Each of us will have differing ideas on things that are “perfectly legal”, yet, morally incongruent. Allow me to site a few examples from a personal and business perspective.

In 2019, my wife and I became engaged for marriage and actively planned our wedding for July 2020. An early stop was to a reception facility as we anticipated a sizeable crowd to help us celebrate. We paid full price in advance per the contract agreement. Now we all know what happened in 2020—lock down!

We ultimately had a wonderful back yard wedding with some family and a few friends present. We hoped to have a reception one year later for the many original wedding invitees. The reception staff said they normally did not extend contracts but ultimately agreed to do so. Well, July 2021, although out of lockdown, was still under mask and distance compliance. We chose not to move forward and requested a refund. We were told no. Why? The contract stated otherwise. The owner of the facility who was thought to be a friend of mine and former fellow Rotarian did not even respond to my email.  

Contrast the experience above with Tom Walter, owner of Tasty Catering in Chicago. When the lockdown mandate became law there, he immediately refunded all deposits for scheduled catering events. Why? He did so out of love and respect for his clients. He also encountered over $1 Million in debt keeping his staff on the payroll out of true love and concern for them. When business finally opened again, Tasty was (perhaps) the only firm with a full staff to handle the onslaught of new business. This is a lesson in good business leadership and practice.

Allow me to give a couple of other situations involving government compliance. 

Beginning in 1999, a high-profile Cincinnati case involving a well-known banana supplier was charged and fined many millions of dollars by the Department of Justice for bribery to a Colombian terrorist group. I have some insight on the case as my best friend from college was the lead to the accounting forensic team that went to Columbia to gather the facts on behalf of the banana company CEO. Here is how it was explained to me:

The company CEO learned of the bribes and wanted to do the right thing and get it cleaned up. He thus hired the forensic firm to gather the facts. What he learned was the terrorist group receiving the bribes held themselves out as a Columbian security force protecting the banana workers there. The truth is they threatened to execute the workers if the fees were not paid. To clear his conscious, the CEO went to the Department of Justice to fess up. The DOJ immediately began its own investigation, charged the company, and leveled an enormous fine.

There is no mercy shown by the Fed when rules and regulations are violated.  

Another situation is humanitarian. There have been many faith-based groups traveling to Haiti to help relieve some of the suffering there. (It has been rumored) that one such group set up medical clinics each year and brought in over 50 bags of medical supplies. It has also been rumored that the custom agents there were tipped allowing the bags to enter. Perhaps the bags otherwise could have been confiscated or the group charged for some trumped-up crime. Who knows?

We business leaders are forced to walk a “tightrope” on many compliance issues:

·      Contract enforcement vs. good business practice.

·      Legal compliance when dealing with foreign entities.

·      Legal compliance when on humanitarian missions.

To list a few.

Here are two take-a-ways to consider from these stories:

1.     Legality does not always equate to moral and ethical behavior.

2.     Government rules and regulations, although necessary, do not equate to be business friendly or forgiving.

You may have other thoughts or ideas on this topic. If so, please weigh in.