Recognizing and Minimizing Tort

Recognizing and Minimizing Tort

and Regulatory Risk Plan

Business Law 531

In this paper, I will discuss a plan I created for Alumina, Inc. explaining how regulatory risk may be identified and managed through preventive, detective and corrective measures. I will also identify common torts and risks that were found in the simulation for week two of this course and describe specific measures to manage each risk.

The business simulation states that Alumina, Inc. was in violation of environmental pollution during a routine compliance evaluation. Five years ago Alumina, Inc. was cited for discharging high levels of PAH. The levels were over the prescribed limit in a test sample. Alumina was ordered to clean up the PAH by the Environment Protection Agency (EPA) and correct the issues and become compliant. (University of Phoenix, 2010). No plans for prevention of regulatory risks or future torts were put in place to prevent this from happening again in the future.

Kelly Bates accused Alumina, Inc. of water contamination of Lake Dira with the cancer causing chemical PAH. She stated that her daughter became ill with leukemia due to consuming the water. Alumina reported that they use state of the art technology for toxic waste cleanup and is in compliant with the Clean Water Act. (University of Phoenix, 2010). Based on their technology, the results were the PAH levels were below the legal limit. The management agreed to conduct independent studies to check for new violations and provide the results to the EPA. The EPA provides incentives to organization for self policing, 100% penalty waiver for voluntary disclosure and correction of any violations (University of Phoenix, 2010).

To prevent Alumina, Inc. from receiving another violation, they must remain in compliance with all laws. Regulatory risks may be identified and managed by preventive measures through the implementation of processes and procedures to monitor PAH and other regulated substance for...