Social Damages for Corruption: Examples Please

Faithful readers know that for a StAR/UNODC project I am searching for cases where corruption victims were compensated for their losses.  One area where I desperately need assistance is in locating awards for social damages. 

Recovery for social damage was pioneered by Costa Rican jurists.  Article 38 of the Costa Rican penal code gives the Procuraduría General de la República the power to recover damages for acts that affect diffuse or collective interests. Termed “social damages,” the PGR web site lists five corruption cases where over $41 million in social damages have been collected.  The cases have generated learned commentary both in Costa Rica (examples here and here) and in other Latin American states (here and here). Likely because I read Spanish poorly and slowly, beyond the Costa Rican ones, I can find no case where social damages for corruption have been awarded.  Help from readers with examples or leads on where I might find examples is solicited.

For the uninitiated, social damages are compensation paid to redress harm to the welfare of a community. A community’s welfare is the combination of economic and non-economic conditions that together produce a sense of satisfaction, happiness, health, and so forth. To me, it seems to parallel Amartya Sen’s argument that GDP alone is not a sufficient measure of a nation’s well-being though I have yet to see the link made.

Thanks again to readers who responded to my earlier queries.  As with those, submissions in any language Google Translate reads welcome.

South Korea’s New Corruption Investigation Office Needs Independent Prosecutorial Power

When South Korean President Moon Jae-in took office, it was clear that fighting corruption was going to be high on his agenda. After all, his predecessor Park Geun-hye was sentenced to 24 years for pressuring conglomerates such as Samsung and Lotte to give millions of dollars to her friend’s foundation. And the president before her was sentenced to 15 years for collecting bribes of up to $5.4 million from Samsung in exchange for favors. President Moon capitalized on the nation’s anger and sense of betrayal, pledging to crack down on corruption. Part of his reform agenda included addressing how Korea’s investigative and prosecutorial bodies—including the Supreme Prosecutor’s Office (SPO)—have handled, or mishandled, corruption cases.

This concern led to the enactment, in 2019, of legislation authorizing the creation of a new agency called the Corruption Investigation Office for High Ranking Officials (CIO). The CIO can investigate certain crimes, such as bribery and embezzlement, related to the duties of current and retired high-ranking public officials—including, but not limited to, the President, SPO prosecutors, judges, and members of the National Assembly. The CIO has the authority to investigate current and former officials, their family members, and other individuals who are implicated in the crimes under investigation. This means if a company employee bribes the grandson of a public official, then the CIO can investigate the company. Furthermore, other law enforcement agencies must immediately notify the CIO when they learn of crimes that fall under the CIO’s investigative jurisdiction, and the CIO can compel those cases to be transferred to it.

There is, however, a significant problem with this new system, one that will likely impede the CIO’s ability to hold high-level politicians and their cronies accountable: The CIO lacks the power to prosecute most of the cases it investigates. The CIO does have the limited authority to prosecute SPO prosecutors (including the Prosecutor General, who heads the SPO), as well as judges and high-ranking police officers. But for all of its other investigations, the CIO must turn the results of its inquiries over to the SPO, which retains the discretion to decide whether or whom to prosecute. Without independent prosecutorial authority, the CIO is unlikely to live up to its potential to make significant progress against high-level corruption.

COntinue Reading

Why Are the Architects of China’s Anticorruption Campaign (Mis-)Reading Tocqueville?

Back in 2013, senior Chinese Communist Party (CCP) official Wang Qishan, who was then head of the CCP’s Central Commission for Discipline Inspection (CCDI), and is widely considered the architect of President Xi Jinping’s anticorruption campaign, instructed party officials to read Alexis de Tocqueville’s L’Ancien Régime et la Révolution (The Old Regime and the Revolution). This is notable in part because the Xi regime has a reputation for rejecting Western thinking, particularly with respect to governance. The timing is also intriguing, in that Wang’s advice that CCP officials should read Tocqueville’s text occurred right as the anticorruption drive was getting underway.

It’s tempting to dismiss Wang’s apparent interest in and enthusiasm for Tocqueville is a minor idiosyncratic biographical detail, with little connection to his or the CCP’s approach to governance generally, or anticorruption more specifically. But I think his interest in Tocqueville’s work is more significant, and more revealing, about the thinking shaping China’s anticorruption strategy today.

Continue reading

Will Mongolia’s Presidential Election Put Batbold and Foreign Ownership of the Oyu Tolgoi Mine at Risk?

U. Khürelsükh is the odds-on favorite to win Mongolia’s June 9 Presidential election after an irregular ruling by the Supreme Court denied incumbent President K. Battulga his constitutional right to run for re-election.  Initial predictions were that the election of Khürelsükh, the former Prime Minister and current chair of the Mongolian People’s Party (MPP), would end the investigation into whether corruption infected the deal Mongolia struck with foreign investors on the Oyu Tolgoi mining project, Mongolia’s ticket to economic prosperity. 

The reasoning was that any investigation would implicate former MPP Prime Minister S. Batbold and other senior MPP members.  As this blog has reported (here, here, and here), the evidence of Batbold’s corrupt dealings with the foreign investors in the project, Australian mining giant Rio Tinto and controversial U.S.-Canadian entrepreneur Robert Friedland, seems strong and Batbold’s denials unconvincing.  But the expectation was that the MPP, the lineal descendant of the Marxist-Leninist party that ran the country when it was an appendage of the Soviet Union, still observed the principle of “democratic centralism.” Or as Benjamin Franklin put the principle more colorfully when signing one the foundational documents of true democracy, “We must all hang together, or, most assuredly, we shall all hang separately.”  

The assumption that MPP members would hang together is now at risk thanks to what Khürelsükh said last week on Mongolian TV9’s interview program.

Continue reading

The U.S. State Department’s New International Anticorruption Champions Awards Are a Winning Strategy in the Fight Against Corruption

This past February, U.S. Secretary of State Anthony Blinken launched one of the first foreign policy initiatives of the new Biden administration: the inaugural International Anticorruption Champions Awards. After receiving nominations from U.S. embassies around the world, the State Department honored a dozen individuals who made significant contributions to combatting corruption in their home countries. The recipients of the International Anticorruption Champions Awards were diverse in every sense of the word. They spanned six continents, represented national and local governments, state-owned companies, and non-governmental organizations. The awardees came from countries big and small, were young and old, and a third were women.

These awards added to a growing movement to provide formal international recognition to those who are leading the fight against corruption in their home countries. Transparency International has recognized such individuals and organizations through their Anti-Corruption Awards semi-annually since 2013, and the United Nations’ Rule of Law and Anti-Corruption Center established the annual International Anti-Corruption Excellence Award in 2016. But, importantly, the International Anticorruption Champions Awards mark the first time that one sovereign country—and a major global power at that—officially recognized and honored anticorruption advocacy in other countries.

While it might be tempting to dismiss these awards as empty symbolism (or worse), this would be a mistake. That the U.S. government has created these awards, and apparently intends to continue to issue them annually, is a significant positive contribution to the global fight against corruption, for several reasons.

continue reading

Corruption at the Heart of India’s Coronavirus Crisis? Prime Minister Modi Must Answer for the PM Cares Fund

India’s unfathomable Covid tragedy has left the country gasping for breath, and no oxygen can be found. Hospitals are overrun, and are often unable to help even those lucky enough to be admitted. Desperate relatives are turning to social media and the black market for help, as beleaguered crematoriums shift from unprecedented 24/7 hours to the horrors of mass cremation to keep up with demand. In the midst of this appalling tragedy looms the question: Why was the government so unprepared? And, more specifically, whatever happened to the billions of dollars raised last year through the Prime Minister’s Citizen Assistance and Relief in Emergency Situations (known as the “PM Cares Fund”)? 

Continue reading

Rethinking Presidential Obstruction of Justice

One of the greatest powers that can be granted to a national chief executive is jurisdiction over law enforcement. From the French President’s authority over the Ministry of Justice to the American President’s authority over the Department of Justice (DOJ), a number of states entrust their chief executive with significant control over the nation’s top law enforcement bodies. While these oversight powers are often exercised to achieve legitimate aims, problems arise when an executive uses his authority to shield himself or his associates from legal accountability. Such misuse of the chief executive’s authority over law enforcement is itself corrupt—an abuse of the president or prime minister’s public power to protect his private interests—and can foster the culture of impunity that allows other forms of corruption to thrive. But policing this sort of improper interference is challenging.

One possible limit on corrupt presidential interference with law enforcement is the fact that such interference may itself be a crime. In the United States, for example, it is a felony—known as “obstruction of justice”—for a government official to “corruptly” use the power of his or her office to “obstruct” a “pending or contemplated official proceeding” (such as a trial or investigation). But as Special Counsel Robert Mueller’s investigation into former President Donald Trump made clear, the current version of the obstruction of justice statute may be inadequate to check this form of presidential corruption.

For starters, it’s not clear whether the obstruction of justice statute, as currently written, even applies to a sitting president. (Scholars have disagreed on this point, with some arguing that the current statute does not apply to the president—see here and here—and others arguing to the contrary that it does.) That problem, though, has an easy fix: As Bob Bauer and Jack Goldsmith’s recent book has argued, Congress can and should amend the statute to state explicitly that a sitting president can commit obstruction of justice. Another difficulty is that, as Robert Mueller’s report stressed, under current DOJ policy, a sitting president cannot be criminally indicted. This too could be changed. The deeper and harder problem is that because in the U.S. system the president may legitimately seek to influence the conduct of criminal investigations, and because the president’s motives may be ambiguous or mixed, it is very hard, perhaps impossible, to prove that the president’s actions with respect to a pending or contemplated official proceedings were “corrupt.” Take President Trump’s decision to fire FBI Director James Comey. The Mueller Report concludes that President Trump fired Director Comey to save his presidency (which seems like a corrupt motive). Yet some claim that President Trump also had other, more legitimate reasons for firing Director Comey, including concerns about partisan bias in Comey’s investigations. And even if one contests that claim in this particular case, it’s not hard to imagine a situation in which a President moved to impede an investigation that both threatened the president’s personal interests and that the President thought was unwise or improper.

How should the law treat such cases, if the goal is to ensure that a U.S. President is not above the law, while simultaneously giving the President appropriate latitude oversee federal law enforcement?

Johnston and Fritzen: The Conundrum of Corruption

Michael Johnston had done it again.  A — if not the — dean of corruption studies has a new book out.  This one a collaboration with a real dean, Scott Fritzen, professor at the University of Oklahoma and dean of its College of International Studies. The two’s The Conundrum of Corruption: Reform for Social Justice, just published in an affordable paperback edition from Routledge, is an invaluable guide to the latest learning on corruption, chronicling the rise of the international anticorruption movement, what has been learned, and what those lessons say about how to carry the fight against corruption forward.

But warning. Readers looking for an inventory of “best practices,” anticorruption “toolkits,” flashy technological innovations, and game-changing carrots and sticks will be disappointed.  Not a one is to be found.  Instead, Johnston and Fritzen explain why practitioners’ two decade plus search for such “silver bullets” has fallen flat and what corruption should concentrate on instead.

Some highlights. The role of cross-national measures of corruption like Transparency International’s Corruption Perceptions Index and whether they have outlived their usefulness. The value of principal-agent analysis and how it can be misused. What civil society can do.

Among those for whom the book is a must read are members of what the authors term the “anticorruption industry.” (Those in development agencies, international organizations, foundations, and academia know who you are.) And those who uttered the phrase “political will.” No one should ever, ever again use it until they have read what the authors say about this much abused and misunderstood term.

Those engaged in the fight against corruption, those teaching the next generation of corruption fighters, or those simply looking for an authoritative guide to the issue will want to make room on their shelf for what is sure to become a classic work on the subject.

The “Big Government Causes Corruption” Zombie Shambles On

I don’t make a practice of responding to opinion columns in mainstream newspapers, especially when they’re not specifically or primarily about corruption. But the opening of Bret Stephens’ piece in yesterday’s New York Times caught my eye, mainly because the column used corruption in the Greek health care system as the “hook” for an argument that President Biden’s ambitious plans for an expanded social safety net will lead to American decline. Here’s how Stephens opens his column:

Years ago, Alexis Tsipras, the party leader of Greece’s Coalition of the Radical Left, surprised me with a question. “Here in the United States,” the soon-to-be prime minister asked me over breakfast in New York, “why do you not have this phenomenon of passing money under the table?”

The subject was health care. Greece has a public health care system that, in theory, guarantees its citizens access to necessary medical care.

Practice, however, is another matter. Patients in Greek public hospitals, Tsipras explained, would first have to slip a doctor “an envelope with a certain amount of money” before they could expect to get treatment. The government, he added, underpaid its doctors and then looked the other way as they topped up their income with bribes.

Take a close look at any country or locality in which the government offers allegedly free or highly subsidized goods and you’ll usually discover that there’s a catch.

What is the point of opening with this anecdote (other than not-so-subtly alerting the reader that the author is the sort of important person who has chit-chats with world leaders)? The implication, so far as I can tell, seems to be that countries that provide free or heavily subsidized social welfare benefits tend to be more corrupt.

There is, however, an important problem with this argument: It’s not true.

Continue reading

A Jordanian Anticorruption Agenda

The Hashemite Kingdom of Jordan – a small, arid swath of land that its Western-educated monarch jokes is “between Iraq and a hard place” – teems with corruption. Most Jordanians often have no choice but to pay bribes for public services. Members of the government and the royal family regularly siphon money from public contracts and foreign aid projects. And the Kingdom’s nepotistic political system does little to hold prominent politicians and businessmen accountable when they leverage their ties to the royal family to steal disproportionate amounts of resources or redirect government funds. Corruption, it seems, crowns the Kingdom.  

It is unsurprising, then, that claims of corruption permeated news of the recent rift between King Abdullah II and his half-brother, Prince Hamzah. After Prince Hamzah’s purported involvement with a conspiracy to undermine Jordan’s national security and destabilize the existing political regime led to his house arrest, he released a video claiming that his unjust detention was for speaking out against government corruption.

Although the international media has covered the dynamics of the royal family and the possibilities of a Jordanian descent into civil war, little has been written about the ways in which King Abdullah’s government can respond to the accusations of corruption and take back leadership. Given that Prince Hamzah – among others – nearly always couches criticism of the Jordanian government in terms of corruption, such a response is necessary. If the current government wants to signal its seriousness in fighting corruption, it should aggressively pursue an anticorruption agenda with five key elements: 

Continue reading