Huzaima Bukhari, Dr. Ikramul Haq & Abdul Rauf Shakoori
The recent Transparency International Corruption Perception Index (CPI) reveals that corruption levels are standstill and there is no visible change noted for the tenth year in review. It shows that though Financial Action Task Force (FATF) is struggling to curtail the flow of illicit proceeds, however, its efforts are not producing desired results in countering corruption that contributes most towards accumulation of black money. Although the World Economic Forum (WEF) estimates corruption at US$2.6 trillion or 5% of global gross domestic product but the World Bank puts the volume of bribes paid by businesses and individuals at around $1 trillion annually.
The FATF’s Best Practice Paper, ‘The Use of the FATF Recommendations to Combat Corruption’, provides clear guidelines to deal with corruption. However, it appears that most of the member states of the FATF have not implemented the relevant recommendations in letter and spirit. The FATF’s standards not only help to minimize corruption but also curtail the flow of money earned through illegal means, though majority of the countries is facing implementation issues. Although Third-World countries have the excuse of limited resources to undertake one step at a time and require sufficient time to streamline their affairs, yet most member states of FATF considered as financially sound jurisdictions could not secure a place in top fifty countries known for having better controls to combat corruption. This indicates that these jurisdictions are not clean enough to decide the fate of other nations.
FATF needs to deal with its member states first and should take aggressive measures for implementation of its standards in concerned jurisdictions. In the upcoming plenary meeting, FATF should make this part of its agenda where all the member countries must explain the reasons of their failure in implementing necessary standards to curtail corruption. These member states should also explain the reason of their worse rating in the current corruption perception index. All those members states who are not part of the first fifty nations, should be giving an action plan with timeline so that they may first clean their house and then come forward to make decisions for other nations. FATF should set an example by suspending the membership of all those countries ranked below 50 in the Transparency Report—to remain suspended until they improve their ranking.
Another factor that requires global attention is political victimization based on fake corruption charges against political opponents. These frivolous charges of corruption on political opponents not only are undermining efforts against corruption but also affecting basic human rights, free speech and right to a fair trial. It is also promoting selective justice that leads to dictatorial rule that ultimately harms democracy.
The U.S Department of Justice Program, in an overview by R. Elias on ‘Politics of victimization—Victims, Victimology and Human Rights’, highlighted that “to varying degrees, all persons victimize others and are victimized themselves. Social, economic and political institutions also victimize people to the extent that they inflict debilitating psychological, financial, and physical costs”. He further stated: “…the concept of victimization to include all violations of human rights by individuals and institutions so as to inflict adverse impacts on persons’ lives. Under such a model, victim advocacy is viewed as a commitment to change that advances social and political democracy”. The bitter reality is that during the dictatorial rules, the justice system always sides with oppressors. Allegation of corruption is the main tool used for ages against political opponents.
In Brazil, President, Luiz Inácio Lula da Silva, known as Lula, was sentenced to almost 10 years in prison for money laundering—Salo de Carvalho, David R Goyes, Valeria Vegh Weis, ‘Politics and Indigenous Victimization: The Case of Brazil’, The British Journal of Criminology, Volume 61, Issue 1, January 2021, Pages 251–271. During his tenure followed by Dilma Rousseff who served as the Chief Minister under Lula, wrote that almost 30,000,000 Brazilians were lifted out of poverty following an economic and political programme aimed at reducing the social divide within the country and strengthening Latin American bonds. However, most circles believe that his arrest and further sentence were engineered to ensure the incumbent president Bolsonaro’s victory.
The Human Rights Watch reported that current President Bolsonaro, brought into power as reported by the media through political victimization of Lula, is now threatening democratic rule in Brazil. He is trying to intimidate the Supreme Court by threatening to cancel the 2022 election or otherwise deny Brazilians the right to elect their leaders and violate critics’ freedom of expression. He is now violating human rights while simultaneously the economy is not doing well under his regime. Brazil is not the only case. There are various other examples where hybrid systems have been imposed to run government affairs, denying the people of the concerned jurisdictions from the right of free vote or fair elections. The hybrid regimes, imposed against public’s will, lack public support.
Instead of introducing structural reform, hybrid rulers focus mainly on strengthening their powerbase by instituting frivolous corruption cases against their political opponents, influencing the judicial system to impose punishment on them. MD Shakawat Hossain, in his Book, Routledge Handbook of South Asian Criminology, has noted that political crime is one of the major concerning issues of his country–Bangladesh. The way the incumbent Prime Minister of Bangladesh is dealing with the opposition parties jailing Khaleda Zia, her main political rival, on corruption charges, is the worst example of political victimization. According to media outlets, sentence of Khaleda Zia was politically motivated—she is widely called a victim of human rights abuse.
Apart from the global scenario about corruption and political victimization, Pakistan is placed as 140th nation on the global perception index. The incumbent government was supposed to introduce reforms to improve governance and promote transparency, thus reducing corruption significantly—until today, no such effort seems to have been made. Pakistan Tehrik-i-Insaaf (PTI) in its manifesto assured the voters that it would launch judicial reforms to provide speedy and quality justice for all citizens but no such reform agenda is apparent. Even the World Justice Project (WJP) in their report ranked Pakistan at 130 out of 139 countries on rule of law in 2021. Similarly, the same report while ranking us in civil justice, regulatory enforcement, fundamental rights, absence of corruption, placed Pakistan at 124th, 123rd, 126th, and 123rd positions respectively.
Law enforcement authorities, responsible for investigating corruption related charges, are facing credibility issues. The former chief of Federal Investigation Authority (FIA) admitted in various interviews that he was asked to register frivolous cases against political opponents. National Accountability Bureau (NAB), the top anti-graft body of Pakistan, has become the most controversial institution. Though its chief was facing credibility issues and time was ripe to restore confidence of the public by appointing a well-reputed person at his place, yet the PTI Chairman detracted from his manifesto. He continued with the same controversial man; as his government could not risk appointing a new head of NAB with consensus, and the existing one was ready to compromise his credibility.
FATF is aggressive in implementing its standards asking the countries to draft laws and regulations in line with its recommendations to curb the flow of ill-gotten money. FATF needs to specifically introduce guidelines stating precisely that risk assessment would be based on transparency and right of fair trial in all investigations instituted against any person in any country. This global check and balance on one hand will expedite the efforts against corruption that is the main source of money laundering and on the other, will minimize human rights abuse strengthening democracy and governance throughout the world.
Huzaima Bukhari & Dr. Ikramul Haq, lawyers and partners of Huzaima, Ikram & Ijaz, are Adjunct Faculty at Lahore University of Management Sciences (LUMS), members Advisory Board and Visiting Senior Fellows of Pakistan Institute of Development Economics (PIDE). Abdul Rauf Shakoori is a corporate lawyer based in the USA and an expert in ‘White Collar Crimes and Sanctions Compliance’. They have recently coauthored a book, Pakistan Tackling FATF: Challenges and Solutions