Tag Archives: Donald Trump

The CICIG Crisis in Guatemala: How the Trump Administration Is Undermining US Anticorruption Leadership

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Back when Donald Trump was first elected, a lot of people—me included—worried about the implications of his presidency for US leadership in the global fight against corruption. Some of the dire predictions have not (yet) come to pass; for example, so far US enforcement of the Foreign Corrupt Practices Act (FCPA) does not seem to have abated despite Trump’s well-documented and ill-informed hostility to that statute. But even if US enforcement of the FCPA has proceeded without much discernible effect (so far), there are other, less easily measurable respects in which the Trump Administration’s foreign policy, and its own cavalier disregard for ethics, may be undermining US leadership on anticorruption issues, and consequently undermining anticorruption efforts and bolstering those who would seek to undermine such efforts.

As just noted, much of this effect is diffuse and hard to observe directly, but there are a few examples where the Trump Administration and its allies are undermining the global fight against corruption is more evident. Perhaps the most striking and disheartening is the situation unfolding in Guatemala, ably documented in a compelling piece by Colum Lynch on Foreign Policy’s FP Blog earlier this month. Long story short: The Trump Administration and its allies in Congress appear to be supporting, or at least tacitly accepting, the efforts of Guatemalan President Jimmy Morales to shut down Guatemala’s UN-sponsored anti-impunity commission, known by its Spanish acronym CICIG, which has proved instrumental in fighting high-level corruption in Guatemala, and forced the resignation of President Morales’s predecessor, Otto Perez Molina. President Morales campaigned on an anticorruption platform, but he now wants to shut CICIG down, apparently because it’s investigating his own family members and associates. And the US, which had supported CICIG in the past and pressured President Molina to renew its mandate when he was inclined to terminate it to protect himself, seems to be backing Morales rather than CICIG.

I won’t go into all the details here, as the story is ably laid out in Mr. Lynch’s excellent piece. I’ll just highlight some themes that emerge from the reporting that Mr. Lynch and others have done, which illustrate connections—some direct, some indirect—between the Trump Administration’s approach to government and the dissipation of US leadership on anticorruption issues, as illustrated by the CICIG debacle. Continue reading →

Uzbekistan’s Own Donald Trump

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Donald Trump owes much of his success as a real estate developer to an easy relationship with the anti-money laundering laws, and he continues to profit from his investments while President thanks to an even easier relationship with conflict of interest norms.  Reports out of Uzbekistan suggest Jahongir Artykhodjaev, mayor of the capital city Tashkent, has followed a Trumpian-like path to wealth and power.  Like Trump, Artykhodjaev has looked past how investors in his real estate projects came into their money; like Trump, while in public office he has steered government contracts to companies he owns, and like Trump, when called on his dual role as businessman and government officials, he claims to have distanced himself from his business empire upon taking office.

The main difference (besides hair color) between Trump and Artykhodjaev is that independent prosecutors are examining whether Trump broke rather than simply bent anti-money laundering and conflict of interest laws. By contrast, after accounts in the international press (here and here) exposed Artykhodjaev’s Trumpian proclivities, senior Uzbek officials called a press conference where they leapt to his defense, going so far as to deny there is any Uzbekistan law that Artykhodjaev could have broken. Continue reading →

Tracking Corruption and Conflicts of Interest in the Trump Administration–February 2019 Update

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Since May 2017, GAB has been tracking credible allegations that President Trump, as well as his family members and close associates, are seeking to use the presidency to advance their personal financial interests, and providing monthly updates on media reports of such issues. The February 2019 update is now available here

As always, we note that while we try to include only those allegations that appear credible, we acknowledge that many of the allegations that we discuss are speculative and/or contested. We also do not attempt a full analysis of the laws and regulations that may or may not have been broken if the allegations are true. For an overview of some of the relevant federal laws and regulations that might apply to some of the alleged problematic conduct, see here.

The Case for State-Level Anticorruption Prosecutions in the U.S.

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In the United States, the federal government’s Department of Justice (DOJ) plays a huge role in the prosecution of state-level public corruption: Over the past five years, federal prosecutors have obtained the convictions of approximately 1,700 corrupt state and local officials for corruption-related offenses. Examples range from prominent and powerful figures like Sheldon Silver, the former Speaker of the New York State Assembly, to low-level functionaries like Eloy Infante and Elpidio Yanez, Jr., two former members of the School Board of Donna, Texas.

The federal government’s primacy in prosecuting state and local corruption is no accident. One of the stories of American law enforcement in the 20th century, especially though not exclusively in the anticorruption context, is the expanding role of the federal government, an expansion that was in part a reaction to the perceived deficiencies of state law enforcement. Most states in the U.S. elect both prosecutors and judges, and concerns that these elected officials were under-resourced, incompetent, partisan, or captured by local influence-peddlers contributed to the rise of federal criminal law enforcement. The federal government’s role in prosecuting state and local corruption blossomed in the 1970s, with regional U.S. Attorney’s offices taking the lead, supported by a new DOJ Public Integrity Section in Washington, D.C. The U.S. Attorney’s offices were considered more independent and less vulnerable to capture than local law enforcement, were generally better resourced than their state and local counterparts, and were able to focus those resources on picked cases.

This system has worked well and achieved considerable success. Many argue—with justification—that the federal government’s central role in prosecuting state and local corruption was instrumental in breaking the stranglehold of corrupt political machines at the subnational level. But today, it’s important for state prosecutors to do more to supplement, and in some cases perhaps supplant, federal anticorruption prosecutions. If the story of the 20th century was a distrust of states to police their own politicians, the early 21st century story may be that we can no longer completely trust the feds to do it either. There are three main reasons why, going forward, we may need to rely increasingly on the states:

Continue reading →

Tracking Corruption and Conflicts of Interest in the Trump Administration–January 2019 Update

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Since May 2017, GAB has been tracking credible allegations that President Trump, as well as his family members and close associates, are seeking to use the presidency to advance their personal financial interests, and providing monthly updates on media reports of such issues. The January 2019 update is now available here. There are a number of important (and disturbing) additions to this month’s update. Most notably:

  • Federal prosecutors are now investigating a range of possible legal violations related to Trump’s inauguration committee, which raised a record amount ($107 million) for President Trump’s inauguration. According to reports, there is evidence that much of this money was raised from questionable sources, and that much of it was spent in ways that brought windfall profits to the Trump Organization–in violation of various federal laws. In particular, on the fundraising side, it seems that both domestic and foreign interests donated heavily to the inaugural committee with the apparent intent of influencing US policy. And on the spending side, the inauguration committee spent heavily at Trump Organization properties, apparently at above-market rates. Though the investigation is ongoing, there’s at least suggestive evidence that the inauguration committee might have been a surreptitious way for interest groups and foreign governments to funnel money directly to the Trump family.
  • Previous editions of this tracking project have noted concerns about the Trump Organization’s past and current business dealings in the Dominican Republic. A recent Global Witness report suggests that although the Trump Organization claims that its current business in the Dominican Republic is a continuation of an older deal that started before Trump took office, in fact the Trump Organization and its local partner are pursuing an entirely new development project, in clear violation of President Trump’s pledge that the Trump Organization would not pursue any “new foreign deals” during his presidency.
  • Jared Kushner and his family stand to benefit personally from a federal program–the “Opportunity Zone” program–that offers large tax breaks to developers who invest in low-income neighborhoods. This program was heavily promoted by Ivanka Trump, Kushner’s wife, and though neither of them will play a direct formal role in determining which neighborhoods will be designated “opportunity zones” eligible for tax credits, there is an obvious conflict of interest concern, especially since the Kushner family owns multiple properties in areas that have already been designated as opportunity zones–including neighborhoods that are actually quite affluent.

As always, we note that while we try to include only those allegations that appear credible, we acknowledge that many of the allegations that we discuss are speculative and/or contested. We also do not attempt a full analysis of the laws and regulations that may or may not have been broken if the allegations are true. For an overview of some of the relevant federal laws and regulations that might apply to some of the alleged problematic conduct, see here.

Tracking Corruption and Conflicts of Interest in the Trump Administration–December 2018 Update

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Since May 2017, GAB has been tracking credible allegations that President Trump, as well as his family members and close associates, are seeking to use the presidency to advance their personal financial interests, and providing monthly updates on media reports of such issues. The December 2018 update is now available here.

As always, we note that while we try to include only those allegations that appear credible, we acknowledge that many of the allegations that we discuss are speculative and/or contested. We also do not attempt a full analysis of the laws and regulations that may or may not have been broken if the allegations are true. For an overview of some of the relevant federal laws and regulations that might apply to some of the alleged problematic conduct, see here.

Tracking Corruption and Conflicts of Interest in the Trump Administration–November 2018 Update

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Since May 2017, GAB has been tracking credible allegations that President Trump, as well as his family members and close associates, are seeking to use the presidency to advance their personal financial interests, and providing monthly updates on media reports of such issues. It looks like our approach is catching on, given that this past month the New York Times published a similar compendium (which the authors described as “the definitive list”) of Trump-related corruption and conflict-of-interest allegations. It’s not clear whether the NYT plans to regularly update this compendium–if they do, then we might wind down the Trump COI tracker here at GAB, given the NYT‘s much wider reach and greater resources. But for now, we’re going to keep plugging away with our monthly updates. The October 2018 update is now available here. The most notable additions since the previous update include:

  • Reports that Interior Secretary Ryan Zinke may have been involved in a shady property development deal that entails negotiations and transactions with parties connected to firms over which the Interior Department has regulatory authority.
  • Renewed and intensified concern about President Trump’s past and present business ties to Saudi Arabia, in light of the administration’s tepid response to the murder of Saudi journalist and U.S. resident Jamal Kashoggi in the Saudi consulate in Turkey, apparently by Saudi intelligence agents.
  • President Trump’s intercession with Japanese officials on behalf of his campaign donor and supporter Sheldon Adelson, in connection with the latter’s interest in a lucrative license to operate a casino in Japan.

As always, we note that while we try to include only those allegations that appear credible, we acknowledge that many of the allegations that we discuss are speculative and/or contested. We also do not attempt a full analysis of the laws and regulations that may or may not have been broken if the allegations are true. For an overview of some of the relevant federal laws and regulations that might apply to some of the alleged problematic conduct, see here.

Is the U.S. Political System Characterized by “Legalized Corruption”? Some Tentative Concerns About a Common Rhetorical Strategy

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Today is Election Day in the United States. It’s an important election (they all are, really), and I hope those of our readers who are eligible to vote in the United States will do so. But this post isn’t going to be about these U.S. elections specifically. Rather, I want to consider a question about the U.S. electoral system more generally: Is it accurate to describe the U.S. system as a one of “legalized corruption”? That is, do the campaign finance and lobbying rules in the United States amount to a system in which wealthy individuals and interest groups “purchase” favorable policy through what are effectively “bribes”—in the form of campaign contributions or support?

The use of the rhetoric of corruption and “legalized bribery” to describe the U.S. political system has been around for a while, and it seems to have become even more pronounced over the last few election cycles—perhaps galvanized by the U.S. Supreme Court’s controversial decision in the Citizens United case. (For examples, see here, here, here, and here.) I certainly understand, and indeed share, the underlying concerns about how the influence of concentrated economic wealth can distort the political process and tilt policy outcomes in a direction that favors the affluent. Yet I’ve felt increasingly ambivalent about the use of the language of “systemic corruption” or “legalized bribery” to describe the very real money-in-politics problem in the United States. There are three main reasons for my ambivalence. Continue reading →

Giuliani’s Inappropriate Letter to Romania’s President Will Harm Anticorruption Efforts

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Romania has long been considered one of the most corrupt countries in the European Union, but in recent years it has been making a concerted effort to bolster its fight against graft. Since 2013, Romania’s National Anticorruption Directorate (DNA), with the support of the ruling political parties, has been convicting roughly 1,000 people on corruption-related charges each year. However, once these anticorruption efforts began ensnaring high-level politicians—including Liviu Dragnea, the head of the biggest party in the Romanian Parliament—the government began to criticize the DNA’s work as biased, overzealous, and unfair. This conflict has been escalating, most dramatically in late 2017, when hundreds of thousands of Romanians took to the streets to protest an overnight decree that pardoned those serving sentences of five years or less for corruption-related crimes, and also decriminalized government officials’ corruption offenses involving less than $47,000 (raised to $240,000 in a later draft bill). The protests led to violent clashes with the police, who used tear gas and water cannons to disperse the crowds.

Adding to the turmoil, Rudolph Giuliani, former Mayor of New York City and current personal attorney of U.S. President Trump, recently wrote a letter to Romanian president Klaus Iohannis, condemning the overreach of the DNA and supporting the government’s efforts to curtail the DNA’s enforcement of anticorruption laws. Giuliani was paid to write the letter by the Freeh Group, a private American firm whose overseas clients include a Romanian businessman convicted for fraud last year, and another Romanian businessman currently under investigation by the DNA for bribery. Giuliani’s letter raises two distinct corruption-related problems. Continue reading →

Lessons from the Trump Administration’s Conflicts of Interest

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In May 2017, this blog began tracking corruption and conflicts of interest in the Trump Administration, in order to identify and document the myriad ways that the President, his family, and his closest advisors may “use the presidency to advance their personal financial interests.” This includes payments directly from the U.S. government to the Trump Organization (e.g. the Secret Service renting out space in the Trump Tower); use of the presidency to promote Trump brands (e.g. numerous Republican re-election campaigns held in Trump owned businesses); regulatory and policy decisions that benefit the Trump family and close advisors (e.g. the General Services Administration approving a lease for the Trump International Hotel); and private and foreign interests dealing with Trump businesses (e.g. Trump hotel, resort, and other development projects around the world). Keeping track of all these various conflict and corruption risks is important at a time when the news of yesterday gets drowned out and forgotten amid the drama of today.

After working for over a year as one of several contributors to this tracking project, I think that there are also some broader lessons and themes that have emerged from these efforts, which are worth highlighting:

Continue reading →