Major corporations operating in California may soon be faced with increased financial penalties for both felony and misdemeanor offenses. This comes as part of a legislative overhaul that is aimed at improving funding for services dedicated to crime victims throughout the state.
The proposed legislation, AB 2432, which recently passed the Assembly Public Safety Committee, could potentially lead to a substantial increase in the state’s corporate crime fines. One notable provision within this bill would see companies convicted of a felony hit with an additional fine of at least $100,000. However, prior to becoming law, the bill needs to pass through both the full Assembly and Senate.
The measure has not sparked significant opposition thus far. If implemented, the proposed penalties could include an added fine eqivalent to two times the amount of the loss in question, or up to a staggering $25 million for companies found guilty of serious offenses.
According to this Bloomberg Law news report, the additional income generated by the increased fines would largely go towards bolstering the state’s funding for crime victim services. Such services have increasingly become a central concern for lawmakers as they strive to provide adequate support for victims in the aftermath of crimes.
Worldwide law firms and international businesses with operations or interests in California are now keeping a close eye on these developments. While the state continues to reassess its approach to corporate wrongdoing, corporations will need to give serious consideration both to the ways these proposed penalties might affect them and to their internal mechanisms for legal compliance.