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Len
Len, Lawyer
Category: Criminal Law
Satisfied Customers: 444
Experience:  15 years practice in criminal and employment law.
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I have received payments from a sub contractor that has provided

Resolved Question:

I have received payments from a sub contractor that has provided payments back to me for the referrals in Texas. I am an executive in the company that hired him. Is this illegal or unethical. It is non medical or govermental contrackts....It is for cleaning of businesses.
Submitted: 7 years ago.
Category: Criminal Law
Expert:  Len replied 7 years ago.

I will help you with this, but I need some more information:

 

1. When you say "hired", do you mean for a one time service at your company?

 

2. Is this a referral based company that you work for? In other words, is the company's primary business to advertise and then assign jobs to sub-contractors?

 

3. Is it customary in your business to receive referral compensation?

 

4. Is your company aware of the payments back to you?

 

Thanks,

 

Len

 

 

Customer: replied 7 years ago.

We had many contracts that came in an emergency situation. We had over a hundred subcontractors help us. One of them provided an extreme amount of help. He did not get the work because of his financial payments to me.

No, it is not customary for the business to receive referral compenstation.

No the company does not know.

Expert:  Len replied 7 years ago.

OK, I appreciate the additional information.

 

The traditional term associated with this practice is "kickback", as you no doubt are familiar. It is the same whether in the private or public sectors. Clearly, the public sector situation provides for criminal sanctions.

 

With private companies, the kickback money may or may not be criminally liable. On the one hand, many companies allow this to take place as part of a employee's compensation, a form of commission. On the other, a ccould argue that you are benefitting illegally from the work derived through the business, a form of embezzlement. Now, that still doesn't mean it would necessarily be a criminal act.

 

Given your question and the additional information, it seems clear that the company would frown upon the payments. So, it comes down to what you would like to do. If it is possible, you might consider talking to the company and telling them what has happened, and then offer to pay the money over to them. Another approach may be to terminate the payments completely, pay the monies back to the sub-contractor, and simply move on with business as usual.

 

In sum, it is not certain that the receipt of the monies would be criminal. There could be a basis for a civil action by the company. How you proceed depends upon dozens of other questions. As such, you need to discuss the above information with a good criminal attorney in your area. There is no substitute for that. You should try to find one through reputation, not advertising.

 

I hope this helps.

 

Len

 

Please press accept and leave some feedback when you get a chnace.

 

Len and 3 other Criminal Law Specialists are ready to help you
Customer: replied 7 years ago.

Len,

 

Thanks, XXXXX XXXXX take your advice.