Accession Number:

ADA022452

Title:

Should Corporations Be Prevented from Paying Ransom,

Descriptive Note:

Corporate Author:

RAND CORP SANTA MONICA CALIF

Personal Author(s):

Report Date:

1974-09-01

Pagination or Media Count:

14.0

Abstract:

Following the kidnapping of Patricia Hearst and subsequent demands by her kidnappers for several million dollars in ransom to finance a food distribution program, part of which was paid by the Hearst family, with more money promised by the Hearst Foundation upon her release, three bills were introduced into the California Senate aimed at preventing the payment of ransom by a corporation or charitable trust. Specifically the bills would prohibit the payment of corporate assets, either directly or indirectly, in response to an extortion demand, prohibit corporations holding assets impressed with a charitable trust from paying, expending, disbursing, or distributing such assets solely in response to an extortion demand, and make it a breach of trust for a trustee to distribute assets of a charitable trust in response to an extortion demand. Corporate officers, directors, employees, or trustees who approved or made such payments would be liable for the full amount. The three bills -- SB 2187, SB 2188, and SB 2198 are appended to this paper. These bills, if made into law, would prevent a recurrence of the type of ransom payment promised by the Hearst Foundation. They would also prevent California corporations from making extortion and ransom payments to political extremists and common criminals such as those which have become commonplace in countries like Argentina.

Subject Categories:

  • Economics and Cost Analysis

Distribution Statement:

APPROVED FOR PUBLIC RELEASE