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corruption

Fixing Fraud in Public-Private Projects

Leonard McCarthy's picture

Available in 中文

What’s a cash-tight government to do when it wants to modernize a hospital, build a railway, or expand the power grid to reach underserved areas? It might explore outside, private sources of financing—that’s where public-private partnerships (PPPs) come in.   The acronym has a promising ring to it, yet going back to the 1970s, its impact has been mixed.  At their best, PPPs can provide rapid injections of cash from private financiers, delivery of quality services, and overall cost-effectiveness the public sector can’t achieve on its own.

But at their worst, PPPs can also drive up costs, under-deliver services, harm the public interest, and introduce new opportunities for fraud, collusion, and corruption.  Our experience at the World Bank Integrity Vice Presidency is that because PPPs most often are geared toward providing essential public services in infrastructure, health and education, the integrity risks inherent in these sectors also transfer to PPPs.

On April 17, the Integrity Vice Presidency convened a public discussion on corruption in PPPs (pdf) bringing together finance, energy, and fairness-monitoring perspectives.  Looking at the landscape, in the last eight years, 134 developing countries have implemented PPPs in infrastructure, and in the last decade the World Bank has approved some $23 billion lending and risk guarantee operations in support of PPPs.

Weekly Wire: the Global Forum

Kalliope Kokolis's picture

These are some of the views and reports relevant to our readers that caught our attention this week.

BET
Like Water for Internet: Ory Okolloh Talks Tech in Africa

“Last week, ahead of her trip to Washington, D.C., to speak to the World Bank about Africa’s private sector, the 35-year-old Policy Manager for Google Africa took to her Twitter account and asked her followers, “What should I tell them?”
The responses came in fast and varied from rants about corruption in multinational corporations to comments about infrastructure and energy. For the most part, Okolloh didn’t engage the responses, but she did re-tweet them for all to read and she made sure to add the World Bank’s twitter account to the dispatches so that the behemoth institution could also see what Africa’s tweeting populace had to say.” READ MORE

Weekly Wire: the Global Forum

Kalliope Kokolis's picture

These are some of the views and reports relevant to our readers that caught our attention this week.

BET
Like Water for Internet: Ory Okolloh Talks Tech in Africa

“Last week, ahead of her trip to Washington, D.C., to speak to the World Bank about Africa’s private sector, the 35-year-old Policy Manager for Google Africa took to her Twitter account and asked her followers, “What should I tell them?”

The responses came in fast and varied from rants about corruption in multinational corporations to comments about infrastructure and energy. For the most part, Okolloh didn’t engage the responses, but she did re-tweet them for all to read and she made sure to add the World Bank’s twitter account to the dispatches so that the behemoth institution could also see what Africa’s tweeting populace had to say.” READ MORE

Tunisia's Cash Back: The start of more to come?

Jean Pierre Brun's picture

Asset recovery is helping to restore justice for Tunisia's citizens (Credit: European Parliament, Flickr Creative Commons)

It is welcome news that Tunisia has received $28.8 million corruptly acquired by the country’s former President Zine El Abidine Ben Ali. The money emanates from a Lebanese bank account held by M. Ben Ali’s wife, and was handed over in the form of a check to Tunisia’s current President Moncef Marzouki, by Ali bin Fetais al-Marri, Qatari attorney-general and the UNODC Special Advocate on Stolen Asset Recovery.

Walk the talk and fight illicit flows

Jean Pesme's picture

Credit: Images_of_Money, Flickr Creative Commons

A hornet’s nest has been stirred up by the leak of millions of financial files by the International Consortium of Investigative Journalists (ICIJ) in collaboration with journalists around the world. The ICIJ says that its work reveals more than 120,000 offshore companies and trusts, exposing the hidden dealings involving politicians, businessmen and others. While authorities around the world are assessing the validity of these documents, the extent of the information emanating from the British Virgin Islands, the Cook Islands and elsewhere is revealing in many ways. Importantly it is a rebuff to those who claim that there is no problem with the workings and transparency of the international financial system. Whatever the veracity of the allegations contained in the ICIJ report, they reveal the extent of highly complex and secret financial and corporate structures, and their cross-border nature.  These revelations have already spurred some to call for more regulation by governments.

Weekly Wire: the Global Forum

Kalliope Kokolis's picture

These are some of the views and reports relevant to our readers that caught our attention this week.

The Washington Post
An incredible map of which countries e-mail each other, and why

“The Internet was supposed to let us bridge continents and cultures like never before. But after analyzing more than 10 million e-mails from Yahoo! mail, a team of computer researchers noticed an interesting phenomenon: E-mails tend to flow much more frequently between countries with certain economic and cultural similarities.

Among the factors that matter are GDP, trade, language, non-Commonwealth colonial relations, and a couple of academic-sounding cultural metrics, like power-distance, individualism, masculinity and uncertainty. (More on those later.)”  READ MORE

Mayors Behaving Badly

Debra Lam's picture

Prison cell inside Alcatraz, San Francisco, CAEarly this year, former Mayor of New Orleans (2002-2010), Ray Nagin was charged with using his office for personal gain, accepting more than $160,000 in bribes and gifts in exchange for city contract work after Hurricane Katrina, as well as other city benefits.1 In total, a federal grand jury charged Nagin with 21 counts of corruption, including bribery, conspiracy, money laundering, wire fraud, and false tax returns. Nagin’s deputy mayor, Greg Meffert already pleaded guilty to accepting bribes and kickbacks for influencing city contracts in 2010. Nagin was Mayor of New Orleans when Hurricane Katrina hit, which makes the charges all the more damming. One of the worst natural disasters to hit the US, Katrina killed almost 2000 people across five states. FEMA’s estimated damage totaled $108 billion.2 New Orleans was especially hard hit, with the infamous levees and other infrastructure failing, and widespread socio-economic despair. Of course there were many factors, including the federal and state responses or lack thereof that made preparing for and rebuilding New Orleans challenging. But a strong mayor would have benefited New Orleans tremendously, and Nagin was not up to the task.

Weekly Wire: the Global Forum

Kalliope Kokolis's picture

These are some of the views and reports relevant to our readers that caught our attention this week

Biz Community
How to speed up change for women in the workplace

“The theme of International Women's Day 2013, on 8 March, is "The Gender Agenda: Gaining Momentum". There are many signs of this momentum in Africa - from female entrepreneurship, which is driving growth in the region, to the fact there are female government ministers or heads of state in South Africa, Ghana, Liberia, Malawi and Rwanda.

In fact, Rwanda, with 56% of seats in its House of Deputies held by women, is currently the only government in the world dominated by women, putting the East African country well ahead of the United States, United Kingdom and Japan, which all fall below the 25% mark.

So, there is momentum, but not enough of it. For instance, the global downturn appears to have worsened gender gaps in employment, according to the International Labour Organisation.”  READ MORE

Realizing the Potential of Right to Information

Anupama Dokeniya's picture

Right to Information (RTI) laws can be a useful instrument for improving transparency – if the political will for implementation is sustained, and if the broader governance environment provides the enabling conditions for the exercise of the law. A research project that studied the implementation of RTI laws in a number of countries showed that implementation has been very uneven across countries. In some countries, RTI laws had been leveraged effectively for extracting information in a number of important areas, ranging from public expenditures, to performance and procurement, and exposing instances of corruption. In other countries, the existence of an RTI law had little impact in any of these areas, and oversight and capacity building mechanisms had either not been set up, or not functioned effectively.

The findings of the study are not surprising. The implementation gap between de jure and de facto reforms in countries faced with capacity constraints and political economy challenges is well-known. Yet, international agencies have pushed policy reforms without adequate attention to the constraints and challenges of implementation. The pressure to win support and legitimacy with international aid agencies has been an important driver of the adoption of RTI laws. The right has also been recognized in international human rights conventions, and more recently has gained increasing international attention (for instance, the existence of a law is one of the considerations for membership in the Open Government Partnership). Further, pressure from domestic constituencies has also propelled political actors to champion the law. But, once passed, capacity limitations, the erosion of political will, and active resistance have been important impediments to realizing the potential of RTI.

Bringing the banks to account

It began as a trickle but has turned into a flood. HSBC, Barclays, Wachovia, JP Morgan, and UBS have all been engulfed by waves of scandal involving, money laundering, fixing interest rates, risky trades, and rigging the money markets. The question now is – have the banks gone bad? The claim by senior bank executives they ‘we did not know’ rings hollow, and must not be allowed to stand if they are to regain their integrity. 

The banks have long resisted greater hands-on supervision of their activities, but the recent rash of publicity surrounding their bad conduct proves that left to their own devices market discipline is not enough. Their involvement in dubious transactions, including in greasing the wheels of corruption through money laundering requires the full implementation of existing rules and regulation, and empowered supervision. The World Bank’s Stolen Asset Recovery Initiative (StAR) along with Financial Market Integrity (FMI) have long pressed for the banks to do more to prevent money laundering and to fight corruption.  As a rough estimate, it is believed that $20 – $40 billion is stolen from the coffers of developing countries every year. Much of it ends up being laundered through the banks, passing through financial capitals around the world en route to the beneficiaries. Mechanisms to detect illicit cash flows have long been in place, but the existing system is not working, and corruption is eating away at the foundations of the banking system.


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