Wednesday, August 31, 2011

Fighting Corruption - Successes, Challenges, and Staying the Course

Fighting Corruption - Successes, Challenges, and Staying the Course
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In December 2010, the World Bank hosted national authorities—“corruption hunters,” as we like to call ourselves—286 senior representatives from 134 countries. Our aim was to improve cooperation and thereby help resolve those cases of transnational bribery which might otherwise fall through the jurisdictional cracks that surround individual entities. By engaging national authorities from around the world, we can maximize the impact of our and their investigations, and build a cadre of crime fighters vested in protecting the interests of development. On April 13 this year, we released a results matrix that can be used to measure the activities of anticorruption authorities in order to increase our collective global effectiveness in the fight against crime.

As a young prosecutor in South Africa, I learned to litigate against small-time fraudsters, gangsters, and dishonest bureaucrats. Later, I graduated to organized-crime syndicates, market manipulators, and corrupt politicians who abused public office for personal gain. It became abundantly clear to me that when you deal with criminals, you have to be cleverer than they are, so that you can play by the rules and still come out ahead.

Recently, The Economist ran a piece about “harassment bribes,” or the small bribes citizens in India must pay in order to receive routine public services. Under the current system, someone who makes this kind of payment is equally liable under the law as the person who accepts the bribe. The proposed law change would allow citizens to file complaints, free from fear of prosecution, and to also receive a refund for their coerced payments. The payer of a harassment bribe would no longer face legal penalties (hence the legalization of the bribe-giving); the receiver of the bribe, however, would still be engaging in illegal activity. It is an untested and provocative idea that tries to weaken the demand side of corruption and repay its victims. The approach demonstrates how old problems can be addressed from a new perspective.

What other ideas lurk just outside our consciousness and are worth exploring? Should public institutions funnel the ill-gotten proceeds of corruption into a well-managed fund that compensates victims? If social media can mobilize protests against corruption, how can it also trigger, what Mr. Zoellick has called for, “a moral revulsion as well as a legal reaction to corruption”?

As you may have surmised from my remarks, while I like to push boundaries, I have utmost respect for the rule of law. Back in 1776 amidst another revolution, Adam Smith advocated the rule of law as an indispensable prerequisite for a society to flourish. It is a theme that has resonated throughout American history, and lies at the heart of economic recovery and prosperity.

Leonard F. McCarthy is Vice President for Integrity at the World Bank."