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. Mirror Fund

    A type of mutual fund, typically run by a life insurance company, ...
  2. Price Fixing

    Establishing the price of a product or service, rather than allowing ...
  3. Short And Distort

    An illegal practice employed by unethical internet investors ...
  4. Fat Cat

    A slang word used to describe executives who earn what many believe ...
  5. Ethical Investing

    Using one's ethical principles as the main filter for securities ...
  6. Bribe

    An illegal payment from one party to another, usually in return ...
Related Articles
  1. Top Broker Excuses For Poor Investments
    Brokers

    Top Broker Excuses For Poor Investments

  2. Biggest Stock Scams
    Personal Finance

    Biggest Stock Scams

  3. The Biggest Stock Scams Of All Time
    Investing

    The Biggest Stock Scams Of All Time

  4. Playing The Sleuth In A Scandal Stock
    Investing Basics

    Playing The Sleuth In A Scandal Stock

comments powered by Disqus
Hot Definitions
  1. Walras' Law

    An economics law that suggests that the existence of excess supply in one market must be matched by excess demand in another ...
  2. Market Segmentation

    A marketing term referring to the aggregating of prospective buyers into groups (segments) that have common needs and will ...
  3. Effective Annual Interest Rate

    An investment's annual rate of interest when compounding occurs more often than once a year. Calculated as the following: ...
  4. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  5. Odious Debt

    Money borrowed by one country from another country and then misappropriated by national rulers. A nation's debt becomes odious ...
  6. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
Trading Center