Laco Case Study

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1 - Is what Frank did ethical? By whose ethics- those of Latino or the United States? Ethical is defined as conforming to accepted standards and consistent with agreed principles of correct moral conduct. Frank’s choice to implement bribery in those of Latino is ethical. In the definition above, being ethical or unethical is in the eyes of the country. If the country doesn’t view this as an issue then neither should Frank. However, in the United States, this bribery would be considered unethical because of the morals that the U.S. stands on. Even though this may be ethical in Latin, bribery is still considered to be illegal when it comes to the Foreign Corrupt Practices Act. 2 - Are Frank’s two different payments legal under the Foreign…show more content…
The Omnibus Trade and Competitiveness Act of 1988 reduces liability of corporate offices from having reason to know about bribes, and also permits lubrication payment if customary in the culture. The choices that Frank is making may be ethical in Latino, but it is definitely illegal. Frank is a United States citizen and just because he relocated to Latino, he still has to follow the rules of the Foreign Corrupt Act. In this case, Frank is making illegal bribes by bribing a jefe versus bribing the dockworkers. 3 - Identify the types of payments made in the case; that is, are they lubrication, extortion, or subornation? The money given to jefe was an example of extortion. It was apparent that the jefe did not use the money that was given to him to repair the supposed damages that he claimed he would fix. An example of lubrication in this case is when Frank gave the dock workers a fistful of pesos to speed up the process of transferring the machines to Latino…show more content…
He should have has someone from the United States come and inspect the machines like he originally was going to do. Agreeing to pay 1,200 for each machine to a local person who did not change one thing was not smart for the company. They have good products, they are priced right, and they provide good service, so there is no reason why they should have to pay bribes. The consequence may be that they might lose their Latino customers and foreign sales might decrease. 9 - What are the company interests in this problem? The company wants to change their character, from being principally an exporter, without any real concern for continuous foreign market representation, to having worldwide operations, where the foreign divisions are part of the total effort rather than a stepchild operation. Latino is one of the last operational divisions to be assimilated into the new organization because they want to make adjustments there without having to change

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