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Post by zuolun on Nov 10, 2013 13:40:50 GMT 7
Kickback(回佣 / 回扣)A kickback is a payment of money, favors, or some other valuable to another individual to perform a certain desired action or to make an important decision in the kickbacker's favor. The desired action is often a referral that results in a transaction that benefits the person who paid the kickback. A kickback can be either legal or illegal, depending on the circumstances of the action. A kickback is generally done in secret. In investing, a common kickback is a broker's reduced commission charged to someone who invests frequently through the broker. Another example is referral payments for finding clients. Kickbacks occur not only in business, but also in government sectors. The US government has laws that prohibit kickback behavior. Example:
The CEO of a listed company, ABC invested company's fund, $1 billion in a company called XYZ with full knowledge that it would go bankrupt soon. Prior to the investment decision, he had liaised a 50/50 split with the owner of company XYZ that each would get $500 million once he got the money. After a while, company XYZ really went bankrupt. It didn't affect the CEO personally as the $1 billion in losses were attributable to the listed company ABC. So what's rightfully company ABC’s money has now become the CEO's personal money, and it’s all legal and above board. 贪污风险知多少(简体版) 测试一: 回佣
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Post by oldman on Nov 10, 2013 19:36:26 GMT 7
There are many variations to this. Investors are truly at the mercy of the listed company management. Herein lies the importance of trusting the management.... but seriously, how can an investor ever know if management is trustworthy or not. For me, I can only view their past transactions and then hope that they continue to be trustworthy. I will certainly avoid listed companies that have always seem to lose money with every acquisition... don't laugh but there are lots of examples in our exchange. Sorry, I cannot share these examples but if you look around, I am sure you can find them.
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Post by candy188 on Nov 10, 2013 22:26:42 GMT 7
Hi oldman, Thank you for emphasising the foremost value in judging our business partner on whether to entrust our hard earned money for investment. There are many variations to this. Investors are truly at the mercy of the listed company management. Herein lies the importance of Trusting the Management.... but seriously, how can an investor ever know if management is trustworthy or not.
For me, I can only view their Past Transactions and then Hope that they Continue to be trustworthy.
I will certainly AVOID listed companies that have Always seem to LOSE Money with Every Acquisition... don't laugh but there are lots of examples in our exchange. Sorry, I cannot share these examples but if you look around, I am sure you can find them.
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Post by zuolun on Nov 10, 2013 22:33:59 GMT 7
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Post by oldman on Nov 11, 2013 5:51:22 GMT 7
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