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Australia slow to tackle international corruption

May 15th, 2018

Most of the world’s developed economies have barely moved on tackling international corruption, and while Australia has begun 21 investigations in the past two years, only two have resulted in penalties to companies.
Only four of 34 OECD countries are actively investigating and prosecuting international bribery, a Transparency International investigation has found.
Fifteen years after 41 nations – the 34 OECD member countries, and seven non-members – signed a global anti-bribery convention, more than half are doing “nothing or little” to stop their companies bribing foreign officials to illegally win or inflate contracts.
Australia, rated as having “moderate enforcement”, has begun 21 investigations into international corruption in the past two years, but has started only one case in court, and concluded only two with minor sanctions.
However, the Australian federal police are set to seize assets of allegedly corrupt Chinese officials in a joint operation with Chinese authorities, Fairfax Media reports.
“Naked officials”, as they are known in China, typically use family members sent overseas to illegally shift assets offshore.
A report released on Thursday in Berlin from Transparency International finds only four countries within the 34-member Organisation for Economic Co-operation and Development, the US, UK, Germany and Switzerland, are actively investigating and prosecuting companies allegedly engaged in international corruption.
Five countries, including Australia, were rated as having moderate enforcement.
Twenty-two OECD countries, including major economies and Australian trade partners Japan and South Korea, are reported to be doing “little or nothing” to stop transnational bribery. Those 22 countries represent more than a quarter of global trade.
In many countries law enforcement agencies have no resources for complex investigations, and governments lack the political will to pursue large, powerful companies.
“The OECD has worked hard to make the convention a powerful too and pushed governments to adopt tough laws. Now it needs to make sure that enforcement authorities have all the support they need to counter the growing power of cross-border crime networks,” the Transparency International chair, Jose Ugaz, said.
Corrupt international deals are increasingly done through shell companies, companies with no assets or business operations, and whose beneficial owners are not known, even to authorities.
Ahead of the G20 next month in Brisbane, Transparency International’s Australia executive director, Michael Ahrens, said the host country should push the world’s most powerful economic gathering to properly address corruption across national borders.
“We have to deal with the corruption that remains rife in so many places,” he said. “The G20 needs to close loopholes in the international financial system to make it harder for corrupt individuals to hide their identity and shift their illicit assets to shell companies.”

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