GENEVA, SWITZERLAND – The London Wapping offices of News Corp, owner of British tabloid The Sun, were raided by Scotland Yard police early Saturday 28 January and during the morning Saturday four journalists and a police officer were arrested. The journalists are all current or former Sun journalists. The Metropolitan Police issued a statement that “Today’s operation is the result of information provided to police by News Corporation’s Management and Standards Committee. It relates to suspected payments to police officers and is not about seeking journalists to reveal confidential sources in relation to information that has been obtained legitimately.”
The raid and arrests are part of an investigation dubbed Elveden into police corruption that involves The Sun possibly paying police for news information.
Links to other sites: Financial Times, Guardian, Reuters
GENEVA, SWITZERLAND – The Global Fund, which disburses monies from other organizations to fight Aids, malaria and tuberculosis, is celebrating its 10th birthday this week with a special gift: the Bill Gates Foundation, which gave $650 million during the Fund’s first decade, has just announced it is giving an additional $750m.
The news, announced by Gates at the World Economic Forum meeting in Davos, Switzerland, came a day after the Global Fund announced that Columbian Gabriel Jaramillo has been appointed general manager, a new position “intended to oversee a process of transformation as it accelerates the fight against the three pandemics by focusing on its management of risk and grants.” Jaramillo is the former chairman and chief executive officer of Sovereign Bank and he has more than 35 years in executive positions in the financial industry.
The gift is larger than the promised cash, for it is helping breath new life into an organization that went on the defense last year after corruption, which the Fund itself had uncovered and was investigating, was brought into the limelight by US media, notably the Associated Press, which is owned by US newspapers and is widely distributed there.
Jaramillo, although in a new position, replaces Michel Kazatchkine, executive director, who announced his retirement this week. The new general manager reports to the board and has full executive responsibility for the Global Fund.
Gates, in Davos, praised the group’s track record and commitment to improved oversight, noting that problems with misuse of funds happens if you’re doing business in Africa.
His remarks refer to changes that are the result of a 2011 review by what is called the High-Level, Independent Panel assigned to look at financial controls and oversights. It was headed by former US Health and Human Services Secretary Michael Leavitt and Botswana’s former President Festus Mogae. The board in November approved a “transformation” plan “to address the findings of the Panel, along with a new, ambitious, four-year strategy and decided to appoint a General Manager to oversee this transformation”.
The panel “recommended changes to risk-management, governance and oversight to ensure the institution manages donor resources as efficiently and safely as possible”, the Fund says in a statement.
The Guardian notes in its report on the changing of the guard that “the shock of the corruption revelations, which were pounced on by the US right, and the subsequent loss of confidence in the Fund – which led some donors to suspend payments – was an alarm call. . . What has happened now is a result of a determination that the Fund must not fail. An overhaul is underway, to ensure not just transparency but greater efficiency.”
GENEVA, SWITZERLAND – The death toll has been steadily mounting with at least 140 people known to have died in Kano, Nigeria, after the city was shaken by a series of bomb explosions Friday night 20 January. The bombs were planted in security areas such as police stations. Boko Haram, an Islamist extremist group that operates mainly in the northern, Muslim-predominated part of the country has claimed responsibility for the attacks. The group killed 37 people and injured scores more in a Christmas Day attack on a church outside the capital, Abuja.
Nigeria has been under pressure from protests over oil prices in recent weeks: it produces nearly 3 percent of the world’s oil, with production in the southern part of the country, but the system is riddled with corruption and the country is dependent on subsidized imported fuel. The government’s efforts to reform the system were behind a 1 January end to the subsidies, but angry protests suddenly broke out when the result was a near doubling of the price of fuel. But Reuters, in a 31 December article, noted that “Its strikes are becoming deadlier and more sophisticated, and suggest that it is trying to ignite sectarian strife in a country historically prone to conflicts between a largely Muslim north and Christian south.”
Links to other sites: AllAfrica, Reuters, WSJ Market Watch
Aljazeera video
GENEVA, SWITZERLAND – Swiss companies share first place at the bottom of the list, but for a change this is a good thing: the list is Transparency International’s (TI) rankings of countries most likely to bribe abroad. Russia heads the list, with China close behind. The last two invested $120 billion overseas in 2010.
The Netherlands and Switzerland are the countries whose companies are the least likely to bribe. The report ranks 28 major international and regional exporting countries by the likelihood of their firms to bribe abroad, based on surveys of 3,000 business executives.
The annual report on bribery looks, for the first time, at business to business bribery rather than just bribes paid to government officials. Story continues …
Source: Transparency International, November 2011
LYONS, FRANCE – The Thursday evening arrest of Michel Neyret, second-in-command of Lyons’s judicial police, with his wife, was followed swiftly by the arrest Friday morning of three senior police officers, two in Lyons, one in Grenoble. The group is being detained on suspicion of corruption and running a huge drug trafficking ring.
The scandal has added spice, according to TF1, with the arrest, also Friday 30 September, of a swindler who is well known to French police. He reportedly loaned luxury cars to Neyret while the assistant police chief vacationed in the south of France.
GENEVA, SWITZERLAND – TSR, Swiss public television, revealed Monday that the Geneva branch of HSBC has had CHF11 million in assets of deposed Tunisian dictator Ben Ali’s clan, information the bank has not publicly confirmed. The accounts were reportedly opened by Belhassen Tribelsi, Ben Ali’s wife’s brother.
He is now on the run, reportedly in Canada, on the Interpol red list.
The accounts raise serious questions, argues TSR, about the diligence with which Swiss banks have been respecting Swiss money laundering laws and laws covering “politically exposed persons”.
Banks in Switzerland must announce funds of anyone considered to be politically exposed; Tribelsi was on the list of 40 Tunisians sent by the Swiss government to banks immediately after Ben Ali’s fall. The funds in his name would be equal to one-sixth of the CHF60 million Tunisian funds that were blocked by the Swiss government, TSR points out, noting that the brother-in-law was notoriously corrupt and that under Swiss money laundering laws the bank would have been expected to report him earlier.
TSR: http://www.tsr.ch/info/suisse/3403069-clan-ben-ali-11-millions-dans-une-banque-a-geneve.html
GENEVA, SWITZERLAND – Russian authorities look set to continue their investigation into the affairs of Sergei Magnitsky, who was beaten to death in prison in November 2009, after the Heritage Capital lawyer spent 11 months in prison, in pre-trial detention. He was arrested on tax evasion charges, reports the Moscow Times, after he “accused several tax and police officials of embezzling $230 million of state money through tax refunds. A case against him was opened shortly thereafter, which was handled by the same officers he accused of corruption.”
A high court ruled in July that the death of an accused person does not mean the case is closed, if his or her family requests that it remain open. Supporters of Magnitsky are divided over whether the case could clear his name or serve public officials who want to justify their case against him.
Switzerland opened an investigation into possible fraud linked to the case in April 2011. Hermitage Capital, based in London, was once the largest foreign investor in Russia; it was founded in 1996 by William Browder and Edmond Safra and specializes in investing in emerging markets. The company has gained a reputation for battling Russian corruption, after bringing to light several cases.
GENEVA, SWITZERLAND – Egypt’s former leader, Hosni Mubarak, arrived in court Wednesday 3 August on a hospital bed for the opening of his trial: he and his sons Alaa and Gamal, and several senior officials and officers are being tried on a number of charges, from killing protesters to illegally gaining wealth. The former president could be given the death sentence if found guilty of ordering protesters to be killed.
Mubarak, 83, fell from power in February 2011. According to Aljazeera, “More than 800 people were killed and about 6,000 wounded in the 18 days of protests that eventually toppled Mubarak’s regime.”
The court case is being widely shown on television, in several countries. The judge decided three days ago to move it to a police academy in Cairo for security reasons, although Egyptian media reported in June that the former president was too frail and ill to be moved.
Sepp Blatter (photo: Agencia Brasil, Roosewelt Pinheiro/Abr)
ZURICH, SWITZERLAND – Down to the wire, with less than a week to go in the election for the post of president of Fifa, world football’s governing body, and the fight for the job is sullied by allegations of corruption against both candidates. The Fifa ethics committee Friday 27 May agreed to summon President Sepp Blatter, who is standing for re-election, acting on yesterday’s request by executive committee member Mohamed bin Hammam.
Blatter is to appear before the committee Sunday, three days before the election.
Bin Hammam was summoned to appear before the committee Wednesday.
The committee is investigating charges made last week of alleged cash payments to delegations attending a special meeting of the Caribbean Football Union. The latest accusations of corruption against Fifa officials continue a string of scandals, as well as questions about how the 2018 and 2022 games were awarded.
Britain’s sport minister, Hugh Robertson, said in a statement Friday that “The Fifa presidential election campaign has descended into a farce,” Robertson said in a statement.” Robertson has “hinted” that national football/soccer bodies may want to break away from Fifa, Reuters reports.
ZURICH, SWITZERLAND – The FA, England’s national football association, has decided against voting for the next president of Fifa, the Zurich-based International Football, saying in a brief statement issued Thursday afternoon 19 May that it cannot support either candidate. AP sports writers put it more baldly, saying that the FA is “unable to choose between two candidates tainted by allegations of corruption scandal”.
The statement issued by FA Chairman David Bernstein, in its entirety:
“There are a well-reported range of issues both recent and current which, in the view of The FA board, make it difficult to support either candidate.
The FA values its relationships with its international football partners extremely highly. We are determined to play an active and influential role through our representation within both UEFA and FIFA. We will continue to work hard to bring about any changes we think would benefit all of international football.”
The two candidates are Sepp Blatter, who is seeking a fourth term from 2012 to 2016 and Mohamed bin Hammam of Qatar, who successfully obtained the 2022 World Cup Games for his country.
Blatter has headed Fifa while a scandal involving members of the executive board unfolded, while there have been charges that Qatar paid Fifa board members to vote for it.
Holenweger case tests tougher anti-corruption laws in country already considered one of world’s best at fighting bribery
Ed. note: AP (here, picked up by Business Week) late Saturday published a second, lengthy article about the implications of the case, which provides a balanced picture
Zurich, Switzerland (GenevaLunch) – The case against former high-flying Tempus Bank executive Oskar Holenweger in Bellinzona, Ticino, in Switzerland’s Criminal High Court, ended Friday 15 April, with the judge’s decision expected 21 April.
The charges of setting up funds for French company Alstom to bribe foreign officials, against the friend of right-wing political leader Christoph Blocher, drew less international media attention Friday than did Switzerland’s reputation, based on an incorrect report that until 10 years ago Switzerland had no law against bribery.
Source: 2010 Transparency International report on perceived transparency and accountability for corruption (click on image to view larger)
Headlines of “Switzerland stakes its reputation on …” imply that the country has until recently done little to fight bribery, when the opposite is true: Switzerland in 2006 was named the top country in the world for fighting bribery, in a ranking by Transparency International.
The group’s 2009 report on progress (pdf) made by the 38 countries signatory to the 1997 OECD Convention on Bribery shows that only four actively enforce it, one of which is Switzerland.
And in its 2010 report on international perceptions of transparency and accountability, Switzerland and Australia shared 8th place with notes of 8.7 out of a possible 10, although Switzerland’s score slipped from 9 the previous year.
Media reports say, wrongly, that bribery was legal in Switzerland until 10 years ago
The implication that Switzerland is weak in this area is unfortunately based on a misunderstanding, reported by Associated Press (AP) and widely disseminated via the Internet by AP’s largely North American member newspapers, including Yahoo News.
Even Maclean‘s, the respected Canadian news magazine, picked up the AP sentence: “Prosecutors hope the high profile trial of a Zurich private banker that ended Friday will send a message to Europe and beyond: Switzerland — where bribery was legal until a decade ago — is getting tough on corruption.”
Forbes was one of the rare AP clients to run a shorter version of the AP story, with the editors opting to leave out the misleading sentence, although it, too, picked up the “Swiss reputation at issue” headline.
Bribery was not legal in Switzerland: what changed in 2000, when the OECD’s 1997 Convention on Combating Bribery entered into force in Switzerland was the first of three key stages to tighten legislation.
The crime, previously punishable by fines, became a criminal level offense, punishable by time in prison as well as a fine. The difference is comparable to that in Switzerland between tax avoidance, a non-criminal offense subject to fines, and criminal tax evasion, with the risk of prison.
Responsibility for complex corruption cases involving bribery of foreign officials was shifted from cantonal governments to the federal government.
Significantly, before 2000, a bribery case would generally go before the courts only if a victim filed charges; as a criminal offense, police and other authorities have for the past decade been required to pursue suspected criminals and press charges.
In a second stage, companies became criminally liable in 2003, not just individuals.
A third stage involved tightening accounting requirements for greater transparency.
Switzerland has been slowly but steadily building up its tool kit against corruption since 2006, based in part on recommendations from the OECD and Transparency International.
Former Egyptian leader Hosne Mubarak was hospitalized Tuesday 13 April for a heart attack, and shortly afterwards he and two sons were put under arrest but face different charges, local media report. The 82-year-old former president, who has been under house arrest since late March, was the target of a 15-day warrant issued by the prosecutor general to determine is he ordered weapons used against protesters before his regime fell in February 2011. His sons are being investigated for corruption.
Links to other sites: Aljazeera, Voice of Russia, Sky News
Swedish home furnishings giant Ikea is continuing its June 2009 decision to put a freeze on opening new stores in Russia, outside Moscow, reports the Moscow Times. The newspaper argues that the company’s firm and very public anti-corruption policy is causing headaches for President Dmitry Medvedev’s push to abolish corruption.
Ikea has been waiting for permits for its Samara and Ufa stores. “‘The reason the stores aren’t opening is that Ikea is refusing to pay bribes to safety inspectors,’ said Kirill Kabanov, head of the nongovernmental National Anti-Corruption Committee.”
Medvedev is keen to reduce the foreign perception that Russia has too much corruption, says the Moscow newspaper, in order to increase foreign investment. “At stake is President Dmitry Medvedev’s goal to match the economic growth rates of other Bric nations. With barely more than one-tenth the population of China and India, Russia needs to attract non-energy investors to grow and diversify. Corruption has ‘penetrated all branches of power,’ Medvedev said in a recent interview.”
Among a number of companies threatened, says the Moscow Times, is Swiss-based Nestlé, which was told in 2010 and again this year that it is not meeting Russia’s safety standards.
33 members of president’s family arrested
Ministers quit party in bid to defuse tensions
“Several minister” have quit the Constitutional Radical Party (RCP) of former President Ben Ali in Tunisia, shortly before the interim government convenes to put together a government, reports Al Jazeera Thursday noon, Swiss time. The move is reportedly in response to the resignation earlier this week of three UGTT trade union party members, who have said they cannot be part of a government that includes the old ruling party.
Ben Ali’s family under arrest
Thirty-three members of the family of former President Zine El Abidine Ben Ali have been arrested over the past several days, state TV reports 20 January. The source was unable to name the detainees nor their exact relationship to Ben Ali, but says they could be tried for “crimes against Tunisia”. Ben Ali fled to Saudi Arabia last week after street riots forced him from power.
The month-long protests in Tunisia that led to the collapse of one of the world’s most long-standing dictatorships were partly fuelled by perceptions of widespread corruption by the families of the former president and his wife.
Switzerland Wednesday 19 January ordered that any assets of Ben Ali and his entourage discovered in Switzerland be frozen and that real estate that might belong to them cannot be sold or transferred.
UN High Commissioner for Human Rights Navi Pillay has ordered a team to Tunisia.
Links to other sites: Le Figaro, Romandie News
Republican politician Tom DeLay of Texas has been convicted by a jury in Texas, USA of money laundering and conspiracy to commit moneylaundering in a case that involved providing corporate donations to Texas Republican candidates in 2002. A court in Travis, Texas found him guilty on both counts 24 November. DeLay faces up to life in prison when he is sentenced 20 December.
The former US House of Representatives congressman, known as “the Hammer” for his persuasive ways as majority leader, is said to have taken $190,000 in donations from corporations, sending the money to the Republican National Committee in Washington DC, which then sent an equivalent amount back to fund the candidacies of local Republican politicians.
Such corporate donations are illegal in Texas. DeLay claims that he did nothing wrong and that this was common practice.
Links to other sites: Christian Science Monitor, Washington Post
Foreign Minister Moses Wetang’ula stepped down 27 October pending an investigation into corruption at his ministry in which millions of dollars may have been overpaid for a new embassy in Tokyo, Japan. A parliamentary committee has found evidence of dubious financial transactions in other Kenyan embassies.
Wetang’ula has said he will be vindicated and that the minister does not sign cheques nor procurement orders. Kenya’s government has been criticized for not taking action against corruption, but several high-profile politicians have resigned or been charged in recent months.
Links to other sites: All-Africa, Financial Times, New York Times
One of Mexico’s most sought-after drug barons, Edgar Valdez has been arrested in a residential district in Mexico City, after being sought by police for several years. The arrest came shortly after the government announced that it had fired 10 percent of the police force in its continuing crackdown on the drug industry and corruption. Valdez, known as “The Barbie” for his blue eyes and blond hair, has a reputation as one of the worst perpetrators of drug-related violence.
Sudan’s ambassador to the United Nations has gone on the attack to deflect multiple charges against his government. Abdalmahmood Abdalhaleem Mohamad told CNN (programme will air 9 December) that his country will never hand over its president, Omar al-Bashir, to the International Criminal Court in The Hague where he is accused of war crimes. The ambassador lashes out in the TV interview at other criticisms of his country, which range from the opposition party saying it is corrupt to some US senators calling for an investigation into whether the country has an ongoing genocide. Sudan’s civil war nominally ended in 2005, but the number of deaths from violence in Darfur as well as other areas remains high. The ambassador 23 November called for UN peacekeepers to leave his country, following a UN report and criticism from Ban Ki-moon. The fighting in Darfur is over, according to the ambassador, but Aljazeera reports that concerns are growing over elections in April 2010.
Links to other sites: Aljazeera, CNN, Voice of America
Japan has pledged $5 billion in additional assistance to Afghanistan’s government just days before US President Obama arrives in Tokyo for an official visit on Friday, 13 November. The increase in aid will go towards building schools, demining, training policement, and rehabilitating Taliban fighters. Obama is to announce a new strategy for the US presence in Afghanistan after he has finished with consultations, perhaps before the end of the week.
The US has said it will expect Afghan President Hamid Karzai to meet clear measures to reduce the corruption that is seen to plague his administration. Western countries have increasingly seen corruption and a lack of transparency as undermining the the government’s legitimacy, putting a brake on development and giving the Taliban a political opening among the population. AFP, Bloomberg, New York Times
The Constitutional Court in Italy, the country’s highest, ruled Wednesday 7 October that a law giving Prime Minister Silvio Berlusconi legal immunity while in office is unconstitutional because it violates the principle of equality of all Italians under the law. Berlusconi responded by saying he expected the ruling, saying the court was dominated by left-wing judges. “We must govern for five years, with or without the law,” he said. “These things charge me up. Let’s go. Long live Berlusconi.”
The ruling opens up the possibility that Berlusconi will testify in at least three trials currently underway for corruption, all of them involving his business interests. BBC, Corriere della Sera, La Repubblica
Italy is again debating the question of whether Prime Minister Silvio Berlusconi should be granted immunity from prosecution. The country’s top court is debating whether a law passed soon after he came to office in 2008 is constitutional. It grants the prime minister immunity from prosecution while in office. Opponents argue that no one is above the law. His supporters claim that without the protection, Berlusconi would be “distracted” from governing and may be forced to resign.
Berlusconi has been the object of several court cases involving corruption, including one where his British lawyer, David Mills, was found guilty earlier this year. Prosecutors in that case are appealing to the Constitutional Court about Berlusconi’s immunity.
In a separate corruption trial a judge ruled 5 October on a case involving his media holding company Fininvest and ordered it to pay €750 million in damages. The judge said that as the owner of the company Berlusconi was “co-responsible.” BBC, Corriere della sere (Ita), Reuters
President Nicolas Sarkozy was jeered as he arrived 16 June at the presidential palace in Libreville, Gabon to attend the funeral of former president Omar Bongo, who died last week in a Spanish clinic after 40 years as president of his country. Sarkozy and former French president Jacques Chirac joined 40 other heads of state to lay a wreath on Bongo’s coffin. France, the former colonial power, maintained close relations with Gabon. But in May 2009 a judge in Paris decided to open an investigation of Bongo for corruption. BBC, Le Monde (Fre)
The provincial government on the eastern side of the Indonesian island of Borneo has opened a dozen “honesty cafes” without cash registers in schools and governments in the past month, reports the New York Times/IHT, where users are expected to be honest. The goal is to “nip in the bud corruption,” as part of a larger and long-term anti-corruption campaign in a country described by the newspaper as “not known for its transparent practices in business, politics and many other areas.” The government in the region is planning to have more than 1,000 such cafes in operation by 2010, including some private ones, says the IHT in a long feature.
The arrest Tuesday in Chicago of Illinois Governor Rod Blagojevich on corruptions charges has the US Democratic Party concerned about its image, with the governor and his aide accused of trying to sell the Senate seat of US President-elect Barack Obama. Blagojevich was freed on $4,500 bail and his passport was seized. CNN
Thabo Mbeki, president of South Africa for the past 10 years, said Sunday he will resign, but he did not give a date. He was pressured by his party, the ruling African National Congress, to leave office after charges of political interference in the country’s judicial system in connection with a corruption case against his rival Jacob Zuma that was thrown out by the courts. AllAfrica, CNN
