8 ms·

> it’s shocking nobody is going to jail in relation to a fraud guilty plea. They are though. From the justice.gov article: "Dennis Balius, the SPI testing lab

by gnode 7y ago

> it’s shocking nobody is going to jail in relation to a fraud guilty plea. They are though. From the justice.gov article: "Dennis Balius, the SPI testing lab supervisor, led a scheme to alter tests within SPI’s computerized systems and provide false certifications with the altered results to customers. Balius also instructed employees to violate other testing standards, such as increasing the speed of the testing machines or cutting samples in a manner that did not meet the required specifications. Balius pleaded guilty in July 2017 and was sentenced to three years in prison and ordered to pay over $170,000 in restitution." You can't send SPI to jail though, because it isn't a human.

derefr 7y ago
Theoretically you could sentence a corporation to community service. I.e., forcibly rewrite its charter into that of a social benefit corporation, where the social-benefit goals are “doing whatever the government says.” Sort of half-way between commandeering a resource and nationalizing a corporation.
- closeparen 7y ago
  Staff are at-will. The only thing a government really gets from that is the corporation’s assets, which it would rather have in cash than in i.e. durable equipment. Hence fines.
  - munk-a 7y ago
    The problem lately, though, is that the government has been really conservative at metting out an appropriate amount of fines. Human beings are regularly deprived of decades of their lives for silly stuff like possession - if a corporation is forced to pay more than a quarter's profits everyone gets up in arms. So I agree that a collection of liquid assets is more reasonable, but it the volume is an issue.
abakker 7y ago
>because it isn't a human. This is especially interesting in the context of corporate personhood[1]. You can't send a corporation to jail, but you can disband it entirely, or prevent it from operating. A lot of the practical solutions try to leave badly behaving company operating, though, since if we shut them down there is a lot of collateral damage in the form of lost productivity in the economy and lost jobs. IANAL, but my opinion is that there needs to be a better non-nuclear option for an actual guilty conviction for corporations. As I understand it, if a company actually goes to trial and is convicted, they are not allowed to operate anymore, hence the plea deals and fines. Please correct me if I am wrong, though. [1]https://en.wikipedia.org/wiki/Corporate_personhood https://en.wikipedia.org/wiki/Corporate_personhood
- rhizome 7y ago
  As far as that goes, I'd be willing to start with implementing standards for execution and working back from there. I haven't looked it up, but I imagine this is how law enforcement evolved in humans.
- nerdponx 7y ago
  Frankly I don't see why being a member of a corporation should protect an individual from criminal charges. If you do or authorize something illegal on behalf of your company, you should be personally responsible. I know it's a long-standing doctrine in law and there is probably a good reason for it, but it just seems too easy to abuse.
  - godzillabrennus 7y ago
    What if you don’t know that your actions are illegal? Who could reasonably do a job as an employee if they didn’t have that liability shield? The justice system is broken enough in the USA (unless you are rich) that I can’t imagine introducing more issues.
    - nerdponx 7y ago
      What if you don’t know that your actions are illegal? Who could reasonably do a job as an employee if they didn’t have that liability shield? This isn't an excuse for private citizens, so why should it be an excuse as an employee? That said, we should propagate responsibility as high as possible. If you are a rank-and-file employee and your manager is asking you to do something illegal, unless you have enough professional autonomy to decline the request without being fired then your manager is responsible, not you.
souterrain 7y ago
And what conditions imposed by Mr. Balius' leadership contributed to this situation? I'd like to see the federal debarment applied to all individuals within the company's executive team. There's nothing preventing them from perpetrating the same fraud tomorrow by forming a new corp or LLC. Having them named on a debarment will stop them from committing fraud against the American taxpayer in the future.
shkkmo 7y ago
But you can send the executives who designed or oversaw a reward and evaluation schema that incentived this kind of behavior. Instead, we seem pretty comfortable with passing off the responsibility to rank and file employees / middle managers while the majority of the benefits from the bad behavior accrue to the executives and shareholders. Edit: I get that the criminal intent needed under our current laws means that those charges may not be feasible. That just means we need new laws that hold Executives and Managers criminally responsible for the criminal actions of their subordinates that are committed as part of their work duties.
- nerdponx 7y ago
  I fully support this. If you, a manager, are aware of illegal activity within your organization and do not take steps to stop it, you are as responsible as the individuals doing the illegal activity.
  - shkkmo 7y ago
    I think more than that is required. I think that they should be held liable even if they do not know. I think it should be their responsibility to to find out and to design corporate structures that don't incentive and conceal illegal activity by their subordinates.
    - nerdponx 7y ago
      That's fair, although at a certain point (e.g. international holding company with several large subsidiaries) it becomes impossible to police every activity by every department of every subsidiary.
argd678 7y ago
I wonder how a testing supervisor could be motivated to falsify the tests?
- DoctorOetker 7y ago
  this is a good question everybody seems to ignore?
CharlesColeman 7y ago
>> it’s shocking nobody is going to jail in relation to a fraud guilty plea. > They are though. From the justice.gov article: > "Dennis Balius, the SPI testing lab supervisor, led a scheme to alter tests within SPI’s computerized systems and provide false certifications with the altered results to customers...Balius pleaded guilty in July 2017 and was sentenced to three years in prison and ordered to pay over $170,000 in restitution." Was he the instigator of this scheme, or were his superiors aware? I'm not seeing the incentive for someone in testing to fake results on their own. I would imagine the motivation would either come from sales (to close a deal to sell product they couldn't actually produce) or manufacturing (to cover up costly quality problems). Balius seems like a fall guy.
- gnode 7y ago
  > I'm not seeing the incentive for someone in testing to fake results on their own. There's a lot of missing details, so it's hard to know. From the description of what he did, it seems the interest was not so much in generating false results, but cutting corners, such as running the tests quicker than was allowable. This could have been to make up for some shortfall in lab throughput, for instance. Also, it sounds like he was in charge of the lab, so fairly high up. That position may have come with substantial performance related incentives.
olliej 7y ago
The Supreme Court disagrees: companies are people, and as so have all the rights of them. That means they should be subject to the same penalties: all members of the executive management should be in jail. Until that happens there’s no reason for them to stop. And it needs to be all so that other executives ensure that no one is breaking the law.
beenBoutIT 7y ago
On top of all that, if it was human it wouldn't have the ability to file for any meaningful type of bankruptcy here in the States. Corporations have it made.

by gnode 7y ago

derefr 7y ago

Theoretically you could sentence a corporation to community service. I.e., forcibly rewrite its charter into that of a social benefit corporation, where the social-benefit goals are “doing whatever the government says.” Sort of half-way between commandeering a resource and nationalizing a corporation.

closeparen 7y ago
Staff are at-will. The only thing a government really gets from that is the corporation’s assets, which it would rather have in cash than in i.e. durable equipment. Hence fines.
- munk-a 7y ago
  The problem lately, though, is that the government has been really conservative at metting out an appropriate amount of fines. Human beings are regularly deprived of decades of their lives for silly stuff like possession - if a corporation is forced to pay more than a quarter's profits everyone gets up in arms. So I agree that a collection of liquid assets is more reasonable, but it the volume is an issue.

abakker 7y ago

>because it isn't a human. This is especially interesting in the context of corporate personhood[1]. You can't send a corporation to jail, but you can disband it entirely, or prevent it from operating. A lot of the practical solutions try to leave badly behaving company operating, though, since if we shut them down there is a lot of collateral damage in the form of lost productivity in the economy and lost jobs. IANAL, but my opinion is that there needs to be a better non-nuclear option for an actual guilty conviction for corporations. As I understand it, if a company actually goes to trial and is convicted, they are not allowed to operate anymore, hence the plea deals and fines. Please correct me if I am wrong, though. [1]https://en.wikipedia.org/wiki/Corporate_personhood https://en.wikipedia.org/wiki/Corporate_personhood

rhizome 7y ago
As far as that goes, I'd be willing to start with implementing standards for execution and working back from there. I haven't looked it up, but I imagine this is how law enforcement evolved in humans.
nerdponx 7y ago
Frankly I don't see why being a member of a corporation should protect an individual from criminal charges. If you do or authorize something illegal on behalf of your company, you should be personally responsible. I know it's a long-standing doctrine in law and there is probably a good reason for it, but it just seems too easy to abuse.
- godzillabrennus 7y ago
  What if you don’t know that your actions are illegal? Who could reasonably do a job as an employee if they didn’t have that liability shield? The justice system is broken enough in the USA (unless you are rich) that I can’t imagine introducing more issues.
  - nerdponx 7y ago
    What if you don’t know that your actions are illegal? Who could reasonably do a job as an employee if they didn’t have that liability shield? This isn't an excuse for private citizens, so why should it be an excuse as an employee? That said, we should propagate responsibility as high as possible. If you are a rank-and-file employee and your manager is asking you to do something illegal, unless you have enough professional autonomy to decline the request without being fired then your manager is responsible, not you.

souterrain 7y ago

And what conditions imposed by Mr. Balius' leadership contributed to this situation? I'd like to see the federal debarment applied to all individuals within the company's executive team. There's nothing preventing them from perpetrating the same fraud tomorrow by forming a new corp or LLC. Having them named on a debarment will stop them from committing fraud against the American taxpayer in the future.

shkkmo 7y ago

But you can send the executives who designed or oversaw a reward and evaluation schema that incentived this kind of behavior. Instead, we seem pretty comfortable with passing off the responsibility to rank and file employees / middle managers while the majority of the benefits from the bad behavior accrue to the executives and shareholders. Edit: I get that the criminal intent needed under our current laws means that those charges may not be feasible. That just means we need new laws that hold Executives and Managers criminally responsible for the criminal actions of their subordinates that are committed as part of their work duties.

nerdponx 7y ago
I fully support this. If you, a manager, are aware of illegal activity within your organization and do not take steps to stop it, you are as responsible as the individuals doing the illegal activity.
- shkkmo 7y ago
  I think more than that is required. I think that they should be held liable even if they do not know. I think it should be their responsibility to to find out and to design corporate structures that don't incentive and conceal illegal activity by their subordinates.
  - nerdponx 7y ago
    That's fair, although at a certain point (e.g. international holding company with several large subsidiaries) it becomes impossible to police every activity by every department of every subsidiary.

argd678 7y ago

I wonder how a testing supervisor could be motivated to falsify the tests?

DoctorOetker 7y ago
this is a good question everybody seems to ignore?

CharlesColeman 7y ago

>> it’s shocking nobody is going to jail in relation to a fraud guilty plea. > They are though. From the justice.gov article: > "Dennis Balius, the SPI testing lab supervisor, led a scheme to alter tests within SPI’s computerized systems and provide false certifications with the altered results to customers...Balius pleaded guilty in July 2017 and was sentenced to three years in prison and ordered to pay over $170,000 in restitution." Was he the instigator of this scheme, or were his superiors aware? I'm not seeing the incentive for someone in testing to fake results on their own. I would imagine the motivation would either come from sales (to close a deal to sell product they couldn't actually produce) or manufacturing (to cover up costly quality problems). Balius seems like a fall guy.

gnode 7y ago
> I'm not seeing the incentive for someone in testing to fake results on their own. There's a lot of missing details, so it's hard to know. From the description of what he did, it seems the interest was not so much in generating false results, but cutting corners, such as running the tests quicker than was allowable. This could have been to make up for some shortfall in lab throughput, for instance. Also, it sounds like he was in charge of the lab, so fairly high up. That position may have come with substantial performance related incentives.

olliej 7y ago

The Supreme Court disagrees: companies are people, and as so have all the rights of them. That means they should be subject to the same penalties: all members of the executive management should be in jail. Until that happens there’s no reason for them to stop. And it needs to be all so that other executives ensure that no one is breaking the law.

beenBoutIT 7y ago

On top of all that, if it was human it wouldn't have the ability to file for any meaningful type of bankruptcy here in the States. Corporations have it made.