A bribe is an illegal payment from one party to another, usually in return for a legal or financial favor. Bribes are often made to public officials or heads of other regulatory agencies to escape legal convictions or unfavorable rulings, or as an incentive for the payee to bend or overlook pertinent regulations that would otherwise restrict the payer.


Bribes and kickbacks of any kind are, obviously, nondeductible. Bribes that take the form of kickbacks to insurance or securities customers are known as rebating and can result in disciplinary actions by the regulatory authorities.

Types and Scales of Bribes

Bribes can be given at a variety of different scales, ranging from minor transactions between individuals to major deals between corporations and/or governments. A common example of a small scale bribe might occur at an expensive restaurant. In an effort to obtain a table before other customers, a patron might hand the host or hostess a small amount of money to earn favor. A bribe on a larger scale might involve a substantial amount of money or goods. As such, these bribes almost exclusively involve larger institutions capable of undertaking such a significant deal. Companies in controversial fields of business, such as oil companies and gun manufacturers, might bribe certain people of influence to look the other way in regards to their actions. Bribery is a key issue at the intersection of business and politics, as there are always concerns that those in government are being illegally influenced by those in business.

The Difference Between Bribes and Lobbying

Bribes and lobbying are almost the same in concept, though there are key differences between the two, at least in American politics. The most significant is a bribe usually refers to an illegal or immoral exchange, while lobbying involves outside consultants arguing for favors as opposed to buying them. Lobbyists act as a very common way for special interest groups to influence government policy without stooping to the act of bribery. However, there is controversy as to whether lobbying is essentially a legalized form of bribery. Some foreign governments, such as South Korea, even outlaw lobbying entirely due to this blurred distinction. The argument in favor of lobbying is that by banning it, bribery might simply take its place. Lobbying acts as a legal measure to prevent full-scale corruption, while bribery allows those with money and influence to buy whatever favors they require.

  1. Facilitating Payment

    A financial payment that may constitute a bribe and that is made ...
  2. Foreign Corrupt Practices Act

    A United States law passed in 1977 which prohibits U.S. firms ...
  3. Lobby

    A group of like-minded people banded together to influence an ...
  4. Kickback

    The payment of something of value to an individual with the goal ...
  5. Proxy Tax

    A tax on lobbying or political expenses that exceed an allowable ...
  6. Corruption

    Dishonest behavior by those in positions of power, such as managers ...
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