02/11/2008 03:02:33 PM EST
Corporate Fraud -- Is It Really Just a Few Bad Apples?
In his Expert Commentary on the Stoneridge decision, Stoneridge Inv. Partners, LLC v. Scientific-Atlanta, Inc., 128 S. Ct. 761 (U.S. 2008), James Fanto states that the Court’s opinion supports the view that corporate fraud is the product of a few “bad apples” in a corporation’s hierarchy.
Stoneridge Inv. Partners, LLC v. Scientific-Atlanta, Inc., 128 S. Ct. 761 (U.S. 2008),
But that position does not reflect the reality of corporate fraud, which is generally the product of a group of participants. Right or wrong, this strikes me as human nature; there is an innate urge to put faces on things, both good and bad. This phenomenon manifests itself consistently in popular culture. For example, when a football team wins or looses, even though 22 people start on offense and defense, the quarterback gets the praise or takes the blame. Films, the ultimate collaborative art-form, are often viewed as the sole work of the director. Fanto is very likely right in his criticism of the Stoneridge decision, but Supreme Court Justices are only human in their desire to find someone to blame for corporate fraud.