I’m delighted to have the opportunity to join you at this first meeting of the International Corruption Hunters Alliance.
We know your mission can be a tough and at times lonely calling. So today, look around you; you don’t stand alone.
We have drawn together over 240 people from 134 countries. This attendance alone signals the significance of this topic and the potential of this Alliance.
You take on crime each and every day. I want to thank you for your commitment and dedication to rooting out corruption. I especially want to thank Leonard McCarthy, the World Bank Group’s Vice President for Integrity (INT), for his leadership. With the support of Steve Zimmerman and Galina Mikhlin-Oliver, Leonard is strengthening, expanding, and building a critical operation. They are enlarging INT’s role from the investigation of corruption with Bank projects to the use of knowledge we gain to prevent fraud and stealing. We are also working to integrate our Governance and Anti-Corruption work across all the World Bank Group.
The World Bank Group Stand Against Corruption
Let me first say a few words about how the Bank Group has tackled clean governance and anti-corruption.
Our strategy combines actions today and shaping the governance and business environment for the future. At present, we are establishing integrity safeguards to protect Bank Group projects. We investigate and sanction those who cheat and steal. And we refer cases to national authorities for criminal action that is beyond our writ.
Over the medium and long term, we want to help build stronger and cleaner governance and anti-corruption capacity in our client countries. We need to keep governments focused on the danger. Sound institutions, transparency, and accountability are key for development effectiveness.
We also need to challenge businesses not to tempt public officials. Companies and other agents need to clean up their acts, too.
As we have learned the hard way across all the challenges of development, outsiders, no matter how well intentioned, will not succeed without local ownership. This Alliance can help us build the local will to improve transparency, strengthen procurement, set higher standards, and hunt criminals.
Acting together, we can be more effective. In May, the Bank Group signed a pathbreaking agreement on cross-debarment with the other four regional multilateral development banks. The agreement sends a clear message: cheat or steal from one of us, and you will be punished by all. In the past decade, multilateral development banks have jointly debarred more than 1,100 fraudulent and corrupt entities.
This is a far-reaching tool for deterring bad behavior and for removing corrupt entities from development projects; it also provides an incentive to companies to clean up their operations. And the cross-debarment agreement demonstrates an alliance at work.
At a time of fiscal constraint in many donor countries, we need to underscore to donors and recipients alike that every development dollar will be spent as intended: to overcome poverty and boost growth and opportunity. Stealing is bad enough; ripping off the poor is disgusting. We need to trigger a moral revulsion as well as a legal reaction.
The Bank Group’s Integrity Vice Presidency closed 238 investigations in fiscal year 2010. The World Bank debarred 45 entities -- including multinational companies, individuals, and non-governmental organizations -- from doing business with it.
When I arrived at the Bank in July of 2007, we had a serious problem interconnecting the then-Department of Institutional Integrity's work with operations in the field, our clients, and even our Board of Directors. This weakness in integrating and supervising joint duties led to frustrations, suspicions, and conflict.
Fortunately, we inherited the impressive work of Paul Volcker and his Independent Review panel, which made 18 recommendations across a range of areas, including: upgrading the status of the Bank's new Integrity Vice Presidency; establishing closer links to Operational Policy; enhancing the focus on prevention; overhauling confidentiality policies so we could share information to be effective; shortening the completion time of internal and external investigative reports on projects; and improving staff diversity and performance.
We implemented all 18 of the Volcker Commission report’s recommendations by July of 2009. We also examined how we could do better. We developed a strategic framework for effective investigations.
We are providing more resources for prevention, too.
Our Preventative Services Unit is turning the results of investigations into practical advice on how to prevent corruption.
In fiscal year 2010, we trained 1,200 people in preventive activities, such as identifying red flags in procurement and managing integrity risks in development projects.
The World Bank and the United Nations joined forces to launch the Stolen Assets Recovery Initiative (StAR), a multilateral partnership to help developing nations recover hundreds of millions of dollars -- or even more -- of looted funds.
StAR helps developing countries in a variety of ways: building capacity to respond to and file international mutual legal assistance requests; adopting and implementing effective confiscation measures, including confiscation legislation where there is proof of criminal activity even absent a conviction; creating and strengthening national anticorruption agencies; supporting quick response teams that can help countries investigate cases; and monitoring the recovered funds, if requested by the countries.
Launch of International Corruption Hunters Alliance
Today, we are taking another big step to help shape the environment in which we work: We are launching what I hope will prove to be a groundbreaking, international initiative to tackle corruption.
In July 1944, representatives from 44 countries met at the Mount Washington Hotel at the Bretton Woods conference.
During the conference John Maynard Keynes said: “We have had to perform at one and the same time the tasks appropriate to the economist, to the financier, to the politician, to the journalist, to the propagandist, to the lawyer, to the statesman -- even, I think, to the prophet and to the soothsayer.”
Keynes was referring to the creation of the World Bank and the IMF, but his words are also appropriate for the International Corruption Hunters Alliance.
Since we first announced in October that we would hold this event, we’ve received a strong endorsement. The International Corruption Hunters Alliance offers a pragmatic, no-nonsense, and aggressive approach that is catching people's attention.
With this Alliance, we are signaling to the world that we have come a long way from the days when we had to debate whether we could openly disclose corruption cases.
The corrupt steal from the poor, but they are abetted by the indifferent.
For too long, anti-corruption efforts relied principally on the courage of individuals who too often had to act alone. Victories were often gained without the support of strong institutional systems, resources, or even moral allies.
The actions undertaken by very brave individuals inspired others to follow in their footsteps. However, individual heroism is not a sustainable or effective strategy to eliminate corruption.
Therefore, we are gathered here in Washington to draw strength and learn from one another and to create a strong corruption hunters’ network.
This morning I see a room filled with practical and practiced men and women: committed and outstanding legal professionals, investigators, practitioners, and experts who -- in Von-Suvigny’s words -- are true gatekeepers of the law.
We want to harness your energy and experience to attract more highly-qualified individuals to our anti-corruption efforts. We want to draw on the expertise and knowledge of existing and successful networks.
We also must keep adapting to what will be continually changing challenges. In five years’ time, I suspect the Alliance will have evolved; what should be a constant is that its members find it useful. Our aim is for an Alliance that provides effective tools and information so all of us can successfully prevent and attack corruption.
I have recently spoken about the shift to a new multipolar global economy, where North and South, East and West, are points on a compass, not economic destinies.
Though we may have different perspectives, circumstances, and legal systems, we have shared responsibilities and mutual interests, particularly when it comes to upholding the rule of law and stopping fraud, theft, and other crimes.
In many parts of the world, corruption buys impunity, strangles fair opportunity, cripples competition, encourages conflict, stalls economic transformation, and chokes growth. The rule of law must be at the center of the development agenda.
Corruption erodes public trust and confidence. This trust is critical to achieving effective governance. Once lost, it is hard to restore.
Eliminating corruption and fostering effective governance go to the essence of public service and responsibility.
I want to share with you a few examples that illustrate what can be accomplished with the right leadership:
· Since 2003, prosecutions brought by the KPK in Indonesia have led to the jailing of more than 100 high-ranking officials. Sri Mulyani Indrawati, now one of the Bank’s Managing Directors, played a key role in the Indonesian government’s anti-corruption drive.
· In Kenya, when massive corruption has been detected in ministries, cabinet ministers have been asked to step aside in order to allow investigations to proceed.
· And in the Philippines, Finance Secretary Purisima has launched a public tip-off campaign which in its first six months has already netted dozens of tax evaders and smugglers who have defrauded the Government.
Even heads of government are now being challenged when there is evidence of corruption or theft. In recent years, at least ten have either been prosecuted or are being investigated.
Everyone in this room knows that corruption involves both developed and developing countries.
One of the biggest investigations the World Bank completed this year involved the employees of a large Western firm bribing project officials in Africa with, among other things, vacations.
Yet we also need to be watchful for the demand side of bribery. In one case, a senior project official solicited a bribe of $75,000 -- approximately 12 percent of the contract sum -- from a multinational firm in exchange for certifying that work had been done.
Tackling Corruption as a Multi-Stakeholder Effort
As corruption becomes increasingly transnational, there needs to be a growing sense of shared responsibility among all stakeholders and a willingness to respond more boldly when confronted with the audacity of corruption.
There has been increasing action at the national level, as countries strengthen their legal frameworks to better align them with the OECD Anti-Corruption Convention and the United Nations Convention against Corruption.
This Alliance can help spur a global push for more bribery convictions.
National authorities are now more empowered to pursue the investigation and prosecution of large multinational firms, with the successful outcome of one country’s efforts sparking related investigations in distant corners of the globe.
This Alliance can help us learn how to pursue more multijurisdictional prosecutions.
The recent decision by the French Supreme Court to allow the complaint of two NGOs to proceed will result in an official inquiry about how the possible proceeds of corruption were spent in France by foreign heads of state.
This Alliance can help us develop new tools to track and return illegal proceeds.
Civil society is expanding its traditional role as watchdog, and countries are being asked to show that corruption committed in one country will not be overlooked in another.
This Alliance can help us share information and mobilize public outrage against corruption.
The private sector is realizing that acting with integrity is not only the right policy but the smart policy.
The new management of Siemens, confronting extensive patterns of corruption, decided on a clean-up strategy that seeks to make integrity into a business principle: rather than delay and resist, Siemens worked with the World Bank and others through settlements, restitution, sharing information, reform, but also sanctions. This approach pays ethical and financial dividends. All of us need to shift the corporate and public calculation, so that crime will be discouraged, caught, and penalized -- and honesty and fair dealing will be esteemed.
We have seen that individual efforts and smaller networks are achieving successes against corruption.
A larger alliance, such as the one we are launching today, can amplify that effect, triggering a more rapid flow of information and igniting a chain of crime-fighting reactions.
Then this Alliance can help us monitor and disclose results, building more support and an even bigger coalition.
Sophocles said that “No one has a more sacred obligation to obey the law than those who make the law.”
As we advance this anti-corruption agenda, we have a duty to uphold the highest standards ourselves.
I hope that over the coming days you will all share your experiences and knowledge with colleagues from around the world. The Bank Group’s Senior Management will be chairing a variety of panels; we are extremely interested in learning from you. I trust you will also benefit from the insights and ideas of the excellent speakers who have agreed to join us.
For too long, it has been the poor who have been the hunted and the corrupt
who have been the hunters. For too long, those hunters have stalked our communities and preyed on our citizens, wounding and destroying hope of progress and potential. It is time to turn the tables. This International Corruption Hunters Alliance has the potential to make a big difference.
Let’s turn this potential into a reality