SmithKline Beecham Clinical Laboratory in Fraud Scandal

Essay by rmichelegUniversity, Master'sA+, May 2004

download word file, 12 pages 5.0

Corporate business is riddled with unethical behavior, which usually leaded to illegal acts and criminal or civil penalties. Being an ethical manager in an unethical organization is sometimes an impossible task. When attempting to determine ethical and unethical behavior, there must be a clear definition of acceptable policy. Ethical behavior is defined as "behavior that is the right thing to do, given the circumstances." The four main fundamentals are honesty, integrity, fairness, and concern for others. These principles should be the foundation of all corporate ethics policies. (Guy 9).

The ethical obligation of business is to establish appropriate workplace behavior. Many companies engage in methods that are not morally correct. Numerous times these immoral practices are initiated by top management then passed down through the chain of command as standard operating procedures. As more and more employees began to recognize these unethical guidelines as company policy, the problem grows out of control.

Along the way, few people realize this practice is immoral and take the necessary steps to correct it. Some employees notify top management and voice concerns or contact the proper authorities as to illegal practices.

In the early 1990's the Attorney General began investigating laboratory practices relating to fraudulent billing practices. The first company caught in the Government scandal was Nation Health Services. In 1992, National Health Services settled a lawsuit with the government for $111 million. Operation Lab Scam was established a direct result of the NHS settlement. (DOJ and HHS para 9) Information obtained in thee NHS investigation pointed to violations committed by other major clinical laboratories, such as SmithKline Beecham, Quest Diagnostics, Damon Clinical, and Allied Clinical Laboratories. Operation "Lab Scam" focused on investigating laboratories for civil and criminal violations; Medicare/Medicaid claims violations, and other federally funded benefit programs. It was suggested that various...