Punish Once or Punish Twice: A Theory of the Use of Criminal Sanctions in Addition to Regulatory Penalties

Though clearly distinct in nature and procedure, both regulatoryagencies and courts frequently rely on similar instruments tosanction the same or very similar kinds of illegal behavior.In this article, we develop a theory of the use of criminalsanctions in addition to regulatory penalties. We show that,even though it is generally more effective to have a penaltyimposed by a regulatory agency rather than by the courts, undersome conditions it is optimal to have both. The article providesthree arguments: agency costs when delegating law enforcement,legal error, and collusion between a regulatory agency and anoffender. The objective of the article, though, is not limitedto the determination of the theoretical conditions that canmake the use of both sanctioning schemes optimal. Our analysisis also relevant to the application of a specific legal doctrine,the Double Jeopardy Clause.