Guest Post: Is It Lawful Under UNCAC to Attach Conditions to Asset Returns?

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GAB is pleased to welcome back Robert Packer, from the University of Nanterre, who contributes the following guest post:

Article 57 of the United Nations Convention Against Corruption (UNCAC), which outlines provisions concerning the return of stolen assets, was the most contentious piece of the entire convention. A straightforward reading of Article 57 appears to require state parties to return assets “on the basis of a final judgement in the requesting State Party” (emphasis added). Often, however, a final judgement is not forthcoming. Article 57 addresses that contingency in its final paragraph, which provides for “agreements or mutually acceptable arrangements, on a case-by-case basis, for the final disposal of confiscated property.” That gives rise to another extremely contentious question, discussed previously on this blog (see here, here, and here): Is it legally permissible for states that confiscate the assets to attach conditions on their return? Continue reading →

Citizens Against Corruption: Report from the Front Line

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Pierre Landell Mills, a long-time and tireless advocate for putting governance at the center of development and a founder and board member of The Partnership for Transparency,  contributes the following guest post:

Everyone professes to hate corruption, but until recently few citizens believed they could stop it. Too often citizens accepted corruption, assuming it was a permanent societal disability to be borne with resignation. But people are increasingly intolerant of being squeezed for bribes and are ever more incensed at predatory officials growing fat on extortion and crooked deals. They want to do something about it.

And they are.  From the Philippines to Azerbaijan to Latvia to India to Mongolia and everywhere in between groups of courageous and dedicated citizens are taking direct action to root out corruption. Citizens Against Corruption: Report from the Front Line recounts the heroic struggle of local civil society organizations in more than 50 countries across four continents supported by The Partnership for Transparency Fund.  Among the examples the book details —   Continue reading →

Is the Kleptocracy Initiative Worth It?: A Tentative Yes

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The New York Times ran a very nice piece last week (with a GAB mention!) about the U.S. Department of Justice’s Kleptocracy Asset Recovery Initiative, and its ongoing efforts to seize foreign assets held by corrupt foreign leaders (and their cronies) in the United States. We’ve already had a lot of blog commentary on some of the issues associated with the Kleptocracy Initiative (see here, here, here, here, and here). But I wanted to pause for a moment to consider a question raised in the NYT piece: Is the effort worthwhile, given its resource costs and the relatively modest successes to date? The answer is not obvious; as Rick (quoted in the article) put it: “In terms of really helping the global anticorruption struggle, I wonder if this is the highest use of resources.” (Rick further suggests that the DOJ’s resources would be better spent on assisting countries pursuing their own anticorruption and asset recovery cases.)

Rick is right to raise these questions about the Kleptocracy Initiative—but my instincts are different from his. Even if it is the case, as the NYT reports, that the DOJ has so far only been able to recover around 8% of the assets it has gone after under the Kleptocracy Initiative, this still strikes me as a good use of DOJ resources. Here’s why: Continue reading →

NGOs, Like Ceasar’s Wife, Should Be Above Suspicion: Why Indian Nonprofits Need To Take Transparency More Seriously

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Soon after India’s new government assumed power in May 2014 under the leadership of Prime Minister Narendra Modi, the Central Bureau of Investigation (CBI) sought permission for arrest and custodial interrogation of journalist and human rights activist Teesta Setalvad for alleged mismanagement of $576,000 by her organization. In October 2014, the Ministry of Home Affairs (MHA) issued show-cause notices to 10,343 non-profits for not furnishing annual returns, and subsequently cancelled FCRA registrations for around 9,000 of these non-profits, citing “non-response within the stipulated time period.” India’s Foreign Contribution Regulation Act (FCRA) regulates the inflow of foreign contributions to charitable organizations and is expanding its tentacles and grip under each successive government (see here and here). In April 2015, Ford Foundation, the philanthropic organization whose work in India dates back to 1952, was put on a national security watch list and removed from the prior-permission list in January 2016, constraining its funding capacity. Ford is being targeted primarily for channeling funds to Ms. Setalvad’s NGO that was apparently ineligible to receive funds under FCRA.

As many in the Indian media have pointed out, the government’s aggressive actions against non-profits seems selective—more like a political vendetta than a principled stand against misappropriation of funds. It’s hard to ignore the fact that Ms. Setalvad had sought the conviction of Narendra Modi for alleged human rights abuses during his tenure as the Chief Minister of Gujarat, or that the case against Ford is linked to its funding for her non-profit. Moreover, in the same month that MHA canceled the FCRA licenses of 9,000 non-profits, an access-to-information query revealed that 401 of the 545 Members of the Parliament’s Upper House had not declared their assets and liabilities – including the Minister of Home Affairs himself. And the government’s tenacious pursuit of non-profits contrasts awkwardly with the practical impunity of those accused of perpetrating India’s three biggest scams (the $27.8 billion coal scam of 2012, the $26.3 billion 2G spectrum scam of 2013, and multi-million Vyapam scam of 2015).

So, when nonprofits, activists, and their supporters accuse the government of applying a double standard, they have a point. Yet, even as we rightly protest the government’s politically motivated vendetta against civil society, it is equally important for India’s non-profits to take a good hard look in the mirror. India has witnessed an unprecedented civil society mobilization against corruption in 2011 and non-profits have spearheaded numerous successful anticorruption initiatives, such as social audits, citizen report cards, and crowdsourcing platforms like I-Paid-a-Bribe.com. Yet the members of India’s vibrant non-profit sector must be sure that they are applying to themselves the same high standards of transparency and accountability that they advocate in the public sphere. Too often, they fall short. Indeed, the accountability practices within India’s non-profits are alarmingly sketchy. Continue reading →

Fighting Corruption With Art: Successfully Raising Public Awareness

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Art is “one of the best societal mediators of difficult messages — it has always created a bridge between the comprehension and the expression of critical problems in society.” So declares the 10th International Anti-Corruption Conference’s website, which organized an art program against corruption. In keeping with that sentiment, last September the Anti-Corruption Organization of Thailand (ACT) organized a “museum of corruption,” a temporary exhibition at the Bangkok Art and Culture Centre intended to raise public awareness about the extent and costs of corruption. Thailand is not the first country to undertake such an initiative. Museums of corruption (actual museums, not just temporary exhibitions) already exist in Paraguay, Ukraine and the United States, and many other enterprises that use art as a tool for anticorruption education and action are flourishing worldwide. For instance, the Open Society Initiative for West Africa has recently launched a hip hop video against corruption in Liberia, while the Inter-American Development Bank organized a cartoon contest to promote awareness and understanding of the corruption phenomenon and its harm to development. More recently, Pakistani President Mamnoon Hussain called upon poets and intellectuals to write against corruption. Other major players in the anticorruption field that have organized artistic projects include Transparency International (see here and here) and the United Nations Development Program (UNDP). In additions to these institutionalized artistic anti-corruption projects, several countries have witnessed spontaneous public art displays – in the physical public domain, usually outside and accessible to all – to promote awareness and solidarity in fighting corruption (see for example in Afghanistan and South Africa).

Understandably, some are skeptical of these initiatives, arguing that museums and temporary exhibitions are not the right forum to communicate on corruption (this was one of the criticisms of the Thai museum of corruption). One might worry that expressing anticorruption messages through cartoons and popular music won’t lead people to take the message seriously enough. (This would also be true when the artistic initiative takes a more humorous approach, as is the case for many of the anticorruption cartoons, as well as New York’s corruption museum.) And of course, nobody thinks that art initiatives on their own are enough. Yet while artistic initiatives will not by themselves solve the issue of corruption, these initiatives are not just a fad or a gimmick or a distraction. Indeed, there’s quite a bit of research indicating that these programs can be quite effective in raising public awareness on corruption. Continue reading →

Anticorruption Bibliography–February 2016 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.

Legal Strategies for Anticorruption Litigation by Civil Society

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GAB is pleased to welcome this guest post by Ken Hurwitz, Senior Legal Officer, Anticorruption, the Open Society Justice Initiative, announcing the publication of a series of papers on civil society and anticorruption litigation sponsored by the Initiative:

Those of us working with civil society groups that seek to combat transnational grand corruption have what might be called a love-hate relationship with the law. Yes, sometimes we can push magistrates and prosecutors to hold perpetrators to account, provided the right conditions are met. But at the same time we too often see existing law and law enforcement mechanisms protecting those responsible for high-level corruption:  bribing business actors, self-dealing kleptocrats, and the financial, legal and business intermediaries who often profit from and facilitate the crime.

This post introduces a series of papers the Open Society Justice Initiative  commissioned to explore how civil society can see that the law holds the corrupt to account rather than protects them from any sanction. Continue reading →

Is Sunlight Really a Good Disinfectant? The Equivocal Evidence on Freedom of Information Laws and Corruption

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Government transparency is widely considered to be one of the most important means for combating public corruption, a sentiment nicely captured by U.S. Supreme Court Justice Louis Brandeis’s famous observation (in a somewhat different context) that “sunlight is said to be the best of disinfectants.” For this reason, many anticorruption activists lobby for the adoption of strong freedom of information (FOI) laws—laws that not only obligate the government to regularly publish certain types of information, but also to respond promptly to citizen requests for a wide range of government records and documents. The thinking is that government corruption is easier to detect when citizens, civil society organizations, and the media can scrutinize information about government operations.

I count myself firmly in the camp of those who tend to believe that FOI laws are useful anticorruption tools, especially given the strong evidence that citizen and media access to government information can indeed help reduce corruption and hold officials accountable (see, for example, here, here, and here). And because of this, I would expect the evidence to indicate that when a country (or sub-national jurisdiction) adopts a stronger FOI law, corruption should decrease afterwards. But I’ve been looking into the research on this recently, and most of the results don’t fit well with my expectations. Long story short, the (admittedly limited) quantitative empirical evidence does not find a strong correlation between the adoption of a strong FOI law and a subsequent decrease in corruption; if anything, the evidence actually seems to suggest that the adoption of a strong FOI law may be followed by an increase in (perceived or detected) corruption.

Does this mean that FOI laws are ineffective or even counterproductive? I don’t think so, for reasons I’ll lay out in a moment. But I do think it’s worthwhile—especially for those of us who are inclined to support broad FOI laws—to consider the evidence carefully and reflect a bit on what it might mean. Continue reading →

A Modest Proposal for Improving Supervision in World Bank Infrastructure Projects

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Infrastructure funding is a massive component of international development—in 2014, the World Bank alone allocated $24 billion to infrastructure, amounting to roughly 40% of its total lending. Yet as has been widely documented (see here, here and here), infrastructure construction and development projects are particularly susceptible to corruption. Compared with other areas of development lending, such as education and public administration, large construction projects require more specialized contractors and consultants, increasing the points of access for corruption or collusion schemes. Furthermore, labor-intensive industries like construction are often captured by organized crime, which increases their susceptibility to corruption.

Corruption schemes in infrastructure projects often take the following form: a contractor pays government officials a bribe to secure a contract, and in an effort to preserve profits, the bribe-paying contractor compensates for the expense of the bribe by failing to build the project to specification. The supervision consultant—the person or entity responsible for evaluating whether the project has in fact been built to specifications—therefore plays a critical role in stopping or enabling infrastructure construction.

However, when the World Bank funds an infrastructure project, whether through a grant or a loan, the recipient country’s government is responsible for hiring the project’s contractors and consultants—including supervision consultants—subject only to arm’s length World Bank supervision. While this process is also subject to the World Bank’s procurement guidelines, these have been criticized as ineffective in addressing corruption (as previously discussed on this blog). Under the current system, if a project has not been adequately completed because of a corruption scheme, government officials have every incentive to retain inspectors willing to mask the abuse of funds. And if the Bank does discover fraud or corruption after the fact, its remedies are limited: the Bank can suspend or bar contractors from future contracts, and can refer matters to national prosecuting authorities, but successful convictions amount to fewer than 10% of sanctioned parties.

The World Bank must therefore prioritize prevention of these situations. Given the existing system, one measure that the World Bank could take to help prevent corruption in infrastructure projects, is to fund independent supervision consultants. Continue reading →

The Indian Judiciary on Trial: Tackling Corruption in India’s Courts

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Corruption in Indian judiciary is considered pervasive: over 45% of Indians believe the judiciary is corrupt, a view shared by external assessments. Not only is corruption rampant in the lower courts, some have alleged that this corruption reaches the highest levels. In 2010, a former Law Minister declared that eight of sixteen former Chief Justices of India (CJI) were corrupt, and in 2014 a former Supreme Court judge alleged that three former CJIs made “improper compromises” to let a corrupt High Court judge continue in office. Sadly, the Indian judiciary has shown a predilection to treat every call from the executive or the legislature for greater judicial accountability as an attack on the judiciary’s independence. That concern is not altogether unreasonable given the terse history of power battles among the three branches, but it increasingly rings hollow, given the rising reports of corruption in judiciary’s ranks (see here, here and here).

Indian judges may be nowhere near as corrupt as its politicians; but Indian judiciary, like its counterparts elsewhere, relies on its reputation for fairness, impartiality, and incorruptibility. The courts can scarcely afford any loss of public faith. Hence, it must have been a wake-up call for the judiciary to face wavering public support as it battled the executive and legislature during 2014-15 on the National Judicial Accountability Commission Act (NJAC), which sought to expand executive’s say in judicial appointments and make them more transparent. When the Supreme Court finally struck down NJAC in October 2015, citing the need for absolute judicial independence, the judgment was met with both veiled skepticism and open criticism. Although the current appointment system (in which judges appoint their successors) has been relatively free of corruption allegations, the NJAC debate brought forth long simmering concerns of judicial corruption and worries that even judicial appointment was not above suspicion.

How has this come to pass? Why is public confidence in the integrity of the Indian judiciary eroding? Four main issues need addressing in the context of India’s judicial corruption: Continue reading →