Question

In: Accounting

Discuss the fraud schemes of bribery, illegal gratuities, and economic extortion?

Discuss the fraud schemes of bribery, illegal gratuities, and economic extortion?

Solutions

Expert Solution

Bribery involves giving, offering, soliciting, or receiving things of value to  influence an official in the performance of his or her lawful duties. Officials may be employed by government (or regulatory) agencies or by private organizations. Bribery defrauds the entity (business organization or government agency) of the right to honest and loyal services from those employed by it. 

An illegal gratuity is similar to a bribe, but it occurs after the fact. It involves giving, receiving, offering, or soliciting something of value because of an official act that has already been taken. 

Economic extortion is the use (or threat) of force (including economic sanctions) by an individual or organization to obtain something of value. The item of value could be a financial or economic asset, information, or cooperation to obtain a favorable decision on some matter under review.


Bribery influences officials unlawfully; illegal gratuity follows an act; economic extortion coerces for value, threatening force or sanctions.

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