Compliance Training As Foreign Aid

Eighteen senior government officials from Afghanistan will receive anti-corruption training in Singapore through an international aid package.

A report last week by Channel News Asia said the week-long training program is part of a $1 million technical assistance package that Singapore pledged at the International Conference on Reconstruction Assistance to Afghanistan.

The training seminar will be hosted by the Singapore Civil Service College. It will include visits to Singapore's Corrupt Practices Investigation Bureau and Supreme Court. Two professors from Japan's Meiji University will also be on the faculty.

We've said before that foreign aid can cause corruption, mainly by helping corrupt regimes stay in power. And because corrupt regimes are the most unstable, aid also fuels civil unrest. But aid in the form of anti-corruption training can create real change.

Singapore is well qualified to help Afghanistan's civil servants fight corruption. It ranked at the top of the latest Corruption Perceptions Index, joining Denmark and New Zealand as the least corrupt countries on earth. Afghanistan ranks just two spots from the bottom, at 176.

Singapore's transfer of technical assistance to fight corruption makes loads of sense. Let's hope the idea spreads beyond Kabul.

Journalists Killed For Covering Graft

More than half the journalists murdered in the line of duty were working to expose corruption.

"Murder, after all, is the ultimate form of censorship," wrote Robert Mahoney, deputy director of the Committee to Protect Journalists (CPJ).

In a story that first appeared in The Media magazine and is now available here, Mahoney said 44 journalists were killed last year as a direct result of their work, eight of them in Africa, and 145 were thrown in prison.

Since 1992, the CPJ reports 861 journalists killed in the line of duty. The 10 deadliest countries have been:

Iraq: 149
Philippines: 71
Algeria: 60
Russia: 52
Colombia: 43
Pakistan: 35
Somalia: 34
India: 27
Mexico: 25
Afghanistan: 22

Editors, Mahoney said, are usually afraid to write about the big fish in corruption stories, so they tackle the small fry.

But not always.

"Only a few courageous writers progress far up the chain to the political and business elites who cream off a country’s wealth," Mahoney said. "Among them are editor Abdou Latif Coulibaly, who has taken on Senegal’s elite, exposing corruption in a US$200 million government deal for a telecom licence. He is now facing three separate criminal defamation lawsuits."

Deloitte And Kabul Bank: Accounting And Accountability

Corruption in Afghanistan is back in the news -- even if our 100,000 troops serving there are not.

Last month, the U.S. government suspended an auditing team from Deloitte who didn't flag massive corruption at Kabul Bank before it nearly failed last fall.

This week, Afghan President Hamid Karzai ordered the bank to be dissolved. He also ordered the country's attorney general to investigate fraud at the bank.

According to the Washington Post, the five-member Deloitte team had been on the audit since 2009. Deloitte billed USAID more than $657,000 a month for the five experts at the bank.

“Some of the Deloitte guys saw signals of corruption and fraud but didn’t tell” USAID, said a senior U.S. official quoted anonymously in the Washington Post. The official said the report concluded that the Deloitte accountants should have known about the problems at Kabul Bank.

In a statement to the Washington Post, a Deloitte spokesperson said, “We were not Kabul Bank’s independent auditor. Our services did not include supervising or conducting bank examinations at Kabul Bank prior to Kabul Bank being put in conservatorship in September 2010.”

After revelations in September that the country's biggest commercial bank loaned about $900 million in now-missing funds to its own shareholders, including a brother of President Karzai, most Western donor nations stopped all aid to Afghanistan.

Some of the loans to the bank's shareholders weren't backed by collateral, the Washington Post said, and were "used to invest in luxury real estate projects in Dubai and other dubious ventures."

Mark Dillen, a spokesman for USAID in Kabul, told the paper, “The U.S. does not, and indeed should not, have an operational role in supervising Afghan banks. U.S. efforts are appropriately focused on capacity-building, particularly with regard to strengthening the integrity of the financial system.”

Wikileaks And The FCPA

Will disclosures by Wikileaks ever lead to prosecutions under the Foreign Corrupt Practices Act?

Maybe. The whistleblower site said this week that among the classified U.S. diplomatic cables it plans to publish soon will be some alleging corruption in foreign governments.

Reuters is reporting that politicians in Russia, Afghanistan, and other Central Asian nations will be named.

The U.S. government is said to be warning other countries of embarrassing allegations contained in the State Department communications.

Wikileaks said it will be releasing 2.8 million secret documents but didn't give further details. It leaked 77,000 classified papers on the Afghan War in July and 400,000 Pentagon reports from the Iraq war last month.

It isn't known yet if any corporations or individuals subject to the FCPA or similar laws are named in the diplomatic cables in connection with corrupt payments to foreign officials, or if past or potential FCPA enforcement actions are discussed.

The Bribes Of War

War is not only hell, it's corrupt too.

Of the bottom ten countries on Transparency International's 2010 Corruption Perception Index, six have active wars, insurrections, or major civil disturbances.

Included are Burundi, Chad, Sudan, Iraq, Afghanistan, Myanmar, and bottom-dweller Somalia.

TI's Shantal Uwimana told VOA that conflict is a major contributing factor in the spread of corruption. "Countries where there is a level of political, social, and economic instability, corruption tends to find a fertile ground," he said.

An active-duty U.S. military officer wrote to us last year from a war zone, saying: "As readers of the FCPA Blog know, it is always unwise for governments to trample the rule of law. Because, as veterans of our recent overseas campaigns know, people without laws cannot be governed at all."

Some recent headlines from the DOJ confirm that conflict corruption infects not just local politicians but everyone in the vicinity:

October 8, 2010 - Army Major Sentenced to 21 Months in Prison for False Statements Charge Related to Attempt to Smuggle Currency from Iraq to the United States

September 24, 2010 - Former U.S. Army Staff Sergeant Pleads Guilty to Bribery in Afghanistan Fuel Theft Scheme

September 2, 2010 - Former Senior Employee With U.S. Military Contractor Pleads Guilty To Bribery Scheme Related To Contracts In Support Of Iraq War

Of 178 countries ranked by TI, peaceful Denmark, New Zealand, and Singapore scored best.

The survey doesn't measure actual corruption but perceptions of it.

It can be downloaded here.