Rather support our institutions

NELIUS BECKER WRITES:Allow me to express my opinion on the column “Corruption - A social disease (Part 155): The corruption trend since 1998: What to expect for the following two years?”.I stated it on many public forums and I will state it hear again. The Transparency International (TI) index is by no means an accurate measurement of corruption in any country. It is based on perceptions (it may even be a column like this of untested opinions of a single person or academic), just like all the surveys done to date are based on perceptions.There is unfortunately no way to measure corruption effectively. The number of reports are also problematic but right now appears to be the most reliable database to consider.You might have noticed that some Nordic countries (Denmark, Finland, Sweden and Norway – plus New Zealand, Singapore and Switzerland all score between 84 and 88 points out of 100 on the index) and are amongst the top performers in this index, but what this index does not measure is money laundering.Denmark, which tops the list this year, has recently been rocked by the money laundering scandal surrounding Danske Bank, its biggest lender, among other corruption cases. About US$230 billion of suspicious transactions are thought to have passed through Danske Bank's Estonian branch, which has been linked to the Russian Laundromat and Azerbaijani Laundromat schemes uncovered by the Organised Crime and Corruption Reporting Project (OCCRP). In November, Danske Bank was preliminarily charged for breaking Denmark's anti-money laundering laws.Swiss banks, and other financial intermediaries and enablers, regularly play a significant role in large-scale money laundering and corruption schemes around the world, such as those related to 1MBD in Malaysia, Odebrecht and Petrobas in Brazil, or Mozambique's “tuna bond” scandal.The Financial Action Task Force, which scores countries across 11 categories on their anti-money laundering effectiveness, gave only one top-seven country, Sweden, a high effectiveness score, and that in only one of the 11 categories. EXPORTING CORRUPTION AND FOREIGN BRIBERYAs relatively rich nations, the top seven are often home to international companies that export large volumes of goods and services.The 2018 Exporting Corruption report showed that most of these countries are failing to investigate and punish companies when they are implicated in paying bribes overseas. Of the top seven countries in this year's CPI, only Norway and Switzerland rank in the highest category of enforcement against foreign bribery. Finland, Denmark and Singapore are in the lowest category, with Sweden and New Zealand conducting moderate and limited enforcement of foreign bribery, respectively.Plenty of examples illustrate why this is a problem. THE CASES OF FINLAND, SINGAPORE, SWEDEN AND SWITZERLAND When OCCRP dug into the companies that appear to have given bribes to politicians in the Maldives in return for undervalued leases to build luxury hotels on pristine reefs and islands, a billionaire Singapore businessman's name came up.In 2017, Sweden's Telia agreed to pay a billion-dollar penalty for bribery in Uzbekistan, where the company paid the President's daughter over US$300 million for lucrative telecommunications contracts.In Finland, the partly state-owned defence company, Patria, has been embroiled in corruption scandals in Slovenia and Croatia.In Switzerland, Geneva-based oil and gas extractor Addax Petroleum agreed to pay a similar amount to settle a criminal investigation into allegations of corrupt payments in Nigeria.In the “tuna bond scandal”, former bankers from Credit Suisse were indicted for being involved in a multi-million bribery scheme in Mozambique.Foreign bribery hinders development and skews the level playing field of international trade. It can also contribute to a culture of bribery, especially when companies from countries regarded as clean legitimise it as a means of gaining a commercial advantage.Ironically, such practices can also reinforce perceptions that less developed countries are more corrupt. FINANCIAL SECRECY ACROSS THE GLOBEThen there is the issue of secrecy.In 2018, Switzerland topped the Financial Secrecy Index, produced by the Tax Justice Network. Singapore comes fifth.These so-called secrecy jurisdictions play a key role in allowing the murky company structures which not only help people avoid paying tax, as the Paradise Papers so clearly showed, but enable the corrupt to move and launder their dirty money. Up to a trillion dollars of illicit financial flows are estimated to leave developing economies each year.Sub-Saharan Africa - the region with consistently the lowest average score in the CPI - loses the largest proportion of its wealth in this way compared to other parts of the world.Finally I need to say that corruption will not be reduced (note that I said reduced, as it will never be eradicated) if we rely on reactive measures like investigation and punishment at courts (which we know is not happening).The way to go is to get all institutions involved in plugging the holes in their own organizations, businesses, Ministries, Offices or agencies in order to ensure that it is difficult if not impossible to perpetrate a corruption offence.I have done many investigations and will do many more and see on a daily basis how the failure by companies and M/O/As to follow procedures contribute to opportunities for corruption.Oversight bodies like for instance in the private sector, auditors are more than happy to look the other way when companies fail to comply with the provisions of the companies Act (which if adhered to would make it much more difficult for fraud and corruption).I am still confident and can speak from first hand experience that the fight is on and can still be won as far as keeping corruption at bay is concerned.As for the rating agencies Fitch, Standard and Poor and Moody's, were you aware that these same rating agencies were sued in New York (case #652410/2013) by two Bear Stearns hedge funds for allegedly fraudulently assigning inflated ratings to securities in the run up to the 2008 financial crises? So how reliable are they?I don't think sending out a picture of gloom and doom is necessary and we should rather be grateful that there are still institutions that are investigating and fighting corruption and they need the support of the public, unless of course your mandate is to discredit and potray such institutions in a bad light, but you know what they say, never dig a hole for another as you may fall into it yourself . . .By the way the latest annual report of the ACC shows the reporting trend in a graph over a number of years.

Rather support our institutions

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Republikein 2025-11-20

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