Category Archives: Commentary

Anti-Defamation Laws: Politicians Abuse Them, But Can Anticorruption Activists Use Them?

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Defamation is a scary word for the anticorruption community. After all, anti-defamation laws are frequently abused to harass, deter, and discredit people who accuse politicians of misconduct. But defamation suits can also be an important tool for anticorruption activists to defend against false and misleading attacks designed to undermine their work. As smear campaigns deter and diminish anticorruption advocacy, we must be cautious in our attempts to weaken or repeal anti-defamation laws, for they may prove to be a necessary line of defense.

To understand why anti-defamation laws can be so important to activists, take the case of Peruvian journalist Gustavo Gorriti. Gorriti has spent much of his life trying to investigate and expose corruption. When the Lava Jato scandal rocked Latin America, his publication, IDL-Reporteros, helped uncover millions in bribe payments to public officials. Gorriti played an important role in what shaped up to be one of the most consequential anticorruption investigations in the continent’s history.

Unsurprisingly, Gorriti came under fire for his investigative work. Among other lines of attack, stories started to pop up in some media outlets falsely accusing Gorriti of having ties to directors of the bribe-paying construction company that he had investigated; these stories were clearly part of a campaign to undermine his credibility by spreading false or misleading information. This is no isolated case. Corrupt politicians and their supporters routinely make use of disinformation campaigns to discredit accusers. The problem is only getting worse, and the consequences are serious. Such campaigns often spark violence and harassment against anticorruption activists, and they can even lead to the opening of criminal investigations purporting to act on the (fabricated) allegations. Other times, disinformation undermines public support for important reforms. These consequences make life harder for the people who, like Gorriti, want to expose corruption.

What did Gorriti do about this problem? Trying to persuade the public through counterspeech wasn’t very helpful. But Gorriti had another idea: sue for defamation. If persuasion couldn’t overcome the lies thrown at him, then perhaps he could use the legal system to hit his attackers where it hurts—their pocketbooks. Claiming to have borrowed the idea from a Finnish journalist who tried the same, he did his research on who was spreading lies and brought them to court. His strategy was successful, and Gorriti scored some important victories, including getting his opponents to retract their false statements and apologize.

Although anticorruption activists and journalists rarely file suits against their attackers, more might (and for that matter, should) start to follow Gorriti’s example. Recent defamation suits against media companies and politicians show that they have a real impact. They correct the record and deter people from initiating smear campaigns in the first place. Continue reading →

IMF Staff: British Virgin Islands A Haven for Fraudsters, Tax Cheats, Corrupt Officials, Other Assorted Financial Crooks

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The IMF staff doesn’t put the conclusion to their report on the British Virgin Islands’ antimoney laundering controls as starkly as the headline to this post does. But its February 27, 330-page assessment of the island nation’s efforts to curb money laundering leaves no doubt the headline is accurate.

The report finds regulatory oversight of the financial sector is sparing at best, and in the rare instance when a violation is detected, the penalty is laughably weak. What seals the deal for those needing a safe place to stash money from corruption, drug dealing, and other financial crimes is the “who cares about others” attitude of the authorities for crimes committed elsewhere.

“The relevant authorities and key reporting institutions broadly view the illicit activities of the foreign beneficial owners as having an insufficient nexus with the territory and do not consider that VI entities are directly involved in such activities.”

IMF Country Report No. 24/55. British Virgin Islands: Detailed Assessment Report on Anti-Money Laundering And Combatting The Financing Of Terrorism

In other words, if you want to put money you stole from the citizens of your country in our banks or take advantage of our lax approach to verifying who really owns a BVI corporation to keep your country from finding your assets, fine by us. Not our problem.

Continue reading →

The Price of Rhetoric: Anticorruption Narratives and Violence Against Doctors in China

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In China, violence against doctors and other healthcare professionals has become a worrisome trend. Much as Americans have gotten depressingly used to the expression “school shooting,” Chinese citizens are now familiar with “hospital stabbings.” While still quite rare events relative to China’s enormous population, these incidents are both troubling in themselves and indicative of larger problems, including distrust and anger toward medical professionals and the healthcare establishment.

Could this distrust and anger have something to do with the rhetoric that has accompanied some of China’s high-profile anticorruption campaigns? It is hard, perhaps impossible, to prove a direct link, but consider the following suggestive evidence: Continue reading →

African Countries and the Corruption Perceptions Index: Don’t Blame the Messenger

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Transparency International (TI) released its annual Corruption Perception Index earlier this year. As many readers of this blog are likely aware, the CPI is quite controversial, particularly in developing countries that typically fare poorly on the index. When I was a Board Member of the African Union Advisory Board on Corruption (AUABC) and President of the Network of Anti-Corruption Institutions in West Africa (NACIWA), it seemed that every time the CPI came up in our meetings, the typical reaction ranged from disapproval to outrage, with many challenging the legitimacy and authenticity of the index. More broadly, many African government officials and business people see the CPI, as well as TI’s accompanying commentaries, as part of a Western-driven smear campaign against African countries.

I do not share this view. I agree that the CPI has significant flaws and limitations, which are familiar enough that they need not be rehearsed at length: the CPI relies on subjective and potentially unreliable perceptions, the underlying sources are not always being sufficiently transparent as to the qualifications of the “experts” who assign scores, and the CPI does not cover some of the crucial issues that antigraft fighters focus on, such as tax fraud, money laundering, and illicit financial flows. I share concerns about the way the CPI is sometimes used by TI and other parties to paint an inaccurate and sometimes unfair picture of how well anticorruption fighters are doing their job. Yet despite these shortcomings, the CPI helps put pressure on governments worldwide to do more about corruption, and the index can be helpful in guiding efforts to combat graft in Africa and elsewhere. Indeed, while many African government officials and business elites criticize the CPI, most African civil society actors appreciate it and find it a credible reflection of the situation in their countries, and it gives them a powerful rhetorical tool to call on their governments to do more on this issue.

Therefore, while it is, of course, reasonable to point out the CPI’s flaws and limitations, African government officials—particularly those who work in anticorruption agencies (ACAs)—would do better to focus their energies not on denouncing the CPI but rather on reforms that can present a better picture of their respective countries. Continue reading →

U.S. Justice Department Does What Mongolia’s Government Wouldn’t

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GAB readers will remember posts in late 2020 and early 2021 recounting damning evidence implicating Mongolian political kingpin S. Batbold in a massive corruption scheme (here, here, and here). Although Batbold fiercely and forcefully denied the allegations to GAB (here), the evidence that corruption during his tenure as Prime Minister netted him tens if not hundreds of millions of dollars seemed overwhelming.

So overwhelming that it prompted the Mongolian government to open a corruption investigation in Mongolia and initiate litigation in the United States to recover New York real estate press reports showed he had bought with corruption proceeds. Nothing came of either, however. Batbold runs the country’s dominant political party, the Mongolian People’s Party, and after a protégé won the June 9, 2021, presidential election, both the Mongolian and New York cases were shut down.

But the evidence did not go away. Yesterday, the U.S. Department of Justice took up what Mongolia had dropped, filing suit to seize the two New York apartments Batbold owns. As the head of the Department’s Criminal Division explained in disclosing the suit:

“Sukhbataar Batbold used his position as prime minister to award lucrative contracts to sell copper concentrates from a Mongolian state controlled mine to entities that were owned and controlled by his known associates or his son. These intermediaries, who had little to no experience in the copper trade, played no part in providing financing for the purchase of the copper concentrates or in arranging the sale or shipment of the commodities. They simply concealed the fact that Batbold and his family were violating Mongolian anti-corruption laws by benefiting from the sale of millions of dollars’ worth of Mongolian natural resources.

“The former prime minister of Mongolia abused his position as prime minister to profit from the sale of his country’s natural resources.  He and his family used the proceeds of their corrupt scheme to buy $14 million in high-end real estate in the United States.”

The Department’s Kleptocracy unit is responsible for the case, and consistent with its kleptocracy policy, the Department said it would work to see that the proceeds of whatever property of Batbold is recovered would go to the people of Mongolia, “the people harmed by these acts of corruption and abuse of office.”

Mongolians elect a new parliament June 9.  Suppose they might want to ask why it was left to the Department of Justice to do what their government should have done long ago?

ECOWAS Must Get Serious About Corruption—or the Coups Will Continue

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The Economic Community of West African States (ECOWAS) was founded in 1975 to foster economic cooperation within West Africa. Over time, ECOWAS’s mission has expanded to include the promotion of democracy and political stability. And for a while, it looked like the region was indeed making progress on this front: Between 2015 and 2020, all fifteen ECOWAS member countries were democratic states. But since 2020, West and Central Africa have been hit with a wave of eight military coups, the most recent ones occurring this past July (in Niger) and August (in Gabon). ECOWAS’s response to this democratic backsliding has been unimpressive. For example, ECOWAS looked on passively when, in 2020, both Ivorian President Alassane Ouattara and Guinea’s then-President Alpha Condé ignored or circumvented constitutional limits on their terms. Just this month, Senegal President Macky Sall unilaterally delayed presidential elections for the first time in the nation’s history. Recently, ECOWAS—under pressure from the US and EU—did impose sanctions against Niger in response to the coup, but these sanctions were insufficient to get the coup leaders to step down. In fact, these sanctions were so ineffective that they caused coup-hit Mali, Burkina Faso, and Niger to withdraw from the bloc, citing “illegal, illegitimate, inhumane and irresponsible sanctions” and failure to support their fight against “terrorism and insecurity.” All this has begun to jeopardize ECOWAS’s credibility even in the eyes of local populations.

Perhaps more seriously, ECOWAS has lost credibility not only for its response to the coups, but also for its failure to address the root causes of these coups, including not only economic woes, but also endemic corruption. As a coalition of West African civil society organizations recently asserted, ECOWAS operates as “a club of Head of States, whose sole preoccupation is regime protection of the various West African leaders, and their penchant for appropriating the benefits of office to themselves, while the ordinary citizens of countries in the sub-region wallow in extreme poverty, misery, and penury.”

ECOWAS could and should take concrete steps to bolster its waning authority. One of the most effective ways it could do so is by taking a strong stand against corruption. This would not be taking ECOWAS far outside the scope of its existing mandate. The ECOWAS Protocol on the Fight against Corruption authorized ECOWAS to take action “whenever an act of corruption is committed or produces some effects in a State Party.” More generally, given the threat that corruption poses to both democracy and stability, ECOWAS is justified in more decisive action to address this scourge.

In particular, there are three things that ECOWAS ought to do:

Continue reading →

Brazil’s Anticorruption Backsliding

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In a recent post I discussed the positive legacy of Brazil’s Car Wash Operation and argued that this operation, for all its missteps, strengthened the country’s legal and institutional framework against corruption. The operation not only increased public awareness of corrupt practices but also inspired the development of effective tools for corruption prevention, investigations, and case resolution, significantly contributing to a more transparent, honest, and efficient business and political environment. Nevertheless, actions taken by Brazilian leaders in the past year have intensified concerns—already present under the previous Administration—about the government’s commitment to sustaining and expanding this legacy. Transparency International (TI) raised some of these concerns in its recent comment on Brazil’s worsening performance on TI’s Corruption Perception Index (CPI). Now, there are well-known reasons to be cautious about drawing strong conclusions from the CPI or other perception-based international indexes, but in Brazil’s case, there are good reasons to be alert. Senior leaders in both the political and judicial branches have made a series of worrisome decisions that seem likely—indeed, may be intended—to set back Brazil’s fight against high-level corruption. Among those setbacks, the following are the most serious and troubling: Continue reading →

Brazilian Supreme Court Justice Orders Investigation of Transparency International

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Six days after it reported in its annual survey of corruption perceptions that the fight against corruption in Brazil was losing steam, Transparency International was placed under investigation by Supreme Court Justice Dias Toffoli (here). The ostensible reason is that the internationally renowned corruption fighting organization, headquartered in Berlin with a Brazilian chapter, misused public funds.  According to the justice, the group is a “foreign” organization and thus funds received in Brazil for its anticorruption work should have been allocated to the national treasury.

TI immediately issued a statement denying all wrongdoing. In the statement it pointed not only to the close connection between release of the 2023 CPI and Justice Toffoli’s decision to open an investigation, but to the criticisms the international organization and its Brazilian chapter have levelled against Justice Toffoli’s continuing efforts to gut Lava Jato, the case where a cartel led by the Brazilian engineering and construction firm Odebrecht bribed some 415 politicians and 26 political parties in Brazil as well as dozens officials in ten Latin American and two African countries (here).

Last September the justice tore up 2017 cooperation agreement between prosecutors and Odebrecht, making it difficult if not impossible for prosecutors in other nations to pursue charges against the company and those it bribed in their countries (here). Last week, as the Financial Times reported in breaking the investigation story, Toffoli issued another ruling letting Odebrecht off the hook; this one suspends a multimillion-dollar fine the company had been ordered to pay.

Brazilian citizens, opposition parties, and Brazil’s friends in the international community have all begun to speak against this effort to undo one the largest — and for its faults (as rehearsed on this blog (latest post here)) — one of the most important steps forward in recent years in the fight against corruption. In Brazil, its neighbors, and indeed globally.  

Let’s hope Brazilian authorities hear them.

Should Officials’ Asset Declarations Be Public? Why I Changed My Mind About Sierra Leone

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Many countries have some form of asset declaration requirement for public officials, but there is substantial country-by-country variance as to the actual design of the process. There is especially wide variation with respect to the public accessibility of the disclosed information. In Sierra Leone, under current law, government officers’ asset declarations are kept confidential. Before I was appointed head of Sierra Leone’s Anti-Corruption Agency (ACA), I was part of a civil society consortium that called for making all of these declarations public. A few months after my appointment, I was asked if I would support changing the law to make asset declarations public, in line with what I had advocated as a member of civil society. In reflecting on this question, I found that I had changed my mind.

Part of the reason I did not advocate changing the law to make asset declarations public was simply that there was no way our Parliament would pass such an amendment in the short-to-medium term. It did not seem sensible to waste political capital on such a controversial proposal—especially since doing so might provoke a backlash and jeopardize other important reforms. But the reasons for my change of view were not merely pragmatic political calculations. I have also come to believe that, at Sierra Leone’s current stage of development, making asset declarations public could do more harm than good. Continue reading →

Moneyball: The Financial Entanglement Threatening the Integrity of Spanish Football

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The Spanish Professional Football League (La Liga) is the most popular and profitable sports league in Spain. (In the 2022-2023 season, La Liga had a record-setting revenue of 1.99 billion euros and more than 11 million spectators.) But the league has been beset by a string of corruption allegations. In an especially prominent recent case, one of La Liga’s most well-known teams, FC Barcelona, confirmed that between 2001 and 2018, the club had paid a total of 7.3 million euros to a consulting company owned by Jose Maria Enriquez Negreira, who during that time was the vice president of the Technical Committee of Referees (CTA) of the Royal Spanish Football Federation (RFEF), the national governing body of all football-related activities, including La Liga. Though FC Barcelona acknowledged the payments, the club insisted that the payments were solely for lawful consulting services unrelated to refereeing decisions. FC Barcelona further noted that such consulting arrangements are standard practice among La Liga clubs. (Indeed, a former police commissioner accused Real Madrid CF of paying Negreira as well.)

While the allegations against FC Barcelona are still under investigation, many outside observers would likely conclude that, even if there was no direct quid pro quo, this is a textbook case of a serious conflict of interest. The problem, though, is that it does not appear that there are any rules—under Spanish law, the RFEF Disciplinary Code, or the league’s own regulations—against such conflicts: Continue reading →