STOP POLITICAL BRIBERY Fight Corruption in America
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Corruption Facts
facts_E.qxd 07/12/2005 14:12 Page 1 Corruption Facts Corruption causes reduced investment. • Investment in a relatively corrupt country compared to an uncorrupt one can be as much as 20 per cent more costly. [“Economic Corruption: Some Facts”, Daniel Kaufmann 8th International Anti-Corruption Conference 1997] • Nations that fight corruption and improve their rule of law could increase their national income • Each year, over US$ 1 trillion is paid in bribes by 400 per cent. worldwide. [“US$ 1 Trillion lost each year to bribery says World Bank”, UN Wire, 12 April 2004] [World Bank, www.worldbank.org] • Corruption reduces a government's ability to provide basic resources and services for Increasing evidence indicates widespread its citizens. corruption in the judiciary in many parts of the world. • Corruption and the transfer of illicit funds • Judicial corruption undermines the rule have contributed to capital flight in Africa, of law and government legitimacy. with more than US$ 400 billion having been looted and stashed away in foreign countries. • A corrupt judiciary cripples a society's Of that amount, around US$ 100 billion is ability to curb corruption. estimated to have come from Nigeria alone. • A report examining the judiciary in 48 • Former President of Zaire, Mobutu Sese Seko countries found that judicial corruption (in power 1965-1997) is believed to have looted was pervasive in 30 of them. the country's treasury of some US$ 5 billion— [Centre for Independence of Judges and Lawyers, an amount equal to the country's external Ninth annual report on Attacks on Justice, March 1997, February 1999.] debt at the time. -
How Does Corruption Affect the Adoption of Lobby Registers? a Comparative Analysis
Politics and Governance (ISSN: 2183–2463) 2020, Volume 8, Issue 2, Pages 116–127 DOI: 10.17645/pag.v8i2.2708 Article How Does Corruption Affect the Adoption of Lobby Registers? A Comparative Analysis Fabrizio De Francesco 1 and Philipp Trein 2,3,* 1 School of Government and Public Policy, University of Strathclyde, Glasgow, G42 9RJ, UK; E-Mail: [email protected] 2 Department for Actuarial Sciences, University of Lausanne, 1015 Lausanne, Switzerland; E-Mail: [email protected] 3 Institute of Political Studies, Faculty of Social and Political Sciences, University of Lausanne, 1015 Lausanne, Switzerland * Corresponding author Submitted: 14 December 2019 | Accepted: 19 March 2020 | Published: 28 May 2020 Abstract Recent research has demonstrated that some governments in developed democracies followed the OECD and the EU rec- ommendations to enhance transparency by adopting lobby registers, whereas other countries refrained from such mea- sures. We contribute to the literature in demonstrating how corruption is linked to the adoption of lobbying regulations. Specifically, we argue that governments regulate lobbying when they face the combination of low to moderate levels of corruption and a relatively well-developed economy. To assess this argument empirically, we compare 42 developed countries between 2000 and 2015, using multivariate logistic regressions and two illustrative case studies. The statistical analysis supports our argument, even if we include a number of control variables, such as the presence of a second par- liamentary chamber, the age of democracy, and a spatial lag. The case studies illustrate the link between anti-corruption agenda and the adoption of lobby registers. -
Corruption from a Cross-Cultural Perspective
Corruption from a Cross-Cultural Perspective John Hooker Carnegie Mellon University October 2008 Abstract This paper views corruption as activity that tends to undermine a cultural system. Because cultures operate in very different ways, different activities are corrupting in different parts of the world. The paper analyzes real-life situations in Japan, Taiwan, India, China, North America, sub-Saharan Africa, the Middle East, and Korea to distinguish actions that structurally undermine a cultural system from those that are merely inefficient or are actually supportive. Activities such as nepotism or cronyism that are corrupting in the rule-based cultures of the West may be functional in relationship-based cultures. Behavior that is normal in the West, such as bringing lawsuits or adhering strictly to a contract, may be corrupting elsewhere. Practices such as bribery that are often corrupting across cultures are nonetheless corrupting for very different reasons. This perspective provides culturally-sensitive guidelines not only for avoiding corruption but for understanding the mechanisms that make a culture work. Keywords – Corruption, cross-cultural ethics The world is shrinking, but its cultures remain worlds apart, as do its ethical norms. Bribery, kickbacks, cronyism, and nepotism seem to be more prevalent in some parts of the world, and one wants to know why. Is it because some peoples are less ethical than others? Or is it because they have different ethical systems and regard these behaviors as acceptable? As one might expect from a complicated world, the truth is more complicated than either of these alternatives. Behavioral differences result partly from different norms, and partly from a failure to live up to these norms. -
Lobbying, Corruption and Other Banes
IZA DP No. 3693 Lobbying, Corruption and Other Banes Nauro F. Campos Francesco Giovannoni DISCUSSION PAPER SERIES DISCUSSION PAPER September 2008 Forschungsinstitut zur Zukunft der Arbeit Institute for the Study of Labor Lobbying, Corruption and Other Banes Nauro F. Campos Brunel University, CEPR and IZA Francesco Giovannoni University of Bristol and CMPO Discussion Paper No. 3693 September 2008 IZA P.O. Box 7240 53072 Bonn Germany Phone: +49-228-3894-0 Fax: +49-228-3894-180 E-mail: [email protected] Any opinions expressed here are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but the institute itself takes no institutional policy positions. The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit organization supported by Deutsche Post World Net. The center is associated with the University of Bonn and offers a stimulating research environment through its international network, workshops and conferences, data service, project support, research visits and doctoral program. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. IZA Discussion Paper No. 3693 September 2008 ABSTRACT Lobbying, Corruption and Other Banes* Although the theoretical literature often uses lobbying and corruption synonymously, the empirical literature associates lobbying with the preferred mean for exerting influence in developed countries and corruption with the preferred one in developing countries. -
Eletrobras Settles Alleged FCPA Violations Revealed Through Brazil's "Operation Car Wash"
Eletrobras Settles Alleged FCPA Violations Revealed Through Brazil's "Operation Car Wash" January 16, 2019 Anti-Corruption/FCPA On December 26, 2018, the U.S. Securities and Exchange Commission ("SEC") settled an enforcement action against Centrais Eléctricas Brasileiras S.A. ("Eletrobras"), an electric utilities holding company majority-owned and controlled by the Brazilian government. This is the second time in 2018 in which the United States government charged a Brazilian state-owned entity with violating the books and records and internal accounting controls provisions of the Foreign Corrupt Practices Act ("FCPA"). As with the September 2018 settlement with Petróleo Brasileiro S.A. ("Petrobras"), the alleged corruption scheme at an Eletrobras subsidiary was uncovered as part of the larger Operation Car Wash ("Lava Jato") in Brazil. Petrobras's settlement, however, involved a coordinated resolution with the U.S. Department of Justice ("DOJ"), the SEC, and the Brazilian Federal Public Ministry ("MPF"). In particular, the Eletrobras enforcement action was based on allegations that spanned from 2009 to 2015, former officers at Eletrobras's majority-owned nuclear power generation subsidiary, Eletrobras Termonuclear ("Eletronuclear"), inflated the costs of infrastructure projects and authorized the hiring of unnecessary contractors. In return, the former officers allegedly received approximately $9 million from construction companies that benefitted from the corrupt scheme. The construction companies also used the overpayment to fund bribes to leaders of Brazil's two largest political parties. The SEC alleged that Eletrobras violated the FCPA by recording inflated contract prices and sham invoices in Eletrobras's books and records, and by failing to devise and maintain a sufficient system of internal accounting controls. -
Anti-Bribery and Corruption Compliance Frequently Asked Questions
Anti-Bribery and Corruption Compliance Frequently Asked Questions Question: What is the FCPA? Answer: The U.S. Foreign Corrupt Practices Act (FCPA) makes it a crime to pay or offer to pay with corrupt intent anything of value (either directly or indirectly) to any “government official” in order to obtain or retain business, or to secure an improper advantage. It also requires that publicly traded companies, like Huron, maintain a system of internal controls and books and records that accurately reflect every transaction. _ Question: What is anything of value? Answer: Anything of value may include, but is not limited to, cash, cash equivalents, discounts, donations, travel expenses, entertainment, stock or gifts. Question: Can I make a payment to expedite the performance of a routine governmental action such as the obtainment of a required license or visa? Answer: No, payments to expedite the performance of a routine governmental action, known as facilitating or “grease” payments, are prohibited by Huron. Question: Can I pay for a client’s travel expenses that are directly related to the promotion or demonstration of Huron products or services; or the execution or performance of a contract? Answer: Yes, as long as these expenses are reasonable and pre-approved by your Managing Director and the Anti-Bribery and Corruption Compliance Officer. Question: Can Huron or I be prosecuted under the FCPA and other anti-bribery statutes, if a bribe is made by a third-party, such as a business finder or agent? Answer: Yes, legal liability is not limited to those who actively participate in illegal conduct. -
Understanding Regulatory Capture: an Academic Perspective from the United States
Chapter 2 Understanding Regulatory Capture: An Academic Perspective from the United States Lawrence G. Baxter Duke Law School In the wake of the Financial Crisis of 2008, the About the Author: Lawrence Baxter is professor of huge Deepwater Horizon oil spill in 2010, and practice of law in the Duke Law School. He has published other industrial catastrophes, the media and extensively in the areas of United States and global academic journals are now replete with charges of banking and regulation; and administrative law. He began that industries have captured their regulators. his academic career at the University of Natal in South Africa, where he held tenure from 1978 to 1984. In 1995, There are well-documented reports of constantly Baxter joined Wachovia Bank in Charlotte, NC, serving revolving doors in which the regulators and the first as special counsel for Strategic Development and regulated frequently change places, of huge later as corporate executive vice president, founding amounts spent by industries in lobbying both Wachovia’s Emerging Businesses and Insurance Group legislators and regulators, and of close social and its first eBusiness Group. He served as chief eCommerce officer for Wachovia Corporation from 2001 relationships that exist between senior regulators to 2006 before returning to Duke in 2009. and executives. A recent Bloomberg BusinessWeek profile describes the “chummy relationship” between the chairman of Citigroup, Sometimes it seems almost as if the United States Dick Parsons, and the Secretary of the United Treasury (not to mention the staff of the White States Treasury, Timothy Geithner, whom Parsons House itself) is run by a cadre of officials who apparently calls “Timmy” – a term that one were either recently members of Goldman Sachs leading Wall Street analyst observes ‘does not or who had spent most of their waking hours exactly acknowledge the authority of the interacting with the CEOs of Goldman, JP Morgan, Secretary, a post once occupied by Alexander 1 Citi and other New York banking giants. -
Greece, Capitalist Interests, and the Specular Purity of the State
Discussion Paper No. 8 Corrupt Compared to What? Greece, Capitalist Interests, and the Specular Purity of the State Peter Bratsis August 2003 The Hellenic Observatory The European Institute London School of Economics and Political Science Acknowledgements This paper was made possible by a research fellowship from the Hellenic Observatory of the European Institute. It is based on a talk given at the London School of Economics on October 22, 2002. Many of the ideas and arguments presented here were developed during discussions with Constantine Tsoukalas, without his input and encouragement this paper would not have been possible. Stanley Aronowitz, John Bowman, Andreas Karras, Lenny Markovitz, Randy Martin, Eleni Natsiopoulou, Frances Fox Piven and Yannis Stavrakakis have read earlier versions of key sections of the current paper and have provided important comments and suggestions. Kevin Featherstone and Dimitris Papadimitriou have been kind enough to read the paper and provide useful criticisms and suggestions. I hope that the arguments contained here are clear and provocative enough to engender discussion. Table of Contents Introduction: Political Corruption and Greece Part I: Legitimation What is Political Corruption? Why Corruption? Rules of Separation: From Leviticus to Washington D.C. The Australian Case: Fetishism Revealed Part II: Accumulation The Opacity of Transparency Instrumental Reason and the Relative Autonomy of the State The Globalization of the Capitalist State Conclusion: Future Directions for Research on Corruption and Greece Works Cited 3 Introduction: Political Corruption and Greece Political corruption is under attack. Technocrats, mainstream academics, and media pundits qua ‘experts’ have increasingly set their sights upon the blight of corruption. -
The Investigation and Prosecution of Police Corruption
Journal of Criminal Law and Criminology Volume 65 | Issue 2 Article 1 1974 The nI vestigation and Prosecution of Police Corruption Herbert Beigel Follow this and additional works at: https://scholarlycommons.law.northwestern.edu/jclc Part of the Criminal Law Commons, Criminology Commons, and the Criminology and Criminal Justice Commons Recommended Citation Herbert Beigel, The nI vestigation and Prosecution of Police Corruption, 65 J. Crim. L. & Criminology 135 (1974) This Criminal Law is brought to you for free and open access by Northwestern University School of Law Scholarly Commons. It has been accepted for inclusion in Journal of Criminal Law and Criminology by an authorized editor of Northwestern University School of Law Scholarly Commons. Tox JouwAx op Canaz AL LAW & CRnmLoaGy Copyright C 1974 by Northwestern University School of Vol. 65, No. 2 Law Printed in U.S.A. CRIMINAL LAW THE INVESTIGATION AND PROSECUTION OF POLICE CORRUPTION HERBERT BEIGEL* INTRODUCTION vestigation and prosecution of police corruption. Within the last few years there has been a This analysis will identify the specific methods marked proliferation of federal investigations and employed by federal prosecutors to subject local 2 prosecutions of state and local officials for official police officials to federal prosecution, thereby misconduct and corruption. So active has the offering insight into the intricacies of the investi- federal government become in investigating the gation of one governmental body by another. In local political arena that state and city politicians addition, the federal investigation of state and and police officers are being investigated, indicted local corruption has raised new questions about and often convicted for a wide variety of violations the proper role of federal law enforcement. -
State Capture Analysis: How to Quantitatively Analyze The
DISCUSSION PAPER No. 2 June 2019 Governance Global Practice State Capture Analysis: Public Disclosure Authorized How to Quantitatively Analyze the Regulatory Abuse by Business-State Relationships Andreas Fiebelkorn Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized This series is produced by Governance Global Practice of the World Bank. The papers in this series aim to provide a vehicle for publishing preliminary results on Governance topics to encourage discussion and debate. The findings, interpretations, and conclusions expressed in this paper are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations, or to members of its Board of Executive Directors or the countries they represent. Citation and the use of material presented in this series should take into account this provisional character. For information regarding the Governance Discussion Paper Series, please contact contact: Ayse Boybeyi, at aboybeyi@ worldbank.org © 2019 The International Bank for Reconstruction and Development / The World Bank 1818 H Street, NW Washington, DC 20433 All rights reserved ABSTRACT Abundant qualitative evidence reveals how public and private actors abuse regulations to seek rents, impede reforms, and distort the economy. However, empirical evidence of such behavior, including its economic costs, remains limited. For that reason, the objective of this paper is to help practitioners who seek to quantitatively analyze state capture make better use of experience, methodologies, and potential data sources. Based on a comprehensive body of existing empirical studies, it provides guidance to analyze state capture and its impact on the economy. Chapter 1 discusses the concept of state capture and its relevance for economic development. -
United Nations Convention Against Corruption
04-56160_c1-4.qxd 17/08/2004 12:33 Page 1 Vienna International Centre, PO Box 500, A 1400 Vienna, Austria Tel: +(43) (1) 26060-0, Fax: +(43) (1) 26060-5866, www.unodc.org UNITED NATIONS CONVENTION AGAINST CORRUPTION Printed in Austria V.04-56160—August 2004—copies UNITED NATIONS UNITED NATIONS OFFICE ON DRUGS AND CRIME Vienna UNITED NATIONS CONVENTION AGAINST CORRUPTION UNITED NATIONS New York, 2004 Foreword Corruption is an insidious plague that has a wide range of corrosive effects on societies. It undermines democracy and the rule of law, leads to violations of human rights, distorts markets, erodes the quality of life and allows organized crime, terrorism and other threats to human security to flourish. This evil phenomenon is found in all countries—big and small, rich and poor—but it is in the developing world that its effects are most destructive. Corruption hurts the poor disproportionately by diverting funds intended for development, undermining a Government’s ability to provide basic services, feeding inequality and injustice and discouraging foreign aid and investment. Corruption is a key element in economic underperformance and a major obsta- cle to poverty alleviation and development. I am therefore very happy that we now have a new instrument to address this scourge at the global level. The adoption of the United Nations Convention against Corruption will send a clear message that the international community is determined to prevent and control corruption. It will warn the corrupt that betrayal of the public trust will no longer be tolerated. And it will reaffirm the importance of core values such as honesty, respect for the rule of law, account- ability and transparency in promoting development and making the world a better place for all. -
Rent Seeking and Corruption in Financial Markets
Rent Seeking and Corruption in Financial Markets Asim Ijaz Khwaja1 and Atif Mian2 1Harvard Kennedy School of Government, Harvard University, Cambridge, Massachusetts 02138 2Department of Economics, University of California, Berkeley, California 94720; email: [email protected] by Harvard University on 02/14/13. For personal use only. Annu. Rev. Econ. 2011.3:579-600. Downloaded from www.annualreviews.org Annu. Rev. Econ. 2011. 3:579–600 Keywords First published online as a Review in Advance on agency issues, financial market design and regulation May 25, 2011 The Annual Review of Economics is online at Abstract economics.annualreviews.org We describe recent advances in the study of rent seeking and This article’s doi: corruption in financial markets. We outline three areas of inquiry: 10.1146/annurev-economics-061109-080310 (a) conceptualizing rent seeking, (b) identifying rent-provision Copyright © 2011 by Annual Reviews. channels and their general equilibrium impact, and (c) designing All rights reserved feasible remedial mechanisms. We provide suggestions for making JEL codes: G2, G3, G18, O16 further progress in these areas and review a variety of approaches 1941-1383/11/0904-0579$20.00 taken in the recent literature. 579 1. INTRODUCTION Financial markets are entrusted with the all-important task of intermediating capital to where it is most productive and maintaining a healthy balance between risk and reward. As a result, rent seeking, to the extent that it distorts this allocation, is deemed costly for an economy. This article draws on some of the recent literature on rent seeking in financial markets in order to present an analytical road map that we hope will be useful for researchers interested in this topic.