It’s frustrating how large corporations operate under a different set of rules than the rest of us. While ordinary people can face serious consequences for certain actions, big businesses often get away with the same behavior – and legally, too. Whether it’s due to legal loopholes, lobbying power, or corporate protections, these double standards highlight how the system favors the wealthy and powerful.
Here are some of the things that big corporations can legally do but you cannot.
Dodging Taxes with Offshore Accounts
If an average person hides money in an offshore account to avoid taxes, they could face serious legal consequences, including hefty fines or even prison time. However, large corporations use tax havens to legally shield billions of dollars from taxation.
By setting up subsidiaries in countries with low or no corporate tax rates, companies reduce their tax burdens while regular taxpayers foot the bill.
Paying Employees in Company Stock Instead of Cash
Corporations regularly compensate executives and employees with stock options to avoid immediate tax obligations and increase wealth without triggering payroll taxes. But if you tried to pay your babysitter or lawn care worker in stock instead of cash, you’d likely run into legal trouble. This strategy helps businesses reduce taxable income.
Engaging in Insider Trading (Indirectly)
When an ordinary investor buys or sells stock based on non-public information, they risk criminal charges for insider trading. However, corporate executives often exploit legal loopholes to time stock sales around company announcements.
By pre-scheduling trades through 10b5-1 plans or using political influence to receive early information, they legally profit from inside knowledge.
Creating Monopolies and Crushing Competition
Small businesses that engage in anti-competitive practices can face severe penalties, but large corporations can build monopolies with little interference. Tech giants, in particular, buy out competitors and manipulate market conditions to eliminate threats, all while using legal teams to avoid antitrust enforcement. A small business that tried similar tactics would face legal action under antitrust laws.
Laying Off Workers While Giving Executives Huge Bonuses
It would be seen as fraud or financial misconduct if a small business owner fired workers and then immediately gave themselves a massive bonus. But big corporations regularly announce mass layoffs while rewarding executives with multimillion-dollar bonuses. Despite public outrage, these practices remain legal due to corporate governance structures that prioritize shareholder profits over worker stability.
Influencing Government Policy Through Lobbying
Should an individual offer money to a politician in exchange for favorable treatment, it’s considered bribery and punishable by law. But corporations do the same thing through lobbying – and it’s completely legal.
They spend millions influencing lawmakers, shaping policies, and writing legislation that benefits them, while the rest of us have little power to impact laws in the same way.
Dumping Pollution Without Serious Consequences
If you, as an individual, dumped toxic waste into a river or emitted large amounts of carbon into the air, you’d face fines, lawsuits, or criminal charges. Yet, major corporations often get away with massive environmental damage. Many simply pay small fines that barely affect their profits while continuing harmful practices that would land an average person in jail.
Classifying Workers as Independent Contractors to Avoid Benefits
Legal trouble awaits if you hire a full-time worker but label them as a contractor to avoid paying taxes. However, big companies routinely misclassify workers as independent contractors, avoiding costs like health insurance, overtime pay, and employment protections.
Despite ongoing legal battles, these businesses continue exploiting this loophole.
Selling Your Personal Data Without Your Permission
An individual who collects and sells someone’s private information without consent will face legal action for privacy violations. Yet, corporations routinely harvest and sell user data to advertisers and third parties without serious repercussions. Social media platforms, search engines, and online retailers profit from tracking consumer behavior while facing little or no regulation on data privacy.
Using Bankruptcy to Escape Debt While Keeping Assets
The ordinary person who racks up massive debts then declares bankruptcy risks losing their home, car, and savings. Meanwhile, corporations regularly use bankruptcy laws to erase debt while keeping valuable assets.
Airlines, retail giants, and even financial institutions have used legal loopholes to restructure their debt without suffering the same consequences as individuals.
Paying Employees Below Minimum Wage with Tips
If you paid someone below minimum wage and told them to rely on customer tips to make up the difference, you’d be breaking labor laws. But many businesses, particularly in the restaurant industry, legally pay workers as little as $2.13 per hour in tipped wages. This forces employees to depend on customer generosity rather than fair compensation from their employer.
Setting Prices Based on Your Data
To charge customers different prices based on their income or online activity would result in you being accused of discrimination. Yet, corporations routinely engage in dynamic pricing, charging consumers different rates based on browsing history, location, and spending habits.
Airlines, e-commerce sites, and even ride-share companies use algorithms to maximize profits, making it impossible for consumers to know if they’re getting a fair deal.
Lying in Advertising (Using “Puffery”)
An individual falsely advertising their car as “better than new” could be sued for fraud. On the other hand, corporations use a legal loophole called “puffery” to make exaggerated claims about their products without consequences.
This could mean fast food looking better in ads than in reality or misleading health claims, but the fact remains that businesses can stretch the truth legally.
Buying Politicians and Influencing Elections
If you donated excessive amounts of money to a political campaign in exchange for influence, you could be charged with corruption. However – you guessed it – corporations and wealthy donors funnel unlimited money into political action committees (PACs) and super PACs, effectively shaping election outcomes.
They operate under legal frameworks that allow them to bypass the campaign finance limits that apply to ordinary individuals.
Forcing Consumers into Arbitration Instead of Court
When you have a dispute with a corporation, chances are you can’t take them to court. Many businesses insert arbitration clauses into contracts, forcing customers and employees to settle disputes through private, company-friendly arbitration rather than an impartial court system. While individuals have limited options to fight back, corporations ensure they have legal protection from major lawsuits.
Creating Shell Companies to Avoid Regulations
Setting up a fake company to dodge taxes or hide financial activity would end up with a fraud charge if you tried it. However, corporations frequently create shell companies to shift profits, hide liabilities, and bypass regulations.
These legal entities exist only on paper but allow big businesses to avoid scrutiny while maintaining a clean public image.
Charging Early Termination Fees for Services You No Longer Use
big corporations routinely impose hefty early termination fees on customers who cancel cable, phone, or gym memberships before the contract ends. These fees can be excessive, locking people into services they no longer need. Even if the service quality declines, customers often have little recourse to escape these charges. Needless to say, if an individual tried to charge someone a penalty for ending an agreement early, they could face legal pushback.