California Forum

Corporate criminals go unpunished

Volkswagen CEO Martin Winterkorn announced his resignation Wednesday over a growing scandal of falsified emissions tests for “clean diesel” vehicles.
Volkswagen CEO Martin Winterkorn announced his resignation Wednesday over a growing scandal of falsified emissions tests for “clean diesel” vehicles. Action Press/Zuma Press/TNS

The Pandora’s box of scandal is just opening for Volkswagen, which falsified emissions tests on as many as 11 million of their cars.

But for the families of the 124 victims killed by General Motors’ failure to recall a known ignition switch defect in their cars, their legal saga is drawing to a shamefully disappointing close.

On Sept. 17, these families watched in horror as the auto giant signed an agreement with the Department of Justice that failed to hold any of the individuals responsible for the cover-up legally accountable. Instead, GM will pay a $900 million fine for a deferred prosecution agreement, which allows the charges to be dropped in three years if it behaves well.

U.S. Attorney Preet Bharara said that his hands were tied because, unlike other industries, the auto industry is not breaking any law by putting a potentially deadly product on the market.

So even though the settlement itself blames individuals for the problems at GM, there will be no trials or jail time for those who knowingly concealed information from the government about the deadly ignition switches for years. While the settlement celebrates GM for “terminating” the wrongdoers, in reality the guilty profited during a decade of delaying the recall, then left the company with golden parachutes.

GM settles, signs a deal to avoid criminal conviction, and its shares go up 11 cents all on the same day. That’s a clear message: You can buy innocence and keep your shareholders happy!

Over the past few years, corporations and the people running them have been getting away with murder, fraud, money laundering and environmental ruin with increasing frequency and diminishing consequences. Get-out-of-jail-free settlements, fines that are dwarfed by ill-gotten profits, and backdoor deals that seal investigation files and prevent public accountability are the order of the day.

These settlements do nothing to quell the sense of entitlement among the business elite. Though its leaders are now backpedaling, Volkswagen is yet another example of corporations acting above the law when it comes to trading the environment or human lives for higher profits.

Something has to change in our justice system when real people, not some faceless corporate entity, make deadly, documented decisions to preserve profit over human life, and there’s nothing prosecutors can do about it. We can only hope that new Department of Justice guidelines to increase prosecution of individual employees will have some impact, though they apply only to new cases, not to the GM case.

As Californians, however, we can do more than hope. A 1990 law requires that corporate managers disclose to a government agency if their product or production process has a hidden danger of causing death or great bodily harm. Failure to disclose such a danger is a crime punishable by imprisonment.

But there was such blowback from the business community that the law routinely fails to be enforced, even when it clearly applies – such as the GM case.

For the sake of the California GM victims, and in the hope of encouraging an accountable marketplace, we challenge the elected prosecutors of our state to put the law to use and secure justice.

Harry Snyder is a consumer advocate and lecturer at the University of California, Berkeley, School of Public Health. Courtney Hutchison is a public health advocate and independent media consultant.