It’s simple to define what kickbacks in health care are. If a physician or medical provider uses any payment or compensation to encourage a patient to come to their office, or to encourage another medical provider to refer patients to their office or facility, that is a kickback.
What is a kickback example?
Kickback Examples Any gift of above nominal value, including things such as food, event tickets, and gift cards, is an improper kickback. If the purpose of giving the gift is to induce or reward referrals or preferential treatment for goods or medical services, this is considered a kickback.
What is the difference between a bribe and a kickback?
A bribe is usually defined as the giving or receiving of a “thing of value” to corruptly influence the actions of another, most commonly to influence a contract award or the execution of a contract. A “kickback” is a bribe paid incrementally by the contractor as it is paid, usually an agreed percentage of the contract.
Most bribes in exchange for large contract awards in international development projects are paid as kickbacks, usually totaling 5%-20% of the contract value. In highly corrupt areas, however, the percentage can be much higher, the perpetrators taking all they can, limited only by the level of oversight, or more accurately, the lack thereof.
Thing of value The “thing of value” need not be money, and often is not. Any tangible benefit given or received with corrupt intent can be a bribe. Bribes provided by bidders, contractors and consultants to project and government officials have included:
- GTE: Inappropriate gifts, travel and entertainment
- “Loans,” whether or not repaid; Leasing vehicles for project officials
- Employment of the children or spouses of project officials
- Payment of educational expenses and scholarships for the children of project officials
- “Study tours” of the contractor’s facilities (in reality often just shopping excursion) for project personnel and spouses
- Leases by contractors of office and living accommodations owned by project officials, usually at inflated rates
- Gifts by contractors of their inventory or services, e.g., improving the house of a project official
- Sexual favors provided to project officials and site inspectors
- “Donations” to “social programs” at the direction of project officials
- Overpaying for assets purchased from project officials
- Subsidizing rents or mortgages of project officials
- Direct cash payments to project officials and inspectors, or payments through subcontractors or local agents, recorded on the contractor’s books as legitimate fees and commissions. The latter is the most common method used by large companies to pay and conceal bribes. Cash for corrupt payments can be generated by raising false invoices for goods, works or services that were not performed, and turning the payments into cash. Bribes also can be funded by collecting payments from subcontractors.
- Providing hidden interests in other companies or enterprises to project officials
It may be easier to charge and prove the more ambiguous bribery schemes, e.g., the giving of gifts or favors, the leasing of property from a project official or the payment of educational expenses for the children of a project official, as a Conflict of Interest, rather than bribery, if that offense is available in the jurisdiction.
Proof of a Conflict of Interest generally does not require evidence of corrupt intent or corrupt influence, only proof that the official received a benefit that could potentially adversely affect his or her official decision, which benefit he or she did not disclose. Corrupt influence In schemes to pay bribes in exchange for contract awards, corrupt influence usually appears as some form of bid rigging, intended to steer the contract to the bribe payer by improper means.
The most common bid rigging methods include: Change order abuse Excluding qualified bidders Leaking of bid information Manipulation of bids Rigged specifications Split purchases Unbalanced bidding In schemes to corruptly influence on-site inspectors or supervisors to accept sub-standard goods, works or materials, corrupt influence can appear as the following schemes: Failure to meet contract specifications Product substitution Change order abuse RED FLAGS OF BRIBES AND KICKBACKS
- The “SPQQD” factors:
- Improper Selection of a contractor, e.g., through the use of bid rigging measures
- The payment of unreasonably high Prices to a contractor
- Purchase of an excess Quantity of goods, works or services from a contractor
- Acceptance of low Quality goods, works or services from a contractor
- Delivery of goods, works or services that do not meet contract specifications
- Failure to adequately advertise the request for bids or proposals
- Unreasonable pre-qualification procedures that exclude qualified bidders, or which allow unqualified bidders to compete
- Unreasonably narrow contract specifications that favor the winning bidder and exclude others
- Leaking of bid information to favor a certain bidder, while withholding critical information from other bidders
- Discarding or changing bids after receipt, or improperly manipulating the scoring of bids
- Disqualification of bidders for arbitrary or trivial reasons during bid evaluation
- Approval of unjustified sole source awards
- Splitting purchases to avoid procurement thresholds
- Pressure by project officials on contractors to select a particular subcontractor or agent
- Contractor engages a questionable subcontractor or local agent (to handle bribe payments)
- Long delays in contract negotiations or award (as bribe demands are negotiated)
- Approval of unnecessary change orders to increase the contract price after award
- Project or government officials display unexplained wealth or live beyond means
- Project or government officials have undisclosed outside business, often shell compnay
CASE EXAMPLES OF BRIBES AND KICKBACKS See actual case examples of bribes and kickbacks from investigated cases. BASIC STEPS TO DETECT AND PROVE BRIBES AND KICKBACKS (in exchange for contract awards)
Identify and interview all complainants to obtain further detail.
- General interview questions
- Bribes and kickbacks questions
2. Collect the relevant procurement, contract and payment documents (including preliminary drafts) such as those listed below. Carefully examine them for (1) information that confirms or rebuts a whistleblower complaint and (2) additional red flags or indicators of wrong doing.
- Requests for Expression of Interest and responses
- Pre-qualification applications and shortlists
- Requests for bids or proposals
- Submitted bids or proposals
- Bid or Proposal Evaluation Reports, including revised reports, with notes of the committee members
- Contract awards or purchase orders
- Change order requests (contract amendments or “variation orders”) and awards
- Invoices and payment records
- Related emails, relevant computer hard drives, correspondence and complaints
- Conduct thorough due diligence background checks on the suspect companies and project officials.
- Discreetly collect employment files on the suspect project or government officials, including, to the extent available at this stage of the investigation, the subject’s:
- Correspondence files
- Business and personal emails
- Computer hard drive files
- Business and personal telephone and travel records
- Salary and employment history
- Collect and review prior audit reports and investigative reports involving the same parties.
- Interview and request documentation from third party witnesses, including losing or excluded bidders and subordinates of the suspect project officials. Ask, for example, about any efforts by officials to improperly steer contracts to favored bidders or any demands for bribes, as well as, of course, addressing any other issues in the case.
- Exercise contract audit rights on the winning bidder. Look for questionable payments made through agents, subcontractors or consultants, or inflated invoices that could be used to generate bribe payments.
- If necessary, do a full financial investigation of the suspect official (suspected bribe recipient) to identify the receipt of corrupt payments or sudden unexplained wealth (See Step Seven of the ten basic steps in a complex fraud and corruption investigation ).
- If necessary, use the evidence collected above to attempt to obtain the cooperation of an inside witness, including a middleman or less culpable member of the corruption scheme.
- Interview the subject official (suspected bribe recipient) and request the subject’s financial documents (See step nine of the ten basic steps in a complex fraud and corruption investigation ).
- Wrap up the case by carefully linking the evidence of improper payments to the evidence of corrupt influence, e.g., show that the bribe payer received an improper contract award approved by the official who received the bribe. Try to identify and rebut anticipated defenses, e.g., the contract award was proper; the payment to the official was the repayment of a prior loan, there was no intent to corruptly influence a decision, etc.
See a much more detailed description of the ten basic steps in a complex fraud and corruption investigation and advice on how to best organize and present the evidence of corruption, The payment of bribes and kickbacks constitutes a corrupt practice,
What happens at a kickback?
What is a Kickback Party? – Just as the name implies, a kickback party is a low-key party where everyone knows each other, and the focus is to spend time relaxing with plenty of food and drinks. The activities for a kickback party may include playing games, dancing, or floating around in the pool.
What is a major cause of kickback?
- Woodworking : Machine Hazards – Kickbacks
Kickbacks occur when a saw seizes the stock and hurls it back at the operator. This can happen when the stock twists and binds against the side of the blades or is caught in the teeth. A blade that is not shvarpened, or that is set at an incorrect height, can cause kickbacks.
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The major hazard with kickbacks is the stock being hurled back at the operator. Hazards due to kickbacks are most likely when there is a lack of safeguards, such as spreaders, anti-kickback fingers, and gauge or rip fences.
- Use a spreader to prevent material from squeezing the saw or kicking back during ripping.
- Use anti-kickback fingers on both sides of the blade to hold the stock down in the event that the saw kicks back the material.
Work Practice Controls
- Use appropriate equipment for the job, Workers can be seriously injured if they do not use the correct equipment for a job. Use machines only for work within the rated capacity specified by the machine manufacturer. Use the correct tools on a given machine. For example, when using a circular saw, use the correct blade for the required cutting action. Similarly, you must only mount blades, cutter heads, or collars on machine arbors that have been accurately sized and shaped to fit these parts.
- Frequently inspect equipment and guards, Ensure that: (1) the operator and machine are equipped with the safety accessories suitable for the hazards of the job, (2) the machine and safety equipment are in proper working condition, and (3) the machine operator is properly trained. Document the inspections and keep the records. Documentation should identify the machine, inspection date, problems noted, and corrective action taken. Noting problems helps to ensure that corrective action will be taken, that operators on all shifts will be made aware of any potential danger, and that any pattern of repeat problems on a particular machine can be detected and resolved as early as possible.
- Do not use stock that has checks, splits, cracks, or knots.
- Allow glued joints to dry before working on stock.
- Hold tools firmly in both hands.
- Use equipment only when guards are in place and in working order, A worker should not be allowed to operate a piece of woodworking equipment if the guard or any other safety device, return device, spreader, anti-kickback fingers apparatus, guard on in-running rolls, or gauge or rip fence is not functioning properly. When guards cannot be used (during rabbeting or dadoing, for instance), you must provide combs, featherboards, or suitable jigs for holding the stock.
- Provide regular preventive maintenance, Regularly clean and maintain woodworking equipment and guards. Ensure that blades are in good condition. Knives and cutting heads must be kept sharp, properly adjusted, and secured. Sharpening blades prevents kickback. You must also remove any cracked or damaged blades from service. Keep circular saw blades round and balanced. You must remove dull, badly set, improperly filed or improperly tensioned saws from service, and immediately clean saws to which gum has adhered.
- Avoid deep cuts ; they increase the likelihood of kickbacks.
- Use appropriate personal protective equipment,
- Whenever possible, stand back or to the side once the boards have been put through to avoid injuries from kickback and flying splinters.
- Do not feed boards of different thickness, Thinner boards will be kicked back.
What is an example of a kickback corruption?
In government – Kickbacks are one of the most common forms of government corruption. In some cases, the kickback takes the form of a “cut of the action,” and can be so well known as to be common knowledge—and even become part of a nation’s culture. For example, in Indonesia, President Suharto was publicly known as “Mr.
Twenty-Five Percent” because he required that all major contracts throughout the nation provide him with 25 percent of the income before he would approve the contract. Also, in Pakistan, President Asif Ali Zardari was publicly known as “Mr. Ten Percent” for a similar reason; after coming into the government, he started taking 10% of all major contract investments before he would approve the contract.
However, kickbacks differ from other forms of corruption, such as diversion of assets, as in embezzlement, because of the collusion between two parties. Kickback schemes can be pervasive. For example, in the United States, companies providing medical services to Medicare patients were paying doctors to send patients to them, whether or not the patient needed the treatment, diagnosis, or test.
How do you prove a kickback?
To identify kickbacks, security services often use frontline methods such as test purchases. During the checkout, the ‘buyer’ proposes a rollback and step by step captures the behavior of the sales manager or purchasing manager.
What is kickback UK slang?
How is Kickback used? Use Cases & Examples – Derived from the phrase kickback and relax, kickback typically refers to a small, casual party held in a person’s home rather than a venue. A kickback would include close friends only, not friends of friends or unknown guests.
Examples of how your teen might use the slang term kickback : -What are you planning to do for your bday? -have a chill kickback -Kickback at Adam tuesday night -OK I’ll bring my very special brownies! -Hey, can I bring some of my city league friends Saturday nite? -not this time it’s just a kickback -I’ll be at your sister’s house for the kickback.
-Can’t wait to see you, Bih!
What is an example of a kickback payment?
Kickback Meaning – Kickback is an unethical payment for obtaining preference over some capable person for any discriminatory or special treatment for supplying any goods or service or getting any work done. It can be in cash, credits, goods, preferential allocation, or any other valuable material or service. It can be referred to as a form of bribery wherein the recipient of illegal gain returns some amount, in the name of the commission, to the bribe-taker, who assisted the recipient in obtaining the assistance. Thus, a kickback fee is a commission paid for getting something done by a person through unethical means.
Kickback is a form of bribery where someone gives or receives something of value in exchange for an illicit or corrupt favor or service. This payment can be in cash, credits, goods, preferential allocation, or other valuable materials or services. The illegal payment receiver returns a specific amount as a commission to the bribe-taker, who assists the recipient. Thus, it is a commission paid. Advertising business and stock broking are examples of kickbacks. The medical industry, financial institutions, public works, securities market, and government contracts are forms of kickback.