civil law, criminal law, or both

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Importance of Criminal Law and its Role in Business Environment

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Importance of Civil Law and its Role in Business Environment

Failing to comply with the established laws, whether federal, state, criminal or civil laws can result in significant implications in an individual’s business. Any business entity should understand the policies set in its environment of operation and the general rules of the business. An organization that does not follow the established guidelines can be vulnerable to lawsuits, fines and audits, and in some cases, may have their businesses dissolved completely. One such essential laws that have an elaborate role in the business environment is criminal law. Unethical behavior among the business individuals or corporations can result in extreme consequences that may force the society to criminalize certain types of business activities. Such actions may include tax evasion, corrupt foreign practices, fraud and embezzlement. A business that violates criminal laws can face severe fines while the corporate managers can also face fines or jail terms. The study will aim to define criminal law and illustrate how the established Criminal Finances Act under criminal law affects the business environment.

Definition of Criminal Law

Criminal law refers to the body that defines criminal offenses, regulates the apprehension, charging, and trial of the suspected individuals, and aid in fixing penalties and modes of treatment applicable to the convicted offenders (Cryer et al., 2019). In the business environment, the criminal law is of significant importance crimes pose a significant threat to the consumers or clients and the organizations. When crimes are committed, individuals get injured, and businesses go through massive losses. Therefore, there should be established laws or guidelines set to punish criminal offenses. Also, some companies use their employees or who have their employees involved in fraud for their benefits. Such events get covered by criminal law that makes the corporations liable for the illegal activities engaged in by an employee working with the firm in the scope of employment that benefits the organization or when the firm’s itself get involved in crime.

Roles of Criminal Law in Business Environment

Under the Criminal Finances Act (CFA), business organizations have been exposed to risks of committing criminal offenses and have offered different states the power to probe their finances (Cryer et al., 2019). The act has placed the criminal law at the leading position and has impacted various business environments. Among the roles include;

Tax evasion

Through the Criminal Finances Act (CFA), criminal law ensures that businesses do not evade tax in their operations. The establishment of the act has made it an offense for any business organization to evade tax. The criminal law, in this sense, ensures that every business organization pays tax to the government. The law also extends to every individual associated with the business and makes it liable if they commit the offense of tax evasion (Cryer et al., 2019). The act ensures that every business association has a role in economic development in any country through taxes.

The money that the businesses pay in the form of taxes to the government and the salaries they pay to their employees help support common resources such as firefighters and the police. The tax money also ensures that the roads and other infrastructural facilities that the businesses use in their products' transportation or used by their clients for distribution purposes are safe and well-maintained (Farmer, 2016). Thus, the companies' taxes are essential because they help fund public services and grow a nation's economy. The businesses have a mandate to pay tax, just like the other working class in the country. However, individual companies do not intend to disclose their financial reports and end up evading tax payments. The criminal law has established measures that ensure that the business who do not remit taxes or provide false information on their financial position, or even fail to pay tax in time face specific policies or fees (Cryer et al., 2019). The aspect ensures that the business is economically and socially responsible for the growth of the environment of their establishment.

Protection against fraudulent electronic communication networks, insurance and Financial Institution Fraud.

Rapid advancement in technology and reduced costs of internet communication media has made it possible for more citizens to access internet services. Attractive marketing and advertising strategies have been deployed by various businesses, which has led to email spam and phishing. Phishing may result in identity fraud and brand impersonation (Golan et al., 2015). Fraudulent utilization of electronic mail and wire in the name of communication is forbidden by criminal law.

The use of mails or a telephone call to defraud anyone, not necessary for monetary gain has been made punishable under criminal law. Moreover, the law prohibits attempts to defraud a business. Hence, the prosecutors are prompted to investigate if the company or anyone suffered a loss. In as much as the criminal law is vast, it is considerably uncomplicated for the prosecutors to determine a breach of the law.

Insurance fraud is another form of illegal business activity where criminal law offers protection. The type of fraud occurs when a business uses deception to receive insurance funds. For example, if a business or an institution uses false reports that an office got burglarized and the stationery, including the computers and other equipment, stolen, and then ask the insurance company to cover for the losses, the result is insurance fraud (Golan et al., 2015). The kind of fraud results because the business has lied about in an attempt to obtain insurance payment. Another form of insurance is arson. In this case, the business individual or person might intentionally burn down their offices since they wish to collect under his fire insurance policy. In this case, the business has committed fraud by arson, intentionally setting the business property on fire for compensations. The criminal protects the insurance companies against such institutions through legal investigation that makes the organizations get no compensation if they lie about the fire's cause. Instead, the law ensures that the firm is held responsible for their actions and get an appropriate punishment in a bid to promote just and fair business practices.

Financial institution fraud is another form of deception that criminal law attempts to protect businesses. The type of fraud is against banks and other similar organizations like the credit unions. The IRS is mandated to investigate the financial institution fraud, and the individuals found with the mistakes or at-fault brought to book through criminal law (Cryer et al., 2019). The various forms of financial fraud can involve individuals who falsify tax documents or those who compromise the profits and loss statements to gain funding from the banks and among the individuals who commit or are involved in money laundering. The criminal law aid in ensuring that the events that result from the deception in an attempt to get money from the bank gets effectively dealt with, another aspect that helps ensure transparency in the business environment.

Prohibitions against the violation of food, drugs and chemical substances Act

Presentation of adulterated or misbranded foods, drugs or any other chemical product like cosmetics or other devices constitutes a criminal offence. The Food Drugs and Cosmetics Act bans any corporation or business from selling any unapproved or expired products to consumers. The law is, however, not a subject of intent as other laws. The Food Drugs and Cosmetics Act allows for the conviction on the violation of the food drugs and cosmetics under US Sec 6.7 even in cases where the offenders were not aware or had no intentions of committing such crimes (Cryer et al., 2019). Therefore, the legal doctrine “Ignorance of the law is no excuse” is applicable.

In this essence, the criminal law makes it illegal for the organizations to sell to the consumers the products that are not approved by organizations such as Food Drugs and Cosmetics Act. Any business involved in food production must comply with the standards or guidelines that have been set by the body (Cryer et al., 2019). Any company found to go against the established guidelines or standards is liable for all the harm caused and may either their license revoked or fined. The law thus helps protect the well-being of the individuals by ensuring that the food production industries provide products that are fit for consumption by a human with no harmful additions.

Environmental protection

Several environmental provisions exist, with a primary intention of conserving, preserving and making the environment safe for business operations. Clean Water Act, for instance, has a stipulated fine of between 2,500 to 25,000 sterling pounds for those companies or individuals who wrongfully discharge pollutants into navigable water bodies, accompanied by a one-year jail term (Brisman et al., 2016). Authorized officers (responsible corporate officers) are charged with the responsibility for defending the Act in a criminal prosecution. The criminal law makes it illegal for the organizations to unlawful discharge pollutants to the water bodies or land. The firms found to dispose of their wastes inappropriately often face severe penalties, and the owners get prosecuted in the courts of law. In this sense, criminal law aims to protect natural resources against exploitation by businesses. The protection of environmental resources or the sustainability of the environment is one of the business's primary roles. Every company has a role in ensuring that its operating environment is well-maintained and that no single activity will destroy natural resources (Brisman et al., 2016). However, some organizations get involved in the inappropriate disposal of waste and over-utilization of the natural resources that result in environmental degradation. The criminal law has set policies against such actions ensuring that the responsible individuals are brought to book through court processes.

Protection of the Foreign Corrupt Practices Act and that of Company’s employees

Bribing a government official to win contracts consequently leads to a criminal offence. Giving bribes to win foreign contracts attracts charges under the Foreign Corrupt Practices Act (Bahoo et al.,2020). A strict requirement has been disposed to ensure accurate records in the company’s books of account on the payments made on contracts and procedures embraced in awarding contracts. The criminal law holds any organization that goes or win contracts using unscrupulous means liable for the dealings. The law requires that businesses win contracts either locally or with foreign organizations based on merits and their ability to deliver and not favor or bribe (Bahoo et al.,2020). The act implies that businesses should be done on a free and fair grounds and give every individual in the business field a chance to compete with the other individuals regardless of their business status.

Another area that the law has played a significant role is on the illegal activities that a member of the organization has been involved in while in the line of duty for the company. The law requires that the liability of a member of a company is a responsibility of the organization. An example is when an organization's employee makes a supplier pay for a particular contract with the threat that failure to pay will ensure that they lose the contract and get awarded to another individual. It is always wrong in any business environment for the suppliers to buy the tenders, especially when it is against the organization's policy (Bahoo et al.,2020). However, specific organizations put pressure on their sales representatives and want to give them a commission based on the value they bring to the organization. The practice always results in the sale representatives giving wrong information to the various parties who want to get involved in the company's business dealings. In the end, they get exploited for the benefit of the company and not necessarily to the employee's advantage.

Criminal law holds the companies responsible for the actions of their employees while in the line of duty. In a case where an employee has used wrong information to the suppliers or clients to the company, the company is held liable and must cater for the damages done (Farmer, (2016). The law requires that the company take responsibility for the harm that has been caused by their employee since the benefits of such actions go directly to the company and not the employee. Thus, this law helps employees get involved in criminal activities as they attempt to earn more revenues for the firm and yet suffer on behalf of the company. The law requires that all businesses be responsible and help protect their employees and any other individual associated with the company. The law requires responsible business practice that encourages humane actions and not that strive to gain more returns through involvement in unlawful activities.

Federal Prosecution of the Organizations

The criminal law has established a general charging principle for the organizations requiring that firms not get treated leniently due to their artificial nature, nor should they form the subject to harsher treatment. The strict enforcement of the criminal laws against the wrongdoers of a company where appropriate has resulted in significant merits for law enforcement and the public, especially in the area of white-collar crime (Fenwick, 2016). The determination of the crimes that the organizations get involved in has resulted in the governments addressing and forming a positive change to corporate culture, influencing company behavior, preventing, discovering, and punishing white-collar crimes.

When charging the corporations, criminal law requires that the law courts determine the nature and the seriousness of the crime. The aspects may include the risk of harm that the action has to the public. The conduct of the organization must be proven harmful to the public or the individuals affected. Also, the law requires that the organization's behavior, especially that of the multi-national and national organizations, effectively intersect with the federal taxation, economic and criminal law enforcement policies (Fenwick, 2016). In applying these principles, the prosecutors and the judges responsible for the cases must determine and consider the practices and the policies of the appropriate Division of the Department while also ensuring that they comply with the policies to the extent that is needed (Fenwick, 2016). In this respect, the law protects both the offender and the offended persons. The criminal law thus strives to establish justice and fairness while carrying out business activities.

Corporate Criminal Liability

Criminal law requires that when an organization is held liable, the extent of the liability or responsibility should affect the business and the individuals in the organization who have been engaged in the criminal act. As the company suffers financially and criminally, the individuals involved also go through the same process (Bahoo et al., 2020). However, in most cases, the law imposes fines on the business and not imprisonment. The act is essential within the business environment since it ensures that the companies are responsible for their operating environments.

Also, the criminal law requires that the directors, managers, or the officers are held liable for the crimes committed in actual authority to perform when they give directions to subordinates to commit any crime. In the process, they fail to practice any due care or supervise their acts that always fall under the category of compliance theory. The theory illustrates that due to the concept framed of responsible relation, an individual would be made criminally liable due to the accountable concern established regardless of whether they have had possession of the knowledge that the act was criminally responsible (Bahoo et al., 2020). The law recognizes that even though an organization can present numerous benefits to the organization, it can also be hazardous to society. The practice needs established principles and standards to help protect the community from the organization's harm. The act gives the firm the mandate to be responsible to the society and the people around their corporation.

Protect businesses following the Racketeering Influenced and Corrupt Organizations Act

The Act is targeted at minimizing and mitigating infiltration of organized crimes in businesses. The Act has banned a series of racketeering criminal offences, referred to as the violation of a minimum of two illegal activities carried out in ten years of any different forms of existing crimes, such as mail, wire and security fraud activities (Kadish et al., 2020). The different types of fraud attract heavy penalties

Mitigation of Computer crime

Computer crime is categorized into four groups, namely:

· Money theft, financial equipment or stealing of a business asset

· Embezzlement of computer time

· computer program theft

· Unlawful retrieval of computer information

Computer-based crimes, including computer abuse, are prohibited by the Computer Fraud and Abuse Act. These offences could be against individuals, property or government policy. Perjury is committed when a crime is committed against public policy. Perjury includes the utilization of mails or internet in a fraudulent manner. A breach of the antitrust law and the violation of other white-collar crimes are also considered.

Conclusion

The unethical behavior by the businesses, people, or organizations can expose society to extreme risks that may force them to respond by criminalizing certain activities. The various forms of criminal activities may include embezzlement, corrupt foreign practices, tax evasion, multiple forms of fraud, and insider trading. Criminal law ensures that the companies that get involved in such activities take responsibility for their actions. The law has established numerous penalties concerning the different kinds of fraud committed. The law can expose the organizations to large fines while the company managers can also face jail terms when they violate the criminal laws.

Businesses have a responsibility for environmental protection. However, some organizations get involved in the release of harmful products that can harm their operating environments. For instance, there are industries associated with toxic waste disposal such as oil into the water bodies and non-biodegradable products on the land. Such waste products are harmful as environmental pollutants and a threat to the living organisms or micro-organisms in the water bodies. The criminal law has instituted the various principles in acts that ensure that the businesses are responsible for their activities and practice effective disposal practices such as the Environmental Acts. The law also provides that a company's or business's food products are safe for human consumption and sold in the right quantities to prevent consumer exploitation. The act makes it illegal for organizations to sell hazardous products or sub-standard products through the Food and Drug Acts. Any business found to go against the act is held responsible for their actions, and this is an essential practice of criminal law in the business environment. The law ensures reliable business operations.

References

Bahoo, S., Alon, I., & Paltrinieri, A. (2020). Corruption in international business: A review and research agenda. International Business Review, 29(4), 101660.

Brisman, A., South, N., & White, R. (Eds.). (, 2016). Environmental crime and social conflict: contemporary and emerging issues. Routledge.

Cryer, R., Robinson, D., & Vasiliev, S. (2019). An introduction to international criminal law and procedure. Cambridge University Press.

Farmer, L. (2016). Making the modern criminal law: Criminalization and civil order. Oxford University Press.

Fenwick, M. (2016). The new corporate criminal law and transnational legal risk. In Flexibility in Modern Business Law (pp. 149-171). Springer, Tokyo.

Kadish, S. H., Schulhofer, S. J., & Barkow, R. E. (2016). Criminal law and its processes: Cases and materials. Wolters Kluwer Law & Business.

Golan, L., Rivner, N., Tsur, M., Orad, A., & Bennett, N. (2015). US Patent No. 9,076,132. Washington, DC: US Patent and Trademark Office