M3

• Misrepresentation


  Actively misrepresenting about the product or customers
• Over-persuasion


  Appealing to the emotions of a prospective customer and urging them to buy an item they may not need
• Types of direct misrepresentation

  • Deceptive packaging
  • Misbranding or mislabeling
  • False or misleading advertising
  • Adulteration
  • Weight understatement
  • Measurement understatement
  • Quantity understatement
• Deceptive packaging


  Placing the product in containers of exaggerated sizes and misleading shapes to give a false impression of its actual contents
• Misbranding or mislabeling


  Making false statements on the label of a product or making its container similar to a well-known product to deceive the customer
• False or misleading advertising

  Advertising that greatly exaggerates the virtues of a product and tells only half the truth
• Adulteration


  Debasing a pure or genuine commodity by imitating or counterfeiting it, adding something to increase its bulk or volume, or substituting an inferior product for a superior one
• Weight understatement


  Tampering with the weighing scale mechanism to make it register more than the actual weight
• Measurement understatement


  Using a measuring stick or standard that is shorter than the real length or smaller in volume than the standard
• Quantity understatement


  Giving the customer less than the number asked for or paid for
• Indirect misrepresentation


  Omitting adverse or unfavourable information about the product or service
• Caveat emptor


  The seller is not obligated to reveal any defect in the product or service they are selling
• Deliberate withholding of information


  Failing to provide significant information in a business transaction
• Passive deception


  The businessman is unable to provide the customer with the complete information they need to make a fair decision
• Over-persuasion


  Persuasion used for the sole benefit of selling a product without considering the interest of the buyer
• Examples of over-persuasion


  • Urging a customer to satisfy a low priority need
  • Playing upon intense emotional agitation to convince a person to buy
  • Convincing a person to buy what they do not need just because they have the capacity or money to do so
• Unethical practices of the board of directors

  • Plain graft
  • Having employees do work unrelated to the business
  • Loose or ineffective controls
  • Unfair labor practices
  • Making false claims about losses
  • Making employees sign documents showing they are receiving full entitlements when they are not
  • Sexual harassment
• Unethical practices of employees

  • Conflicts of interest
  • Dishonesty
• Conflict of interest


  When an employee violates their obligation to protect and promote the interests of their employer by acting in their own personal interest
• Conflicts of interest


  • Holding a significant interest in a competitor, supplier, customer or dealer
  • Accepting cash, gifts, entertainment or loans from business partners
  • Using or disclosing confidential company information for personal gain
  • Engaging in the same type of business as their employer
  • Using a business opportunity their employer has an interest in for their own benefit
• Examples of employee dishonesty

  • Taking office supplies home for personal use
  • Padding expense accounts with fake receipts
  • Taking credit for another employee's idea