- A construction company, XYZ Inc., is bidding on a government contract to build a new hospital.
- A government official Mr. Smith is the responsible person for reviewing bids, and he has the authority to choose the winning contractor.
- Company XYZ Inc. offers official Smith a hefty bribe (kickback) in exchange for awarding them the contract for the hospital, regardless of whether their bid is the most competitive.
- This kickback could be a cash payment, a luxury vacation, or even a promise of a future job after they leave office.
- If official Mr. Smith accepts the kickback and awards the contract to Company XYZ Inc., even if their bid is inferior, it’s a clear example of a kickback scheme.
Kickbacks: Meaning, Implications, Examples, Forms & FAQs