What are illegal corporate practices?
Unlawful business practice, also known as illegal business practices, are a practice in a business setting that violates the law. Here are some examples of illegal business practices:
• Employment discrimination;
• Employment harassment;
• Breach of a business contract;
• Bribery;
• Unfair competition;
• Financial fraud
• Theft
Employment harassment is a legal term for when an employer creates a hostile work environment. When individuals in a workplace engage in harassment that makes it extremely difficult or impossible for an employee to perform their job duties, a hostile work environment exists.
When a party fails to perform its duties as outlined in a business contract, this is a breach of a business contract. Each situation is different and is determined by the terms of the specific contract. This illegal business practice may also occur if a party makes a false representation during the contract formation process that benefits the breaching party.
Bribery is an illegal business practice in which one person offers, promises, or gives something of value, usually money or an expensive item, in exchange for a better deal on goods or services.
Oppressive Business Practices Quick Links
Call Florida Business Litigation
Consumer fraud is an illegal business practice that involves using unfair or deceptive tactics to illegally entice customers to buy a product or service. False advertising, pyramid schemes, and/or bait and switch are examples of this type of fraud. A bait and switch occurs when a persuading a customer to buy a product or service that is no longer available and then offered an alternative product or service in its place.
Unfair competition is a legal term that is constantly evolving and broadening with each lawsuit filed. Typical examples include:
• Misrepresentations made to consumers;
• Discriminatory treatment of consumers;
• Trademark infringement;
• Advertisements expressing hostile treatment of competitors; and/or Unreasonable “non-compete” clauses in employment contracts.
• And, that which falls into this concept will vary by state and federal law.
Financial fraud is an illegal business practice in which an individual alters a company’s financial statements or financial books to make it appear that it generates more revenue than it is. In addition, financial Fraud typically entices investors to purchase stock to artificially raise the company’s market value.
Theft is an illegal business practice that can take many different forms. These are some examples:
• Failure to refund customer returns,
• embezzlement of company funds,
• and/or theft of warehouse equipment
The laws governing illegal business practices differ depending on whether they fall under state or federal law. Therefore, it is critical to have an attorney review the case to determine which laws will apply.
What Is the Distinction Between Illegal and Unfair Business Practices?
Unlawful business practices are distinct from unfair business practices in the eyes of the law. In most cases, unfair business practices, while inappropriate, are, in fact, legal. Typically, they involve unethical or immoral business behavior on the part of an owner or corporation. For example, unfair business practices include when a company owner steals and/or destroys a competitor’s work product or intentionally violates a company policy.
The main distinction between unlawful and unfair business practices is that illegal business practices, as discussed above, actually violate the law. Unfair business practices are not illegal, but they may violate a person’s or a company’s moral code.
Is an Illegal Business Practice the Same as Puffery?
No, an illegal business practice is not synonymous with puffery. Puffery is an exaggerated statement made solely to attract customers. These statements exaggerate or promote the quality of a product or service.
Puffery statements are typically regarded as personal opinions. However, the Federal Trade Commission (FTC) does not consider them illegal because a reasonable person would not interpret them as a literal statement of fact. Instead, they are regarded as a legal practice frequently associated with the language used in advertisements and/or promotional sales.
For example, if a person advertises a beach house rental as “God’s Little Slice of Heaven” they are not engaging in illegal business practice. Instead, they are advertising in an exaggerated manner that is appealing to customers.
False advertising, on the other hand, is a type of advertising not considered legal. It differs from puffery in that it is a factual statement, rather than an opinion, used to intentionally mislead the general public rather than simply attract customers. For example, a company that advertises a product as having healthy, high-quality ingredients when it contains a lot of sugar and chemicals is an example of false advertising.
What are some of the legal ramifications of illegal business practices?
Unlawful business practices are illegal, and owners and/or companies may face repercussions. Individuals who relied on businesses, on the other hand, may be able to recover damages for their losses.
There are numerous types of illegal business practices, each with its own set of remedies. The consequences of each will vary depending on the specific case, local laws, and whether federal or state laws apply. For example, in an employment discrimination lawsuit, the following remedies may be available:
• Compensation for lost wages;
• Reinstatement to the individual’s previous job position following wrongful termination;
• Individuals’ lost benefits, including retirement benefits, could be ordered reinstated, and/or changes to a company’s policies and practices could be required by the court.
Individuals convicted of business crimes such as bribery and/or fraud may face the following penalties:
• Jail time;
• probation or parole;
• fines, and/or restitution or repayment of any money taken.
If convicted of a theft-related crime or embezzlement of employer funds, it may be difficult for them to find future employment. They must be prepared to disclose their crimes, which will almost certainly be discovered during a background check.
In some cases, if an individual’s profession, such as a financial investor, required a professional license, they may lose that license and be barred from obtaining another even after serving their sentence. Each case will be determined by the specific circumstances of what occurred and the court’s decision.
Should I Seek Legal Advice About Unlawful Business Practices?
Yes, you should consult an attorney if you are engaging in illegal business practices. An experienced business lawyer can help you whether you are a victim or accused of illegal business practices. In addition, a lawyer will be able to review the facts of your case, determine whether you have a claim, determine which laws apply, and, if necessary, represent you in court.
If accused of engaging in illegal business practice, you could face serious consequences. A business lawyer can review your case, determine what defenses you might have, and represent you in court if necessary. A lawyer may also be able to assist you in negotiating a more favorable outcome for your case.
Furthermore, when charged with a business crime, you should consult with a business lawyer who is also experienced in criminal law. Many areas of the law overlap and many attorneys have experience in several areas. A criminal charge stemming from an illegal business practice can have serious and long-term consequences.
