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Criminal Law



It is important for business leaders to understand the criminal justice system, the basic elements required for a crime, crimes in the business environment, and federal criminal statutes that regulate business. Criminal law punishes people who commit crimes against the public, and the government is in charge of criminal prosecutions. The U.S. Constitution provides a variety of rights to people, and courts have extended some of those rights to organizations. A number of federal criminal statutes regulate the way organizations do business, which is important as it provides the public and stakeholders with confidence in both organizations and the legal system.

At A Glance

  • Criminal law is designed to punish people who commit crimes and deter those who are thinking of committing crimes. The government prosecutes criminal law at the local, state, and federal levels.
  • In criminal cases, the prosecution bears the burden of proof to present evidence demonstrating, beyond a reasonable doubt, that the defendant is guilty of every element of each charged offense.
  • Criminal liability requires two distinct elements: an act or omission when one has a legal duty to act (guilty act, or actus reus) and criminal intent or state of mind (guilty mind, or mens rea).
  • Forms of punishment for committing a crime include incarceration in prison or jail, community service, fines, house arrest, probation, restitution, deportation, and the death penalty.
  • Corporations have most of the same constitutional rights in criminal proceedings as individual defendants.
  • Corporations cannot be incarcerated and will most likely be fined if found guilty. Individuals working for the corporation can be incarcerated for their guilty acts because corporations cannot act on their own. The 5th Amendment may protect the individuals who face criminal liability as part of the prosecution of a corporation.
  • White-collar crimes are typically nonviolent crimes committed in a commercial context by a professional or manager for financial gain. The most common white-collar crimes include embezzlement, fraud, bribery, insider trading, tax evasion, and money laundering.
  • The major federal statutes relevant to businesses and crime are the Racketeer Influenced and Corrupt Organizations (RICO) Act, the False Claims Act, the Foreign Corrupt Practices Act of 1977, and the Sarbanes-Oxley Act of 2002 (SOX), as amended by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.
  • Other federal statutes that regulate business include the Economic Espionage Act of 1996 (EEA), the Controlling the Assault of Non-Solicited Pornography and Marketing (CAN-SPAM) Act, and the White-Collar Crime Penalty Enhancement Act of 2002 (WCCPA), in addition to various state laws.