Financial coercion describes an environment in which CEOs make difficult decisions under stress. These suboptimal decisions are often made outside of normal operating and financial conditions. For example, to keep a business afloat, a manager may sell an asset because they know it will disrupt the business in other ways. A coercive mutant involves hostage-taking, in which a person is forced to commit a criminal act under the threat that their family member or close associate will be killed immediately if they refuse (commonly known as tiger abduction). This has been levied in some ransom cases, in which a person commits theft or embezzlement on the order of a kidnapper in order to guarantee the life and freedom of a family member. However, coercion is not a complete defense of all crimes. For example, the general rule, both at common law and today, is that coercion is never a defence to murder; That is, one never has the right to kill another innocent person, even if his life has been threatened, although this part can be questioned if several people are threatened with death, if the accused does not kill only one or fewer people than threatened (such a situation is similar to the problem of the cart).  The following elements of economic coercion must be proven: Here are the two main categories of coercion: A defendant who raises a defence of coercion has in fact done everything to form the actus reus of the crime, and has mens rea because he intended to do so to avoid imminent or actual harm. Thus, the defendant already adheres to a certain degree of guilt for what has been done. Personal financial coercion can be induced in several ways. For example, a person may lose their job or end up closing their home if they can`t pay their mortgage.
A health crisis and high medical bills could wipe out a savings account. Theoretically, these events could cause a person to act illegally due to the stress of the situation. When a company starts to experience financial pressures, things have a way of reverberating negatively. Small disruptions begin to intensify, leaving managers with little choice but to make a series of often weak decisions. In case law, coercion or coercion refers to a situation in which a person performs an act as a result of violence, threats or other pressures against him. Black`s Law Dictionary (6th edition) defines coercion as “any unlawful threat or coercion used. to induce others to act [or not to act] in a way that [they] would not do or would not otherwise do.” Coercion is pressure on a person to perform an action that they would not normally perform. The concept of coercion must be distinguished from both undue influence in civil law. In criminal law, coercion and necessity are different defences.   Coercion has two aspects. The first is that it nullifies the person`s consent to an act such as sexual activity or the conclusion of a contract; or, secondly, as a possible legal defence or justification for an otherwise unlawful act.
 A defendant who uses forced defense admits to having broken the law, but claims that he is not liable because, although the act violated the law, it was committed only because of extreme illegal pressure.  In criminal law, a forced defence is comparable to an admission of guilt in cases of partial guilt, so that if the defence is not accepted, the offence is admitted. If a person is forced to do something against their will, they are said to have become a victim of coercion, a threat of inappropriate actions to get a person to sign a contract. – Coercion. There are two types of coercion: physical coercion and coercion by unreasonable threat. A contract induced by physical violence is void. Coercion occurs when a person is prevented from acting (or not acting) of their own free will. Forms of coercion could be subject to imminent physical harm or economic coercion. Financial coercion can be internal in nature, for example when. B a company takes out more loans than it is prudent or engages in questionable merger activity. These self-inflicted injuries can permanently damage a business. In other cases, there may be coercion due to external forces, for example.
B the impact of a generalised economic recession on a firm. For example, when Bob makes illegal threats or engages in coercive behavior that causes his Aunt Sally to sign an agreement or execute a will against her will, Bob makes Aunt Sally “under pressure.” A party who fears for his safety may exercise coercion. One example would be the threat to harm a person`s family if they refuse to sign a contract. If an illegal or threatened act takes place, this is considered coercion. .