Guest Post: Why the U.S. Congress Should Pass the CROOK Act

Today’s guest post is from Abigail Bellows, a nonresident fellow at the Carnegie Endowment for International Peace and an independent governance consultant. Ms. Bellows previously served in the U.S. Department of State, where she created and led the anticorruption portfolio in the Office of the Under Secretary for Civilian Security, Democracy, and Human Rights.

In countries long plagued by pervasive corruption, a wave of global protests is disrupting the political order. These protests, typically triggered by a corruption scandal, produce a brief upswing in political will and may result in the ouster of the current government. In fact, 10% of countries of countries around the world have experienced corruption-fueled political change over the last five years. These settings present historic opportunities to produce genuine, lasting reform. But to succeed, reformers must take advantage of political momentum before public interest dissipates or opponents regroup. During these windows of opportunity, U.S. support can play a valuable role, both because of the symbolic power of U.S. support and because of the scale and rigor of the technical assistance that the U.S. can provide. Yet all too often, the U.S. government is unable to respond sufficiently and quickly to support reformist governments during these crucial windows of opportunity. One of the main reasons is that the current U.S. anticorruption budget is too small ($115 million annually), too geographically rigid, and insufficiently flexible (given that programming is typically planned and budgeted two years in advance).

New legislation pending in the U.S. Congress—Countering Russian and Other Overseas Kleptocracy (CROOK) Act—would help address these problems. The House version of the CROOK Act, which was introduced on July 18, 2019 by Representative Bill Keating (D-MA) and Representative Brian Fitzpatrick (R-PA), with support from the U.S. Helsinki Commission, passed the House Foreign Affairs Committee on December 18. The companion Senate bill was introduced on December 11 by Senator Roger Wicker (R-MS) and Senator Ben Cardin (D-MD) and is awaiting review by the Senate Foreign Relations Committee. While the CROOK Act contains many measures that would strengthen U.S. anticorruption efforts, its centerpiece is the creation of an “Anti-Corruption Action Fund.” Continue reading

Possible Reforms to Australia’s Approach to Corporate Criminal Liability: “Failure to Prevent”, Strict Liability, or Something Else?

Many of the most significant bribery offenses, both domestically and internationally, involve corporations. When, and under what conditions, should the corporation itself—as opposed to, or in addition to, the individual employees involved in the wrongdoing—be held criminally liable? The attribution of criminal liability is sometimes thought to be conceptually or philosophically problematic: As Baron Thurlow LC once observed, a corporation has “no soul to be damned and no body to be kicked.” Yet it is clear that corporations can do wrong, and the prospect, and extent, of corporate criminal liability can have significant impacts on corporate behavior. Various legal systems have developed different approaches, but in some jurisdictions there has been considerable dissatisfaction with the status quo, and agitation for reform.

Australia is one such jurisdiction. In response to concerns about the Australian legal system’s approach to corporate criminal liability (an issue that is important in, but not limited to, the corruption context), last April the Commonwealth Attorney General of Australia, Christian Porter, announced that the Australian Law Reform Commission (ALRC)—the Australian Federal Government’s highly influential law reform agency—would conduct an inquiry into this issue. The Terms of Reference required the ALRC to review, among other things, the policy rationale behind Australia’s current framework for imposing criminal liability on corporations, as well as the availability of alternate mechanisms for attributing corporate criminal liability. This past November, the ALRC released a 279-page Discussion Paper that thoroughly canvasses potential approaches to reforming Australia’s corporate criminal liability regime; the ALRC is currently receiving comments on that paper, which are due at the end of this month (January 31, 2020), and after considering these submissions, the ALRC will release its final report by April 30, 2020.

The ALRC paper covers many issues, but perhaps the most fundamental concerns the basic rules for attributing criminal responsibility to the corporation. The ALRC, and the Australian government, faces a choice among several plausible alternatives: Continue reading

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

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

New Podcast Episode, Featuring Oz Dincer

A new episode of KickBack: The Global Anticorruption Podcast is now available. This week’s episode features an interview with Professor Oguzhan “Oz” Dincer, the Director of the Institute for Corruption Studies at Illinois State University. In the interview, Professor Dincer and I discuss a range of topics, including new approaches to the challenges of measuring corruption, the concept of “legal corruption,” the role of cultural factors in influencing corrupt behavior (both internationally and within the United States), and troubling developments related to political corruption in Turkey.

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.

I Caught the Sheriff: Why U.S. Anticorruption Officials Should Keep an Eye on Sheriffs

An unusual feature of US law enforcement is the important role of the county sheriff. As of 2013, over 3,000 sheriffs’ offices across 47 U.S. states employed 352,000 people—roughly one-third of the country’s law enforcement personnel. The sheriff’s job varies from state-to-state, but the common denominator is responsibility over county corrections, including the operation of jails and transportation of inmates to and from court. In some states—Massachusetts, for instance—that’s essentially the extent of sheriffs’ duties. In other states, though, sheriffs wield much broader authority. Texas sheriffs, for example, can enforce the state’s criminal laws anywhere in their county, even where municipal police departments have jurisdiction. Most states are somewhere in the middle, tasking sheriffs with general law enforcement duties only in unincorporated parts of the county and sometimes with security for state government buildings, in addition to their correctional responsibilities.

Despite the variety of roles played by sheriffs, many commentators view sheriffs as merely another kind of police. After all, they wear badges, can legally use force, and, in many parts of the country, patrol the beat. But sheriffs are distinct from their police counterparts in significant respects. Most notably, whereas police chiefs are appointed by city officials, sheriffs are popularly elected by the county they serve. And, unlike police departments, which are creatures of state statute, the responsibilities of a county sheriff are often rooted in the state constitution.

These differences render sheriffs more susceptible than police to corruption for three reasons:

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Where Should U.S. State Governments Put Their Anticorruption Agencies?

As other contributors on this blog have argued, U.S. states should assume a greater role in investigating and prosecuting corruption crimes, rather than leaving anticorruption enforcement efforts entirely to the federal government. But the call for a greater state role in anticorruption naturally invites a follow-up question: which office or unit within the state government should have principal responsibility for anticorruption? For starters, should the state have a specialized unit dedicated to investigating or prosecuting corruption crimes? And if so, where within the state government should that unit be located?

There are a range of potential answers to these questions. A 50-state survey from the Center for the Advancement of Public Integrity (CAPI) finds that although the vast majority of states have some kind of anticorruption commission, roughly half have no specialized anticorruption unit dedicated to investigating or prosecuting corruption crimes. States that do have such units house them in one of three places: (1) the state attorney general’s office, (2) local prosecutors’ offices, or (3) the state police.

State Unit Dedicated to Prosecuting Corruption?

Source: Center for the Advancement of Public Integrity at Columbia Law School

Having a specialized unit to prosecute corruption promotes the development of the expertise critical to successfully prosecuting corruption cases. Maintaining specialized anticorruption units also ensures resources are dedicated specifically to combating corruption, fosters norms of (and a reputation for) impartiality, and enhances deterrence by increasing officials’ perception that they’ll get caught if they do something wrong. But where a specialized anticorruption unit is located within state government affects the degree to which these benefits will be realized. In this respect, the three models of current state practice, as discussed in the CAPI survey and illustrated in the above map, differ along two dimensions: (1) the level of government (state or local); and (2) the nature of the law enforcement agency (prosecutors or police). An examination of both dimensions indicates that state-level prosecutors—state attorneys general—are best-equipped to house specialized anticorruption units.

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Beneficial Ownership Registry Coming to the United States?

This may be the year the United States finally requires disclosure of who owns American corporations.  By a 43-16 vote, the House Financial Services Committee recommended on June 11 that the full House of Representatives approve legislation creating a beneficial ownership registry accessible to federal and state law enforcement agencies and presumably to foreign law enforcement authorities through a valid mutual legal assistance request.  At the same time, a bipartisan group of Senators, including two conservative Republicans who back President Trump, is proposing similar legislation in the Senate.

The American legislative process is an arduous one.  The Financial Services Committee’s proposed bill must be passed by the House of Representatives; an identical bill approved by the Senate, and President Trump must then sign it. Long-time supporters of a registry cite two reasons for optimism a bill will pass this year. One, 10 Republican members of the Financial Services Committee voted for the bill and others may support it when the House considers it, and second, the Senate bill has the support of Republican Senators close to President Trump.

Key provisions of the committee-approved bill: Continue reading