Kickbacks and Shady Business
May 15, 2007 11:37 PM Subscribe
I own with my partner a transcription service for film and TV production companies in Ontario. Recently, a company asked us to do something I consider slightly shady, and I'd like some opinions about what to do.
posted by anonymous to work & money (21 answers total)
Apples Inc. contacted us and requested us to do some transcription of tapes for Oranges Ltd., for whom they'd produced a series of documentaries. But, they informed us that they did not realize Oranges Ltd. would want their transcriptionist to bill them directly. Oranges Ltd., the larger company, has all work that is done on their behalf billed directly to them for some kind of tax purposes. Apples Inc. was given by Oranges Ltd. a larger budget for transcription than was needed, because my company would do it for cheaper. When Apples Inc. contacted us, they told us that we should bill Oranges Ltd. the full amount, and then they would in turn bill us the difference, so that they could use the extra funds in areas where the project needed the money. As i understand it, because we are billing Oranges Ltd. for the full amount, they are our rightful employers, despite the fact that Apples Inc. contacted us. If Apples Inc. wants us to give them money that Oranges Ltd. is paying us, it is in fact a "kickback" and it's illegal.
Because Apples Inc. is not directly employing us, it's not "marking up", it's just shifting money around to their advantage, and we will have to pay taxes on the amount that the larger company, Oranges Ltd. pays us, so this is bad for us. And possibly illegal.
I want to keep this job because it's lucrative, but I need to figure out a course of action that is legal and smart. I'm fine with Apples Inc. getting their money, but I don't want to be feeding them an illegal kickback, and I don't want us to be participating in any kind of fraud. I am not comfortable invoicing a company for one amount when it's not actually an accurate reflection of the budget. What do you think we should do?