'Everyone does it' and eight other excuses, answered

Nearly everyone who has taken or paid a hidden commission has told themselves something that made it feel acceptable. Here are the common ones, and the honest answers.

"Everyone does it."

Not everyone does. Many people refuse, and some lose business for it. And "everyone does it" is not a defence in any legal system we know of. It is also an admission that people know it is happening.

"He's a billionaire. He won't miss it."

Whether the client will notice is not the test. The test is whether they were told and agreed. The size of someone's fortune does not change whose money it is, and it makes a poor reason to take it.

"The price is the same either way."

Perhaps. It makes no difference to whether the arrangement was disclosed. The wrong is that the person trusted to advise the client was being paid by the other side, in secret. See Commission or kickback?.

"The supplier pays it out of their own margin."

Then the supplier is paying you to choose them, and your client does not know. That is exactly the problem. It also does not stay true for long: margins that pay for steering orders are earned back somewhere.

"It's a thank-you, not a payment."

A benefit given because of an order, or in the hope of the next one, is a benefit connected to that order. Cases of wine, tickets and trips are all benefits. The label is not the test.

"I'm not an employee, I'm a freelancer, so it's different."

The duty comes from the role you are performing for the client, not from your contract of employment. An agent who is a freelancer owes the same loyalty.

"My brokerage (or manager, or captain) knows."

Then it should be in writing, and the client should know. If the person above you knows and the client does not, you are not protected by their knowledge. You may be more exposed.

"It's legal. We have an invoice."

An invoice for an undisclosed commission does not make it lawful. It makes a record. Records have a way of being found.

"If I don't, I'll lose the business."

Sometimes that is true, and it is the real cost of honesty in the current market. That is exactly why this site exists: to change the market so the honest do not lose. In the meantime, a written policy, a polite refusal and a record of the request protect you. You are not alone. Ask us if you want help.

General information, not legal advice. See the disclaimer.