The Multinational Monitor

JUNE 1993 - VOLUME 14 - NUMBER 6

B E H I N D   T H E   L I N E S

Cracking Corporate Crime

A U.S. Department of Justice Survey released on May 23 finds that state and local corporate crime is on the rise, especially in the areas of environmental and consumer offenses.

The report surveys district attorneys in large jurisdictions and calls attention to the ongoing failure within the justice Department to detect, prosecute andd punish corporate transgressions. Two-thirds of the survey respondents said their offices prosecuted at least one of nine types of corporate crime in 1988.

Consumer fraud was the most frequently prosecuted corporate offense, with 41 percent of the offices prosecuting at least one case of consumer fraud. False claims and insurance fraud followed as the most frequently prosecuted economic crimes, with 31 percent of the offices prosecuting at least one offense in these categories.

Only one type of noneconomic crime - environmental offenses - was prosecuted as often as economic crime. In 1988, 31 percent of the offices handled at least one environmental offense.

According to the Justice Department report, environmental offenses are on the rise. One prosecutor surveyed notes, "The danger from this environmental stuff is much greater than what we have to worry about from drugs."

The report, conducted by the National Institute of Justice, the Department of justice's principal research arm, describes corporate crime as "Crimes committed by and for business" which "pose a serious threat to the health, safety and financial welfare of consumers and workers as well as to the orderly functioning of the economy and the government."

The report's co-author Bill Maakestad says that the objective of the research was to determine means by which to ensure that corporate and white collar crime is prosecuted. "On the local level, prosecutors should be recruited who have an interest in issues of workplace safety, environmental health and other areas," says Maakestad. "In order for reforms to take place, changes must be made at the law school level - at this time, law schools, if they address corporate and white collar crime at all, never make it a priority." Among other suggestions, the report calls for an effort to educate the public about who to contact when an environmental or workplace offense occurs.

Green Deception

In a grossly misleading advertisement carried in Malaysian newspapers, the British multinational ICI Agrochemicals has been promoting its herbicide paraquat - a product described by the World Health Organization as one of the world's most deadly chemicals - as environmentally friendly and necessary for a "greener Malaysia." The chemical, used in food production, has an extremely high oral toxicity. When absorbed or ingested, the chemical causes often lethal injury to the liver, kidneys and lungs.

The full page advertisement contains the headline "Paraquat and nature working in perfect harmony" and goes on to state, "It's a fact. Paraquat is environmentally friendly." In the ad, ICI claims that "Groundwater, rivers, streams and lakes are not affected" by the chemical. The U.S. Environmental Protec - tion Agency, however, says that paraquat "has a potential for ground water contamination."

Paraquat, although banned in Sweden, Finland and the Netherlands and restricted for use in Norway, Indonesia, the Philippines, Japan and Turkey, is one of the biggest selling pesticides internationally and is widely used on plantations throughout the Third World. The chemical is identified as a particular problem by agricultural workers. Workers spraying paraquat suffer from vision and skin disorders and experience nausea. Workers' fingernails and toenails fall out as a result of contact with paraquat.

S.M. Mohd. Idris, president of Persatuan Penggu na Negeri Pulau Pinang, the Consumers Association of Penang, says the organization is "outraged by the `green' deception practiced by ICI Agrochemicals in its paraquat advertisement appearing in our local newspapers." The ad, says Idris, "blatantly misleads consumers." The Association is calling for a ban on the advertisement in Malaysia for violating the country's 1972 Trade Description Act, which protects against misleading marketing schemes.

Crude Awakenings

U.S. oil companies, in pursuit of higher profits overseas, are leaving a host of health and environmental problems in their wake, finds Crude Awakening, a report released on May 17 by the Washington, D.C.-based environmental organization Friends of the Earth. The report examines the U.S. oil industry and details the shocking amount of leaking oil and energy waste that has been left to endanger public health and the environment at taxpayers' expense.

"The major U.S. oil companies are abandoning [the United States] in order to make quick profits in overseas oil exploration and development," says report author Jack Doyle. "They are leaving behind a deteriorating infrastructure, some of which is a half-century old and much of which is leaking."

Every year, the equivalent of 1,000 Exxon Valdez oil spills is leaked, vented, spilled, evaporated or used inefficiently somewhere in the deteriorating oil system of the United States, the report finds. As a result of these leaks and inefficiencies, the United States loses more oil each year than Australia consumes.

"The spills and waste occurring in the U.S. oil system today, if captured, could cut [the U.S.] oil import bill in half," Doyle argues. "Plugging the leaks and cleaning up the mess will also put people back to work."

"It is outrageous that while President Clinton is asking all U.S. citizens to pay their fair share in getting the country back on its feet economically, the major oil companies are taking their money and running overseas," says Jane Perkins, president of Friends of the Earth. "And it's people with no profits and no place to run - U.S. taxpayers - who will be left with an enormous bill to pay."

- Julie Gozan

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