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Understanding Kickbacks And Why They’re Illegal

On Behalf of The Foley Law Firm | April 19, 2021 |
Colorado Springs Medical Malpractice Attorneys | T: 719-757-1182

Understanding kickbacks and why they’re illegalSometimes it’s easy to get into a way of doing business because it’s how your predecessor operated. Maybe that’s just how things are done in your organization.

However, some of these ways of doing business may be illegal. One example is kickbacks.

What is a kickback?

Basically, a kickback is any kind of illegal payment that’s made in exchange for preferential treatment. A kickback, which is a type of bribery, is considered compensation. However, it doesn’t have to be money. It can be anything of value, including credit, gifts, rebates or favors.

Both the people who provide kickbacks and those who receive them are engaging in corruption – and breaking the law. That’s because kickbacks interfere with unbiased decision-making.

Examples of kickbacks

We’re all familiar with cases where public officials choose one contractor over others for a coveted project because that contractor paid them money. However, kickbacks can occur in just about any type of private business and in non-profit organizations.

Kickbacks often involve those who are part of handling invoices, like bookkeepers and accountants. For example, a vendor may overcharge a company for its goods or services and pay the bookkeeper or others in the company something “under the table” to keep quiet about the overcharging and approve the invoices.

Sometimes, vendors will even bill a company for nonexistent services. With so many services involving online work, it can be difficult to detect that they were never provided.

Kickback schemes can cost companies and taxpayers a considerable amount of money, so prosecutors take them seriously. They can result in shoddy work and perhaps even unsafe products if an unqualified vendor or service provider was chosen because they were willing to bribe their way into the job – and someone accepted the bribe. If you are facing charges involving kickbacks or have learned that you are under investigation, an experienced criminal defense attorney can provide valuable advice and assistance.

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