A HISTORY OF BRIBERY IN BUSINESS

Acts of bribery committed by companies and business establishments by paying foreign officials to hasten processes and/or procurement of contracts that have been recorded date back to the mid-1970’s yet the actual earliest records of the practice remains obscure.

 

Bribery is essentially the offering of anything of value that might influence the actions of a government official or someone in power. The offering of bribes has been seen in many fields including sports, politics, medicine, research, government and business. When we talk of bribes, it may take on any form. It may be in the form of cash, gifts, rights in action, property or a particularly difficult favor which otherwise may not be given if not in exchange for something.

 

Bribery: An Overview

 

The sole purpose of bribery is to influence or alter an action of a recipient in favor to the giver of the bribe. Typically, both the giver and the recipient is charged with bribery. In which case, a prosecutor must be able to provide substantial evidence that an actual agreement has been made. Since in most bribery cases there is no actual written agreement, it is difficult to charge someone with the crime. Prosecutors rely on accounts and records, as well as demonstrate that there is corrupt intent.

A crime usually affiliated with bribery is extortion. These two are often confused with each other. The main difference between them though is that the former uses positive reward for the alteration of the recipient of the bribe’s behavior whereas the latter involves negative acts such as threats or violence in order to initiate compliance in the part of the recipient.

 

Bribery in Business

 

            As already mentioned in the first part of this article, bribery has been seen in many fields – sports, politics, medicine, research, government and business. For the longest time though, bribery has been a common practice most especially in the corporate world. The main process in which bribery is involved in business is when companies and conglomerates offer payment to foreign officials in order to procure a contract, expedite legal processes or secure the continuation of a business.

In which cases, these bribes that are often made range to hundreds of thousands of dollars to billions. In fact, the largest amounts tallied as bribes occur in business. Most companies admit that they have paid questionable amounts to officials just to be able to secure the future of their business. Many of the bribes are initiated through blackmail using dirty usernames techniques. In the following segment in this article, we will be showing some of the largest bribery cases in the history of the modern corporate world.

 

Cases of Bribery in Business

 

Ralph Lauren Corp.

In 2013, Ralph Lauren Corp. was quick to report a case of bribery by its South American subsidiary. Accordingly, the payments amounting to $568,000 was made to certain Argentinian foreign officials to make sure that prohibited goods were cleared for import, to avoid inspection and to be able to import goods without the necessary documents.

Although Ralph Lauren Corp. was praised by the Securities and Exchange Commission (SEC) for its efforts to report its subsidiary, it still had to pay more than $8.6 million dollars in penalties.

 

KBR and Halliburton

KBR and Halliburton forked out a massive total of $1.2 billion in fines for pleading guilty in 2009 to bribing Nigerian officials in one of its joint ventures. Its former president, Albert “Jack” Stanley, also had to face seven years in prison for the same charges.

 

Siemens AG

In 2008, Siemens AG – considered to be one of Europe’s biggest engineering company – pleaded guilty to bribery and had to pay $800 million fines in the U.S. and another $800 million more to Germany for the same reason after being proven to have paid at least $1.4 billion in bribes to four continents just to procure land government contracts.

 

BAE Systems

This British defence company was charged with the crime of bribery under the 1977 Foreign Corrupt Practices Act (FCPA) of the United States. The company eventually had to pay a total of $400 million in fines for making payments during their weapons sales to several countries such as Saudi Arabia, Hungary and the Czech Republic.

 

Laws to Counter Bribery in Business

            Many countries have legislated several laws in order to counter bribery in the corporate world and bring a level playing field to all companies and save the integrity of business with various different countries. One of this is the United States’ Foreign Practices Act of 1977 (FCPA) which aims to eliminate bribery in U.S. companies. Other anti-bribery and corruption laws are the Philippines’ Republic Act No. 3019 or the Anti-Graft and Corrupt Practices Act (ACPA) and the United Kingdom’s Bribery Act 2010.

 

Final Say

            Despite the many laws against bribery and corruption implemented by many countries, various companies are still practicing the act of bribery in order to gain more profit and influence in favor of their sales and increase in status. Still, we can only hope that these laws might be implemented properly so that these companies may be encouraged to stop and eliminate the practice of bribery.

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