> company and all its investors and directors should have all their assets seized

This is expropriation. Its track record is poor. It results in government cronies applying the “death penalty” to people it doesn’t like to take their stuff. To the degree it exists in America (for individuals), it’s called civil forfeiture and is roundly criticised.

If you don’t give the assets to the government after seizure, and instead auction them off, the original investors would repurchase them. This redistributes assets from shareholders who do not have access to the auction to those who do. Again, cronyism.

Corporate “death penalties” are either stupid or an invitation for corruption. Punishing individual actors, individual decision makers, is less risky and more effective.