| Abstract | A growing number of multinationals are ripped off by corrupt employees controlling their distribution networks in emerging markets. Particularly affected are textiles, pharmaceuticals, paper, scientific equipment and health care products being sold in emerging markets such as India, Vietnam and China. Victims not only forfeit millions in revenue, but they also face losing their reputation among customers and being held to ransom by corrupt employees. With kickbacks to public officials a major feature in this type of fraud, the United States companies also run the risk of prosecution under the Foreign Corrupt Practices Act. In this article, the author reports on distribution frauds and suggests some ways to prevent them. |
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