Hide No Harm Would Establish Criminal Penalties for Corporate Executives
Sen. Blumenthal’s Bill Would Close Loophole That Lets General Motors Officials Avoid Jail Time in Recall Scandal
October 6, 2015
WASHINGTON, D.C. – Consumer safety, public health, environmental and other groups in the Coalition for Sensible Safeguards lauded “Hide No Harm,” a new bill introduced today by U.S. Sen. Richard Blumenthal (D-Conn.), which would hold corporate officers criminally accountable if they knowingly conceal serious dangers that lead to consumer or worker deaths or injuries. Penalties could include jail time.
The bill is in response to the General Motors (GM) recall scandal, in which an ignition switch defect was linked to 124 deaths. Documents released by a congressional committee showed that GM officials knew about problems with the device as early as 2001. Despite this, last week, the U.S. Department of Justice agreed to settle criminal charges with GM through a “deferred prosecution agreement,” which includes a fine but no criminal charges for any individual GM corporate officers and no explicit admission of criminal culpability from GM.
Even the prosecutor in the GM case admitted that “there are gaps in the law,” which prevented him from prosecuting corporate executives. Hide No Harm would give prosecutors the tools they need to go after corporate executives who hide the truth about dangerous products. Other notable cases where corporate officers withheld information about dangerous products include:
- Merck withheld information on the risks of the arthritis drug Vioxx from doctors and patients for more than five years, resulting in up to 139,000 heart attacks;
- Simplicity Cribs sold products company officials knew were defective, leading to the deaths of at least 11 babies and many injuries; and
- Toyota officials knew that millions of cars it sold had a defective gas pedal mechanism that could cause unintended acceleration – which led to numerous fatal collisions – yet the company failed to tell the public or federal regulators, the company later admitted in a federal settlement.
Statements from the CSS leadership:
“Our current fines and penalties are not tough enough to ensure that every business is playing by the same rules. We have to make sure that the businesses that are willing to put the health of the American people at risk face heavy sanctions. The bad actors should not have a competitive advantage over responsible businesses that adhere to health and safety standards.”
Katherine McFate, president and CEO, Center for Effective Government (CSS co-chair)
“After the disgraceful GM settlement, it’s imperative that the Hide No Harm Act be made law. We need to make clear to corporations and corporate executives that they will face criminal prosecution if they hide product and workplace dangers from government regulators and the public. And we need to make it clear to prosecutors that they have no excuse to let giant corporations off the hook with cost-of-doing business fines that fail to punish, deter or provide justice to victims of corporate crime.”
Robert Weissman, president, Public Citizen (CSS co-chair)
“Countless numbers of workers and citizens have suffered and died because companies withheld and hid information on the dangers of products and exposures like asbestos. This bill would hold corporate officials personally responsible for their role in these deaths and injuries, help stop corporate concealment and save lives.”
Peg Seminario, safety and health director, AFL-CIO
“This bill will provide an important deterrent to companies and their executives who knowingly sell and distribute unsafe products to consumers. The consequences to consumers can be dire while the consequences for companies may be negligible. This legislation seeks to ensure that the consequences of selling an unsafe product are significant.”
Rachel Weintraub, legislative director and general counsel, Consumer Federation of America
“Access to information is the cornerstone of our democracy. This legislation sends a clear message that corporations have a serious responsibility to inform the public, including disclosure of information crucial to protecting public health.”
Celia Wexler, senior Washington representative, Center for Science and Democracy, Union of Concerned Scientists
“For too long, powerful CEOs have looked at the penalties for corporate wrongdoing – even wrongdoing that threatens or harms the health or safety of workers or consumers – as mere costs of doing business. The Hide No Harm Act changes that paradigm to substitute significant criminal penalties, including jail time, for the loophole-ridden laws that result in wrist-slaps for companies and executives that hide health and safety harm. Besides punishing wrongdoers, Hide No Harm will lead to safer workplaces and a safer marketplace.”
Ed Mierzwinski, consumer program director, U.S. PIRG
“For too long, responsible corporate officers at car companies and other manufacturers of consumer products could knowingly sell products that had fatal defects without fear of being subject to meaningful criminal accountability. The Hide No Harm bill brings a long overdue change to criminal enforcement by making this kind of conduct a felony – giving prosecutors a new tool to punish corporate officers for malfeasance with the best deterrent available, the threat of significant jail time.”
Rena Steinzor, member scholar, Center for Progressive Reform
Steinzor is the author of Why Not Jail? Industrial Catastrophes, Corporate Malfeasance and Government Inaction.
The Coalition for Sensible Safeguards is an alliance of more than 150 consumer, labor, scientific, research, faith, community, environmental, small business, good government, public health and public interest groups — representing millions of Americans. We are joined in the belief that our country’s system of regulatory safeguards should secure our quality of life, pave the way for a sound economy and benefit us all.