Slush Fund

AAA

DEFINITION of 'Slush Fund'

Money earmarked for a loosely defined, but legitimate, purpose that is instead surreptitiously used for an illegitimate purpose. The term "slush fund" indicates a fraudulent use of money. Expenses paid for out of a slush fund may be disguised as legitimate expenses, such as salaries, but not be commensurate with the work performed. Other times, no effort is made to disguise the spending, such as when a corporate executive uses a slush fund to purchase luxury vehicles for family and friends.

INVESTOPEDIA EXPLAINS 'Slush Fund'

For example, if a politician siphoned off tax payments that were supposed to fund public goods and used the money to pay for a lavish vacation, the stolen money would be referred to as a slush fund. Another example of a slush fund would be an officer of a charity using donations to pay for personal expenses.

RELATED TERMS
  1. Kickback

    The payment of something of value to an individual with the goal ...
  2. Ethical Investing

    Using one's ethical principles as the main filter for securities ...
  3. Mirror Fund

    A type of mutual fund, typically run by a life insurance company, ...
  4. Bribe

    An illegal payment from one party to another, usually in return ...
  5. Price Fixing

    Establishing the price of a product or service, rather than allowing ...
  6. Asset Allocation

    An investment strategy that aims to balance risk and reward by ...
RELATED FAQS
  1. What is an unregistered security scam?

    Each year, millions of Americans lose money to con artists who convince them to invest in companies through "private offerings" ... Read Full Answer >>
  2. What is an available seat mile in the airline industry?

    One airline seat available for sale and flown one mile equals one available seat mile (ASM) in the airline industry. A primary ... Read Full Answer >>
  3. How is the principle agent problem manifested in the government?

    The principal-agent problem describes challenges that occur when agents and principals have conflicting interests. Democratically ... Read Full Answer >>
  4. Why do supply shocks occur and who do they negatively affect the most?

    The exact nature and cause of supply shocks is imperfectly understood. The most common explanation is that an unexpected ... Read Full Answer >>
  5. What kinds of productivity data does the Bureau of Labor Statistics keep?

    The U.S. Bureau of Labor Statistics (BLS) tracks two primary sets of productivity data for the U.S. economy: labor productivity ... Read Full Answer >>
  6. What role does the government play in capitalism?

    The proper role of government in a capitalist economic system has been hotly debated for centuries. Unlike socialism, communism ... Read Full Answer >>
Related Articles
  1. Brokers

    Top Broker Excuses For Poor Investments

    It is not uncommon for investors to lose money through misselling or other forms of mismanagement.
  2. Personal Finance

    Biggest Stock Scams

    These companies betrayed their investors and in many cases, the financial fallout wasn't pretty. Would you have seen it coming?
  3. Investing

    The Biggest Stock Scams Of All Time

    Where there is money, there are swindlers. Protect yourself by learning how investors have been betrayed in the past.
  4. Investing Basics

    Playing The Sleuth In A Scandal Stock

    Learn the legwork involved in finding out whether your investment can weather a storm.
  5. Personal Finance

    How To Identify A Micro-Cap Scam

    Discover how to distinguish a real investment opportunity from a fraudulent one.
  6. Entrepreneurship

    Stop Scams In Their Tracks

    Find out how to protect yourself and your loved ones from financial fraudsters.
  7. Fundamental Analysis

    Explaining Expected Return

    The expected return is a tool used to determine whether or not an investment has a positive or negative average net outcome.
  8. Economics

    Explaining PFIs and PPPs

    Public-private partnerships (PPP) and Private Finance Initiative (PFI) are two business relationships between government agencies and private businesses.
  9. Economics

    How to Calculate Trailing 12 Months Income

    Trailing 12 months refers to the most recently completed one-year period of a company’s financial performance.
  10. Economics

    The Field So Far: US 2016 Presidential Candidates

    Over the past several months, there has been a lot of speculation as to who will make a run at the Republican and Democratic nominations.

You May Also Like

Hot Definitions
  1. Venture-Capital-Backed IPO

    The selling to the public of shares in a company that has previously been funded primarily by private investors. The alternative ...
  2. Merger Arbitrage

    A hedge fund strategy in which the stocks of two merging companies are simultaneously bought and sold to create a riskless ...
  3. Market Failure

    An economic term that encompasses a situation where, in any given market, the quantity of a product demanded by consumers ...
  4. Unsystematic Risk

    Company or industry specific risk that is inherent in each investment. The amount of unsystematic risk can be reduced through ...
  5. Security Market Line - SML

    A line that graphs the systematic, or market, risk versus return of the whole market at a certain time and shows all risky ...
  6. Tangible Net Worth

    A measure of the physical worth of a company, which does not include any value derived from intangible assets such as copyrights, ...
Trading Center