September 23, 2008 05:24 PM UTC

Amendment 53 - Criminalize Management Incompetence

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• by: DavidThi808

An amendment to the Colorado Revised Statutes extending the criminal liability of a business entity to its executive officials for the entity’s failure to perform a specific duty imposed by law, and, in connection therewith, conditioning an executive official’s liability upon his or her knowledge of the duty imposed by law and of the business entity’s failure to perform such duty; and allowing an executive official who discloses to the attorney general all facts known to the official concerning a business’s criminal conduct to use that disclosure as an affirmative defense to criminal charges.

This initiative is part of the union’s response that will destroy the Labor Peace Act of 1943.

Further info at Colorado Ballot – The Liability of Business Entities and Their Executive Officials Initiative.

Arguments Against

This will negatively impact a business climate in which most businesses and their executives comply with the law. For example, the new criminal penalties could drive higher insurance costs for law-abiding executives, which may ultimately be passed along to consumers. Additionally, fear of prosecution could hinder recruitment of top business talent and may leave community leaders reluctant to serve on nonprofit boards.

State and federal laws already hold business executives accountable. For example, executives can be prosecuted under Colorado law for their own criminal conduct on behalf of their business. Recent federal laws have strengthened criminal and civil penalties for business executives who commit fraud. Criminal prosecution when it is clearly deserved already exists.

This will lead companies who call Colorado home to leave the state, and those who are considering moving here to relocate to other places. It’s a job killer.

Arguments For

Amendment 53 addresses a gap in state law. While business entities themselves can be prosecuted, their executives can currently avoid responsibility for their businesses’ failure to follow state law. The measure helps ensure that these executives are held accountable when they know of a legal duty that their business has failed to perform. Over time, Amendment 53 can foster a business environment that attracts and retains responsible employers.

Amendment 53 may encourage a healthy and moral economic climate for Colorado. When businesses fail to comply with state law, the state’s economy can be impacted in a variety of unexpected or far-reaching ways.

Vote No

You want to drive businesses out of Colorado – this is a great start. This measure criminalizes traditionally civil and regulatory conduct. Any violation of any statute, ordinance, regulation, health standard, etc., would constitute a criminal offense under the statute. And the thing is, there are so many rules & regulations that probably every executive, no matter how hard they try, is probably violating some rule somewhere.

There are already numerous penalties for clearly illegal acts, starting with the fact that the executives involved will be fired and no other company will hire them. There are also numerous civil remedies as well as criminal for the most egrarious cases. This is unnecessary.

In addition, to continue with the incredibly successful Colorado Labor Peace Act of 1943, this (and the other 6 peace act violators) must be defeated.

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