The World Bank’s excellent publication Left out of the Bargain -- Settlements in Foreign Bribery Cases and Implications for Asset Recovery (available here in pdf) highlights the thorny issue of how international anti-corruption enforcement can best repatriate tainted assets and proceeds to the victim countries in line with Chapter 5 of United Nations Convention against Corruption. In particular, the study focuses on how national prosecution settlements can impact on the ability of the victim countries to recover the proceeds arising from the substantive corruption.
The study looked at 395 enforcement settlements between 1999-2012. Most of these did not involve the victim countries but arose from their own public procurement programmes. These settlements produced recoveries amounting to $6.9 billion. Quite remarkably, from that amount only $197 million or 3.3% got repatriated to the victim countries that were largely unable to get further redress. Although a number of recent settlements have provided for repatriation of tainted proceeds the amounts involved have been fairly nominal and sporadic.
The study suggests that irrespective of such national settlements:
- the victim countries should take more effective action to recover assets or proceeds arising from bribery and corruption;
- there should be greater co-operation between national enforcement agencies to ensure that victim countries recover tainted proceeds irrespective of a prosecution settlement agreement;
- the victim countries should either seek to become a party to enforcement proceedings, particularly, in civil law jurisdictions, or take individual asset recovery action through if necessary civil forfeiture and private civil proceedings;
- settlements to resolve international corruption cases should be much more transparent and involve the victim countries from inception; and
- the victim countries should be more ready and willing to rescind tainted contracts and projects and initiate debarment of bribe payers irrespective of bilateral settlements.
The publication is a great piece of work with useful comparative examples and constructive suggestions about how victim countries might best tackle the failure to repatriate tainted proceeds. However, what is really needed is an effective and binding international protocol to tackle what will be an increasingly contentious issue.
Alistair Craig is a commercial barrister practicing in London. He can be contacted here.