IANAL, but I believe for a charge of grand larceny you'd have to show intent to steal, and the "Low-Level" employee seems to have a pretty legitimate case that this was negligence, not theft. On the other hand, I think it's a pretty straight-line open-n-shut case for Apple to sue for damages, and I'm not sure that ruining a young software engineer's financial life for a decade is less of a deterrent than jail.
Did I understand you correctly? Are you saying that being in jail is almost the same as having a bad credit with bankruptcy record?
if you're struggling to stay afloat and have no credit/assets, a short time in jail is way worse than bankruptcy. on the other hand, if you've worked as a SWE for a few years, loosing all your money and having terrible credit for years is pretty awful. you're broke, so you can't buy anything outright, and your losses are compounded by the fact that you pay much more interest on things you buy on credit (if you can even get financing at all). it's not hard to see that this could be worse than a short time in jail. it all depends on the length of the sentence and your total losses from bankruptcy.
also keep in mind we are talking bad credit and all your assets seized by creditors. i'm not saying a bad credit score is literal hell on earth, but if you have no money and no credit you are gonna have a really bad time for a while.
It is hard to imagine one could get penalty of bankruptcy instead of going into Jail for this.
I actually value this working model a lot. The comment below suggest this is culture of fear, instead I call this a culture of utmost trust. ( Well he did say he hate Apple, haters are going to hate whether it is rational or not )