Bovill in collaboration with the ICA’s Corruption Awareness Week

19 May 2017

The future of ABC

‘To some degree it matters who’s in office, but it matters more how much pressure they’re under from the public’, Noam Chomsky. It could be argued that it is worldwide public outcry that has been the trigger for governments around the globe to sit up, take notice and commit to actions to tackle bribery and corruption.

In March 2015 Transparency International (TI) published their study, ‘Corruption On Your Doorstep: How Corrupt Capital Is Used to Buy Property in the UK’ which found London is seen as a global magnet for corrupt funds due to high property prices and lax rules on the disclosure of property ownership. This was compounded in July 2015, when the Channel 4 documentary ‘From Russia with Cash’ was aired.

An undercover reporter posed as a Russian government minister to investigate the increasing evidence that the London property boom is being partly fuelled by overseas buyers laundering money. These events prompted the UK Prime Minister at the time to vow to do more to tackle global corruption when he delivered the message that ‘London is not a place to stash your dodgy cash’. What these examples show is that bribery and corruption is a global issue which is generating increasing public outcry and it requires international coordination.

The direction of travel is clear – anti-bribery and corruption (ABC) is finally firmly on the agenda of government agencies, non-governmental organisations, media outlets and the public.

As a result, over the coming years we should expect to see:

  • more international collaboration
  • strengthening legislative frameworks
  • increased enforcement action, and
  • a global attempt to uplift firms’ compliance standards.

More international collaboration
In May 2016 the UK hosted representatives from more than 40 countries at the Anti-Corruption Summit. The Summit sought to ‘galvanise a global response to tackle corruption’ and agree steps to expose corruption, punish perpetrators and drive out the culture of corruption.

The measures announced at the Summit included:

  • an international anti-corruption coordination centre (IACCC) will be created in London and hosted by the UK’s National Crime Agency (NCA) in partnership with the US, Canada, Australia, New Zealand, Germany, Switzerland and Interpol to strengthen cross border investigations and recover stolen assets
  • 18 countries agreed to enter into law enforcement partnerships to help strengthen anti-corruption agencies by sharing best practices and technical assistance
  • 40 jurisdictions with major financial centres will share beneficial ownership information between governments, and
    a Global Asset Recovery Forum will be set up to focus on asset recovery assistance to Nigeria, Ukraine, Tunisia and Sri Lanka.

It is a clear step in the right direction that representatives from these countries committed to actions to tackle corruption, but more work remains to be done with those countries which were not represented at the Summit. We may find that as public and political pressure increases on governments, more countries pledge to do more to tackle these issues. On the other hand, we may find a widening divergence in legislation, between countries that have committed and those that have not.

Whilst the UK spearheaded this campaign, as part of its country statement submitted at the Summit, Singapore outlined it would ensure law enforcement agencies had timely access to ownership information and would share information with other law enforcement agencies. These commitments of cross-border cooperation were demonstrated where Singaporean authorities worked closely with their overseas counterparts to investigate the corruption scandal surrounding Malaysia’s state development fund, 1MDB. With so much international focus and coordination, we are likely to see more investigations which start locally lead to enforcement action spanning multiple jurisdictions. However, we might also see increased competition between countries’ regulatory bodies as they each seek to demonstrate their authority and take a slice of any enforcement penalties.

Download the full article  The future of ABC.

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