In Their Push for Investigations, Did Trump’s Associates Break Ukrainian Law?

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The U.S. political news for the last month has been dominated by the explosive and fast-developing scandal involving reports that President Trump and his associates—including not only U.S. government officials but also Trump’s personal lawyer Rudy Giuliani and other private citizens—have been engaged in an ongoing behind-the-scenes campaign to pressure the Ukrainian government to pursue criminal investigations that would benefit President Trump politically. In particular, President Trump, Mr. Giuliani, and others pushed Ukraine to investigate supposed wrongdoing by Vice President Joe Biden and his son Hunter, as well as alleged Ukraine-based interference in the 2016 election on behalf of Democrats. (There is no credible evidence to support either allegation, and experts in President Trump’s administration repeatedly warned him against these unfounded conspiracy theories, to no avail.) The pressure brought to bear by President Trump and his associates on Ukrainian officials appears to have included not only general statements of interest in these allegations—allegations that the Ukrainian authorities viewed as baseless—but also included implicit or explicit threats that failure to comply would lead to various forms of retaliation, both symbolic (the refusal to invite newly-elected President Zelensky to the White House) and tangible (the withholding of desperately needed military aid).

While the main ramifications of this scandal are political rather than strictly legal, the U.S. media extensively discussed whether President Trump and his associates may have violated any U.S. laws, and commentators have suggested a number of potential legal violations. For example, asking a foreign entity for dirt on a domestic political rival might violate the provision of U.S. campaign finance law that makes it illegal to “solicit … a contribution or donation [to an election campaign] … from a foreign national,” where “contribution or donation” includes not only money but any other “thing of value.” President Trump and his associates may also have violated domestic anti-corruption law (the federal anti-bribery statute and/or the anti-extortion provision of the Hobbs Act) in conditioning the performance of an official act (such as the transfer of military aid) on the receipt of something of value from Ukrainian government officials (investigations into political rivals). Private citizens like Mr. Giuliani may have violated the Logan Act, which makes it illegal for private citizens, without the authority of the United States, to correspond with any foreign government or foreign official “with the intent to influence the measures or conduct of any foreign government …. in relation to any disputes or controversies with the United States.” And of course, the attempts to conceal all of these interactions may have amounted to obstruction of justice.

The focus in the U.S. media on whether President Trump and his associates may have violated U.S. law is entirely understandable, but seems incomplete. Strangely absent from the conversation is any mention, let alone sustained exploration, of the question whether any of President Trump’s associates may have violated Ukrainian law. At least this seems strange to me. Imagine that the situation were reversed. Suppose, for example, that a Chinese businessman, nominally a private citizen but known to have close ties to President Xi, approached the U.S. Attorney General and said something like, “We know your administration is anxious to cut a trade deal and would also like China’s assistance in addressing the North Korea situation. I’m sure President Xi could be persuaded to help you out. But you should help China out too. There’s a dissident, now an American citizen, who’s been writing a lot of damaging lies about President Xi, and he’s gaining a following in China and stirring unrest. Why don’t you publicly announce that the U.S. government is investigating him for running a ring of child prostitutes? That would really help us out.” If a story like this came out, I’m quite sure the U.S. media would be abuzz with discussions about which U.S. laws this businessman might have broken, and whether he might be prosecuted in U.S. courts if U.S. authorities managed to arrest him. But in the Ukraine case, we may have something similar—a private citizen (Giuliani) with close ties to a foreign political leader (Trump) apparently told senior political and law enforcement officials (the Ukrainian President and Prosecutor General) to pursue a bogus criminal investigation in exchange for that foreign government’s cooperation on important issues—and nobody seems to be even raising the possibility that this might violate Ukrainian law.

By the way, when I say nobody is talking about this, that apparently includes Ukrainian media and civil society. I don’t read Ukrainian and I’m by no means a Ukraine expert, but I have some friends and other contacts there, and they tell me that while the story is big news in their country, there hasn’t been any discussion about whether Trump’s associates may have violated Ukrainian law. That gives me pause, and makes me think that perhaps I’m totally off base in thinking there’s even an interesting question here. Nonetheless, at the risk of looking foolish (something that’s happened plenty of times before, I admit), I want to use this post to float this topic and see what others think. Continue reading →

Guest Post: Indonesian Anticorruption Institutions at Risk, Part 2: Legislative Amendments Spell Disaster for the KPK

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GAB is pleased to welcome Simon Butt, Professor of Indonesian Law and Director of the Centre for Asian and Pacific Law, the University of Sydney, to contribute a two-part series on recent developments in Indonesia. Today’s post, the second of the two, is a revised and expanded version of an article that Professor Butt originally published on Indonesia at Melbourne.

As I discussed in yesterday’s post, Indonesia’s anticorruption commission (the Komisi Pemberantasan Korupsi, or KPK) has found itself under serious attack since it began to pursue powerful political figures. Members of the national parliament, many of whom have found themselves in the KPK’s sights, have long threatened to use their legislative power to weaken the KPK and undermine its independence. For many years the KPK has managed to stave off such threats, thanks mainly to strong leadership and public support. But the KPK has found itself in a weakened state in recent months. It lost its first case in its 17-year history, and more significantly, the KPK’s leadership team has been replaced with a new group of problematic commissioners, whose terms commence next year. And last month, on September 17th, the parliament took advantage of this vulnerability and finally made good on its threat to amend the 2002 statute that established the KPK. These amendments, which attack the very institutional features and powers the KPK has used to build its impressive track record, are disastrous for the KPK and Indonesia’s fight against corruption. Continue reading →

Guest Post: Indonesian Anticorruption Institutions at Risk, Part 1: The Significance of the KPK’s First Acquittal

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GAB is pleased to welcome Simon Butt, Professor of Indonesian Law and Director of the Centre for Asian and Pacific Law, the University of Sydney, to contribute a two-part series on recent developments in Indonesia. Today’s post, the first of the two, is a revised and expanded version of an article that Professor Butt originally published on the East Asia Forum.)

Over the past decade or so, Indonesia’s anticorruption commission (the Komisi Pemberantasan Korupsi, or KPK) had managed to deflect numerous efforts of powerful politicians and senior law enforcement figures to reduce its independence and effectiveness. However, last month Indonesia’s national parliament appears to have successfully hobbled the Commission, with the support of President Joko Widodo. The effort to weaken the Commission began with the appointment of a new batch of commissioners, widely condemned as being sympathetic to the regime or likely to be ineffective. This was followed by amendments to the Commission’s founding statute that are clearly designed to render the Commission ineffective in investigating and prosecuting corruption.

An important precursor to these events was the KPK’s first loss in court. Until this past July, the KPK had not, since its establishment in 2003, lost any of the hundreds of cases it had brought to full trial. This was a remarkable achievement in a country renowned for deeply entrenched and widespread corruption at the highest levels, particularly in government institutions and the courts.

But on July 11, 2019, the KPK’s perfect record was broken when a divided three-judge Supreme Court panel voted to acquit Syafruddin Arsyad Temenggung, the former chair of the Indonesian Bank Restructuring Agency. Temenggung had been convicted at trial (in one of Indonesia’s specialized anticorruption courts) for a scheme in which a businessman, Sjamsul Nursalim, overstated the value of assets used to repay government assistance funds he had received after the 1997 Asian Economic Crisis. According to the prosecution, by improperly approving the discharge of Nursalim’s debt, Temenggung caused the Indonesian state to lose 4.5 trillion rupiah (well over USD 300 million). Temenggung’s lawyers argued, among other things, that there was no proof that their client had obtained any benefit from Nursalim in exchange for discharging the debt, and that their client was simply doing his job and had not committed any crime. The trial court rejected these defences, convicted Temenggung, and sentenced him to 12 years’ imprisonment. On the first appeal, the Jakarta High Provincial Court affirmed the conviction and increased the prison sentence to 15 years. But Temenggung then appealed to the Supreme Court, and there he prevailed. At time of writing, the Supreme Court judgment acquitting Temenggung has not yet been made publicly available. Nevertheless, according to media reports, two of the three judges on the panel voted to acquit Temenggung, though for somewhat different reasons, while the third judge would have affirmed the conviction.

Given that the KPK probably lacks a legal basis for asking the Supreme Court to reconsider its decision, the KPK appears to have now suffered its first defeat in its 15-year history. The loss of this case is a major blow on its own terms, because it was the KPK’s largest-ever case in monetary terms, involving over twice the alleged state loss than its previous largest case. But the significance of this acquittal may be much broader, and raises a number of questions about the future of corruption eradication efforts in Indonesia. Continue reading →

New Podcast Episode, Featuring Sergei Guriev

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A new episode of KickBack: The Global Anticorruption Podcast is now available. In this episode, I interview Professor Sergei Guriev, who until last month served as the Chief Economist for the European Bank for Reconstruction and Development (EBRD). In the conversation (which took place a couple of months ago, when Professor Guriev was still in his EBRD post), we discuss a range of topics, including his academic work (both his research on the role of oligarchs in the Russian economy and his more recent work on how expanded high-speed internet access affects both perceptions of and political responses to widespread corruption); the question why some post-socialist countries were more successful than others in making a transition to a market economy and reasonably well-functioning democratic government, while others remain mired in corruption; and some of the major challenges and opportunities confronted by international organizations, like the EBRD, that want to help advance the fight against corruption in challenging political environments.

You can find this episode, along with links to previous podcast 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.

Guest Post: Toward a Meaningful “Common African Position on Asset Recovery”

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GAB is delighted to welcome back Mat Tromme, Director of the Sustainable Development & Rule of Law Programme at the Bingham Centre for the Rule of Law, who contributes the following guest post:

It’s no secret that kleptocratic rulers in Africa have robbed their countries of substantial assets that could have  otherwise been used to promote development and social welfare. Indeed, the amounts are often staggering: $16 billion reportedly stolen by former Libyan President Gaddafi; $1 billion by Gambia’s ex-President Jammeh; billions by former Congolese President Kabila; and the list goes on. Recently, Nigeria’s Economic and Financial Crime Commission suggested that up to $50 billion has been looted from Africa, and whether or not particular estimate is accurate, there’s little doubt the problem is serious. More troubling is the fact that only a small proportion of these stolen assets have been recovered and repatriated to the country of origin.

As part of the effort to address the challenges of asset recovery—and to give African states more clout in negotiating the terms and conditions of asset return with the states that initially seize the stolen loot—African countries are currently undertaking an effort to develop a “Common African Position on Asset Recovery” (CAPAR). Incidentally, a common african position was the chosen theme of this year’s African Union Anti-corruption day. At this early stage, it seems likely that this effort will result only in a political proclamation (perhaps within the framework of this month’s UN General Assembly), one that will re-emphasize the importance of the speedy and unconditional return of assets, and call for better collaboration across countries. That’s a good start, but not enough! Developing a pan-African position on asset recovery—perhaps similar to the multilateral framework adopted by the Mercosur countries and by the EU—is a worthwhile endeavor, one that will likely produce tangible benefits only if it goes beyond mere statements of intent or general principles, and lays out some concrete steps to translate the vision into reality.

Ideally, CAPAR should seek to streamline policies and resources devoted to recovering assets and developing better investigative and prosecutorial capacity across African states, for example by implementing cross-border investigations and fostering collaboration, experience and information-sharing between countries. There are various ways to achieve this broad objective: Continue reading →

Memorandum of Conversation Between Presidents Trump and Zelensky UPDATED

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America has unfortunately plunged into what is likely to be a long and divisive debate about corruption. Media reports of a conversation President Trump had July 25 with Ukrainian President Volodymyr Zelensky have swirled since allegations surfaced that President Trump had there asked President Zelensky to investigate former Vice President Biden for corruption.  In the hopes of ending speculation about what he said, earlier today President Trump released a memorandum recounting the call.  [Update: The controversy leading to release of the memorandum was sparked by reports an intelligence professional had filed a whistleblower complaint concerning President Trump and Ukraine.  That complaint, released the morning of September 2, is here].

Unfortunately, the release is likely only to fuel ever more nasty, partisan debate. One controversy certain to arise is the memorandum’s accuracy.  It is not a verbatim transcript of what the leaders said, a transcription of an audio recording of the call.  Rather, it represents what one or more staff huriedley scribbled down while the two spoke; later others reviewed it.  Did someone “scrub” more incriminating comments from the memo before its release?  Is there a better record of the call?  Will the person or persons who actually listened to the call come forward to testify to its accuracy?  Or contest the accuracy?

A more critical point of contention is whether what President Trump said during the call is on its face a crime under American law.  President Trump clearly asked President Zelensky to investigate former Vice President Biden for criminal activity.  The Federal Election Campaign Act makes it a crime for presidential candidates to receive contributions, defined as “anything of value,” from foreign citizens or governments. President Trump is a candidate for president in the 2020 election as is the former Vice President. Had Ukraine actually initiated an investigation of the Vice President, would that have been something of value under the election law?  If it would have been, was President Trump’s solicitation of such a contribution a violation of the law?  Or any other U.S. laws?

Is the fact that Mr. Biden is seeking the 2020 Democratic presidential nomination relevant to the inquiry?  That, were he to be the Democratic nominee, current polls show him decisively defeating President Trump?

Some reports allege President Trump personally held up critical military and economic assistance to the government of Ukraine, only releasing it under Congressional pressure.  That will surely be the bitterest bone of contention, for if he used a denial or delay in providing aid as leverage to force Ukraine to open an investigation, that would constitute attempted bribery under American law and thus strong grounds for impeachment and removal from office.

Was there such a threat?  As students of U.S. bribery law know, it need not have been overt; “a wink and a nod” suffices.   Expect a great deal of argument over “winks and nods,” with partisans seeing none opponents seeing them everywhere

The only bright spot in this very dismal chapter in American history is release of  memorandum of conversation.  It provides at least some uncontested facts upon which partisans can build their cases.  For those who have yet to read it, here it is Memorandum telephone conversation between Presidents Trump and Zelenskyy

Anticorruption Bibliography–September 2019 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.

Lula’s Lawyers Respond to the Lava Jato Prosecutors’ Letter

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Last week, GAB published two letters presenting alternative perspectives on the so-called “Car Wash” (Lava Jato) anticorruption operation in Brazil, in particular the prosecution and conviction of former president Luiz Inácio Lula da Silva (Lula). The first letter was a re-publication of an open letter sent by a group of international jurists and scholars, who asserted that Lula did not receive a fair trial and that the prosecutors were politically biased. The second letter was a reply from the prosecutors, who defended their conduct, argued that the conviction of Lula was legitimate and not politically motivated, and contended that a number of factual and legal assertions in the international jurists’ letter were incorrect.

After publication of that post, I received a message from Lula’s lawyers (the law firm of Teixeira, Martins & Advogados), who asked me to publish their letter in response to the prosecutors. In the interest of furthering this important substantive debate, I am presenting their letter below: Continue reading →

Guest Post: U.S. State Ethics Agencies Must Improve Both Enforcement and Transparency

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Today’s guest post is from Shruti Shah, President and CEO of the Coalition for Integrity (C4I), and Alex Amico, a C4I legal fellow.

Recently, the Coalition for Integrity released a report on Enforcement of Ethics Rules by State Agencies (along with an associated index and map) which examined the performance of state-level ethics agencies across the United States. In addition to providing basic enforcement statistics, the report emphasized two aspects of these agencies’ performance. First, the report looked at how these agencies enforced the ethics laws they were charged with enforcing, to see how aggressively agencies stand up for ethical government within their legal authority. Second, the report examined how transparent the agencies were in that enforcement, and hence how accountable these agencies make themselves to the public. (The report also ranked each state and agency based on their transparency of enforcement). Both of these aspects of agency performance are crucial to creating a culture of honest government and a robust ethics enforcement regime. Some our headline findings with respect to each of these dimensions of performance were as follows: Continue reading →

Memo for SEC Chairman Clayton: Getting Other Nations to Enforce Their Antibribery Laws

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In recent remarks to the New York business community, you complain that vigorous enforcement of the Foreign Corrupt Practices Act has had little effect on corruption levels “in many areas of the world.”  The blame, you argue, lies with other nations which don’t enforce their antibribery laws. When companies from these nations seek business in a third state, they are free to, and too often do, bribe their way to commercial success. Indeed, as you explain, their repeated success provides the states where they are headquartered an incentive not to enforce their antibribery laws.

Using the prisoners’ dilemma game, you show that bribery will only be brought under control when all countries with firms that do business in foreign states agree to crack down on the payment of bribes.  And you promise that whenever you speak to counterparts in these countries, you will try to persuade them of the value of “common, cooperative enforcement strategies.”  But while the prisoners’ dilemma paradox underscores why all countries where firms that may pay bribes are located must enforce their antibribery laws, it obscures another important step in the global fight against corruption. One that the Commission can do much to advance.    Continue reading →