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New York Mets owner Steven Cohen looks to continue his offseason spending spree by signing Carlos Correa to a short-term contract. Although negotiations are ongoing, the parties initially agreed on a 12-year contract worth $315 million. Infamously, Correa was a member of the 2017 Houston Astros team that cheated its way to the World Series, and Cohen was involved in one of the most famous insider trading scandals in history. This potentially lucrative contract left me with a burning question. Why do scammers thrive?

In both baseball and the corporate world, cheaters rarely seem to get their just deserts. Whether it’s former Major League Baseball star and chronic doper Alex Rodriguez making good TV appearances or Wells Fargo maintaining a stable stock price despite serial consumer abuse, those who break the rules seem to do well even when facing some sanctions such as suspension. or fines.

The response to cheating in baseball can tell us a lot about how corporate crime is handled.

When investigating the Astros’ cheating scandal, MLB Commissioner Rob Manfred had several options. He could punish individual players with anything from fines and suspensions to outright bans. He could punish the team by levying a fine or taking away draft picks. He could go after management using fines, suspensions or bans as sanctions. After all, he could have vacated the 2017 World Series title and robbed the Astros of his cheating spoils.

Manfred ended up fining the Astros $5 million, firing two managers and forfeiting four draft picks. But the Astros retained their World Series title and no players were penalized. Instead, the players were granted immunity for providing information.

These options and dilemmas are at the heart of how we respond to corporate crime. Often, when a corporate crime occurs, prosecutors may indict individual employees or corporate executives. Prosecutors can charge the corporation, or they can pursue a Deferred Prosecution Agreement, or DPA, and levy a fine against the corporation. Finally, in theory, prosecutors could pursue a “corporate execution” by liquidating the company through a court order.

Corporate crimes are difficult to prove, so prosecutors tend to offer immunity to individuals in exchange for their testimony. Prosecuting a corporation is a challenge in itself. corporations are legal shams that cannot be jailed. And corporate capital punishment is unpopular because of collateral damage. employees and shareholders who have done nothing wrong can lose their jobs or investments if the company is liquidated by court order. As a result, the default approach to corporate crime is the DPA and fines.

Manfred faced a similar choice. Stripping him of the title, or in extreme cases giving the Astros a “death sentence” and dissolving the franchise, would hurt fans and employees who had nothing to do with the scandal. Sanctioning individual players would make it difficult to detect the full extent of the cheating. And it was extremely difficult to prove that the owner knew enough to be held liable for suspending or forbidding ownership.

The bottom line in baseball and business is that cheaters thrive. Individuals go free, corporations survive, and fines become the cost of doing business. The Astros won the World Series again last year, just a few years after the penalty and draft pick penalty. Former general manager Jeff Luno, though suspended and fired, now owns a football team. The other former manager, AJ Hinch, also suspended and fired, currently manages another MLB team. Correa is on the verge of a huge contract, and every Astros player needs to keep their World Series ring. The cost of the tainted World Series trophy was a $5 million fine and four draft picks.

With such lenient penalties, cheaters should come out ahead.

So too in the business world. Despite federal fines and a two-year trading ban for his financial violations, hedge fund manager Cohen is still fabulously wealthy and now owns the Mets. Wells Fargo, despite widespread consumer abuse and paying billions in fines, continues to see no impact on its stock price. Hardly any financial institutions were held responsible for the 2008 financial crisis, and many are alive and well today. The Sacklers are still wealthy from their ill-gotten gains from Purdue Pharma’s opioid sales. In the corporate world, fines and DPAs are a manageable cost to business, resulting in commercial anomie that hurts us all.

If we really want accountability, we must be prepared to make tough compromises. We must be prepared to pursue individual prosecutions, even if this makes it difficult to find the facts. And we must put corporate capital punishment on the table, even if the consequences are frightening. Of course, the right approach will depend on the circumstances of each particular case. But, in general, it is clear that the CDPs were not enough.

If we don’t get serious about accountability, scammers will continue to thrive.

Max Wilner-Giverk is a student at the University of Chicago Law School and an avid baseball fan. He has been published in Northeastern University Political Review, E-International Relations, and Northeastern University Writing Journal.

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