraine (Kyiv,
Ukraine). ORCID ID: https://orcid.org/0000-0002-8731-2941
**** Candidate of Law, Associate Professor, Head of the Department of Criminal Law and Criminology,
Donetsk State University of Internal Aairs (Kropivnitskiy, Ukraine). ОRCID ID: https://orcid.
org/0000-0002-9315-9381
***** Associate Professor, Dean of the Faculty of Humanities and Economics at Berdyansk State Pedagogical
University (Kyiv, Ukraine). ORCID ID: https://orcid.org/0000-0003-2893-7789
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Anatolii Tarasiuk, Daria Prokoeva-Yanchylenko, Yuriy Lutsenko, Andrii Danylevskyi y
Tamara Makarenko
Corporate liability and white-collar crime: Comparative review
Responsabilidad de las empresas y delitos de cuello
blanco: Revisión comparativa
Resumen
El objetivo de la investigación fue analizar los enfoques académicos
para comprender la naturaleza jurídica de la delincuencia de cuello blanco
y qué delitos incluye; sobre la base de dicha comprensión, se investigaron el
modelo de responsabilidad penal de las empresas para situarlo en diversos
contextos de aplicación de la ley. A lo largo del artículo se han utilizado
métodos de investigación apropiados, como: el método de derecho
comparado, método sistémico-estructural, método formal-jurídico. Sobre la
base de los resultados del análisis comparativo detallado, se ha establecido
que no existen normas o modelos unicados tanto para los delitos de cuello
blanco como para la responsabilidad penal de las empresas. Además, se ha
argumentado que el concepto de fraude (engaño) constituye el elemento
clave de la delincuencia de cuello blanco y es también el fundamento de la
mayoría de los delitos empresariales. En las conclusiones, se arma que
la responsabilidad penal de las empresas en Estados Unidos, y en menor
medida en algunos países europeos (incluida Ucrania), es una poderosa
herramienta de aplicación de la ley capaz de proteger a la sociedad de
delitos masivos como de disuadir a las empresas de desviaciones ilícitas.
Palabras clave: responsabilidad de las empresas; delitos de cuello
blanco; blanqueo de dinero; fraude; delincuencia
empresarial.
Introduction
To this date various denitions of crimes in economic activities are
proposed, and more or less successful attempts to classify (organize) such
punishable acts are made. Specic nature of economic crimes, reference
of white-collar crime (hereinafter – WCC) statutes to regulatory law,
dependence of specic provisions on the level of development and protection
of economic relations in the country refer any scholar to the issue of correct
terminology behind economic oenses. “Commercial”, “economic” (in some
countries also “white collar”, “corporate” and “professional”), “business
environment related” – one can nd many variations of concepts in the
legal literature and across the nations’ criminal codes.
Sometimes it is noted that the term “crimes of economic orientation”
along with such denitions as “economic crimes”, “crimes in the area of
economy” and “crimes in the area of economic activity” have become a
strong part of the conceptual framework of criminal law and other elds of
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knowledge, and are widely used by employees of law enforcement agencies.
This is the rst prong of the complicated “corporate economic crime”
phenomenon to be discussed in this scholarly work.
Being closely connected to the issues of white-collar criminality is the
corporate criminal liability regime. Nowadays corporations are as big a
part of any given society as are any other collective institutions – political,
educational, non-prot etc. Corporations represent a distinct and powerful
force at regional, national and global levels and they wield enormous
economic powers. Besides governments and governmental agencies,
corporations become ever more eective agents of action in any society.
The development of the society, at various points of time, has had a
direct inuence on the structure and functions of the corporation. However,
there is another side of the medal: corporate wrongdoing has become an
ever-growing issue in the modern business world. Almost daily we witness
large companies and nancial institutions enters into plea agreements with
national prosecutorial oces as a result complicated white-collar crimes
they have committed. Millions of dollars move from corporate accounts to
sovereign treasuries in the form of nes and other nancial penalties.
With regard to Ukrainian corporate criminal liability model in particular.
On May 23, 2013 the Law of Ukraine with a long title “On Amendments to
Certain Legislative Acts of Ukraine in Connection with the Implementation
of the European Liberalization Action Plan Union of the Visa Regime for
Ukraine Regarding Liability of Legal Entities” has been adopted (it entered
into force on September 1, 2014).
As a result of such legislative intervention, Chapter XIV-1 has been added
to the General Part of the Criminal Code of Ukraine with the title “Measures
of a criminal law nature against legal entities”. While commentating the
specied legislative novel, M. Khavronyuk writes that the issue of criminal
liability of legal entities, although it has been introduced in Ukraine in
the form of the so-called quasi-criminal or limited criminal liability, still
remains debatable in theory of criminal law (Dudorov and Khavronyuk,
2014).
1. Methodology
While working on this paper, the following methods of research have
been employed extensively.
The major, for the purposes of the paper, comparative law method has
enabled us to research WCC statutes and corporate liability regimes across
several European jurisdictions (including Ukraine) as well as in the United
States. Based on comparative paralels a conclusion has been reached that:
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Anatolii Tarasiuk, Daria Prokoeva-Yanchylenko, Yuriy Lutsenko, Andrii Danylevskyi y
Tamara Makarenko
Corporate liability and white-collar crime: Comparative review
1) the phenomenon of WCC is extremely complicated and includes various
oenses; 2) similarly, national approaches toward the issue of corporate
criminal liability vary signicantly and have dierent statutory foundations.
Overall, currently the comparative law method is widely used when
researching various issues of white-collar crime (Reznik, et al., 2020).
The system-structural method has been used to describe applicable
statutes and their location within the structure of the national Criminal
Codes. Legislative approaches toward constructing relevant statutory
frameworks also fall under this scientic method. Based on the core laws
of logic and reason, the system-structural method allows to evaluate, if the
new legislative material ts the law and the “spirit” behind it.
Finally, the formal-legal method has enabled the authors to analyze in
detail the legal meaning of the provisions of various legal acts, which cover
issues of economic criminality and corporate liability.
Overall, extensive use of the methodological tools has eneblaed a closer
comparative look at the issues of WCC and corporate liability in the United
States, Ukraine and several other European jurisdictions, even more so
in the context of the modern globalized world, with its various risks and
challenges.
2. Recent research and ndings
This research paper focuses on the advantages and aws of corporate
criminal liability within the wider scope of white-collar criminality in various
world jurisdictionsб including United States of America and Ukraine. The
American corporate liability model will play a virtual “sparring partner”
role for the purposes of evaluating both progress and potential pitfalls
on Ukraine’s (and to less extent those of other European nations) way to
establishing eective legal framework to combat corporate crime.
Obviously, a large body of academic literature has been devoted to the
issues discussed in this paper. As such, issues of criminal responsibility
for economic crimes in Ukraine, including in comparative context, has
been studies by such Ukrainian commentators as P. Andrushko, P. Berzin,
A. Boyko, N. Gutorova, R. Volynets, V. Navrotskyi, M. Panov, V. Popovych,
A. Savchenko, M. Khavronyuk and some others.
The most consistent and systematic approach to solving problems related
to the qualication of this category of crimes and the practice of applying
the norms of the Criminal Code of Ukraine (hereinafter referred to as the
Criminal Code), which establish them, is embodied in the scientic works
of O. Dudorov. Authors of this paper has also extensively commented on
the issues at hand (Pidgorodynskyi, et al., 2021; Minchenko, et al., 2021).
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In the American criminal law doctrine, various pressing issues of liability
for economic crimes and corporate crimes in particular have been studied
by K. Brickey, S. Buell, S. Green, L. Dervan, U. Zagaris, J. Ko, E. Luna, P.
Morgan, J. Oh ‘Sullivan, E. Podhor, R. Posner, J. Rako, E. Sutherland, K.
Strader, P. Henning, and others.
Thus, as one might see, the topic of white-collar criminality (including
corporate wrongdoing) is extensively researched and discussed at various
professional forums. At the same time, such topic remains far from being
“over-researched” – a number of issues remains unsolved, since economic
criminial schemes constantly evolve as business and regulatory landscapes
shift and chages globally on a regular basis.
a) White-Collar Crime: Its Origins, Meaning and Elements
Analysis of legal literature on the issues of criminal liability for business
(or economic, white-collar) crimes, demonstrates a lack of focus from
local scholars on the issues of adequately labeling such crimes, justifying
their balanced name based on position of developing quality conceptual
apparatus of the Criminal Code. With this being said, numerous authors’
interpretations of generic and specic objects of economic oenses in
criminal law treatises exist today.
For the record: to this date no clear, all-inclusive denition of WCC
exists, and such description is not likely to appear anytime soon due
to a variety of reasons. The term “white collar crime” is notorious for its
ambiguity just in any global jurisdiction where it is used. At least some
agreement among scholars exists on what types of criminal behavior this
phrase should include.
Among various types of criminal activity, one can name antitrust
violations, computer and internet fraud, credit card fraud, phone and
telemarketing fraud, bankruptcy fraud, healthcare fraud, environmental
violations, insurance fraud, mail fraud, government fraud, tax evasion,
nancial fraud, securities fraud, insider trading, bribery, kickbacks,
counterfeiting, public corruption, money laundering, embezzlement,
economic espionage and some other related oenses.
In particular, degree of eectiveness of criminal law protection of
Ukrainian stock market largely depends, among other things, on the
quality of the law on combating illegal use of insider information and on the
substance of the relevant regulatory legislation rules. Just like in the United
States, Ukrainian insider rule refewrs to the need for equal information
ow – such approach is fundamental to the proper functioning of any stock
market in the world.
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Anatolii Tarasiuk, Daria Prokoeva-Yanchylenko, Yuriy Lutsenko, Andrii Danylevskyi y
Tamara Makarenko
Corporate liability and white-collar crime: Comparative review
The lack of specic law enforcement practice in Ukraine is explained by
the internal characteristics of the national stock market, by its currently
undeveloped status (Kamensky et al., 2020). Within this particular case, we
see a direct connection between the need to protect instruments of market
economy (stock market specically) and criminal liability for WCC.
The commonly used phrase “white-collar crime” was reportedly
introduced in 1939 during a famous speech by sociologist Edwin Sutherland
to the American Sociological Society. Sutherland dened this term as an
oense committed by a person of respectability and high social status in
the course of his occupation. Later in his scholarly paper Sutherland stated
that dierent forms of illegal white-collar conduct “consist principally of
violations of delegated or implied trust, and many of them can be reduced
to two categories: misrepresentation of asset values and duplicity in the
manipulation of power” (Sutherland, 1940). Such denition, as history
has showed us, reveals the key elements of both individual and corporate
economic crimes.
From the comparative standpoint, the framework of the criminal law
of Ukraine, attributing the “market economy” concept to the body of
legal relations protected by Chapter VII of the Criminal Code of Ukraine
indicates that this form of organization of national system of production,
distribution, exchange and consumption of goods covers areas of economic
activity, which are protected by criminal law, in an overall comprehensive
manner.
Thus, stock market, creditors’ rights, fair competition – such components
of Ukrainian economy are the embodiment of the market economy model.
As one might see, WCC remains actively present in countries with both
emerging and developed market economies.
Some real life numbers. According to some extensive research: 1) white-
collar crimes are estimated to make up only 3% of federal prosecutions; 2)
in 2021 white-collar crime prosecutions have been down 53.5% compared
to 2011; 3) as of 2021, annual losses from white-collar crimes have been
anywhere from $426 billion to $1.7 trillion – such wide range here is due
to the lack of prosecutions; 4) there were 4,727 white-collar prosecutions in
2021 alone. Finally, by some estimates up to 90% of white-collar crimes go
unreported (ZIPPIA, 2023).
Current political developments, globalized economy, and further
synchronization of legal systems around the globes provide a unique
forum for expanding existing national legal frameworks, establishing new
principles and doctrines of law.
Of course, when outlining the “white collar” segment of criminal law
studies, special attention should be drawn to the study of globalization trends
in today’s world and, accordingly, in interstate economic relations. Today
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we are all able to follow the processes of digitalization,communication,
erasure of language barriers, migration of labor and capital, joint space
exploration, implementation of international research projects in almost
all areas, transnationalization of business and more (Kamensky, 2021).
Such endeavors, while obviously gaining momentum, cannot but
aect, at least indirectly, law in general and criminal law in particular. The
emergence of new types of economic crimes, the growth of economic crime
in general and its adaptation to various socio-economic changes are widely
recognized.
Hence, it makes sense to refer to Guy Stessens’s statement: modern
societies are increasingly dealing with types of economic crime unknown in
the XIX century, when most European criminal justice systems have been
created. Nowadays, prosecutors and courts face the growing challenge of
economic crime, which did not exist before. Corporations play an important
role in it, as the lion’s share of business activity in today’s world is attributed
to corporate business (Stessens, 1994). The latter notion will be explored in
greater detail within the following pages of the article.
The annual numbers of federal prosecutions for economic crime in
America over the two plus decades is demonstrated in Figure 1.
Fig. 1. White-collar crime prosecutions in the United States, 1987-2021. Source:
Zippia. “20 Shocking White-Collar Crime Statistics [2023]: The State of White-
Collar Crime in The U.S.” Zippia.com. Sep. 28, 2022, https://www.zippia.com/
advice/white-collar-crime-statistics.
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Anatolii Tarasiuk, Daria Prokoeva-Yanchylenko, Yuriy Lutsenko, Andrii Danylevskyi y
Tamara Makarenko
Corporate liability and white-collar crime: Comparative review
Finally, we want to make a point that fraud is usually “at the heart” of
any given WCC. This is true in any criminal law system as law enforcement
practice proves.
b) Fraud as the key element of any white-collar crime
The word “fraud” is widely refered to in the WCC context. This term
underlines “intelligent”, nonviolent, and primarily for-prot nature of
such oenses that are intended to deceive (an individual, a corporation,
or public at large) in order to earn something of value, power, or both. The
key message is “that fraud is typically the cornerstone of every white-collar
oense, no matter how simple and meager or intricate and grandiose”
(Bailey and Rothblatt, 1984: n/p).
In one of the rst works devoted to the analysis of the term “white-collar
crime”, its author E. Sutherland wrote that crime in business is most often
manifested in the form of distortion of nancial statements of corporations,
manipulation on the stock market, commercial bribery, direct or indirect
bribery of public ocials for the purpose of concluding protable contracts
or adopting favorable regulatory acts, distorting facts during advertising and
promotion of goods and services, waste or misuse of funds, weighing and
measuring, as well as knowingly false valuation of goods, tax fraud, incorrect
use of funds received as a result of current activities or during bankruptcy.
It was precisely these and many other forms of illegal behavior of big
business that the infamous American gangster and “Public Enemy No. 1” A.
Capone aptly described as legal racketeering (Sutherland, 1940).
American commentator S. Buell writes that complex conceptual and
denitional problem of fraud is further aggravated by the fact that such
manifestations of socially negative behavior directly permeate many spheres
of social life, not the least of which is the regime of legislative regulation of
the market economy. Fraud is one of the most serious, costly and punishable
causes of legal liability that apply to the modern corporate sector and
nancial markets.
Fraud permeates almost every sphere of the nancial system and
economic exchange relations. If the legal system is unable to develop a more
or less accurate denition of fraud, then neither state regulators nor society
in general will be able to objectively assess the legal signicance of those
events that negatively aected, say, national nancial markets (Buell, 2011).
A few more words about the American realities of combating fraudulent
manifestations in the economic sphere. In particular, the high level of
legislative attention (and, accordingly, the recognition of its dangerous
nature) to fraud in the economic sphere is evidenced by the fact that the
structure of the current federal criminal code (Title 18 of the United States
Code) contains two chapters that contain “anti-fraud” provisions.
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This is Chapter 47 “Fraud and False Statements”, which contains §§ 1001-
1040, as well as Chapter 63 “Mail Fraud and Other Fraudulent Crimes”,
which contains §§ 1341–1351. Within these two chapters, we have counted
forty-four prohibitions, most of which relate to manifestations of fraud in
various spheres of the national economy.
c) Corporate Crime: Old Issues, New Methods
Corporate criminal liability is closely related to the issues of WCC in
modern globalized world.
In one joint scientic study, attention has been paid to the fact that
the answer to the question of the reasons for the emergence and further
development of the institution of criminal liability of corporations in the
USA lies not only (and not so much) in the area of criminal law, but in
the eld of requirements and tasks, related to the general development of
society, primarily in the part of forming and protecting the foundations of
the market economy.
Materials of federal judicial practice in this part clearly demonstrate the
scale of corporate abuses and the level of danger to society that the activities
of modern corporations can create in the absence of reliable regulatory and
law enforcement barriers.
According to many representatives of the American legal community,
it is the norms of criminal law and the high eciency of law enforcement
associated with them that are able to werve as such barriers, which is actually
conrmed by the modern practice of criminal prosecution of corporations
(Dudorov and Kamensky, 2015).
Though a lot of time has passed since the adoption of the Law on Liability
of Legal Entities, the practice of applying criminal law measures against
legal entities is still not stable; it has not become a common instrument of
criminal law.
In particular, as evidenced by the nationwide statistics of court decision,
the issue of seizure of the property of legal entities is often resolved at the
stage of pre-trial investigation. However, it is hardly possible to count at
least two dozen verdicts against authorized persons, in which criminal law
measures are simultaneously applied against legal entities. The big question
is: what exactly prevents this legal institution from working eectively and
meeting the tasks set before it?
Markedly contrasting with the more or less established American
approach, Ukrainian judicial practice in terms of the application of measures
of criminal law inuence against legal entities remains today in a, so to speak,
a rudimentary state.
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Anatolii Tarasiuk, Daria Prokoeva-Yanchylenko, Yuriy Lutsenko, Andrii Danylevskyi y
Tamara Makarenko
Corporate liability and white-collar crime: Comparative review
Our own analysis has demonstrated that reference to Art. 96-3 of the
Criminal Code is often made in decisions of appellate courts and investigative
judges, which cancel the decisions of investigative judges (investigative law
enforcement agencies, respectively) on the seizure of the property of those
legal entities, the activities of whose ocials are investigated under the
articles of the Criminal Code on liability for tax evasion, fees (mandatory
payments) and terrorism nancing (Articles 212 and 258-5). Relevant
resolutions and petitions are annulled, in particular, on the grounds that Art.
212 of the domestic Criminal Code is not provided among the legal grounds
for the application of criminal law measures to legal entities.
Despite the presence in judicial practice of certain materials that relate to
issues regarding the possibility of applying measures of a criminal law nature
to legal entities (Archive, 2015; Archive, 2016) in the dockets of Ukrainian
courts, it was not possible to nd any reference to the application of these
measures to a legal entity on the grounds provided for in Art. 96-3 of the
Criminal Code. Such law enforcement “silence” is somewhat alarming.
On the other hand, introduction of criminal liability of legal entities in
the common law system owes a great deal to the doctrine of strict (absolute)
liability, which, while being a feature of the Anglo-American legal system,
actually means objective incrimination, that is, liability for criminal
violations – no-fault legal norm.
We would like to add that such pragmatic concept is used during the
criminal prosecution of corporations for violation of the requirements
stipulated mainly by the norms of regulatory legislation, in cases where
corporations carry out activities that are obviously harmful to society, and
therefore prohibited by relevant regulations. In the famous case “New York
Central & Hudson River Railroad Company v. United States” (1909) the
Supreme Court of the United States has for the rst time recognized that a
corporation can be found guilty of committing even such a crime, where the
relevant statute provides only for willfulness (criminal intention) as a form
of guilt.
This case applied provisions of the Elkins Act, which back in the day
regulated freight rates charged by railroad companies to carriers and
prohibited those companies from granting discounts to preferred carriers.
The U.S. Supreme Court decided that without criminal liability for legal
entities, legislation such as the Elkins Act would not operate and the public
would not be able to take advantage of its benets.
The court also noted that at the beginning of the 20-th century in the texts
of most court decisions and scientic commentaries, the possibility of crimes
being committed by corporations was rejected, at the same time assuming
the possibility of crimes being committed by their representatives – natural
persons (New York Central, 1909).
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The court also noted that the authority of the US Congress in terms
of regulating economic relations between states, preventing undue
protectionism and ensuring equal rights for all those who participate in
economic relations at the national level should not be questioned. At the
same time, the Court observed, it would be a marked step backward to enact
a decision that would prohibit Congress from exercising control over those
who conduct interstate commerce by prosecuting such persons for the intent
and purposes of agents to whom those economic entities have delegated
authority to act on their behalf.
The law cannot be “blind” to the fact that now the vast majority of
economic transactions are carried out by organizations, and foreign trade
operations are almost completely in their hands; as a result, the absence of
criminal liability of such organizations will lead to the loss of eective state
control in this area.
One can hardly argue that legal entities are articial legal entities capable
of subjective expression of will in the form of certain behavior regulated by
the norms of national legislation. Among all legal entities provided for by
the federal law, the corporation itself has the unique status of the aggregate
impersonal expression of the will of the persons who are part of it, i.e. the
shareholders.
It is this collective status that determines the noticeably higher and more
perfect production, nancial, economic and, of course, legal regime of a
corporation compared to the legal capacity of an individual or, say, a limited
liability company. This specicity of the legal nature of the corporation
allows it to exert a signicant inuence on social and legal relations in the
state. In the criminal law context, this means that corporations are potential
carriers of a much greater public danger (social harm) to legal relationships
protected by law than individuals (Kamensky, 2016).
The latter circumstance actually determines the need to adopt appropriate
norms of a preventive, protective and punitive nature, capable of eectively
“protecting” society as a whole and its individual law-abiding representatives
from crimes and other violations by corporations. After many years of
discussions and experiments, the United States, to be followed by other
developed nations, chose the path of giving corporations the status of the
subject of crime. Thus, the possibility of bringing corporations to criminal
liability has become an undeniably eective form of state control over their
activities.
The annual amounts of criminal nes paid by the U.S. corporate
wrongdoers over the period of 2001-2018 are shown in Figure 2.
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Anatolii Tarasiuk, Daria Prokoeva-Yanchylenko, Yuriy Lutsenko, Andrii Danylevskyi y
Tamara Makarenko
Corporate liability and white-collar crime: Comparative review
Fig. 2. Corporate Criminal Penalties, 2001-2018. Source: Declining Corporate
Prosecutions. Corporate Prosecution Registry Blog. In: https://corporate-
prosecution-registry.com/blog/declining-corporate-prosecutions.
In the research paper on the issues of rethinking principles of criminal
liability of corporations in the USA, American commentator L. Dervan
rightly focuses attention on the fact that such liability runs into many
questions, problems and mistakes, since legal norms, which from the
very beginning have been developed to apply to natural persons, should
henceforth also cover legal ctions. Criminal laws, nevertheless, can and
should be applied to corporations to ensure their liability to society, as long
as companies develop, they increase their assets, as well as the degree of
inuence on important processes in public life.
At the same time, corporations are nothing more than an association
of people primarily for the purpose of obtaining income, and therefore
it is worth remembering not only the guilty individuals who embody the
illegal behavior of companies, but also all those innocent employees and
shareholders who may seriously suer as a result of guilty verdicts against
corporations. Therefore, in criminal cases initiated against companies the
same high standard of fairness, balance and objectivity should be ensured,
as during the actual criminal prosecution of individuals – representatives
(employees) of companies (Dervan, 2011).
Historically, the prevailing criminal law theory was that corporations
could not be held criminally liable due to their articial personality (juristic
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ction approach) and lack of the moral blameworthiness element. For a
long time, particularly for the past hundred years, American criminal
law experienced several serious advancements in both rethinking and
introducing corporate criminal liability into federal and state law systems.
This was done primarily through judicial decision-making and prosecutorial
enforcement (Brickey, 1993). Despite the ongoing discussions on the
reasons and results of having corporate criminal liability, it is clear that it
is established: it is routinely imposed on corporate wrongdoers, it brings its
share of public benets, and it seems to serve at least some of the criminal
law goals.
d) European Model of Corporate Criminal Laibility
Throughout Europe, a large number of criminal oences are committed
in the exclusive interest of legal entities by their directors, managers and
employees. For a long time, civil law jurisdictions followed the principle
derived from Roman law societas delinquere non potest, which constituted
an obstacle to the acceptance in the respective legal systems of the possibility
of holding a legal entity responsible in criminal law.
However, in recent years, owing in large part to the spread of oences
connected with business activities and corporate globalization, and taking
into account the inuence of the OECD guidelines, the Council of Europe
initiatives as well as EU and EC legislation, the regulatory framework has
been constantly shifting. Within the European context, the domestic legal
orders vary in their approach to the issue of legal entities liability.
On the one hand, some jurisdictions focus on individual liability, while
others, in contrast, focus on corporate responsibility; conversely, some
countries do not recognize any form of criminal liability of companies,
while others provide for administrative sanctions for oenses. If it is not
possible to discern a “common European model” of how to govern such
corporate responsibility, one can nevertheless identify the guidelines that
are followed in the European domestic jurisdictions.
Moreover, corporate globalization means that many companies have their
headquarters in one country whilst at the same time having an important
part of their business in other jurisdictions. This further underscores the
importance of securing the introduction in Europe of legislation on the
liability of legal entities, which will provide uniformity, and certainty in the
prosecution of actions related to corporate crime.
If today in most of European legislations societas delinquere potest, it is
also true that step-by-step European Countries are going towards a system
in which also societas publica delinquere potest, which means that also
public bodies can be liable for criminal oenses.
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Tamara Makarenko
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Thus, European corporate managers and administrators must have at
least basic legal knowledge related to issues of corporate criminal liability,
if they want to avoid incurring any form of liability, whether criminal or
administrative.
While serving as a typical case for the European jurisdictions, the
relevant approach by Dutch law and practice can be of particular interest
here. Section 51, paragraph 1 of the Dutch Criminal Code provides:
“Criminal acts can be committed by natural persons and bodies corporate.”
Furthemore, the Dutch Supreme Court (HR 21 oktober 2003, LJN: AF7938)
has interpreted this general rule as to include corporate liability “… when
the act has taken place within the sphere of the body corporate.”
Non-limitative enumeration (HR 21 oktober 2003, LJN: AF7938)
includes the following situations: 1) it is an act of an employee or someone
working for the corporate; 2) the act ts the regular course of business of
the corporate; 3) the act benetted the corporate in its business; 4) the
corporate was in a position to prevent the act, but the act was acceted or
condoned – or in the past similar acts have been accepted or condoned
(Brouwer, 2015).
B. Keulen and E. Gritter have also presented a thorough scholarly report,
which provides a brief overview of the concept of corporate criminal liability
in the Netherlands. Following a description of the historic development of
this concept, they pay attention to the substantive law regarding corporate
liability, including the concept of secondary liability and defenses, and to
specic rules for the trial and the punishment of legal persons. The position
in Dutch criminal law of the public law legal person, such as the provinces,
has also been dicussed in this work. The report was completed with a short
evaluation of the concept of corporate criminal liability in the Netherlands
(Keulen and Gritter, 2011).
Some other major European economies also currently have some
variations of corporate criminal liability models. For example, since coming
into force of the new Penal Code on March 1, 1994, French law recognizes
corporate criminal liability. The legislature chose a rather broad model of
corporate criminal liability, which applies, in principle, to all oenses and
to all legal persons, including companies (Deckert, 2011). However, the
legislation requires that a department or representative of the legal person
commits the oense “on the behalf of” this entity (Art. 121-2 of the French
Criminal Code). Such approach resembles the current Ukrainian model.
Liability of a legal person may therefore arise out of oenses committed
by their collegial bodies such as the board of directors or the supervisory
board, or individual legal representatives. Individual representatives include
individuals such as: (i) directors, managers, general managers and presidents,
who are vested, by the law or the bylaws, with the power to administrate,
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manage and control the entity; and (ii) de facto directors or managers, but
also persons, vested with delegation of powers (including employees) or
acting within a specic mission for the company (such as liquidators).
Regarding the issues of liability, arising out of acts of employees, and
given that the delegation of powers does not need to be made in writing,
certain Supreme Court cases refer to the status or quality of the employee
to determine whether they have been acting as “representatives” of the legal
person. Since December 31, 2005, any legal persons may be held liable for
any criminal violation of French law (Lasry, 2023).
Penalties for legal persons may be of a monetary and non-monetary
character. Also, some penalties can be incurred by the legal persons only.
No general principles under French law constrain the judge when deciding
the penalties incurred by a convicted legal person. The French legislator
has also established some specic procedural rules with regard to legal
persons. However, with a few exceptions, the majority of the rules of criminal
procedure applicable to natural persons apply to legal entities as well.
In turn, the Criminal Code of Ukraine has embodied such a model of
criminal law inuence on a legal entity, within which the subject of the crime
and only a natural person continues to be held criminally liable, and criminal
law measures are applied to a legal entity, which itself is not a separate form
of criminal liability (Orlovska, 2014).
Based on the current Criminal Code of Ukraine, manifestations of
criminal and legal response to the commission of crimes and other social
crimes dangerous encroachments provided for by this Code, criminal are
not exhausted by responsibility; measures of criminal law inuence can be
applied as part of the implementation of criminal liability, as well as outside
it (as it happens, in particular, when applying measures criminal law to legal
entities).
Conclusions
Nowadays, criminal liability of corporations in the USA is a wide spread
practice. Such liability regime is characterized by a close connection
between provisions of substantive criminal law, criminal procedural law,
and regulatory legislation. Corporate liability is a unique body of law,
peculiar to the American legal system and at the same time signicantly
diers from European legal approaches.
In this research paper we have established that the answer to the
question of the reasons for the emergence and further development of the
institution of criminal liability of corporations in the USA lies not so much
in the area of criminal law, as in the coordinate system of real needs related
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Anatolii Tarasiuk, Daria Prokoeva-Yanchylenko, Yuriy Lutsenko, Andrii Danylevskyi y
Tamara Makarenko
Corporate liability and white-collar crime: Comparative review
to the general development of society, primarily in the part of forming and
protecting foundations of the market economy. Federal case law on the
issue demonstrates the scale of corporate abuses and, at the same time, the
high level of harm to society that the activities of modern corporations can
create in the absence of reliable regulatory and law enforcement barriers.
At the same time, it has been established that formation and development
of the institution of criminal liability of corporations in the USA as in any
other given country is a long and complex process, which will be specic for
each state that introduces this type of liability.
As pointed out by legal commentators, corporate criminal liability in the
United States, and to a lesser degree in some Western European nations, is
a powerful law enforcement tool, which is capable of both protecting society
of massive wrongdoings and deterring businesses from unlawful deviations.
Therefore, upon introduction of such type of liability to the criminal
law of any given country, as is currently the case with Ukraine, detailed
guidelines for prosecutors and judges need to be issued to ensure both
responsible and eective use of such newly created statutory provisions.
Organizational liability statutes have been initially designed and thus should
be used for the purposes of punishing and detering corporate misconduct
only.
By no means should they be used with the purpose of abusing discretion
by judges or prosecutors or corruptly inuencing lawful businesses.
Unfortunately, such legal guidelines have not been developed and
implemented in Ukraine yet. However, a balanced application of well-
written organizational criminal liability standards empowers prosecutorial
and judicial communities with higher integrity, professional responsibility,
and impartiality – qualities, which are always important, when dealing with
a powerful corporate world.
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Esta revista fue editada en formato digital y publicada
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