Most American business executives will never have to pay the true costs associated with their decisions to engage in damaging and often illegal practices. Whether it’s pharmaceutical companies releasing products and lying about potential, associated hazzards, investment advisors lying to investors about the risks of certain products to rake in their own on fees, or politicians who lie to the people and pass legislation that benefits their cronies – they get in, take what they can and get out. Often, they walk away, paying fines that are merely a pittance.
Pharmaceutical company Johnson & Johnson agreed to pay $2.2 billion in 2013 for criminal and civil penalties for allegations regarding Risperdal, Invega and Natrecor. The company was alleged to have marketed the drugs for uses that were not approved by the Food and Drug Administration (FDA) and paying kickbacks to physicians and pharmacy providers.
“Risperdal was marketed for off-label uses, putting patients at risk,” commented Megan McBride, an attorney with the Levin, Papantonio law firm who practices in the areas of bad drug and pharmaceutical litigation. “It’s not the first time that Johnson & Johnson has been brought to task for needlessly putting patients at risk.”
GlaxoSmithKline agreed to pay $3 billion for fraud for similar allegations that it was marketing its drugs for unapproved uses, failure to report certain safety data, and its civil liability for allegedly false price reporting practices.
In November 2013, the DOJ announced that JPMorgan would pay $13 billion for misleading investors about securities containing toxic mortgages. The settlement is the largest in the history of the financial industry. The lawsuit was over toxic assets that were pawned off on investors misled by their advisors during the housing crisis that led to the great recession, activities nearly half a decade old.
All of these companies are still in business and making astronomical profits. Admittedly, the JPMorgan settlement included an agreement that the business assist in ongoing criminal investigations, but no indictments have been issued to date.
Indeed, it seems that for American corporations these fines and penalties are just another cost of doing business. One that, if the potential earnings will exceed the cost of the penalty, corporations will engage in again and again.
Joshua is a writer and researcher with Ring of Fire. You can follow him on Twitter @Joshual33.
