(Online), 5 July 2021 - Across Southeast Asia, many countries issued emergency measures in response to the Covid-19 pandemic. In Indonesia, this took the form of trillions of rupiah for social safety net programs and cash assistance for those in need as well as micro, small and medium-sized enterprises. In recent months, the country’s Corruption Eradication Commission (KPK) has implicated several officials in corruption around the disbursement of these funds, including one case of a minister alleged to have received kickbacks totaling 17 billion rupiah. This is consistent with a UNODC study, which found that Covid-responsive funds in much of Southeast Asia were issued without sufficient oversight, leading to a heightened risk of large-scale cases of corruption.
The issue of corruption involving vast quantities of assets is distinct from “ordinary corruption” in various respects. Such large-scale cases are singled out in the preamble of the United Nations Convention Against Corruption (UNCAC) as those that “constitute a substantial proportion of the resources of States that threaten political stability and sustainable development of those States”. Yet it is not only the sheer quantities of wasted public funds that makes corruption of this nature so devastating. Such cases often involve highly influential Politically Exposed Persons (PEPs), presenting a real danger that the independence of state institutions can be undermined. As a result, it is not uncommon that the perpetrators of such cases evade justice, alongside retaliatory threats to the whistleblowers, investigative journalists or law enforcement agencies that seeking to expose their wrongdoing.
Putri Wijayanti (UNODC Indonesia) and Sofie Schutte (U4 Anti-Corruption Resource Centre) discuss ways to sustain the independence of institutions fighting corruption
To share best practices on this issue, UNODC held the webinar Combating Corruption Involving Vast Quantities of Assets, on 5 July 2021 – fully recorded and publicly available here. The event included insights gleaned from prominent cases within the region and recommendations to uphold the independence of institutions that fight corruption. The webinar received 838 registrations to attend live, spanning government, civil society and private sector organizations.
Key issues discussed during the webinar are as follows:
Addressing corruption involving vast quantities of assets requires a strong systemic response
Dato’ Sri Azam Baki, Chief Commissioner of the Malaysian Anti-Corruption Commission (MACC), reflected on lessons learnt from the 1MDB scandal, an incident regarded by many as one of the largest known corruption cases ever to occur in Southeast Asia. He pointed out that, due to the complex and interconnected nature of the global financial system, States seeking to tackle such cases must be able to trace assets across numerous jurisdictions. In practice, this requires a number of systems to be in place, including beneficial ownership transparency, Anti-Money Laundering (AML) infrastructure and an asset disclosure system that covers both Politically Exposed Persons (PEPs) and their families.
Breakdown of Registered Attendees of Webinar on Corruption Involving Vast Quantities of Assets
Meanwhile, the complexity of the global financial system also has implications for law enforcement officers at the operational level. Muhammad Asri Irwan, a senior prosecutor at Indonesia’s Corruption Eradication Commission (KPK), argued that investigators need to know more than the skills related to their primary function, and to learn about business and investment typologies to be able to navigate the types of assets sought by corrupt high-profile individuals.
Consistently with this, Francesco Checchi, Anti-Corruption Advisor at UNODC, cited Resolution 7/2 of the Conference of the States Parties to the United Nations Convention against Corruption (UNCAC), which calls for responses to this type of corruption to be “comprehensive and multidisciplinary”. The Resolution covers topics including whistleblower protection, the support of civil society, mutual legal assistance measures, integrated and coordinated working approaches and financial disclosure systems. Such a broad-based strategy parallels the workings of many corrupt Politically Exposed Persons (PEPs) themselves, who use their influence to operate across sprawling networks of shell companies, corrupt legal specialists, money launderers and other complicit officials.
Investigations & prosecutions of corruption involving vast quantities of assets may be subjected to undue amounts of pressure
Because they seek to disrupt the vested interests of powerful individuals, investigations and prosecutions of large-scale corruption can be met with resistance. For this reason, Bivitri Santi, Board Member of Transparency International Indonesia, stressed that it was crucial to uphold the independence of institutions that fight corruption. She explained that the independence of Anti-Corruption Agencies (ACAs) are crucial to the fight against corruption, in line with principles laid out in the Jakarta Statement and applied measures detailed in the Colombo Commentary. A number of such measures have been adopted by Indonesia’s Corruption Eradication Commission (KPK), such as the policy that personnel do not have the authority to issue a warrant calling for the termination of an investigation.
Slide presented by Bivitri Santi, Board Member of Transparency International Indonesia, showing that ministries and city governments have accounted for a large proportion of anti-corruption investigations since 2006
The risks that large-scale corruption cases entail are taken into account in the Oslo Statement on Corruption Involving Vast Quantities of Assets, which calls for investigation, prosecution and adjudication authorities to be given special protection against retaliatory action and threats. The Statement also calls upon States to consider initiatives to protect activists, investigative journalists and other anti-corruption fighters, such as through a special fund.
Nevertheless, such protection may not always be adequate in contexts where there is an “evolving concept of human rights protection”. Sofie Schutte, U4 Anti-Corruption Resource Centre, outlined a series of recommendations from U4’s guide on Managing a Hostile Court Environment. The guide includes ideas for individual practitioners, such as calling upon competent civil society partners who can monitor court processes, and systemic considerations, such as the establishment of “specialized anti-corruption investigation, prosecutorial and adjudicating institutions”.
The full recording of the Webinar on Corruption Involving Vast Quantities of Assets can be viewed here
This webinar was part of activities funded by prosperity programming of the Government of the United Kingdom. Footage (where available) and written summaries of UNODC webinars are publicly available via our website.
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