For many years now I’ve witnessed the often huge fines imposed by one of the US’ governing agencies tasked with levying fines against corporations and other entities that break the law. There has to be an equitable solution to the US Federal Deficit that does not require us to look inept for all the world to see.
Having spent many years in the food industry, I’ve read of the huge fines imposed against giant poultry and other meat manufacturers for price fixing, among other complaints.
I have also learned that massive corporations build immense reservoirs of funds into their annual budgets to be able to absorb these humongous fines and then they go on about their business as usual until the next infraction (often the exact one for which they were previously fined!) and the process repeats itself over and over.
What government agencies can impose fines such as these? Where does the money from all these fines go?
According to Marketplace.org’s Janet Nguyen in their I’ve Always Wondered category on Aug 12, 2022, “At the federal level, a large number of governmental agencies have the power to hit companies with fines, including the Department of Justice, the Environmental Protection Agency, the Securities & Exchange Commission, the Federal Trade Commission and the Consumer Financial Protection Bureau.”
“Some can impose civil penalties just through an administrative proceeding. Other agencies, like the Federal Trade Commission, [have] to go to court in order to impose a civil penalty,” explained David Vladeck, a professor at Georgetown University Law Center who served as the director of the FTC’s Bureau of Consumer Protection from 2009 to 2012.” “As for where that money goes: it depends, but generally it goes to the U.S. Treasury,” Vladeck said.
David Vladeck, added that during his role at the FTC it could be frustrating because “the agency was underfunded while sending hundreds of millions back to the Treasury.” Vladeck noted that the FTC recently imposed a $5 billion penalty on Facebook, which granted the political consulting firm Cambridge Analytica access to user data.
“That money went straight to the Treasury. It didn’t pass through the FTC’s hands,” Vladeck said.
You will note I included a couple of links related to this article and post for those wanting more detail.
This writer has been affected by the Facebook and Cambridge Analytica travesty, the Equifax Hack we learned of in 2017, the Sony hack of 2014, and more. We consumers rarely see much of anything in the way of resolution and let’s face it, the real damage can be done years after the fact. So where does the money go?
Most resources I searched seem to agree with David Vladeck: the Treasury Department.
A May 29, 2023, CNN Business report by Matt Egan, citing the Bloomberg Billionaires Index, states that each of 31 billionaires are worth more than our government’s Treasury has in cash, $38.8 billion. WHAT?! IF this is where most of the money from these corporate fines go, then who is picking its pockets?
Listen to the legendary Warren Buffet, who for years has criticized the Debt Ceiling Deal as bad news and has encouraged our government to get rid of it. What are we waiting for? I cannot imagine the US looking more incompetent than what we have witnessed during this excruciating process.
I have an excellent idea for where the money from those fines should go (after the lawyers get their hefty share:)
Pay Down the US Deficit, build real treasury reserves, and absolutely hang up the idea of holding our country hostage to the outrageous and extremely damaging “Debt Ceiling” debacle!
Additional Links relating to this content:
AND, just this week – Microsoft is in the news again and it isn’t good news: