ABSTRACT
The EPA wants companies to conduct environmental audits and to disclose violations in order to avoid criminal liability and stiff, gravity-based penalties. Gravity-based penalties are defined as “that portion of a penalty over and above the economic benefit; i.e., the punitive portion of the penalty, rather than that portion representing a defendant’s economic gain from noncompliance.” This chapter explores how the EPA’s new policy works and its relationship to the states that have co-extensive jurisdiction to prosecute environmental violations. The EPA’s policy and the audit privilege statutes enacted by many states present new opportunities for businesses to create sound environmental management systems that reduce the risk of noncompliance.
