Define: Self Dealing

Self-dealing refers to a situation where a person in a position of trust or authority, such as a company director or a trustee, takes advantage of that position for their personal gain.

Yes, self-dealing is generally considered illegal as it involves a breach of fiduciary duty or a violation of the duty of loyalty owed by the person in a position of trust.

Examples of self-dealing include a company director awarding a contract to their own company without disclosing the conflict of interest, a trustee using trust funds for personal expenses, or a lawyer representing both parties in a transaction without obtaining informed consent.

The consequences of self-dealing can vary depending on the jurisdiction and the specific circumstances. However, common consequences may include civil liability, disgorgement of profits, removal from the position of trust, and criminal charges in some cases.

To prevent self-dealing, it is important to establish and enforce strict conflict of interest policies, require disclosure of potential conflicts, and ensure transparency in decision-making processes. Regular audits and independent oversight can also help detect and prevent self-dealing.

In some cases, self-dealing may be justified if it is in the best interest of the organisation or the beneficiaries involved. However, such situations are rare and require full disclosure, informed consent, and independent review to ensure fairness.

Self-dealing involves taking advantage of a position of trust for personal gain, while self-interest refers to acting in one’s own best interest. While self-interest is generally acceptable, self-dealing is considered unethical and often illegal.

Yes, self-dealing can occur in personal relationships as well. For example, if a person in a relationship uses joint funds for personal expenses without the knowledge or consent of the other person, it can be considered self-dealing.

Possible legal defences against allegations of self-dealing may include lack of intent, lack of knowledge, or lack of evidence. However, it is important to consult with a legal professional to determine the best defence strategy based on the specific circumstances.

Yes, self-dealing can be a criminal offense in certain cases, especially if it involves fraud, embezzlement, or other illegal activities. The severity of the offense and the potential criminal charges depend on the specific laws of the jurisdiction and the extent of the self-dealing conduct.