Fighting Corruption to Improve Global Security: An Analysis of International Asset Recovery Systems
By Mark V. Vlasic and Jenae N. Noell
From Volume 5, Issue 2 – Spring/Summer 2010: Spotlight on Security
Abstract
Typically not counted among the battles to be waged in the fight for global security, Mark V. Vlasic and Jenae N. Noell argue that stemming corruption through stolen asset recovery programs has the ability to fortify the rule of law and reduce state impunity in the developing world.
It is widely recognized that corruption is a threat to the stability of societies the establishment and maintenance of the rule of law and economic and political progress. Any meaningful solution to the problem must account for the recovery of the assets derived from corruption.
—UN General Assembly when negotiating the UN Convention against Corruption[i]
I. Introduction
While much of the intellectual discussion regarding the fight for global security has focused on religious extremism in fragile states, it is critical to understand that international corruption remains one of the most important and challenging battles in the fight. Corruption, ever the enemy of stability, threatens the integrity of state systems, erodes the rule of law, weakens state capacity to respond to crime, and endangers the citizens who live among it.[ii] According to a study by the Danish Institute for International Studies, most fragile states rank in the bottom 20th percentile of control of corruption on the World Bank Governance Indicators.[iii] Thus, it is no surprise that many of the world’s most unstable and least-governed states are also those with the highest levels of corruption.[iv]
A detrimental byproduct of poor governance and the instability stemming from corruption is increased opportunity for criminal entrepreneurs. Taking advantage of weak law enforcement and vulnerable gaps within legal infrastructure, criminal enterprises maneuver in and out of corrupt countries with considerable ease compared to countries where corruption is absent. Drug trafficking, human trafficking, and terrorist activities are among the most threatening activities plaguing corrupt countries. One example of this can be seen in West Africa where security institutions of fragile states like Cote d’Ivoire, Guinea Bissau, and Sierra Leone are hampered by corruption making their borders easily penetrable by cocaine traffickers and the like, threatening the security of the entire region.[v] Afghanistan is another example of how corruption and a burgeoning poppy industry threaten the creation and growth of stable institutions. With the potential to affect multiple countries, in addition to the countries from which they operate, as we are currently seeing in West Africa and Afghanistan, the devastating effect of corruption on global security emphasizes the importance and urgency of anticorruption efforts, as their successes encompass much more than simply confiscating European villas from former kleptocratic dictators. Indeed, this was one reason for the negotiation and adoption of the United Nations Convention against Corruption, the first truly global and comprehensive anticorruption treaty.[vi]
Equally important in this effort, and necessary for a meaningful solution to corruption and fighting the impunity that is so often associated with economic crime, is that anticorruption measures provide for the recovery of illicit assets derived from corruption.[vii] But while at first glance the benefits from asset recovery efforts may appear to be purely economic in nature, their underlying rationale, according to the World Bank and the United Nations Office on Drugs and Crime’s Stolen Asset Recovery (StAR) Initiative, should be to help enforce the rule of law. As a measure of accountability, asset recovery is an essential component to improving global security. Experts indicate that between $20-40 billion is stolen from developing countries through corrupt practices each year.[viii] In Africa alone, the African Union has reported that corruption contributes to a 25 percent loss of the continent’s GDP, or $150 billion dollars each year.[ix] Of the hundreds of billions stolen over the course of the last fifteen years, only $4.9 billion has been recovered, a far cry from the potential possessed by the current systems and programs in place today.[x]
This article will explore the role of stolen asset recovery programs as one component in global good governance efforts to improve the rule of law and strengthen state security. It argues that asset recovery, as a measure of accountability, has the potential to reduce impunity thereby detrimentally impacting global corruption schemes. Section II will examine Afghanistan’s pervasive corruption quandary, demonstrating the inextricable link between corruption and security. Section III will provide an overview of the UN Convention against Corruption, as well as obstacles and advances in implementation. Section IV will explore international efforts to recover stolen assets since the inception of UNCAC and the StAR Initiative; and lastly, section V will illustrate a few significant asset recovery cases in developing countries highlighting the recent successes and future challenges of asset recovery.
II. Understanding the Entanglement of Corruption and Security Through Afghanistan
There are few better examples of the link between security and corruption than in Afghanistan. According to Transparency International’s Corruption Perception Index (CPI), Afghanistan ranks 179 out of 180, falling 63 levels from its position in 2005, faring better than only Somalia for the most corrupt country in the world.[xi] A poor and war-torn country, Afghanistan has the support of some of the most powerful and wealthiest countries in the world—from the North, and the Global South—as well as the military backing of the world’s preeminent security alliance, the North American Treaty Organization (NATO), yet it seems unable or unwilling to combat the internal virus of corruption that is jeopardizing its very survival, as well as the goodwill of those willing to help it. This has lead to criticism from those in the international community, as well as those internal to Afghanistan, and has raised critical concern for the country’s security. Antonio Maria Costa, executive director of UNODC, recently commented that, “Corruption is the biggest impediment to improving security, development and governance in Afghanistan.”[xii] His comments echoed many of those made by former Afghan Minister of Finance Ashraf Ghani during his recent bid for president. Referring to the three main threats to Afghanistan’s stability—al Qaeda, the local insurgency and drug trafficking—he noted that, “Bad governance and corruption have created the vacuum to allow for the three other threats to be consolidated. Unless we, and until we address this central issue of the threat that emanates from bad governance, we are not going to make a break.”[xiii]As Candace Rondeaux, a senior analyst for the International Crisis Group, adeptly notes, the coverage of corruption is missing a “nexus between power and security.”[xiv] Upon recognizing this connection, the need for measures of accountability becomes clearer, and we can see how utilizing international legal assistance to recover stolen assets can be a powerful tool. But without domestic political will to fight corruption and recover stolen assets, and the help of the international community, such efforts are challenging.
With an estimated $2.5 billion paid out in bribes in 2009—approximately one-quarter of Afghanistan’s GDP—it becomes apparent that many of those in power are using their influence for their own personal and vested interests.[xv] According to a March 2010 United Nations report detailing pervasive corruption in Afghanistan, the Afghan government is often “unable to deliver basic services, such as security, food or shelter, or protect communities from lawlessness.”[xvi] This corruption, which has been highlighted by President Barak Obama and acknowledged by Afghan President Hamid Karzai, is contributing to the collapse of public confidence in government and a resurgence of the Taliban.[xvii] General Stanley McChrystal decried the situation in a recent report, stating, “The weakness of state institutions, malign actions of power brokers, widespread corruption, and abuse of power by various officials, and ISAF’s (the International Security Assistance Force) own errors, have given Afghans little reason to support their government.”[xviii] In a 2006 survey conducted by Tiri, an independent non-governmental organization working with governments, business, and civil society to improve integrity, over half of the Afghan survey respondents, living across thirteen provinces of Afghanistan, felt that police and military corruption reduced their personal safety.[xix] Unsurprisingly, a majority of the survey respondents also noted that they felt the Karzai administration was more corrupt than the Taliban and the Mujahideen.[xx]Such a survey aptly illustrates public perception of the direct and inextricable link between corruption and security.
This downward trajectory illustrates the deft mobilization capabilities of corruption, and invokes concern in the anticorruption community—as well as the hope that robust, comprehensive anticorruption measures will be included in on-going Afghan reconstruction efforts. Such measures, particularly when backed by all elements of the international community, can strengthen legal systems, increase security by deterring and decreasing criminal activity, and improve the overall lives of citizens. While Afghanistan does not appear to be lacking international support since ratifying the United Nations Convention against Corruption in 2008, the country is fighting an uphill battle to change laws that were designed to “ensure opportunities for corruption.”[xxi] Despite an active anticorruption office, Deputy Chief Ershad Ahmadi is still without investigative authority to enforce recommendations.[xxii] Such impediments contribute to Afghanistan’s corruption and security quandary.
While the corruption and security challenges faced by Afghanistan present a timely and relevant case study, these challenges are not unique to this single fragile state. Indicative of the anticorruption challenge facing fragile states around the world, from West Africa, where the world’s newest “narco-states” threaten the stability of an entire region, to Cambodia where corruption affects nearly every aspect of public life, the necessity for purposeful solutions to disentangle corruption from the institutions that protect society pervades many states in the developing world.
III. United Nations Convention against Corruption – Treaty & Implementation
The Treaty
As the nexus between corruption and security becomes increasingly clear, the international community is slowly responding. Over the last twenty years, international and national efforts to combat corruption have varied across the board. In need of a global authority on anticorruption matters, members of the international community worked together to negotiate the United Nations Convention against Corruption, which entered into force in 2005.[xxiii] With the creating of UNCAC, the world saw its first legally binding, global and comprehensive anticorruption framework. By consolidating elements of past years’ efforts and including both international and national obligations, UNCAC has become the most widely accepted international authority in the battle against global corruption.
UNCAC serves an important role by providing states with another tool in their good governance—i.e., better security—toolbox. When states fully implement the Convention, accountability, whether it is in the legal system or financial institutions is supposed to become paramount—thereby improving good governance and state security. Along the spectrum of measures that should be taken to ensure security, holding illicit actors accountable for violating laws is essential to strengthening governance and deterring future bad conduct.
A critical element of such international anticorruption efforts is the recovery of assets obtained through corruption. The reason why this is so important is not simply the repatriation of scarce state assets that can ideally be directed toward development, but also that the process of accountability can have positive spillover effects in terms of generating a climate of rule of law. In this respect, UNCAC outlines asset recovery as a “fundamental principle” of the Convention, and requires state parties to “…afford one another the widest measure of cooperation and assistance in this regard.” Chapter V of the Convention lays out the asset recovery measures and mechanisms to be implemented by the state parties. What makes Chapter V distinctive from past asset recovery efforts is its multifaceted approach, which incorporates preventative, punitive and international cooperation elements into the general legal framework. The Convention also imposes obligations on both the public and private sector, which include financial institutions, public officials and national courts. To give these measures teeth, the Convention provides sanctions for non-compliance by those institutions or persons who fail to cooperate with UNCAC’s requirements.
Since corruption oftentimes involves cross-border issues, it is no surprise that UNCAC places international cooperation and collaboration at the forefront of its agenda. Proactive, forward thinking provisions, such as Article 56, placing an affirmative duty on state parties to take measures, without prior request of a receiving state party to assist in initiating or carrying out an investigation, prosecution or judicial proceeding are included—refreshing measures that set UNCAC apart from its predecessors.
Perhaps more unique however are the Convention’s provisions for direct recovery of stolen assets. In an attempt to resolve years-long delays that often accompany international asset recovery litigation, UNCAC seeks to provide a more direct and expeditious method of recovery by requiring that state parties permit civil suits by other state parties in their national courts and conversely, that state parties recognize the judgments of other state party courts. This strategy provides citizens and public interest groups with a financial incentive to find and eradicate corruption. While timely recovery is not always the case, a few recent examples discussed below demonstrate that there is cause for some optimism.
Implementation – Obstacles and Advances
While UNCAC provides a foundation for fighting corruption and thereby helping ensure good governance and security to the countries that choose to embrace it, continued progress remains difficult when countries fail to fully implement the foundational legal instrument from which their obligations derive. Since its entry into force in 2005, the UNCAC has gained worldwide recognition, as evidenced by the 140 states that have committed to undertake the Convention’s obligations. Despite the high number of state parties, implementation at the national level has been slow moving. Contributing factors include lack of political will, ill-equipped institutional frameworks, and lack of resources and manpower.
The presence or absence of political will can significantly affect the pace by which a state implements its asset recovery agenda.[xxiv] Since the decision to pursue grand corruption is usually a political decision, political support is crucial to mobilize resources and secure collaboration of partner agencies.[xxv] But often, when states compare the costs of pursuing an asset recovery agenda to uncertain benefits, the risk of stepping outside the status quo is more than they are willing to take on. While political pressure placed on governments can facilitate a willingness to honor international commitments, this pressure is generally accompanied by moral and reputational considerations and driven by financial and law enforcement incentives.[xxvi] Regardless of politics, the responsibility of implementing UNCAC obligations into domestic systems ultimately rests with the individual state parties. Diverse legal systems and varying legal standards however often make it difficult to introduce new concepts and procedures into existing legal systems. Varying between common and civil law systems, civil and criminal asset recovery approaches, and burdens of proof, the modifications and amendments expected of states can be onerous.
In addition to political will and legal challenges, weak state capacity to undertake asset recovery operations further hinder anticorruption efforts. The StAR Initiative notes that “Many developing countries lack the capacity to prepare indictments, collect, preserve and present evidence, properly adjudicate cases and obtain convictions, as well as trace the proceeds of corruption and obtain valid freezing and confiscation orders.”[xxvii] More broadly, law enforcement’s limited capacity to effectively prevent asset theft and recover stolen assets in an internationally accepted manner has proven to be a great challenge highlighting a need for technical and operational assistance.[xxviii]
Some countries have fared better than others at implementing their international obligations. Among the front-runners returning illicit funds to pilfered nations are Switzerland, the United Kingdom and the United States.[xxix] Indeed, Switzerland, a country known in the past for its privacy in banking, has proven to be a trendsetter in the pursuit of corrupt leaders in possession of ill-gotten gains. Through progressive banking regulation reforms, Switzerland has made it more difficult than in years past, for corrupt leaders to hide behind the private banking veil of secrecy.[xxx]
Even the front-runners, however, are not without their challenges. After returning stolen assets looted from such notables as Sani Abacha, Ferdinand Marcos and Vladimiro Montesinos, Switzerland was recently confronted by the limits of their current legislation, despite making great strides to implement international agreements into their domestic legal system. After a decision by the Federal Office of Justice finding that approximately $6 million stolen by former dictator Jean-Claude “Baby Doc” Duvalier should be returned to the people of Haiti, the Federal Supreme Court called the decision into question citing an issue with the statute of limitations on asset restitution.[xxxi] With the stolen assets currently frozen while the Federal Council awaits the approval of a legal amendment to rectify the problem, the issue highlights the technical difficulties countries face when dealing with illicit funds.
These issues highlight the need for an effective review mechanism to identify and assist in eliminating barriers and monitor overall implementation. In November 2009, at the Conference of States Parties of the United Nations Convention against Corruption, in Doha, Qatar, state parties adopted a review mechanism. Some, such as the UNCAC Civil Society Coalition, are disappointed, citing the mechanism’s non-mandatory provisions for civil society involvement and its failure to set up an effective review body as a few of the contributing factors to their disappointment. In the meantime, UNCAC state parties are assisted by a number of other review mechanisms to assist in anticorruption efforts. In addition to UNCAC’s self-assessment checklists, which cover fifteen articles of the Convention, including Chapter V on asset recovery, the Financial Action Task Force (FATF) is currently assisting 124 countries to identify areas in their national systems that need strengthening.[xxxii]
IV. International Support of Global Asset Recovery Efforts
Strengthening state institutional frameworks, through important global agreements such as UNCAC, is but one front on which the fight must be won. However, for such agreements to be effective, they must be implemented and actually used. Underscoring the necessity of practical assistance in this endeavor, a joint effort by the World Bank Group and the United Nations, the StAR Initiative, launched in September 2007, serves as one important component of the global “good governance” and anticorruption agenda. Acting as a support system for international efforts to deter the illicit flow of the proceeds of corruption, StAR “combines policy analysis, the development of knowledge products and capacity building, while simultaneously developing a portfolio of country programs that can deliver results on the ground.”[xxxiii] Such a comprehensive program, if utilized, particularly in countries where a legal infrastructure to pursue foreign dictators in a criminal court is absent, has the potential to provide accountability, improve good governance and thereby strengthen state security.
Over the past decade we have witnessed the positive effect that international collaboration can have on asset recovery litigation. In the Swiss case involving former Haitian President Jean-Claude Duvalier, a Swiss court ordered approximately $6 million of misappropriated public funds to be returned to the people of Haiti. While the effort, led by the Haitian and Swiss governments, and assisted by the StAR Initiative, has since encountered difficulties — as stated above — it does illustrate that incremental success can result when members of the international community work together to pursue a common goal.[xxxiv]
The fact that the StAR Initiative played a role in the Duvalier matter—the first time ever that the international community, in the form of the World Bank and the UN, worked together to help recover stolen assets—is a cause for optimism, in that our international institutions are finally working together to help fight the impunity that is so often associated with economic crime. StAR, working with Haiti’s government officials and lawyers, provided the Haitian government with critical technical and diplomatic assistance in an area that few developing countries have the necessary expertise to achieve asset recovery success.
Indeed, what started as a modest effort to help countries track down and recover stolen assets, has slowly come to the forefront of the international community’s development discussion as an international development tool that can be used by developed and developing countries alike to help end the devastating effects of grand corruption. The StAR Initiative has also increased its efforts in areas outside of the Bank’s traditional expertise, partnering with law enforcement and other operational cooperatives to complete the asset recovery cadre of experts and best practice. However, as the body of knowledge, partnerships, and expertise grows, so does the need for stronger commitments to utilize these resources to strengthen legal infrastructure to improve internal security. More attention to this topic is needed before large-scale efforts can be made to translate international discussion into international action.
Technical Capacity Inroads
In line with these sentiments, in a September 2008 meeting, the Open-ended Intergovernmental Working Group on Asset Recovery identified information sharing and increasing knowledge on asset recovery as top priorities. In response, StAR expanded its efforts to mirror these priorities. The StAR Initiative’s agenda is supported by three primary components: (1) increasing global knowledge and advocacy; (2) providing assistance in the recovery of stolen assets; and, (3) building national capacity. While all three components remain in operation, StAR has placed the development of knowledge products and policy analysis, already its priority in 2009, at the top of its agenda for 2010. Commitment to this agenda is manifested in a series of “how-to” guides, practice tools and handbooks, such as the Asset Recovery Handbook, which serves as a reference work covering jurisdictional requirements, best practices, common challenges and modern solutions for asset recovery.
Tasked by the G20’s request to “develop mechanisms for strengthening global cooperation” and strengthening enforcement standards related to “the identification of beneficial ownership and monitoring of politically exposed persons,” StAR is currently analyzing policy through a series of studies and surveys. In one study, which focuses on politically exposed persons (PEPs), the StAR Initiative identifies best practices and makes key recommendations that will assist financial institutions with their obligations in conducting enhanced scrutiny on PEPs. This is a useful addition to the fight against unjust enrichment—especially in developing countries trying to ensure for the security of their own people—in that PEP databases are generally private, incomplete, and there is little incentive to improve them without further government stipulations on quality control and comprehensiveness. Similarly, through a “Barriers” survey that will study fifteen financial centers, experts will attempt to identify country-specific barriers that impede asset recovery at the national level and make necessary recommendations to assist in improving country procedures.
Operational Capacity Inroads
As INTERPOL’s Secretary General Ronald K. Noble noted, “Corruption undermines everything the law enforcement community works towards. It impoverishes whole communities, and threatens the safety and security of the many for the benefit of a very few.”[xxxv] In the law enforcement context, corruption is of particular concern in view of the fact that corruption in one country can compromise an entire international investigation and affect many other nations.[xxxvi] Consequently, organizational capacity is perhaps one of the more important components of anticorruption efforts when a state’s primary concern is security. Many officials in countries attempting to ensure basic security to their citizens, such as Iraq, Afghanistan and Haiti, long to fight the impunity of economic corruption, but have neither the technical capacity nor the organizational capacity to do so. While programs like the StAR Initiative demonstrate great advances in technical capacity, StAR does not have the manpower, or the full-time technical skills, to investigate the world’s numerous asset recovery cases. To account for this gap, individual countries and regional cooperatives have taken the lead.[xxxvii]
In an effort to devise a more integrated, strategic approach to asset recovery, INTERPOL, the world’s only international law enforcement organization, recently established a partnership with the StAR Initiative to connect its law enforcement expertise to the technical and administrative support provided by the StAR Initiative.[xxxviii] Included in more recent efforts to strengthen the coordination of law enforcement bodies, INTERPOL recently launched the Asset Recovery Focal Point Database, a multi-faceted resource that not only assists in the coordination of international investigations, but also provides technical assistance on the logistics of investigations in particular foreign venues. In addition to a “24/7” emergency assistance contact list, which provides immediate assistance and coordinates investigatory efforts even after the period of urgency desists, the database includes contact details for initial inquires into asset recovery procedure and the amount/type of evidence needed to open criminal investigations or initiate civil action regarding stolen assets in foreign jurisdictions.[xxxix]
Close collaboration between the investigatory and legal aspects of asset recovery is necessary if a country expects be successful in their recovery efforts. In countries with limited resources or where the political will to pursue asset recovery is weak, ad hocinvestigatory systems are set up to investigate individual cases. On the other hand, in countries where political commitment is present, multi-agency structures have seen great success in coordinating national and international cases throughout the asset recovery process.[xl]
Recognizing the battle against corruption as one of its key objectives, the United States employs a multi-agency structure in its efforts to ferret out corruption and recover stolen assets. By designating U.S. Immigration Customs Enforcement (ICE) as a primary agency to investigate corruption cases, ICE leads coordinated efforts with the Department of State, the Department of Justice, and other federal law enforcement to seek out and return stolen money. Though some have said that this intra-agency agency effort is understaffed, underfunded and underprioritized, this Foreign Corruption Investigations Group has made impressive strides: ICE has initiated 182 investigations, made 80 criminal arrests, secured 148 indictments, and seized over $131 million in stolen assets.[xli] One wonders what it could do with adequate resources.
V. Recent Developments in Asset Recovery
With the international framework, and legal, technical and operational capacity established, the next challenge is transforming the anticorruption component of the global security agenda into action. Utilizing measures put in place by UNCAC and global partners, asset recovery litigation is a powerful tool that is not only used to recover billions of dollars of stolen assets to be used for development, but communicates a strong message that accountability is paramount and eliminates the impunity that weakens the stability of governing institutions.
In courtrooms across the world, asset recovery efforts have been making steady progress in their charge to hold corrupt leaders accountable. At least part of the success can be attributed to the development of more defined global and national legal frameworks addressing the proceeds of corruption. One such example, presently ongoing in a national court, is the case of APDHE v. Obiang Family, where a Canary Islands court admitted a criminal complaint against Equatorial Guinean President Obiang and his family members, alleging the crime of money laundering for illegally diverting large sums of public funds to purchase private real estate in Spain.
Equatorial Guinea is one of the wealthier nations in the world, rich in hydrocarbon deposits and undeveloped natural resources, yet its citizens live in desperate poverty.[xlii]As one of the worst governed countries in the world, with a far reaching system of corruption, the executive regularly enforces unlawful land expropriations to benefit a limited few, namely those related or close to President Obiang.
In a recent effort, the Open Society Justice Initiative is leading an attempt to fight corruption in Equatorial Guinea through a human rights mechanism—the African Commission on Human and Peoples’ Rights. In APDHE v. Equatorial Guinea, a complaint alleges that the Equatorial Guinea government’s plundering of national oil revenues violates the right of the Equatorial Guinean people to freely dispose of their natural wealth, a right protected by the African Charter. In this case we are witnessing the beginning of what could be a great leap forward for citizens victimized by kleptocracy. By seeking accountability and repatriation through a human rights vehicle, victims are given a voice, which has the potential to change public perception of anticorruption efforts and strengthen the measures currently in place.
However, with every few steps forward, it is not uncommon for an occasional step back. Asset recovery progress is certainly no exception. This was most recently seen last year with the dismissal of a complaint that alleged several African heads of state and their families’ had acquired property in France with misappropriated public funds. Regrettably, the French Court of Appeal ruled that Transparency-International (France), an anticorruption NGO, could not bring a complaint against foreign heads of state. The court’s decision represents a significant setback for organizations with respect to how they file complaints. It also reveals a recurring weakness present in asset recovery efforts, not only in France, but globally. This weakness, as stated above, is that state parties to the UNCAC are failing to adequately implement UNCAC into their national legislation. This serves as an important reminder of the work that still lies ahead.[xliii]
VI. Conclusion
Traditionally, much of the debate regarding security and corruption has taken place in separate corners, by separate constituencies, often focusing on separate audiences. Those focused on security—largely defense ministries and national security-related think thanks—have focused on the tools they have in their own tool box—weapon systems and troop levels—while those focused on the fight against corruption—non-profits, activists and multilateral organizations—tend to be more attentive to intellectual discussions regarding political economy than applying such ideas in war-torn corners of the world. Sadly, there was little overlap between these worlds. But as the world’s attention has focused more on fragile states and their ability to foster terror and insecurity on a global scale, these two conversations are being brought closer together. Military officers are talking openly of fighting corruption, hand-in-hand with discussions regarding military tactics and operational maneuvers. Meanwhile, multilateral institutions such as the World Bank, have transformed internal discussions regarding what was once referred to as “the ‘C’ word,” to high-profile efforts to fight corruption and recover stolen assets, such as the StAR Initiative. In each case, both constituencies are starting to have frank and open discussions regarding the impact of corruption on the security of states and their people.
It can only be hoped that these discussions continue and escalate, and that they involve all relevant parties—military, multilateral, NGOs, activists and academics—in a concerted effort to tackle grand corruption as an integral effort to ensure the stability of states. Central to such efforts is the recovery of assets plundered by such corruption, and while a recognition of the linkage between security and corruption is already a substantial step forward, the next big step will be the recognition of the need for collective international responsibility to prohibit grand corruption and recover stolen assets as one more element of the fight against impunity and ensuring state security.
Julie McCarthy served as the lead editor of this article.
About the Authors
Mark V. Vlasic (B.S./B.A., J.D., cum laude, Georgetown University; Fulbright Scholar, Leiden University; Certificate, Hague Academy of International Law) served as a public sector specialist at the World Bank and head of operations of the Stolen Asset Recovery Initiative. A former White House Fellow and special assistant to the secretary of defense, and member of the Slobodan Milosevic prosecution team, he is now a senior fellow at Georgetown University’s Institute for Law, Science & Global Security and a partner at Ward & Ward PLLC (www.wardlawdc.com), where he focuses on international law and asset recovery issues.
Jenae N. Noell (LL.M., Georgetown University; J.D., cum laude, California Western School of Law) practiced law as a criminal prosecutor in California for five years.
Endnotes
[i] “Global Study on the Transfer of Funds of Illicit Origin, Especially Funds Derived From Acts of Corruption” (report presented to the Ad Hoc Committee for the Negotiation of a Convention Against Corruption, January 13–24, 2003).
[ii] According to one U.S. government official: “Corruption undermines the rule of law, threatens the principles of democracy, and impedes economic development. It poses a significant threat to government infrastructure and erodes the trust of the public, creating an unstable environment where criminal and terrorist organizations flourish…[C]orrupt actions hamper U.S. national security interests, foreign assistance goals, and the security of the United States against transnational crime and terrorism. Kleptocracy perpetuates the cycle of poverty, instability, and crime that denies the most vulnerable nations and people prosperity.” Janice Ayala, “Keeping Foreign Corruption Out of the United States: Four Case Histories” (testimony before the U.S. Senate Committee on Homeland Security and Governmental Affairs Permanent Subcommittee on Investigations, Washington, D.C., February 4, 2010).
[iii] All thirteen states appearing on both the Low-Income Countries Under Stress (LICUS) and the Fragile States indexes, all rank in the bottom 20th percentile for control of corruption on the World Bank Governance Indicators. “Corruption In Fragile States,” The Danish Institute for International Studies, October 2008.
[iv] “The Failed States Index 2009,” Foreign Policy, http://www.foreignpolicy.com/articles/2009/06/22/2009_failed_states_index_interactive_map_and_rankings.
[v] Christian Strohmann, “More Cocaine Smuggled From Americas to Europe via Fragile States,” Suite101.com, http://crime.suite101.com/article.cfm/un_to_combat_drug_trafficking_in_west_africa#ixzz0kT7kCNwb.
[vi] “Global Study on the Transfer of Funds of Illicit Origin, Especially Funds Derived From Acts of Corruption” (report presented to the Ad Hoc Committee for the Negotiation of a Convention Against Corruption, January 13-24, 2003).
[vii] Ibid.
[viii] The World Bank and the United Nations Office of Drugs and Crimes (UNODC), Stolen Asset Recovery: Toward a Global Architecture for Asset Recovery, http://siteresources.worldbank.org/EXTSARI/Resources/5570284-1257172052492/GlobalArchitectureFinalwithCover.pdf?.
[ix] “Corruption risk analysis in Southern Africa,” Transparency International, http://www.transparency.org/news_room/in_focus/2007/nis_africa.
[x] These figures were calculated by the StAR Initiative on the basis of major judgments reported. The World Bank and the United Nations Office of Drugs and Crimes (UNODC), Stolen Asset Recovery: Toward a Global Architecture for Asset Recovery, http://siteresources.worldbank.org/EXTSARI/Resources/5570284-1257172052492/GlobalArchitectureFinalwithCover.pdf?.
[xi] “Transparency International Corruption Perceptions Index 2009,” Transparency International, http://www.transparency.org/policy_research/surveys_indices/cpi/2009/cpi_2009_table.
[xii] “Corruption Widespread In Afghanistan, UNODC Survey Says,” United Nations Office on Drugs and Crime, http://www.unodc.org/unodc/en/frontpage/2010/January/corruption-widespread-in-afghanistan-unodc-survey-says.html.
[xiii] Joshua Kucera, “Afghanistan: Corruption Is The Mother Of Insurgency — Presidential Challenger” Eurasianet.org, http://www.eurasianet.org/departments/insightb/articles/eav042809a.shtml.
[xiv] Heidi Kingstone, “Corruption in Afghanistan,” Huffington Post, http://www.huffingtonpost.com/heidi-kingstone/corruption-in-afghanistan_b_440078.html.
[xv] Stephanie Nebehay, “Corruption Deepens Poverty in Afghanistan-U.N. Report,” Reuters, March 30, 2010.
[xvi] Ibid.
[xvii] Dexter Filkins, “Afghan corruption: Everything For Sale,” New York Times, January 2, 2009.
[xviii] Gen. Stanley McChrystal, “Commander’s Initial Assessment,” August 30, 2009, http://media.washingtonpost.com/wp-srv/politics/documents/Assessment_Redacted_092109.pdf
[xix] “The Problem,” TIRI-Making Integrity Work, http://www.tiri.org/index.php?option=com_content&task=view&id=39&Itemid=
[xx] Ibid.
[xxi] Ian Timberlake, “Afghan Anticorruption Office Needs Muscle.” Telegraph.co.uk, Nov. 10 2009.
[xxii] Ibid.
[xxiii] “United Nations Convention Against Corruption,” United Nations Office of Drugs and Crime, http://www.unodc.org/documents/treaties/UNCAC/Publications/Convention/08-50026_E.pdf.
[xxiv] Ivan Pavletic, “The Political Economy of Asset Recovery Processes,” International Centre for Asset Recovery, 2009.
[xxv] The World Bank and the United Nations Office of Drugs and Crimes (UNODC), Stolen Asset Recovery: Toward a Global Architecture for Asset Recovery, http://siteresources.worldbank.org/EXTSARI/Resources/5570284-1257172052492/GlobalArchitectureFinalwithCover.pdf?.
[xxvi] Ivan Pavletic, “The Political Economy of Asset Recovery Processes,” International Centre for Asset Recovery, 2009 and The World Bank and the United Nations Office of Drugs and Crimes (UNODC), Stolen Asset Recovery: Toward a Global Architecture for Asset Recovery, http://siteresources.worldbank.org/EXTSARI/Resources/5570284-1257172052492/GlobalArchitectureFinalwithCover.pdf?.
[xxvii] The World Bank and the United Nations Office of Drugs and Crimes (UNODC), Stolen Asset Recovery Initiative: Challenges, Opportunities, and Action Plan, June 2007.
[xxviii] The World Bank and the United Nations Office of Drugs and Crimes (UNODC), Stolen Asset Recovery Initiative: Challenges, Opportunities, and Action Plan, June 2007.
[xxix] Tamara Walid, “Corruption Costs Poorer States Up To $40 Billion A Year,” Reuters, November 7, 2009.
[xxx] Federal Department of Foreign Affairs, “Dictators’ assets (potentate funds),” Schweizerische Eidgenossenschaft, http://www.eda.admin.ch/eda/en/home/topics/finec/intcr/poexp.html and Federal Department of Foreign Affairs, “Banking Secrecy,” Schweizerische Eidgenossenschaft, http://www.eda.admin.ch/eda/en/home/topics/finec/bank.html.
[xxxi] Ibid.
[xxxii] The World Bank and the United Nations Office of Drugs and Crimes (UNODC), Stolen Asset Recovery: Toward a Global Architecture for Asset Recovery, http://siteresources.worldbank.org/EXTSARI/Resources/5570284-1257172052492/GlobalArchitectureFinalwithCover.pdf?.“Stolen Asset Recovery: Toward a Global Architecture for Asset Recovery,” World Bank, http://web.worldbank.org/
[xxxiii] Progress Report July 2009, World Bank and United Nations Office of Drug and Crime, 2009.
[xxxiv] “World Bank Welcomes Steps by Swiss Government to Ensure Stolen Funds Go To Haiti,” ENP Newswire, February 8, 2010.
[xxxv] Ibid.
[xxxvi] Ibid.
[xxxvii] “Recovering Stolen Assets: A Problem of Scope and Dimension,” Transparency International, http://www.transparency.org/publications/publications/working_papers/wp_01_2009_stolen_assets.
[xxxviii] “About Corruption,” INTERPOL, http://www.interpol.int/Public/Corruption/about.asp.
[xxxix] “Asset Recovery On the Road To Doha: Activities Under the Stolen Asset Recovery Initiative” (paper presented to the Open-Ended Intergovernmental Working Group on Asset Recovery, Vienna, Austria, May 14-15, 2009).
[xl] The World Bank and the United Nations Office of Drugs and Crimes (UNODC), Stolen Asset Recovery: Toward a Global Architecture for Asset Recovery, http://siteresources.worldbank.org/EXTSARI/Resources/5570284-1257172052492/GlobalArchitectureFinalwithCover.pdf?.
[xli] Janice Ayala, “Keeping Foreign Corruption Out of the United States: Four Case Histories” (testimony before the U.S. Senate Committee on Homeland Security and Governmental Affairs Permanent Subcommittee on Investigations, Washington, D.C., February 4, 2010).
[xlii] “Corruption and Its Consequences in Equatorial Guinea,” Open Society Justice Initiative, http://www.soros.org/initiatives/justice.
[xliii] “With Development Aid Seen As Being Crucial To Ending Conflict, the Stakes of Getting Global Institutions Functioning Correctly Is Even Higher,” BBC.com, http://news.bbc.co.uk/2/low/africa/8570884.stm.