Monthly Archives: March 2021

TI France Demands Dismissal of Gabon Government Claim to be Corruption Victim

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TI France is moving to block an audacious, underhanded move by the Gabonese government to frustrate the confiscation of hundreds of millions in assets stolen from its citizens.  The assets are likely to be confiscated as part of the proceedings known as Bien Mal Acquis (wrongfully acquired assets), where French prosecutors are investigating the ruling families of Gabon, Equatorial Guinea and the Republic of the Congo for buying hundreds of millions of euros of French real estate and other properties with corrupt monies. In 2017, in the first case to go to trial, €150 million in French assets were confiscated from Equatorial Guineans First Vice President Teodorin Obiang (here).

Apparently anticipating a similar result, the Gabonese government recently joined the proceedings as a partie civile or civil party.  Under French law, if a court orders the confiscation of the Gabonese ruling family’s assets, the Gabonese government would then have a claim to some if not all of the assets under the theory it is entitled to recover damages suffered by the ruling family’s corruption. A just and reasonable outcome were a democratically elected government committed to its citizens’ welfare in power.

Tragically, for the Gabonese people this is not the case.  The same family responsible for stealing the nation’s wealth, the Bongos, remains in power.  TI France has now moved to have the government’s claim to be a civil party dismissed. This should be an easy decision for the presiding magistrate given how well the Bongo family’s corruption has been documented. 

The continued active participation of civil society in the landmark Bien Mal Acquis case shows how critical it is that anticorruption NGOs to represent those like the citizens of Gabon, Equatorial Guinea, and the Republic of the Congo where their governments make it impossible for corruption victims to bring cases on their own.  The TI Press Release on its move to strike the Gabonese government as a civil party is here. The origins of Bien Mal Acquis and its lessons are discussed here.

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New Podcast, Featuring Thomas Stelzer

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A new episode of KickBack: The Global Anticorruption Podcast is now available. In this week’s episode, I interview Thomas Stelzer, who is currently the Dean of the International Anti-Corruption Academy (IACA), and who recently served as a member of the United Nations High-Level Panel on International Financial Accountability, Transparency and Integrity for Achieving the 2030 Agenda (a mouthful of a name, which is why this distinguished group is usually referred to as the FACTI Panel). After Dean Stelzer opens our conversation with a discussion of his own professional background and interest in corruption, the interview turns to the FACTI Panel’s report, published this past February, and the report’s recommendations for combating illicit international financial flows. (In addition to the full report, which runs to 49 pages not including annexes and references, FACTI has released a shorter executive summary, as well as an interactive web page.) I asked Dean Stelzer about several of the report’s recommendations that seemed especially pertinent to the fight against grand corruption, and he gamely responded some of the questions and concerns that I raised about certain aspects of the report. In addressing these issues, Dean Stelzer emphasized the importance of more and better research on the topic of illicit financial flows, as well as the need for sustained efforts to ensure effective implementation of reforms such as those that the FACTI Panel outlined. You can also find both this episode and an archive of prior episodes at the following locations: KickBack is a collaborative effort between GAB and the ICRN. If you like it, please subscribe/follow, and tell all your friends! And if you have suggestions for voices you’d like to hear on the podcast, just send me a message and let me know.

Can Slovakia’s New Anticorruption Movement Avoid Common Pitfalls?

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In late February 2018, news that Slovakian anticorruption journalist Jan Kuciak was shot to death at home—the first murder of a journalist in Slovakia’s modern history—shocked the country and world. Slovakians demanded that the government, controlled by the corruption-plagued Direction-Social Democracy (SMER-SD) party, investigate the brazen attack and hold the perpetrators accountable. Tensions escalated in the days following Kuciak’s murder after his last unpublished story surfaced, exposing connections between advisors to SMER-SD Prime Minister Robert Fico and a prominent Italian organized crime syndicate. Fico resigned shortly thereafter, a development which proved to be the beginning of the end of SMER-SD’s twelve-year reign. By the February 2020 general election, voters decisively ousted SMER-SD in favor of the emerging anticorruption-focused Ordinary People and Independent Personalities Party (OLaNO).

Much of OLaNO’s appeal stems from party leader and current prime minister Igor Matovic, a self-made media mogul. His signature communication method was posting videos exposing graft to social media (similar to Russian anticorruption hero Alexei Navalny, whom this blog recently discussed here). In one of Matovic’s most widely viewed videos, he filmed himself in Cannes outside the luxury home of a former SMER-SD politician holding signs saying “Property of the Slovak Republic” and alleging that the home was illegally bought with taxpayer money. Matovic also traveled to Cyprus and posted a video of mailboxes belonging to shell corporations connected to Penta, a multi-million-euro investment group; the video claimed that Penta had used the companies to evade 400 million euros in taxes. Each of Matovic’s videos garnered several hundred thousand views in a country of less than 5.5 million, which helps explain why the February 2020 election boasted Slovakia’s highest voter turnout in 20 years.

Now, just one year into its mandate, OLaNO and its coalition are hard at work rooting out corruption. The government arrested and prosecuted dozens of current and former public officials involved in graft. Those targeted include high-level figures, such as the former Finance Minister, the head of the State Material Reserves Administration, the Director of the Agricultural Paying Agency, and more than a dozen judges, including a member of the Supreme Court and the former Deputy Minister of Justice. OLaNO is also pursuing a number of legislative efforts, including aggressive judicial reform.

Can Matovic and OLaNO finally cleanse Slovakia’s reputation as the corruption “black hole of Europe”? Maybe. But while the story of an outsider stepping forward in the wake of a national scandal and securing electoral victory with an anticorruption political agenda may be a first in Slovakia’s modern history, it is not an unknown tale on the world stage—and (spoiler alert!) the story often doesn’t have a happy ending. To be sure, difficult political dynamics and entrenched domestic corruption can hamper even the most earnest anticorruption efforts. Nevertheless, examples from other countries provide some cautionary tales of how populist leaders elected on anticorruption platforms can sometimes lose their way, and offer some lessons that Matovic, OLaNO, and their supporters should take to heart going forward. Three lessons in particular stand out:

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The Perils of Over-Criminalizing Sports Corruption

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Although the fight against corruption has traditionally focused on corruption in government, the anticorruption community has started to pay more attention to corruption in other spheres. One particularly prominent concern is corruption in sports (see here, here, and here). The topic of sports-related corruption includes not only corruption in the major sports associations (think FIFA and the International Olympic Committee), but also the corrupt manipulation of individual sporting events in order to win bets (whether legal or illegal). Such corrupt manipulation includes match-fixing (where corrupt actors fraudulently influence the outcome of a game); spot-fixing (where wrongdoers seek to influence events within the game that do not necessarily have a significant effect on the final outcome, such as the number of minutes an athlete plays or timing the first throw-in or corner in a soccer game); and point-shaving (where perpetrators seek to hold down the margin of victory in order to avoid covering a published point spread).

Different jurisdictions approach this sort of sports corruption differently. Many countries in Europe have enacted blanket laws criminalizing match-fixing in order to uphold the integrity of sports. The United States, by contrast, takes a narrower approach: The relevant criminal laws targeting sports corruption in the U.S.—both the Federal Sports Bribery Act (the “Act”) and comparable laws at the state level—focus solely on bribery. Furthermore, the Act has historically been used to prosecute individuals involved in paying bribes or inducing others to collect bribes, but not the people (usually athletes, coaches, or officials) who receive the bribes. Although a great deal of corruption in sports involves the payment of bribes, and would therefore be covered by these laws, some types of sports corruption are unilateral: An athlete or sports official may place bets on sporting events and subsequently undertake behavior to win those bets. For this reason, some scholars have argued that the U.S. should close this loophole by criminalizing such unilateral conduct as well.

I disagree. To be sure, unilateral sports corruption is unethical, and criminalizing it would help to prevent athletes, referees, and coaches from engaging in corrupt acts that jeopardize the integrity of sports. But the benefits of criminalizing this form of misconduct are minimal and are greatly outweighed by the corresponding costs.

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Guest Post. Corruption Victims: Law and Practice in Italy, Russia, other European States

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Earlier this month, I asked readers for help on a UNODC project examining the compensation of corruption victims.  UNCAC article 35 requires states parties to ensure those injured by “an act of corruption” can initiate “legal proceedings. . . to obtain compensation.” In 2017, the UN Office on Drugs and Crime reported that virtually all 187 convention parties say their laws permit those injured by corruption to bring an action to recover damages. Yet few cases appear to have been brought.  The project seeks answers to three questions: Are there really few cases? If so, why? And what can be done to increase the number?

My thanks to the several readers who replied.  Thanks especially to Mjriana Visentin. An Italian lawyer with a Master’s Degree from the International Anticorruption Academy, Mjriana has been working on human rights and anticorruption for several years, most recently in Russia. She was kind enough to respond to my query with a thoughtful analysis reflecting both her experience representing victims of human rights abuses and corruption in Russia – categories which often overlap in practice – and current law on recovery of damages for corruption in Italy, other European states, and the European Court of Human Rights.  A valuable contribution to the global discussion on corruption victim compensation, it is below.  

Probably it would be useful to differentiate between types of corruption before discussing if victims did (or could) claim compensation.  If we are talking for example of extortion by a public official, I think that an analysis of the national case law will likely show a large number of individuals who were granted victim status and sought compensation.  [Editor’s note: a point I had not appreciated. I have subsequently learned that upon a conviction for extortion in Sri Lanka, defendants reportedly are required to return the bribe to the victim.  Example cases solicited from there or other jurisdictions.] 

As for other types of corruption, the situation may be more blurred.

Reviewing the laws of a number of European state members, I have seen that corruption still tends to be framed either as a victimless crime or crime against the state. This affects the view that potential victims have of themselves.

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Guest Post: Do More Candidate-Centric Electoral Systems Help Reduce Corruption?

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Today’s guest post is from Rumilda Cañete-Straub, Josepa Miquel-Florensa, Stéphane Straub, and Karine Van der Straeten.

Although many people hope and expect that regular elections will help reduce corruption, this is not always the case: In many democracies, voters elect and reelect corrupt politicians. Why is this? Scholars have suggested that the efficacy of electoral democracy in reducing corruption depends on specific features of the electoral system, and the information available to voters. With respect to the electoral system, a common view is that electoral rules that give voters more formal control over individual candidates—such as primaries in majoritarian systems or open lists rather than closed lists in proportional representation (PR) systems—are more effective in reducing corruption. With respect to information, the conventional wisdom holds that providing voters with more information should help them identify corrupt politicians, thus increasing the chances that those politicians will be punished at the ballot box.

In our recent article, we present findings that challenge both aspects of this conventional wisdom. We focus on the comparison between closed-list PR system (in which voters vote only for a party, with the individual candidates elected depending on their position on the party’s list) and an open-list PR system in which voters can vote for any number of candidates on the list, without any constraint. Continue reading →

Sunshine or Sunset? The Latest Threat to Freedom of Information in Mexico

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In a country beset by extreme and seemingly intractable corruption, Mexico’s National Institute for Access to Information (INAI)—which runs Mexico’s freedom of information system—has stood out as an unusually effective mechanism for promoting transparency, accountability, and integrity. The INAI’s effectiveness stems from its binding legal authority and independence, as provided by constitutional provisions passed in 2013. The Institute can and has compelled other government agencies to improve their information disclosure policies, and, perhaps most significantly, the INAI can override other government agencies’ denial of information access requests. The INAI has substantial leverage to ensure greater government compliance by way of meaningful fines and effective injunctions for noncompliance. The INAI also moves lightning fast; the INAI regularly satisfies its statutory obligations to respond to requests within twenty business days and to deliver documents within thirty. The INAI does not charge search fees, and all uncovered information is available to the wider public. Citizens can challenge decisions to withhold information, and they routinely prevail.

The INAI’s broad freedom of information mandate makes the agency a powerful actor in exposing corruption (see, for example, here, here, and here). Perhaps most notably, the Institute enabled discovery of former President Pena Nieto’s secret mansion (“the White House Scandal”), the diversion of over $400 million allotted to public services, and embezzlement in public-private ventures in Mexico’s vast energy sector. More broadly, despite all the well-known deficiencies of Mexico’s anticorruption institutions, the INAI has been globally lauded for its role in government transparency.

Given this, why is Mexico’s President Andrés Manuel López Obrador (commonly referred to by his initials “AMLO”), who ran and won on an anticorruption platform, so keen on eradicating the agency? In a press conference earlier this year, AMLO proposed decommissioning all of Mexico’s independent agencies, singling out the INAI as an especially egregious example of bloated bureaucracy. His rationale boils down to three main arguments: (1) the INAI hasn’t ended corruption, (2) the INAI costs too much, and (3) the INAI’s functions can be provided by the Secretariat of Public Functions (SFP), a non-independent body that performs federal government audits and reports directly to the president. These arguments are unconvincing, to say the least.

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The Many Uses of Xi Jinping’s Anticorruption Campaign

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Since Chinese President Xi Jinping launched his anticorruption campaign in 2012, much of the foreign commentary has debated the extent to which the campaign is a genuine effort to root out corruption or a means for purging or undermining President Xi’s political opponents. This simple framing, however, obscures the other uses and objectives of the anticorruption campaign. Better understanding these motivations is important to understanding the dynamics of the campaign and the role that anticorruption plays in modern Chinese politics. Three political and policy objectives are particularly notable:

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Anticorruption Bibliography–March 2021 Update

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An updated version of my anticorruption bibliography is available from my faculty webpage. A direct link to the pdf of the full bibliography is here, and a list of the new sources added in this update is here. As always, I welcome suggestions for other sources that are not yet included, including any papers GAB readers have written.

Guest Post: Corruption on the Gualcarque River — Will Its Victims Have their Day in Court?

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GAB’ s latest post on compensating victims of corruption is below. Authored by Naomi Roht-Arriaza, Distinguished Professor of Law at UC Hastings Law and President of the Board of the Due Process of Law Foundation, it recounts the harm those living along the Gualcarque river in Western Honduras suffered from the corrupt award of a contract for a hydroelectric dam and the community’s efforts to recover damages for their injuries.  While a trial court has recognized the community is entitled to relief as corruption victims, on specious reasoning an appellate court denied them victim status.  As Professor Roht-Arriaza explains, the case is now before the Constitutional Chamber of the Honduran Supreme Court. It can either reverse the appellate court decision or affirm its denial of an effective remedy for the enormous harm corruption has wreaked on the community.     Leer en español.

Who are the victims of grand corruption?  The answer used to be “no one” or, at best, the state itself.  But especially with the advent of a human rights approach to corruption in the Inter-American and United Nations human rights systems, that perception is slowly changing.  Grand corruption affects the full range of human rights of individuals and groups.  When rights are violated, states have an obligation under international law to investigate, prosecute, and provide redress.  The UN Convention Against Corruption mirrors this requirement in Article 35. 

And yet national courts have been reluctant to recognize the rights of those who have suffered damage — either to participate in proceedings involving grand corruption or to recognize them as victims due compensation.  In part, the reluctance stems from difficulties legal doctrine creates for establishing the causal link between a specific act of corruption and harm to a specific person or group.   To create the same “justice cascade” as in human rights cases, corruption victims should be able to seek relief through either a criminal or civil action and as either individuals or communities or through representative organizations.  Where a state prosecutor has brought charges, victims should be able, as they can in  France and Spain, to be full participants in the prosecution.      

The corruption in the bidding, contracting and construction of the Agua Zarca hydroelectric dam on the Gualcarque River in Honduras would seem to be the poster child for victims’ compensation.  In an atmosphere of widespread corruption from the top down, a well-known elite family won a contract to generate and sell electricity to the state: without being on the list of approved bidders, without a valid environmental impact statement, and with a design apparently aimed at maximizing the haul from government coffers. 

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