ations A CONF. 187/9 United Nations Congress Distr. General CPPME 31 December 1999 on the Prevention of crim Original: english and the Treatment of offenders Vienna, 10-17 April 2000 Item 4 of the provisional agenda International cooperation in combating transnational crime new challenges in the twenty-first century International cooperation in combating transnational crime new challenges in the twenty-first century Background paper for the workshop on combating corruption and The workshop on combating corruption will deal with issues related to the prevention control of corruption using a multidisciplinary approach, as advocated in the global Programme against Corruption of the Centre for International Crime Prevention and the United Nations Interregional Crime and Justice Research Institute. According to the Global Programme, the purpose of a national anti-corruption programme is(a)to increase the risk and cost of being corrupt; (b)to build integrity such that the rules of the game and the behaviour of the players change; and(c)eventually to ensure the rule of law Among the few success stories, the experience of Hong Kong Special Administrative Region(SAr)of China should have shown that it takes time and considerable effort to urb corruption in a systemically corrupt environment. After more than 25 years, Hong Kong SAR is now spending 90 million United States dollars per year (1998 figure)and employs 1, 300 staff, who in 1998 conducted 2, 780 training sessions for the private and public sector. The Independent Commission against Corruption(ICAC) is focusing its efforts on three major areas: (a) the Operations Department, which investigates complaints; (b) the Community Relations Department, which conducts community outreach, educational programmes and their development; and(c)the Corruption Prevention Department, which aims at preventing corruption through improved systems and procedures. The amount spent is probably more than all 50 African countries spent on fighting corruption in 1999 A/CONF. 187/ The present paper was prepared by the United Nations Interregional Crime and Justice Research Institute. 99-91376(E)
* A/CONF.187/1. ** The present paper was prepared by the United Nations Interregional Crime and Justice Research Institute. V.99-91376 (E) United Nations A/CONF.187/9 Tenth United Nations Congress on the Prevention of Crime and the Treatment of Offenders Vienna, 10-17 April 2000 Distr.: General 31 December 1999 Original: English Item 4 of the provisional agenda* International cooperation in combating transnational crime: new challenges in the twenty-first century International cooperation in combating transnational crime: new challenges in the twenty-first century Background paper for the workshop on combating corruption** Summary The workshop on combating corruption will deal with issues related to the prevention and control of corruption using a multidisciplinary approach, as advocated in the Global Programme against Corruption of the Centre for International Crime Prevention and the United Nations Interregional Crime and Justice Research Institute. According to the Global Programme, the purpose of a national anti-corruption programme is (a) to increase the risk and cost of being corrupt; (b) to build integrity such that the rules of the game and the behaviour of the players change; and (c) eventually to ensure the rule of law. Among the few success stories, the experience of Hong Kong Special Administrative Region (SAR) of China should have shown that it takes time and considerable effort to curb corruption in a systemically corrupt environment. After more than 25 years, Hong Kong SAR is now spending 90 million United States dollars per year (1998 figure) and employs 1,300 staff, who in 1998 conducted 2,780 training sessions for the private and public sector. The Independent Commission against Corruption (ICAC) is focusing its efforts on three major areas: (a) the Operations Department, which investigates complaints; (b) the Community Relations Department, which conducts community outreach, educational programmes and their development; and (c) the Corruption Prevention Department, which aims at preventing corruption through improved systems and procedures. The amount spent is probably more than all 50 African countries spent on fighting corruption in 1999
A/CONF. 187/9 Taking into account the increasing number of international instruments dealing with corruption, the Workshop will be aimed at promoting coordinated efforts for the and best practices in prevention at the international, national and municipal levels ts development of joint strategies for the implementation of those international instrum A solid and successful anti-corruption strategy advocated rests on four pillars (a)economic development; (b)democratic reform; (c)a strong civil society with access to information and a mandate to monitor the actions of the State; and (d) the presence of the rule of law. Given these four broad principles, there are four basic areas in which action can be taken against corruption within a country (a) The basic institutions of good governance need to be strengthened, first and foremost, the judiciary, which is itself the guardian of laws and of integrity. If the judiciary itself is corrupt, the problem is compounded and the public at large is left without the rule of law: (b) The capacity and integrity of enforcement need to be enhanced. The best law has no value if it is not enforced. The best judges and magistrates are wasted if cases are never brought before them. Good investigations are wasted effort if the police or prosecutors are themselves corrupt (c) A Government needs to put in place a solid set of preventive tools. Codes of conduct and strong independent oversight bodies can help ensure that acceptable standards of behaviour are followed in both the private and public sector. Political leaders in all branches of government, the legislature and the judiciary can be required to have transparency in their own financial dealings through asset disclosure for themselves and members of their families (d) The public needs to be educated on the advantages of good governance. It must also be clear that the public itself bears a large share of responsibility for insisting on honesty and integrity in government and business. Members of the public need to learn not to let anybody buy their votes; not to pay bribes themselves, to report incidents of corruption to the authorities, and to teach their children the right values, for instance, that grity is good and corruption is bad
A/CONF.187/9 2 Taking into account the increasing number of international instruments dealing with corruption, the Workshop will be aimed at promoting coordinated efforts for the development of joint strategies for the implementation of those international instruments and best practices in prevention at the international, national and municipal levels. A solid and successful anti-corruption strategy advocated rests on four pillars: (a) economic development; (b) democratic reform; (c) a strong civil society with access to information and a mandate to monitor the actions of the State; and (d) the presence of the rule of law. Given these four broad principles, there are four basic areas in which action can be taken against corruption within a country: (a) The basic institutions of good governance need to be strengthened, first and foremost, the judiciary, which is itself the guardian of laws and of integrity. If the judiciary itself is corrupt, the problem is compounded and the public at large is left without the rule of law; (b) The capacity and integrity of enforcement need to be enhanced. The best law has no value if it is not enforced. The best judges and magistrates are wasted if cases are never brought before them. Good investigations are wasted effort if the police or prosecutors are themselves corrupt; (c) A Government needs to put in place a solid set of preventive tools. Codes of conduct and strong independent oversight bodies can help ensure that acceptable standards of behaviour are followed in both the private and public sector. Political leaders in all branches of government, the legislature and the judiciary can be required to have transparency in their own financial dealings through asset disclosure for themselves and members of their families; (d) The public needs to be educated on the advantages of good governance. It must also be clear that the public itself bears a large share of responsibility for insisting on honesty and integrity in government and business. Members of the public need to learn not to let anybody buy their votes; not to pay bribes themselves; to report incidents of corruption to the authorities; and to teach their children the right values, for instance, that integrity is good and corruption is bad
A/CONE.187八9 Contents L. Introduction 1-5 A. Consequences of corruption 14-195 B. Top-level corruption 20-226 C. Corruption in public administration and the criminal justice system 23-24 D. Corruption in the private sector 25-28 7 The ed A. National measures 34-44 B. Prevention 45-48 C. Use of statistical data to understand the dimensions of corruption 49-5610 D. Future areas of concern 57-6111 IV. International experience and activities A. United Nations 64-6811 European Union 69-7012 C. Organisation for Economic Cooperation and Development 71-7413 D. Council of Europe 75-7713 E. World Bank 78-8114 F Other bodies and mechanisms V. Measures required to succeed in the fight against corruption 88-9015 IV. Conclusion
A/CONF.187/9 3 Contents Paragraphs Page I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-5 4 II. Aspects and causes of corruption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-33 4 A. Consequences of corruption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14-19 5 B. Top-level corruption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20-22 6 C. Corruption in public administration and the criminal justice system . . . . . . . . . 23-24 6 D. Corruption in the private sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25-28 7 E. The link to organized crime . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29-33 7 III. Responses to corruption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34-61 8 A. National measures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34-44 8 B. Prevention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45-48 9 C. Use of statistical data to understand the dimensions of corruption . . . . . . . . . . . 49-56 10 D. Future areas of concern . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57-61 11 IV. International experience and activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62-87 11 A. United Nations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64-68 11 B. European Union . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69-70 12 C. Organisation for Economic Cooperation and Development . . . . . . . . . . . . . . . . 71-74 13 D. Council of Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75-77 13 E. World Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78-81 14 F. Other bodies and mechanisms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82-87 14 V. Measures required to succeed in the fight against corruption . . . . . . . . . . . . . . . . . . . . 88-90 15 IV. Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91-94 17
A/CONF. 187/9 I. Introduction (c) Prevention and best practices (d) Recommended executive, law enforcement 1. The topic of corruption has long been a priority of legislative, private sector, civil society and international the Commission on Crime prevention and criminal measures Justice. The United Nations Interregional Crime and Justice Research Institute (UNICRI) has been 5. The sessions of the workshop will aim at promoting entrusted with the organization of a workshop or the best practices approach advocated in the global combating corruption within the framework of the Programme, by bringing such practices to the attention Tenth United Nations Congress on the Prevention of of potential donor and recipient countries. Particular Crime and the Treatment of Offenders The attention will be devoted to issues of prevention, taking preparatory work for the workshop has included, in into consideration their potential effectiveness in cooperation with the International Scientific and raising the risk of being caught when combined with Professional Advisory Council of the United Nations (a) a strong political will; (b)increased balancing of power across the legislative, judiciary and executive, Crime Prevention and Criminal Justice Programme, (c)an empowered civil society; and(d) the existence of the organization of an International Conference on free and independent media with access to information Responding to Challenges of Corruption in Milan Italy, on 19 and 20 November 1999 to confront corruption 2. In its resolution 54/128 of 17 December 1999 entitled"Action against corruption", the General II. Aspects and causes of corruption Assembly stressed the need for a global strategy against corruption, and invited Member States to 6. There is a general consensus that, although the most examine the adequacy of their domestic legal regimes serious consequences to the economic and social in terms of preventing and controlling corruption and development of a country are likely to come from the providing for forfeiture of the proceeds of corruption pread of corruption at the upper levels, citizens 3. The Office for Drug Control and Crime Prevention of perception is related for the most part to their own the Secretariat has recently launched a Global Pro- first-hand experience with public administration at the gramme against Corruption(E/CN. 15/1999/CRP 3), to "street"level. While bribery was seen for many years be undertaken jointly by the Centre for International as a way of getting things done in most developing Crime Prevention and uNiCri The Global countries and countries with economies in transition Programme is aimed at assisting Member States in this"greasing the wheel" syndrome has turned into their efforts to curb corruption through two sanding the wheel". This change in perception is due components, assessment and technical cooperation in part:(a)at the international level, to the recent The first component involves the development of a economic crisis in Asia, which, according to many corruption-monitoring protocol for a thorough experts, was triggered in part by inadequate corporate assessment of corruption at all levels, while the second governance practices(e.g. inadequate accountability omponent envisages the implementation of a set of and transparency)and(b)at the national level, to the chnical assistance activities aimed at building and/or fact that citizens who give bribes are actually less strengthening institutional capacity to prevent, detect, likely to be satisfied with the service received than investigate and repress corruption those not paying bribes, as shown by data from surveys in Uganda(1998), Ukraine(1999)and the United 4. The workshop on combating corruption will adopt Republic of Tanzania(1997). In the United Republic of the multidisciplinary approach advocated in the Global Tanzania, survey participants who did not pay a bribe Programme and discussed at the Milan Conference according to the following structure were 2.9 times as likely to find a higher level of service provided On the other hand, those who paid bribes (a) Aspects and causes of corruption: the three were 1.7 times more likely to receive poor service than levels of corruption, the organized crime nexus, good service. In fact only 13 per cent of those surveyed (b) Measures against corruption at the international paid a bribe and received good service and national levels
A/CONF.187/9 4 I. Introduction 1. The topic of corruption has long been a priority of the Commission on Crime Prevention and Criminal Justice. The United Nations Interregional Crime and Justice Research Institute (UNICRI) has been entrusted with the organization of a workshop on combating corruption within the framework of the Tenth United Nations Congress on the Prevention of Crime and the Treatment of Offenders. The preparatory work for the workshop has included, in cooperation with the International Scientific and Professional Advisory Council of the United Nations Crime Prevention and Criminal Justice Programme, the organization of an International Conference on Responding to Challenges of Corruption in Milan, Italy, on 19 and 20 November 1999. 2. In its resolution 54/128 of 17 December 1999, entitled “Action against corruption”, the General Assembly stressed the need for a global strategy against corruption, and invited Member States to examine the adequacy of their domestic legal regimes in terms of preventing and controlling corruption and providing for forfeiture of the proceeds of corruption. 3. The Office for Drug Control and Crime Prevention of the Secretariat has recently launched a Global Programme against Corruption (E/CN.15/1999/CRP.3), to be undertaken jointly by the Centre for International Crime Prevention and UNICRI. The Global Programme is aimed at assisting Member States in their efforts to curb corruption through two components, assessment and technical cooperation. The first component involves the development of a corruption-monitoring protocol for a thorough assessment of corruption at all levels, while the second component envisages the implementation of a set of technical assistance activities aimed at building and/or strengthening institutional capacity to prevent, detect, investigate and repress corruption. 4. The workshop on combating corruption will adopt the multidisciplinary approach advocated in the Global Programme and discussed at the Milan Conference, according to the following structure: (a) Aspects and causes of corruption: the three levels of corruption, the organized crime nexus; (b) Measures against corruption at the international and national levels; (c) Prevention and best practices; (d) Recommended executive, law enforcement, legislative, private sector, civil society and international measures. 5. The sessions of the workshop will aim at promoting the best practices approach advocated in the Global Programme, by bringing such practices to the attention of potential donor and recipient countries. Particular attention will be devoted to issues of prevention, taking into consideration their potential effectiveness in raising the risk of being caught when combined with: (a) a strong political will; (b) increased balancing of power across the legislative, judiciary and executive; (c) an empowered civil society; and (d) the existence of free and independent media with access to information to confront corruption. II. Aspects and causes of corruption 6. There is a general consensus that, although the most serious consequences to the economic and social development of a country are likely to come from the spread of corruption at the upper levels, citizens’ perception is related for the most part to their own first-hand experience with public administration at the “street” level. While bribery was seen for many years as a way of getting things done in most developing countries and countries with economies in transition, this “greasing the wheel” syndrome has turned into “sanding the wheel”. This change in perception is due in part: (a) at the international level, to the recent economic crisis in Asia, which, according to many experts, was triggered in part by inadequate corporate governance practices (e.g. inadequate accountability and transparency) and (b) at the national level, to the fact that citizens who give bribes are actually less likely to be satisfied with the service received than those not paying bribes, as shown by data from surveys in Uganda (1998), Ukraine (1999) and the United Republic of Tanzania (1997). In the United Republic of Tanzania, survey participants who did not pay a bribe were 2.9 times as likely to find a higher level of service provided. On the other hand, those who paid bribes were 1.7 times more likely to receive poor service than good service. In fact only 13 per cent of those surveyed paid a bribe and received good service.1
A/CONF. 187/9 7. Types of corruption have been classified the case of high-level corruption, national decision ways in the literature. For example, distinctions can be makers holding political and administrative office. made between" petty or survIval"and "grand"11. Finally, developed countries are also susceptible to rruption, or between“ episodic”and“ systemIc corruption. Another distinction has been made corruption as a result of elite groups establishing closed networks in which distinctions between private between"simpleand"complex "corruption as it is observed in European countries. This paper will refer and public interests become blurred to three levels-"street, "business and top12. A further multiplier of corruption is the increasing Programme against Corruption involvement of organized crime. As occurs in the business world, the influence of organized crime over 8. In discussions of the issue of corruption, a distinction public structures through the corruption of public must be made between the supply and the demand side officials is linked for the most part with international of that activity. Corruption involving the supply side whether exports o focuses on the payment of bribes in return for specific context, it should be noted that a close relationship services, preferential treatment or contracts, while exists between tax rates, trade barriers and the corrupt practices occurring on the demand side include involvement of organized crime solicitation of bribes and/or extortion. The latter is 13. As a rule, corruption goes hand in hand with abuse of typical of corruption involving political and financial power, political and economic monopolies and powers. organized crime. Thus, cultural, political, economic 9. Countries that are in a developing phase are most and legal measures, including criminal justice,to susceptible to corruption. This is basically the result of prevent and fight corruption cannot be divorced from hange in the needs of civil society as it moves broader processes of political democratization, towards a consumer society in combination with economic and social development and reliability o imperfectly organized and enforced public and judicial financial and legal transactions. To implement effective administrations. Previously existing corruption at the action against corruption, commitment on the part of street level thus provides a hotbed for corruption at he government at the highest level must be publicly higher levels. Greed, social injustice, peer pressure demonstrated by providing a good example to all and a lust for social status and power may all be sectors of civil society, including politicians, business contributing factors. Since corruption is in a narrow public administration and the private sector sense a victimless crime, the low risks of discovery and punishment do little to decrease the prevalence of these factors. Additionally, certain country-specific A. Consequences of corruption factors, such as population size and natural resources also appear to be strongly linked with the prevalence 14. The consequences of corruption are disastrous both of bribery and corruption for the economy in general and for the citizens in 10. Countries that are radically reforming their economic particular. The pain caused by corruption at the village and political systems, such as many central and eastern level has best been described by more than 3, 500 European countries during the 1990s, are confronted villagers participating in 348 focus groups facilitated with corruption in the business sector and at the high by Community Information, Empowerment political and financial levels. Their exposure stems Transparency(CIET)in Uganda in 1998 mainly from the strong impact of reforms on their 15. Corrupt behaviour, such as bribery, also produces national economy, through the large-scale external costs in the form of"added taxes", which are privatization of former state-owned properties, such as mainly shouldered by the national economy. This enterprises, buildings and other holdings, which are an undermines efficient allocation of badly needed important part of national economic value. The new financial resources for economic development, in opportunities arising from the distribution of such particular in developing countries, and is distorting the property increases the appeal of obtaining illegal composition of public expenditure advantages. The actors in this context are not only national or international business people, but also, in
A/CONF.187/9 5 7. Types of corruption have been classified in many ways in the literature. For example, distinctions can be made between “petty” or “survival” and “grand” corruption, or between “episodic” and “systemic” corruption.2 Another distinction has been made between “simple” and “complex” corruption as it is observed in European countries.3 This paper will refer to three levels— “street”, “business” and “top” political and financial—as referred to in the Global Programme against Corruption. 8. In discussions of the issue of corruption, a distinction must be made between the supply and the demand side of that activity. Corruption involving the supply side focuses on the payment of bribes in return for specific services, preferential treatment or contracts, while corrupt practices occurring on the demand side include solicitation of bribes and/or extortion. The latter is typical of corruption involving political and financial powers. 9. Countries that are in a developing phase are most susceptible to corruption. This is basically the result of a change in the needs of civil society as it moves towards a consumer society in combination with imperfectly organized and enforced public and judicial administrations. Previously existing corruption at the street level thus provides a hotbed for corruption at higher levels. Greed, social injustice, peer pressure and a lust for social status and power may all be contributing factors. Since corruption is in a narrow sense a victimless crime, the low risks of discovery and punishment do little to decrease the prevalence of these factors.4 Additionally, certain country-specific factors, such as population size and natural resources, also appear to be strongly linked with the prevalence of bribery and corruption.5 10. Countries that are radically reforming their economic and political systems, such as many central and eastern European countries during the 1990s, are confronted with corruption in the business sector and at the high political and financial levels. Their exposure stems mainly from the strong impact of reforms on their national economy, through the large-scale privatization of former state-owned properties, such as enterprises, buildings and other holdings, which are an important part of national economic value.6 The new opportunities arising from the distribution of such property increases the appeal of obtaining illegal advantages. The actors in this context are not only national or international business people, but also, in the case of high-level corruption, national decision makers holding political and administrative office.7 11. Finally, developed countries are also susceptible to corruption as a result of elite groups establishing closed networks in which distinctions between private and public interests become blurred. 12. A further multiplier of corruption is the increasing involvement of organized crime. As occurs in the business world, the influence of organized crime over public structures through the corruption of public officials is linked for the most part with international transactions, whether exports or imports. In that context, it should be noted that a close relationship exists between tax rates, trade barriers and the involvement of organized crime. 13. As a rule, corruption goes hand in hand with abuse of power, political and economic monopolies and organized crime. Thus, cultural, political, economic and legal measures, including criminal justice, to prevent and fight corruption cannot be divorced from broader processes of political democratization, economic and social development and reliability of financial and legal transactions. To implement effective action against corruption, commitment on the part of the Government at the highest level must be publicly demonstrated by providing a good example to all sectors of civil society, including politicians, business, public administration and the private sector. A. Consequences of corruption 14. The consequences of corruption are disastrous both for the economy in general and for the citizens in particular. The pain caused by corruption at the village level has best been described by more than 3,500 villagers participating in 348 focus groups facilitated by Community Information, Empowerment, Transparency (CIET) in Uganda in 1998.8 15. Corrupt behaviour, such as bribery, also produces external costs in the form of “added taxes”, which are mainly shouldered by the national economy. This undermines efficient allocation of badly needed financial resources for economic development, in particular in developing countries, and is distorting the composition of public expenditure