Joe Keen sold widgets to Ironworks Distributors. He knew the purchasing manager,

Question

Joe Keen sold widgets to Ironworks Distributors. He knew the purchasing manager, Mike Cotton, loved to attend Yankees baseball games. In exchange for a huge order of widgets, Joe gave Mike 4 playoff tickets. Mike tried to refuse, but Joe insisted. A huge RFP was expected to come out in a week. Joe commented to Mike that he knew in light of the ticket gift he was in like flint. Explain

1) Is anything wrong with this exchange? 2. Has any crime been committed? 3. If so, what? 4. Whose rights, if any one, have been compromised by this exchange? 5. What should the company do about this type of situation in the future?

Explanation / Answer

Answer- 1-Yes, this exchange is wrong as the exchange should be of the same value. Huge order of Widgets costs huge that can not be set off by giving merely the tickets that cost very less. If Joe Keen wanted to give the playoff tickets, he should first make some payment (partial payment) and rest of the payment, he could make by giving the tickets then it would have been a win-win situation for both.

2- No crime has been committed but Joe Keen took the undue advantage.

3- Mike Cotton has compromized by taking the tickets in place of payment.

4- Company should not accept this type of exchange, Company should maintain proper records and cross check the payments, whether it is timely and properly made. Company should keep its personal relations away from the business payments and shoul check these activities and warn the distributor as well as purchasing manager.

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