Conflict of Interest
A Conflict of Interest occurs when an entity or individual becomes unreliable because of a clash between personal (or self-serving) interests and professional duties or responsibilities. Such a conflict occurs when a company or person has a vested interest — such as money, status, knowledge, relationships, or reputation — which puts into question whether their actions, judgment, and/or decision-making can be unbiased. When such a situation arises, the party is usually asked to remove themselves, and it is often legally required of them.[1]
source: the balance small business
Is a Conflict of Interest a Crime[2]
Like other types of illegal or unethical activities, conflict of interest activities carry the risk of consequences. Federal and state laws have been set up to criminalize conflicts of interest in the public sector, and in certain circumstances, conflict of interest can result in prosecution. The federal government has a criminal conflict of interest statute that prohibits government employees from participating personally and substantially in official matters where they have a financial interest. The spouse, minor child, general partner, and certain others are also included in this prohibition. Potential conflicts of interest can arise from several sources:7
- Assets and investments
- Liabilities
- Private investment funds
- Business or farm ownership
- Corporate employment
- A law firm or consulting employment
- Employment with institutions of higher education, and related research, speaking, and writing activities
Penalties are fines of up to $10,000, prison for up to two years, or both.
- ↑ Definition - What Does Conflict of Interest Mean? Investopedia
- ↑ Is a Conflict of Interest a Crime? the balancesmb