Presidential liability

No, not that President.

The former president of Penn State University was convicted of child endangerment connected with the Jerry Sandusky scandal, for not telling the authorities about a complaint of allegedly inappropriate conduct in order to preserve the university’s reputation.  “Ex-College Head Guilty In Sandusky Case,” The Wall Street Journal, March 25, 2017 A2 (U.S. Watch).

A couple of points.

First, the president of a corporation is responsible for his or her own acts, even if the corporation hasn’t (yet) been held vicariously liable for the criminal act.

Second, the common law duty to report violations of law or policy applies to all employees, even the president.  If the president had reported this to the Board (or it’s close friend, the Compliance Department), and the Board didn’t act (disclose to authorities), would criminal liability against the corporation be easier to establish?

Third, as far as I know, the corporation hasn’t been criminally charged.  Why not?

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Filed under Controls, Duty, Employees, Internal controls, To report

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