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    What is the appropriate punishment for violation of ethical and legal principles? Should the remedies be limited to expulsion of the members who violated those principles or should the entire community be held responsible? Use ethical principles or theories to answer this question.

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    You work for the city of Bigtown's legal department. Bigtown has been trying for years to attract more convention business, but it has been unsuccessful to date. The new mayor was voted in on the tagline, "I'll make Bigtown the place to see and be seen."

    It's been six months since the mayor's inauguration, but tourism is, if anything, worse than before. The mayor is desperate and talking about offering contracts for city work in exchange for convention business. Your boss (the city's counsel) needs to convince the mayor that this strategy is unethical and possibly illegal. She asks you to research the Salt Lake City Olympics scandal and address specific issues that link to Bigtown's situation.

    The Big Business of the Olympics and Bribery

    LEAD STORY-DATELINE: The Washington Post, January 15, 1999.

    Salt Lake City and the state of Utah are considered synonymous with the Mormon Church and the morality that flows from religious pursuits. A recent bribery scandal relating to Salt Lake City's successful bid to host the 2002 Winter Olympics casts a cloud over the city and state.

    The Salt Lake Organizing Committee (SLOC) had assigned individual members to lobby members of the International Olympics Committee (IOC) to select Salt Lake City as the 2002 Winter Olympics' site. Since November 1998, there have been allegations that the members of the SLOC lobbied by making gifts to certain influential IOC members and their families. The allegations are that the SLOC members gave scholarships, free medical care, guns and other expensive gifts valued at hundreds of thousands of dollars to visiting IOC members. IOC rules limit members to gifts with a maximum value of $150. One influential IOC member is alleged to have received free medical treatment for hepatitis and financed land investment deals for one SLOC member.

    The scandal has resulted in investigations by a several agencies, including the federal Department of Justice, the International Olympics Committee, the U.S. Olympic Committee, and an ethics panel for Salt Lake Organizing Committee (SLOC). The Utah legislature had created a committee to oversee the Olympics because of the approximately $1.4 billion initial costs to be incurred by Utah and the State's obligation to pay any shortfall. That committee has entered the fray and demanded financial accounting from the SLOC. The state of Utah projected receipt of three billion dollars in revenues from hosting the games.

    IOC members investigating the scandal have said that punishment may range from requiring an apology to censure to expulsion depending on the results of its investigation. Several SLOC members including president Frank Joklik and vice president Dave Johnson, resigned (during the investigation process).

    Assignment:

    Part A - Research the Salt Lake City Olympics scandal and address specific issues that link to Bigtown's situation.

    Part B - Prepare a slide presentation for your boss to give to the mayor answering the questions below. Your main points should be listed on the slides and the specific information to support each point must be explained in the notes section of the PowerPoint slide.

    Lobbying is defined as "the act of trying to directly shape or influence a government official's understanding and position on a public policy issue." (Post, Business and Society 7th ed.) What is the difference between lobbying and bribery?

    Whether bribery should be considered unethical or illegal has been debated extensively. Many scholars and businesspeople take the position that bribery should not be treated as unethical. Why is it that the general public considers bribery to be immoral? Use ethical theories or philosophies to explain your answer.

    The Foreign Corrupt Practices Act (15 U.S.C. sec. 78) makes it illegal for US companies to pay bribes even if they are in foreign countries. Assuming that this is a case where the FCPA would apply, it helps to look at its definition of a bribe. The FCPA defines a payment that is "meant to influence an official to award or maintain business activity" as illegal. Payments that assist the payer to obtain ministerial actions are not prohibited. What argument could the SLOC members make that the payments made do not fit the definition of an illegal bribe under the FCPA?

    What is the appropriate punishment for violation of ethical and legal principles? Should the remedies be limited to expulsion of the members who violated those principles or should the entire community be held responsible? Use ethical principles or theories to answer this question.

    This is essentially a subject for your consideration and personal opinion regarding the ethics of bribery (as supported by ethical theories), whether in the public arena or in business. The exception to this is if a specific law or rules of conduct exist prohibiting or regulating certain activities. See, for example, section 76-6-508(1)(a) and section 76-8-103 of the Utah Code: http://le.utah.gov. Click on (1) "Utah Code/Constitution" (2) "Utah Code" (3) "Title 76" (4) "Chapter 6" [or] "Chapter 8" then find section 76-6-508(1)(a) or section 76-8-103. Hints for Excellent Work: Answer every question thoroughly. Remember to address the Bigtown proposal in your answer.

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    Solution Preview

    Part A - Research the Salt Lake City Olympics scandal and address specific issues that link to Bigtown's situation.

    The mayor's considerations could be considered bribery, much as the same as reported in the Salt Lake City Olympics' scandal.

    It's been called "the ugliest chapter in the history" of the Olympic Games. While many will argue that distinction will forever belong to the hostage killings in 1972 at Munich, one thing is for certain; the way Olympic sites are chosen will never be the same. (http://www.factmonster.com/ipka/A0114715.html) Scandal is nothing new to the Olympic Games, but the scope and intensity of the recent corruption charges were. Allegations of vote buying first surfaced Dec. 12, 1998, involving Salt Lake City's winning bid for the 2002 Winter Games. (What is vote buying - http://www.stanford.edu/~albertod/docs/Bellagio_Schaffer_Schedler.pdf)
    Members of Salt Lake's bid committee are accused of spending millions of dollars to improperly influence the votes of 14 International Olympic Committee members. (Who are the International Olympic Committee - http://en.wikipedia.org/wiki/International%5FOlympic%5FCommittee) The payments reportedly include cash payoffs, medical expenses, travel expenses, gifts, entertainment and college tuition payments for IOC members' children. Six IOC members have already been booted and three more have resigned. Still three others are currently under investigation and a fourth has been given a warning. While it is unlikely that any actual criminal activity took place, the decision by several IOC members to accept lavish gifts and money was certainly unethical. It is difficult to determine whether votes were actually bought because the committee votes to award the Games by secret ballot.
    The six members that have been preliminarily expelled are Jean-Claude Ganga of The Republic of Congo (http://www.factmonster.com/ipka/A0107427.html) Agustin Arroyo of Ecuador (http://www.factmonster.com/ipka/A0107479.html), Zein El Abdin Ahmed Abdel Gadir of Sudan (http://www.factmonster.com/ipka/A0107996.html), Lamine Keita of Mali (http://www.factmonster.com/ipka/A0107759.html), Charles Mukora of Kenya (http://www.factmonster.com/ipka/A0107678.html )and Sergio Santander of Chile (http://www.factmonster.com/ipka/A0107407.html). Mukora is the only one of the six thus far to resign rather than be expelled. IOC members Pirjo Haeggman of Finland (http://www.factmonster.com/ipka/A0107513.html), Bashir Mohammed Attarabulsi of Libya (http://www.factmonster.com/ipka/A0107722.html) and David Sibandze of Swaziland (http://www.factmonster.com/ipka/A0108004.html) have also resigned their posts in the wake of allegations.
    IOC president Juan Antonio Samaranch (http://en.wikipedia.org/wiki/Juan_Antonio_Samaranch#Biography), though under pressure to step down due to the widening scandal, has ruled out resigning and has pledged to lead the effort in purging the corruption. He has promised the formation of an ethics commission to review how the IOC members operate. Changes are already in place for the 2006 Winter Olympics, the next games to be awarded. In a trial run for future selections, the city will be chosen by a panel made up of eight IOC members, three athletes, one winter sports representative, one national Olympic official, the IOC's longest serving member and the chairman of the 2006 evaluation ...

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