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Kickback brokers appear in various forms in corruption schemes. A very common involvement of such a broker is the situation of a local agent, representative, or joint venture partner. A local representative is often necessary when a company is doing business in an area where they do not have a local office or ongoing business operation. |
Local representatives, or business development agents, are invaluable to multinational trade and are utilized by the largest companies throughout the world. Typically, a business will retain the services of an agent to market, distribute or resell their goods, products and services. Because of their local knowledge and expertise, retaining a local agent has proven to be an efficient and indispensable element of global trade.
In the procurement process, project overseers should be aware of typical red flags that may signal bribery, such as in the cases mentioned above.
Some of the major bribery indictors are: |
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Improper source selection. For example, repeated sole sourcing to a single supplier at higher than market prices; |
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Appearance of an unnecessary middleman or agent; |
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Procurement officials who accept inappropriate gratuities from contractors such as expensive dinners or gifts; |
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Unexplained wealth of government officials running the project; |
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Reputation in the community for taking bribes; |
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Under-delivery or poor performance on a contract followed by recurrent engagements; |
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Previous government officials appearing as suppliers or agents on a project; |
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Close personal relationship between suppliers or agents and government officials. |
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