Question 1

What is the kickback prohibition in Florida construction?

Accepted Answer

The kickback prohibition in construction prevents contractors, subcontractors, and material suppliers from paying or receiving improper payments in exchange for referrals, contract awards, or favorable treatment. In Florida, kickbacks in construction are prohibited by: the federal Anti-Kickback Act (40 U.S.C. Section 3145, applicable to federally funded construction projects), the Florida Deceptive and Unfair Trade Practices Act (FDUTPA), local government ethics ordinances (many Florida counties prohibit kickbacks in public construction), and industry standards (kickbacks violate the professional codes of architects, engineers, and licensed contractors). A kickback is any payment, gift, or benefit given to influence a business decision, regardless of whether the decision was in the best interest of the project.

Question 2

How do kickbacks affect Florida construction projects?

Accepted Answer

Kickbacks harm construction projects by: inflating costs (the kickback is built into the contract price, increasing the owner’s cost), compromising quality (the contractor selected based on a kickback may not be the most qualified), creating conflicts of interest (the general contractor who receives kickbacks from subcontractors may not adequately supervise their work), violating the owner’s trust (the owner relies on the GC to select the best subcontractors, not the ones who pay the most), and exposing all parties to criminal liability. In public construction, kickbacks also violate the public trust and can result in debarment (prohibition from future government contracts).

Question 3

What are the penalties for kickbacks in Florida construction?

Accepted Answer

Penalties: under the federal Anti-Kickback Act: criminal penalties of up to 50,000 fine and 10 years imprisonment per violation. Under Florida law: criminal prosecution for commercial bribery (Section 838.015), civil liability for fraud and breach of fiduciary duty, contractor license revocation or suspension by the Construction Industry Licensing Board, debarment from public contracts, treble damages under FDUTPA, and liability for the owner’s losses caused by the inflated costs and compromised quality. Whistleblowers who report construction kickbacks on federally funded projects may be entitled to a share of the recovery under the federal False Claims Act.

Kick Back Prohibition Construction Referral

Kickback Prohibition in Florida Construction

Legal Framework

Project Impact

Penalties

Related Terms

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