New Bill Would Punish Corporate Execs With Jail Time For Lying About Deadly Products

Even though General Motors has acknowledged that more than 100 people died because the carmaker failed to fix defective ignition switches, the recent $900 million settlement with federal prosecutors means that not a single person at GM will see a day behind bars. A newly introduced piece of legislation hopes to hold corporate officers accountable when they conceal information about potentially deadly products.

The Hide No Harm Act of 2015 [PDF], introduced by Senators Richard Blumenthal of Connecticut and Bob Casey of Pennsylvania, would make it a crime for a corporate officer to knowingly conceal information about an action or product that poses the danger of death or serious physical injury to consumers or workers.

Corporate officers would have 24 hours after “acquiring actual knowledge of a serious danger associated with a covered product” to verbally inform an appropriate federal agency or 15 days after to provide written notification of the issue.

The individuals could also be found liable under the Act if they fail to inform other employees and consumers of the dangers “as soon as practicable.”

Under the legislation – first introduced in 2014 – those found to withhold such safety information would face up to five years in prison and/or fines.

The Act defines a corporate officer as an “employer, director, or officer of a business entity” who “has the responsibility and authority, by reason of his or her position in the business entity and in accordance with the rules or practice of the business entity, to acquire knowledge of any serious danger associated with a covered product.”

While the Act seeks to hold officials accountable for any perceived negligence, it also encourages others to come forward with concerns by safeguarding against retaliation.

“It shall be unlawful to knowingly discriminate against any person in the terms or conditions of employment, in retention in employment, or in hiring because the person informed a Federal agency, warned employees, or informed other individuals of a serious danger associated with a covered product, covered service, or business practice, as required under this section,” the Act states.

Additionally, individuals who report potential dangers to regulatory agencies would receive safe harbor from criminal liability. If they are found to have been retaliated against, the employee could receive compensation from the company in question.

“We cannot continue to condone blatantly deceptive and immoral behavior – for too long, individuals who deceive the public and cover up information about dangerous or deadly products have gotten away with little to no penalties,” Blumenthal said in a statement. “This measure would put in place common-sense, long-overdue reforms to ensure officers are held responsible for dishonorable acts that put lives at risk.”

Consumer advocacy groups were quick to back the Act, with our colleagues at Consumers Union saying the legislation would “raise the bar for safety and accountability.”

“When a company hides the truth about dangerous products, the people in charge often get away with little, if any, punishment,” Ellen Bloom, Senior Director of Federal Policy for Consumers Union, said in a statement. “Under this bill, people who know about deadly defects and cover them up would be brought to justice. It’s the right prescription for an outrageous problem.”


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