The problem with that is it would put lots of innocent employees out of work. You'd have to sell the company to a competitor or something so that the operation kept going but shareholders got wiped out. Make shareholders feel the pain and the behavior will change.
The same sort of thing happens when individuals go to jail. Family members lose their means of support, children lose their parents, etc. One person going to jail can potentially devastate an entire innocent extended family. That doesn't stop us.
I think at a minimum firing all CXX level employees and the loss of all stock options/pending bonuses is a good compromise. Fines harm investors, but the actual people that decide to break the law are rarely impacted.
Investors should be harmed if they invest in enterprises that engage in criminal acts. Perhaps then there will be a bit more appetite for some ethics at the expense of a little profit.
Not only that but you'll get shorts interested in criminal companies because they can profit by exposing wrong-doing. And, on the other side, the market will discount a company's stock if it is criminal which kills the executives incentives to take these actions.
Hamstringing the company is going to do a lot of collateral damage to innoccents. I mean, if all CXX level people are guilty then so be it- but purely punitive beheading of a company's leadership? Come on.
If your actions are destroying other people's lives and unlawfully disposessing them of their homes, then the word you're looking for is "criminally negligent". Not "innocent".
Nazi guards tried that defense. Didn't work for them either.
I'm talking about people like [Schindler](http://en.wikipedia.org/wiki/Oskar_Schindler) who was a Nazi but obviously not following orders. In a corporation with tens of thousands of employees, not all of them will have conspired to break the law. Those are the people that shouldn't be subject to putative measures.
