Corruption and Government Contracts
Corruption, what is it and why it seems to thrive in the world of business…specifically government contracting? The Marriam-Webster dictionary defines “Corruption” as “impairment of integrity, virtue, or moral principle” (vulnerability to bribery); “improper and unlawful conduct intended to secure a benefit for oneself or another” (“corruption,” 2010). All over the world, there are stories of corruption from money laundering, unjustly awarding government contracts, and bribery. Government acquisitions have become increasingly more susceptible to corruption, which inevitably has a bearing on how effective fiscal policy can be. Contracting is the term the government uses to perform government acquisitions; this is the primary way government tax revenues are spent. While corruption can take place in any phase of the contracting process, it seems to be most prevalent during the initial evaluation & selection phase. Other areas of concern include acquisition planning, when decisions are made on how a contract is to be solicited, some acquisitions are set aside as sole source (a specific contractor). Furthermore, abuse can also occur once the solicitation process has been completed and the contractor has been selected. This form of abuse includes lack of performance, renegotiations on contracts, over-billing, and non-compliance just to name a few. To gain a better understanding of the current representation of corruption in government contracting, it would be valuable to take a look at several areas that have had or continue to have a direct impact on government contracting. These areas include the history of government contracting and why it was implemented, the contracting process, a specific corrup...
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...ligence to ensure they are well versed and ready for all aspects of the government contracting process. Money will continue to be a driving force in government contracting fraud. This was the case in the highly publicized Cunningham scandal where bribery and payoffs were initiated and foolishly accepted in an effort to secure government contracts. Cunningham having to endure several years of investigation, highlighted by the deceitful and unscrupulous behavior of contractors and government officials. Cunningham was one of the biggest contracting scandals, but it by no means stands alone. This is why acts such as the Protected Disclosure Act (whistle blowers) and the MACC were put in place. These measures give some hope in what can be a tumultuous environment because contractors are vying for the same thing, often willing to go to extreme lengths to win a contract.
The "Corrupt Bargain" 1824. As the "Era of Good Feelings" under James Monroe came to an end in 1824, the old congressional caucus system for choosing presidential candidates had broken down. Four candidates towered above the others: John Quincy Adams of Massachusetts, Henry Clay of Kentucky, William H. Crawford of Georgia, and Andrew Jackson of Tennessee. All four rivals professed to be "Republicans."
Serpico (1973) is a movie that reveals the true story of Frank Serpico who was the only honest cop in the New York police sector at his time. The film shows the realistic view of the corruption that was evidenced in the New York police and highlights the character of Frank as being honest and courageous. Although he started as an inexperienced cop, he later worked as an undercover officer and was determined to bust all the criminal activities especially the drug dealers and pushers. Unlike the other cops, Serpico refused to take any bribes from the wrongdoers. More so, he felt that the other officers were doing wrong by accepting bribes and wanted to expose the situation. The other officers were so corrupt that they collected more money through bribes than the salary they earned, a situation that did not please Serpico. His strong stand concerning corruption made his friends turn against him, placing his life in danger. The anti-corruption efforts of Serpico jeopardized his life at the hands of his colleagues. He was later transferred to the Narcotics Squad where he was shot by a drug dealer after his partners betrayed him by failing to support him. The cop was then rushed to hospital. The shooting made Frank deaf since it affected the brain, rendering
When dealing with corruption, first question to ask or to clarify is what corruption is. NSW Research (2002) describes corruption anything from gaining materialistically by virtue of position (for eg. getting a special discount at stores) to engaging in ‘direct criminal activities’ (eg. selling drugs). Newburn (1999) believes that there is a thin line between the definition of ‘corrupt’ and ‘non-corrupt’ activities as at the end, it is an ethical problem. For common people, however, bribery generalises corruption.
In today’s light, the Progressive Era is seen as a time period where people’s lives changed for the better, but none of that change would have been possible without muckrakers exposing the numerous problems that lied hidden from the American public. With the corruption of government officials, dangerous and unhealthy working conditions for young children, and poverty-ridden slums in cities, this article aims to expose three of the most prominent problems of the Progressive Era.
Bribery occurs when money, services, goods, information, or anything else of value is offered with intent to influence a person’s actions, decisions, or opinions of the accuser. Charges can be brought against an individual, whether they offered the bribe or accept it. Bribery and public corruption cases frequently make headlines new stories daily. Bribes can take the forms of gifts or payments of money in exchange for favorable treatment like awards of government contracts (Mince-Didler, n.d.). Government officials tend to gain a huge incentive with bribery while serving their term. Other forms of bribes may include privileges, services, various goods, property and favors. Bribes are always intended to influence or alter the actions of individuals with political and public corruption (Mince-Didler, n.d.).
First, paying bribes and siphoning off millions of dollars from the corporation would eventually lead to the company losing money because building mega projects in politically unstable countries would prove problematic. A sudden regime change would render the contracts useless, as
Bologna, Jack, Lindquist, Robert, Wells, Joseph, & Jones, Peter. (2004). Fraud and corruption in public services. Gower Publishing Company.
Parliamentary and other leaders often provide poor ethical examples for the community. In a world where there is a particular reliance and trust in political leaders, corruption is surfacing and the recent events seem to be the tip of the iceberg. Logan Mayor Luke Smith and Ipswich Mayor Antoniolli have been charged with several fraud allegations, revealing a rotten core. The expulsion of Ipswich and Logan Mayors have caused a series of investigation on all Gold Coast city councils. This further lead to the sack of the entire Ipswich council, displaying how corrupt leaders can infect others.
Anti-bribery laws in the U.S. were established to prevent the rampant corruption exhibited in the Airbus case study. Similar anti-corruption laws do not exist in many of the host countries the U.S. does business with. Host county’s laws and regulations take on different forms especially when power, money and politics are involved, manipulating or creating a new set of rules to benefit their own selfish needs. Savvy sales negotiators, like those at Airbus, seek opportunities through loop holes, off shore accounts and large sums of bribery money, to entice country officials or others with the authority to make purchases to commit to Airbus. A more uniform worldwide approach to international laws needs to be adapted, implemented and more importantly enforced, so all companies involved can conduct fair business practices under the same set of rules.
Bribery is wrong, and it would be almost instinctive to point at the benefits of impartially functioning public servants and incorrupt corporations to our democratic society as justification. However, in this imperfect world where bribery is rife in varying degrees, is it possible to express this notion convincingly? Certainly 'because the UK Bribery Act says so' is far less persuasive to a council planning office in Shanghai than in London, and indeed in compliance with section 7 of the Bribery Act 2010 which relates to commercial offences, it is essential that this question is engaged with on a corporate scale and without assertion through dogma. Accordingly, this essay will argue that elements wrong with bribery are inclusive of both moral and economic considerations. Moreover, in conjunction with international mandates, advent of aggressive legislation such as that of the UK Bribery Act 2010 is representative of global efforts to eliminate bribery. Hence, it follows that bribery can never be considered a normal part of business because it is economically unsustainable in the long term.
This essay will attempt to explore the relationship between the two from the definitions, causes, consequences and the solutions. Corruption can be defined as the abuse of public power for private gain. (World Bank, 2004) Corruption is attracting a lot of attention around the world, and is a growing international and regional concern. According to Corruption Around the world (Tanzi, 1998), in its end-of-year editorial on December 31, 1995, The Financial Times characterized 1995 as the year of corruption.
The existence of bribery and unethical behavior is rampant in the world market and may not change overnight. The question of bribery has been distilled in business literature as a question of ethics. In this situation at the airport with the customs officer, it is important to distinguish between business ethics and personal ethics. In a business ethics situation, the Foreign Corruption Practices Act would prohibit offering any bribe to the custom office – for example to free a shipment of goods that was lost in red tape (Pitman & Sanford, 2006). Most companies also have policies against bribery as well. In this situation, however the main issue at hand is that of personal ethics. When in a situation where your company is unknown and there is no business being conducted, normal business ethics and laws (including FCPA) do not apply only personal ethical standards.
Montesh, M. (n.d.). Conceptualizing Corruption: Forms, Causes, Types and Consequences. Retrieved May 4, 2014, from
In our industry the majority of professionals consider corruption activities such as bribery to obtain planning permission or contracts; billing for unperformed work; production of fraudulent invoices; concealment of bribes; false or exaggerated claims; collusion and cartel activity; inclusion of extra cost to contract claim; cover pricing; employment of illegal workers; cover pricing; and leaking of information to a preferential bidder. Nevertheless are practices that exist in construction, and this is because the people start with small things, and in the end, people will tolerate this behaviour gradually, without realising that his moral scale has been
Corruption and fraud is a relevant topic in South Africa and will continue to be so until it is able to be limited. Corruption is committed mainly by people in power as they neglect and take advantage of this power in order to better themselves at the expense of others. Fraud and corruption is the wrongful or criminal deception that results in financial or personal gain. Government officials, police officers and some unexpected individuals such as law officials have been known to commit corruption and fraud. There have been cases of corruption in the 2014 elections and the political parties have seen that it is something the community is concerned over. Each party has addressed this concern and suggested ways in which to limit this corruption. Not only is corruption morally wrong, but it causes trust problems between the community and people in power, the people who are meant to help society. (1)