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Large companies will continue doing illegal things while reward outweighs the risk. This reminds me of pharmacy distributors that contributed to the opioid epid

Large companies will continue doing illegal things while reward outweighs the risk. This reminds me of pharmacy distributors that contributed to the opioid epidemic. They continue operating even when they were told not because there was no real punishment in place, and the only thing that stopped them eventually was a criminal indictment [1]. Fines do not work, because like the OP article states, the shareholders end up paying up, not the executives who let these things happen. If we want to curb this behavior, we need to do one of 4 things: 1. Criminal indictments for executives and/or the company instead of fines for breaking the law 2. Fine executives severely, to the point of bankrupcy, on top of fining the company 3. Significantly increase the fines against the company, maybe a magnitude of 100-1000x, to the point where breaking the law flagrantly may result in bankruptcy or dissolution of the company. A fine should not just be "cost of doing business" 4. Prevent the company from doing business in an area where they broke the law. E.g - if they launder money illegally for a Ukranian businessman, forbid them from doing any business in Ukraine for several years. This one is more nebulous and may not work effectively for banks. Worked for shutting down opioid distribution for certain localities[2]. [1] https://www.npr.org/2019/04/23/716571375/drug-distributor-and-former-execs-face-first-criminal-charges-in-opioid-crisis https://www.npr.org/2019/04/23/716571375/drug-distributor-an... [2]https://www.pharmacytimes.com/news/oxycodone-supplier-shut-down-due-to-massive-shipments https://www.pharmacytimes.com/news/oxycodone-supplier-shut-d...

valuearb 6y ago
You advocate terrible policy. Someone sets up a bank to serve their community, taking investors from all over your area. They take deposits, make loans to help the community grow. The management team is great at training staff to follow all banking regulations. The bank grows to hundreds of branches. Then one branch manager is bribed by a criminal to subvert banking regs and the internal control systems, so they can launder millions of dollars. You would prosecute the CEO for unknowingly employing a criminal? Or senior execs for unknowingly having security holes a clever employee could buy pass (when all control systems can be bypassed by clever employees)? You’d increase fines to bankrupt the Company and wipe out investors investment fir the crime of hiring an honest CEO and execs who got fooled by one bad Apple? Intent matters.
- stainforth 6y ago
  Yes absolutely.
- ativzzz 6y ago
  A one off situation like you describe can be limited to punishing the particular branch manager. However, banks like Deustche and JPMorgan, who seem to be having these issues nonstop with regularity, are clearly run to allow these kinds of criminals to actively participate in their banking structure with minimal oversight, hence the responsibility resting on the higher-ups.
  - valuearb 6y ago
    Again no monitoring system is perfect or unbreakable. Large banks are going to seem more like they “allow” this simply because they have 10x-100x more employees. The solution to people laundering funds from selling marijuana isn’t punitive banking regulation, its legalizing marijuana. The solution to Dictators stealing from their citizens isn’t onerous banking regs on the 99.9% of honest clients, it’s removing Dictators from power.
    - ativzzz 6y ago
      > removing Dictators from power One way to remove dictators from power is to disrupt their money flows, so tighter banking regulations to prevent fraud and money laundering. > simply because they have 10x-100x more employees There are plenty of large banks who do not have this issue. Considering Deustche on its own has had more sketchy money than pretty much all other banks combined (according to the article) speaks volumes.
      - valuearb 6y ago
        Please name a single dictator removed from power using banking regulations. Then explain why the banking system is used against Dictators who still have voting rights in the UN.
Malician 6y ago
This sort of regulatory response has already caused a problem: as a 100% legitimate business, you can already get totally cut off from all banking services if something about you feels potentially dangerous to back-office staff isolated from anyone you can talk to.

valuearb 6y ago

You advocate terrible policy. Someone sets up a bank to serve their community, taking investors from all over your area. They take deposits, make loans to help the community grow. The management team is great at training staff to follow all banking regulations. The bank grows to hundreds of branches. Then one branch manager is bribed by a criminal to subvert banking regs and the internal control systems, so they can launder millions of dollars. You would prosecute the CEO for unknowingly employing a criminal? Or senior execs for unknowingly having security holes a clever employee could buy pass (when all control systems can be bypassed by clever employees)? You’d increase fines to bankrupt the Company and wipe out investors investment fir the crime of hiring an honest CEO and execs who got fooled by one bad Apple? Intent matters.

stainforth 6y ago
Yes absolutely.
ativzzz 6y ago
A one off situation like you describe can be limited to punishing the particular branch manager. However, banks like Deustche and JPMorgan, who seem to be having these issues nonstop with regularity, are clearly run to allow these kinds of criminals to actively participate in their banking structure with minimal oversight, hence the responsibility resting on the higher-ups.
- valuearb 6y ago
  Again no monitoring system is perfect or unbreakable. Large banks are going to seem more like they “allow” this simply because they have 10x-100x more employees. The solution to people laundering funds from selling marijuana isn’t punitive banking regulation, its legalizing marijuana. The solution to Dictators stealing from their citizens isn’t onerous banking regs on the 99.9% of honest clients, it’s removing Dictators from power.
  - ativzzz 6y ago
    > removing Dictators from power One way to remove dictators from power is to disrupt their money flows, so tighter banking regulations to prevent fraud and money laundering. > simply because they have 10x-100x more employees There are plenty of large banks who do not have this issue. Considering Deustche on its own has had more sketchy money than pretty much all other banks combined (according to the article) speaks volumes.
    - valuearb 6y ago
      Please name a single dictator removed from power using banking regulations. Then explain why the banking system is used against Dictators who still have voting rights in the UN.

Malician 6y ago

This sort of regulatory response has already caused a problem: as a 100% legitimate business, you can already get totally cut off from all banking services if something about you feels potentially dangerous to back-office staff isolated from anyone you can talk to.