Good/Bad Backlinks - Penalties

[Prime85]

Just a quick question from someone that is extremely new to this:

If "G" penalizes sites for bad backlinks (low quality, spammy) then why are people not building these types of links towards the competitors that are currently outranking them?

Or are they?  and if they are, is it beneficial? (are your competitors dropping in rankings?)

Seems like a fair question.... Any insight is appreciated

[JamesNorquay]

Well the thing is that it is not ethical to do this type of thing. If Google finds out you are trying to sabotage your competitors it can end up making your company/brand look very very bad. you would never try this for a big respected brand.

That been said people do this kind of thing every day in niches like poker, I also saw a recent example in my market where a clients website was hit with 1000s of adult links from competitors over night.