Legislation calls for penalties for corporate malfeasance, funds crime victim services | Opinion

Assemblymember Jesse Gabriel (D-Encino) joined California Attorney General Rob Bonta and joint author Assemblywoman Eloise Reyes (D-Colton) announced Attorney General Bonta’s sponsorship of a bill that would allow state courts to levy increased monetary penalties on corporations convicted of criminal offenses.

Such penalties would in turn provide much-needed funding for crime victim service programs in California, which provide free medical care, mental health counseling, lost wages, courtroom advocacy, and temporary housing, among other forms of assistance, to victims and their families.

While the crime victim service programs have been historically financed through the federal Crime Victims Fund, the fund is experiencing a significant decline in funding. Unlike several other states, California has not yet updated its criminal code to take into account the size and power that corporations have now.

AB 2432 would create a new state-level funding mechanism for the crime victim service programs.

“This bill is about fairness and justice — when major corporations break the law, they must be held accountable,” Assemblymember Gabriel said. “The enhanced penalties in this bill will ensure that bad actors cannot evade responsibility when they defraud or exploit vulnerable Californians or illegally pollute our environment.”

Attorney General Rob Bonta said “By enhancing monetary penalties for corporate crimes, AB 2432 would establish a supplemental funding source at the state level, bringing greater peace of mind to victims of crimes and those who support victims of crime while holding accountable corporate bad actors.”

The federal Fund is the primary funding source for victim services in all 50 states and six U.S. territories. It was established by the federal Victims of Crime Act of 1984 and is financed exclusively by fines and penalties levied on individuals convicted of federal crimes.

Through annual grants to states, the fund supports approximately 3.7 million victims nationwide. As a payor of last resort, the California Victim Compensation Board also administers state compensation to crime survivors, but is underfunded as well.

Under AB 2432:

• The maximum criminal fines that could be imposed on corporations would be increased to generally twice the amount taken from victims by the defendant or twice the amount of the loss caused by the defendant. Currently, the maximum criminal fines are generally $10,000 per felony.

• Restitution fines for corporations would be increased to $100,000 from $10,000. 75% of the monies would be deposited in the California Crime Victims Fund, and 25% would be distributed to the prosecuting agency that brought the criminal prosecution. Restitution fines are an additional fine imposed on defendants upon conviction.

• In addition to creating a new state funding stream that will support crime survivors, the proposed criminal enhancements will help ensure corporate offenders are held accountable and offer a significant deterrent for the benefit of all Californians.

For example, AB 2432 would have led to a more just outcome in the case regarding the 2015 Refugio Oil Spill in Santa Barbara County when Plains All American Pipeline, L.P. was sentenced to pay only $3,347,650 in total fines and penalty assessments — the maximum allowable amount under state law — and the corporation fought payment of any suitable restitution to hundreds of victims of this criminal conduct. AB 2432 would have given the court discretion to levy an additional fine proportionate to the conduct and harm caused by Plains, the proceeds of which would have been paid into the new California Crime Victims Fund, thereby providing greater support to victims of crime across California. It is estimated that the misconduct by Plains, a Fortune 200 company that made over $2 billion in net income during 2018, caused over $200 million in damages in the 2015 Refugio Oil Spill.