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Treasury takes a big step to fight dirty money

Treasury takes a big step to fight dirty money | Global Corruption | Scoop.it

For years, the Treasury Department has worked to bring transparency to our financial system. Yet, one critical gap remains — banks and brokerages often do not know the identity of the people behind the businesses that open accounts. This makes it easier for financial criminals, terrorist financiers, and sanctions busters to move and launder their dirty money through anonymous shell companies, front companies, and other types of legal entities.

This week, the Treasury Department took an important step to close this loophole. We proposed a new regulation that would require, when an account is opened, for banks and other financial institutions to identify and verify the identity of the real people behind the businesses who are their customers. And while this may sound rather technical, it nonetheless is a critically important step forward in the fight against dirty money.

Surprising as it may be, many companies do not need to disclose their owners when opening a bank account. This is because our anti-money laundering regulations do not currently require financial institutions to obtain this information, though some still do so voluntarily. As a result, an anonymous shell company in one state owned by a similarly faceless company in another, and controlled by a shadowy foreign-based holding company, may be able to open a U.S. bank account without revealing the true identities of its individual owners. In short, the lack of an explicit legal requirement has allowed bad actors to transact through opaque legal entities with no personal traceability.

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Global Corruption
Corruption is a particularly viral form of cancer. It is caught here and there but it reappears somewhere else as soon as vigilance is relaxed. It is not eliminated, just driven underground. The corrupt merely suspend their operations temporarily. It lingers, hovering always in the background for its next opportunity.<br>                                                                         - Gerald E. Caiden <br>
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Jim Wesberry posts to the Anti Corruption Digest

Jim Wesberry posts to the Anti Corruption Digest | Global Corruption | Scoop.it
Jim Wesberry

Anti-Corruption/Accountability/Transparency Specialist

Mr. Wesberry is the Anti-Corruption Digest’s Contributing Editor for Latin America.  Jim has almost 60 years of senior level international experience in anti-corruption, financial and related activities with organizations ranging from corporations, federal and state government, foreign countries as well as NGO’s such as the United States Agency for International Development and the World Bank.

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Justice News | Department of Justice

Justice News | Department of Justice | Global Corruption | Scoop.it
Friday, February 5, 2016

Press Release
Two Georgia Residents Indicted in Interstate Armed Jewelry Theft Case
Press Release
Two Louisiana Residents Indicted for Involvement in Stolen Identity Tax Fraud Scheme
Press Release
United States Attorney Announces Southern Indiana Drug Indictments
Press Release
Virginia Man Sentenced to 87 Months for Attempted Coercion and Enticement
Press Release
Justice Department Reaches $470 Million Joint State-Federal Settlement with HSBC to Address Mortgage Loan Origination, Servicing and Foreclosure Abuses
Press Release
Member of International Child Exploitation Conspiracy Sentenced to 216 Months in Prison
Speech
Principal Deputy Assistant Attorney General Renata B. Hesse Delivers Remarks at Global Competition Review Live 5th Annual Antitrust Law Leaders Forum
Thursday, February 4, 2016

Press Release
Criminal Charges Filed Against Bank Julius Baer of Switzerland with Deferred Prosecution Agreement Requiring Payment of $547 Million, as Well as Guilty Pleas of Two Julius Baer Bankers
Press Release
Minnesota Chiropractor Indicted for Tax Evasion
Press Release
Father and Son Found Guilty in Manhattan Federal Court in Connection with Multimillion-Dollar Vending Machine “Business Opportunity” Scheme
Press Release
Federal Court Orders Delaware Donut Business and Its Owner to Pay Federal Payroll Taxes on Time
Press Release
Virginia Electrician Arraigned on Tax Charges
Wednesday, February 3, 2016

Press Release
Three Texas Tax Return Preparers Convicted of Filing False Tax Returns for Clients
Press Release
Two Georgia Real Estate Investors Indicted for Bid Rigging and Bank Fraud at Public Home Foreclosure Auctions
Press Release
BBA Aviation to Divest Facilities at Six Airports in Landmark Aviation Acquisition
Press Release
Former U.S. Citizen Pleads Guilty to Tax Fraud Related to Swiss Financial Account
Press Release
Maryland Man Sentenced to 10 Years for Transporting Child Pornography into United States
Press Release
Tennessee Man Pleads Guilty for Role in New Orleans-Based Sex Trafficking Scheme
Press Release
Florida Man Pleads Guilty to Bribing Public Official at Georgia Military Base
Press Release
Texas Woman Sentenced to Prison in Prescription Drug Smuggling Ring
Press Release
Kansas Man Pleads Guilty in Plot to Explode Car Bomb at Fort Riley in Manhattan, Kansas
Press Release
Justice Department Announces New Acting Pardon Attorney
Press Release
Vermont Man Surrenders U.S. Citizenship and Consents to Removal from United States
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Mexican Doctors Arrested on U.S. Federal Fraud Charges

Mexican Doctors Arrested on U.S. Federal Fraud Charges | Global Corruption | Scoop.it
Two Mexican doctors who operated a clinic in the Mexican border city of Reynosa are facing federal charges in the U.S. in connection with a fraud scheme that they allegedly ran for more than 10 years.

Court records obtained by Breitbart Texas reveal that husband and wife Hernandez Melchor had a medical clinic in Reynosa and would allegedly help individuals file thousands of fake insurance claims for U.S. clients.

The policy holders would fill out false claim forms in the United States  and deliver them to the two doctors in Reynosa. The doctors would prepare and sign corresponding accident reports for each fake accident and injury, according to the charges. 

The more than 50,000 fake insurance claims were sent to the insurance company known as AFLAC. The company dispursed more than $5,000,000 to their policy holders, the indictment filed against the two doctors revealed. Both doctors would allegedly receive between $10 and $15 U.S. dollars per fake accident report that they helped their customers submit.
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IACA Master in Anti-Corruption Studies

A short video about the International Anti-Corruption Academy's (IACA) flagship Master in Anti-Corruption Studies (MACS) programme with testimonials from students and professors
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Peru lost S/. 3 billion due to corruption since 2010 (PHOTOS)

Peru lost S/. 3 billion due to corruption since 2010 (PHOTOS) | Global Corruption | Scoop.it
Peru has lost US$ 860 million or S/. 3 billion due to corruption in the last five years, informed the Comptroller General of Peru, Fuad Khoury, at the 6th International Anti-Corruption Conference in Lima today.

In addition to Khoury, all of Peru’s presidential candidates are scheduled to participate in the event by presenting proposals to fight against corruption.

To demonstrate the context of corruption in Peru that the candidates will be tackling in their proposals, Khoury provided a few startling facts at today’s meetings.

Presidential candidates to present at anti-corruption conference

He informed that the Comptroller General’s Office has discovered more than 21,500 criminal irregularities committed by more than 11,000 officials in the past six years.

Since 2011, the office has begun to process 7,000 of these officials for serious offenses. However, they have only convicted 747 of them, some with punishments of up to five-year bans for holding public office.

Khory added that there are currently 11 regional governors in Peru with charges filed against them for alleged corruption.
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RUSSIA: Pussy Riot is back, and taking on corruption this time

RUSSIA: Pussy Riot is back, and taking on corruption this time | Global Corruption | Scoop.it
“I RUN the war on corruption here, or to be precise, I run the corruption here,” raps Nadya Tolokonnikova, one of the leaders of the art-punk protest collective Pussy Riot, in a new song aimed at Russia’s prosecutor-general, Yuri Chaika. In a video clip released on the internet on Wednesday, Ms Tolokonnikova and a cadre of conspirators dressed in prosecutors’ uniforms take turns beating prisoners, collecting bribes and dancing salaciously under a portrait of Vladimir Putin. “Don’t worry, son, we’ll shut up all our competitors,” intones Ms Tolokonnikova. “You’ll have your bricks, your ships and your salt mine.”



For those baffled by the lyrics, they stem from an investigation released in December by the opposition leader Alexei Navalny, whom Ms Tolokonnikova calls “my political muse”. In a 45-minute film, Mr Navalny and his anti-corruption foundation implicated Mr Chaika and his sons in a vast web of graft that stretches from an Irkutsk shipyard to a luxury hotel in Greece. While Mr Navalny’s crusades against government officials are nothing new, the case against the Chaikas, if it claims are accurate, would be the most serious yet. Mr Navalny suggests that the prosecutor-general used his position not only to help his offspring build a vast business empire, but also to cover up their links to the Tsapok family, a criminal gang notorious for the mass murder of 12 people, including four children.
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Peru PM: Political agreement crucial to fight corruption

Peru PM: Political agreement crucial to fight corruption | Global Corruption | Scoop.it
Peruvian Prime Minister Pedro Cateriano explained that one of the key aspects to fight corruption in the country involves establishing a political deal between parties and actors on the domestic political scene.

“A political agreement between parties with nationwide presence is required […] one of the dramas of Peruvian democracy is the lack of solid parties that have remarkable presence all over the country and seek to represent all citizens’ interests,” he affirmed.

A constitutional debate is convenient to analyze the Magna Carta aspects such as regionalization which —he said— facilitated the emergence of corruption over the last years at some regional governments.

Cateriano claims the current government has worked on this front, but it continues to be a pending issue that the next Parliament will have to deal with.

According to the senior official, the State should assume all international commitments towards eradication of corruption.

The Cabinet Chief went on to note the political decision to join the Organization for Economic Co-operation and Development—OECD, for which —he noted— preparation is required.
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Is perception a good measurement of corruption? (Column: Active Voice)

Is perception a good measurement of corruption? (Column: Active Voice) | Global Corruption | Scoop.it
Evidence of corruption in a developing countries like India can cause massive turmoil. Two cases in point have been the near collapse of UPA-II on account of corruption charges and the rise of the AAP in Delhi on the anti-corruption plank.

And yet, India is not alone when we talk about the endemic problem of corruption. Brazil has seen a lot of turmoil in the recent past with impeachment charges being pressed against the president. Similarly, the Petrobras scandal dented the image of Brazil internationally. All this points to the fact that countries across the world have seen corruption in the past.

Historically, even Kautilya (more than 300 years before Christ), in the treatise Arthshastra, mentions the problem of illegal transactions as well as public fraud. In a reference to it among officials stealing the money, he mentions that it is easier to ascertain the movement of birds in the sky rather than track the activities of corrupt officials. While things have got a lot better than the Mauryan times, there remains the endemic problem of corruption. The question is how do we track or measure it?

Reference to corruption is used in the context of use of public office for private good. However, this is not the only form of corruption one can think about or in which corruption can exist. Corruption can be with respect to the movement of files quickly through a system, as well as be benefits in kind and the like. Corruption can be classified in various ways - as public versus private, moral versus monetary and even institutional versus retail. However, a fundamental feature is that it corrodes public wealth and often causes a loss to the society. It is worth mentioning that corruption can also be between two private individuals, though often people conceive it to be a public problem.
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SAP settles with SEC over Panama bribery scheme

SAP settles with SEC over Panama bribery scheme | Global Corruption | Scoop.it
SAP SE agreed to pay nearly $3.9 million to settle U.S. Securities and Exchange Commission civil charges over a former executive's scheme to bribe Panama government officials in order to win lucrative technology contracts.

The SEC on Monday said SAP's deficient internal controls enabled Vicente Garcia, a former vice president of global and strategic accounts responsible for Latin America sales, to pay $145,000 in bribes to a top Panamanian official and offer bribes to two others in exchange for the contracts.

Garcia, of Miami, pleaded guilty last August to a related bribery conspiracy charge. He was sentenced on December 16 to one year, 10 months in prison. SAP had fired him in April 2014.

Monday's settlement calls for SAP to give up $3.7 million of profit and pay $189,000 of interest to settle charges that it violated the federal Foreign Corrupt Practices Act, which prohibits bribing foreign officials to win business.

SAP did not admit or deny wrongdoing, and the penalty reflected the Walldorf, Germany-based company's cooperation and remedial measures, the SEC said.

In a statement, SAP confirmed the accord, adding: "SAP is strongly committed to high standards of integrity and business conduct and has zero tolerance for any form of corruption."
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Latin America - Beatrice Rangel: 2 Diseases in Latin America -- Different Prescriptions, Very Different Outcomes

Latin America - Beatrice Rangel: 2 Diseases in Latin America -- Different Prescriptions, Very Different Outcomes | Global Corruption | Scoop.it
Two epidemics blaze in the Americas.

One exhibits a patina shaped by centuries of deployment. Its birth certificate going as far back as Columbus' visit to the Americas.

The other had been dormant for almost a century until it left the African prairies to seek more fertile grounds in South America and the Caribbean.

The first is corruption, the second is Zika.

Both have been the subject of analysis and policy recommendations. In the case of corruption prescriptions seem to be finally working . This past week major breakthroughs were achieved.

In Chile, Natalia Compagnon, daughter in law to President Michelle Bachelet was indicted over corruption charges while her business partner in the firm Caval, Mauricio Valero, was accused of issuing false invoices in an arrangement to avoid paying approximately $165,000 in taxes.

In Brazil prosecutors confirmed the indictment of Andre Esteves for his role in facilitating corrupt payments arising from Petrobras' briberies through his bank BTG-Pactual. And while Mr Esteves' arrest shook Brazil's financial world, analysts are taken by the senselessness of the engagement with Petrobras and the Brazilian government. To be sure, deals with Petrobras did not add to BTG-Factual growth or were even needed to promote its further expansion.

Last and quite significant was the arrest in Spain of Humberto Moreira, former President of PRI, Mexico's ruling party on the grounds of money laundering. It is worthwhile to note that the Spanish judge acted upon notice by foreign law enforcement agencies seeking to uphold the United Nations Convention against Corruption after Mexican courts had acquitted Moreira.

These events seem to indicate the effectiveness of the international regulatory network built to fight corruption and organized crime.
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Undercover in New York

Undercover in New York | Global Corruption | Scoop.it

lobal Witness has previously looked at a whole range of crimes, and found they all had one thing in common. They were all carried out by anonymous company owners, who are able to skirt U.S. laws and launder money through our financial system. If these sham companies did not exist, those crimes would be far harder to commit.

Anonymous companies do great damage to society. Warlords and dictators use them to steal from their people and stash the loot in places like the U.S. A violent Mexican drug cartel called the Zetas used American companies to launder its profits.The Iranian government has used them to evade sanctions. Credit card scammers, mobsters, tax evaders and other criminals routinely use them to rip off innocent citizens or threaten U.S. interests and get away with it.

The crazy thing is, these companies are often set up in the U.S. - it is one of the easiest places in the world to do this legally.


To prove our point, we went undercover and approached 13 New York law firms. We deliberately posed as someone designed to raise red flags for money laundering.

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China cracks down on alleged $7.6 billion Ponzi scheme

China cracks down on alleged $7.6 billion Ponzi scheme | Global Corruption | Scoop.it
Chinese authorities have arrested more than 20 suspects who are accused of involvement in a massive Ponzi scheme that allegedly swindled hundreds of thousands people out of billions of dollars.
The arrests reported Monday by state media relate to E-zubao, a peer-to-peer lending platform that promised investors attractive returns of as much as 15% when it launched a year and a half ago.

But the man behind the platform, Ding Ning, is now accused of gobbling up new capital largely in order to pay off existing investors, according to the official Chinese news agency Xinhua. Ding and 20 others have been arrested on suspicion of embezzling 50 billion yuan ($7.6 billion) from around 900,000 investors.
Authorities began investigating Ding's company, Yucheng Group, late last year. During the probe, investigators reportedly found 1,200 account books stashed in sacks buried 20 feet underground.
E-zubao has become one of the largest investment scandals to emerge from China's shadow-banking world -- a dark, unregulated patch of the country's financial system that offers murky investments with extremely high rates of return among other services.
There's often no transparency about where exactly investor money is going -- and the investment vehicles have vague names, such as "wealth management products." In some cases, they're sold through privately run exchanges or via online platforms, like E-zubao.
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USA: Report: Cronyism perceptions hurt state

USA:  Report: Cronyism perceptions hurt state | Global Corruption | Scoop.it
 The perception that government in New Mexico has a high level of cronyism is one factor dampening private investment in the state, according to a recently released report.

"From day one, what business leaders tell us is that corruption and cronyism matter, and they have consequences to economic growth," said Michael S. Rocca, an associate professor of political science at The University of New Mexico who led a team of researchers and graduate students to author the report "Crony Capitalism, Corruption and the Economy in the State of New Mexico."

Rocca concludes that the perception in New Mexico that moneyed interests gain more advantage through lobbying and tax subsidies is a subtle but negative factor as businesses decide where to expand or relocate. "No question that education and infrastructure and things like broadband matter, but corruption and cronyism matter as well," he said.

To curb cronyism in New Mexico, the report suggests three changes that are already under consideration — a statewide ethics commission; greater transparency in campaign financing and lobbying; and a more detailed review of tax breaks given to businesses. Rocca said the measures are fairly simple to enact and not as controversial as bigger changes that might meet more resistance, such as term limits for elected officials.
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Madoff Sleuth Warns of 3 New Ponzi Scams

Madoff Sleuth Warns of 3 New Ponzi Scams | Global Corruption | Scoop.it
At least three major Ponzi schemes are currently scamming American investors, according to Harry Markopolos, the man whose warnings about the Bernard Madoff Ponzi scheme were ignored by the Securities Exchange Commission (SEC).

“I’m working on three multi-billion dollar Ponzi schemes today,” Markopolos told ABC News, including one that he says will be bigger than Madoff’s. "You can’t stop them."

Markopolos, who declined to identify the names of the scams until he provides the information to government investigators, now runs his own private financial fraud detection business and continues to work as an adviser for federal law enforcement agencies.
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TI Daily Corruption News: 5 February 2016

TI Daily Corruption News: 5 February 2016 | Global Corruption | Scoop.it
Brazil: Brazil president testifies on alleged bribery scheme
Associated Press

Brazilian President Dilma Rousseff told a federal judge on Thursday that she knew nothing of an alleged scheme to pay bribes in exchange for tax benefits for the auto and other industries.



MORE NEWS

Global: Suspended U.N. diplomat lacks immunity from U.S. bribe case: judge
Reuters

Bangladesh: Speak up against corruption
The Daily Star (TI mention)

Bosnia and Herzegovina: U.S. senator warns of 'worsening corruption' in Bosnia
Radio Free Europe/Radio Liberty

China: Chinese anti-corruption agency warns of 'major problems' in financial sector
CNN Money

Greece: After 11 years on the job, Greece’s anti-corruption tsar retires
Financial Times

Kenya: Kenya commission wants tribunal to probe judge, nation says
Bloomberg

Malaysia: Malaysia's anti-graft efforts haven't put investors at ease
Bloomberg
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Almost every top official in Texas city arrested in federal corruption case

Almost every top official in Texas city arrested in federal corruption case | Global Corruption | Scoop.it
Almost every top official in a remote South Texas city was arrested Thursday under a detailed federal indictment that accuses them of taking bribes from contractors and sending city workers to help an illegal gambling operator nicknamed "Mr. T."

Crystal City's mayor, city manager, mayor pro tempore, one of three current councilmen and a former councilman were all arrested under an indictment obtained by the U.S. attorney's office in San Antonio, a spokesman for the U.S. attorney said.

A second councilman is already charged in a separate case with smuggling Mexican immigrants. That leaves just one councilman not facing federal charges in Crystal City, a town of about 7,100 people about 50 miles from the U.S.-Mexico border.

Once billed as the "Spinach Capital of the World," Crystal City's logo features a cartoon of Popeye, and a spinach festival with a cook-off and a beauty pageant draws tens of thousands of people each year. But in recent months, the town has been in the news for turmoil at City Hall and allegations of misuse of public money.

"What happened is nothing to celebrate. It's something sad that happened to us," said the remaining councilman, Joel Barajas, on Thursday. "By all means, we need to move forward."

The indictment accuses the town's leadership of using their positions "to enrich themselves by soliciting and accepting payments and other things of value." Also charged was Ngoc Tri Nguyen, alleged to be an operator of illegal gambling rooms, who was nicknamed "Mr. T."

Crystal City Mayor Ricardo Lopez took $6,000 from Nguyen to buy a vehicle, the indictment alleges. In return, he allegedly waived some taxes for Nguyen and had employees close competing casinos that violate state law but exist informally throughout South Texas. Lopez allegedly told city employees inspecting Nguyen's property to "make it easy."

City Manager William James Jonas and Mayor Pro Tempore Rogelio Mata are accused of giving a contractor a $12,000 payment "in exchange for payments and other things of value."

And Lopez, Rogelio Mata, current councilman Roel Mata and former councilman Gilbert Urrabazo are accused of voting to keep Jonas as city attorney and city manager at a salary reported by local media to exceed $200,000. In exchange, Jonas provided payments and other illegal benefits to the four leaders, the indictment alleges.
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PHILIPPINES: Ombudsman upholds criminal charges vs VP Binay, son

PHILIPPINES: Ombudsman upholds criminal charges vs VP Binay, son | Global Corruption | Scoop.it
The Office of the Ombudsman upheld its decision to indict Vice President Jejomar Binay, his son dismissed Makati mayor Jejomar Erwin “Junjun” Binay Jr, and 22 others over the alleged overpricing of the Makati city hall parking building II.

In two separate resolutions on 6 docketed cases, the Ombudsman said it has jurisdiction to conduct its preliminary investigation that led it to find probable cause to file criminal charges against Binay, his son, and their co-respondents for graft, malversation of public funds, and falsification of public documents in connection with the bidding and construction of the carpark project.

Rappler obtained copies of the documents on Friday, February 5.

The Vice President, Makati mayor for 21 years, sought the reconsideration of the October 2015 decision of Ombudsman Conchita Carpio-Morales, claiming that the Ombudsman has “no jurisdiction” to investigate and issue a resolution indicting him for criminal charges.

Citing the High Court's In Re: First Indorsement from Honorable Raul M Gonzalez dated 16 March 1988 (Gonzalez), Binay argued that the Ombudsman cannot file a case against him before the anti-graft court Sandiganbayan or any other court while he is still vice president.

In its resolution, the Ombudsman said it has the authority to investigate Binay “in accordance with the Constitution, law and jurisprudence.” (READ: ‘Vice President does not enjoy immunity’)

Carpio said Binay was being investigated for alleged criminal acts committed while he was Makati city mayor, not as vice president.

“It bears recalling that the assailed Joint Resolution resolved to hale Binay Sr to court after his term of office as an impeachable officer expires,” the Ombudsman said in the decision.

This means that the Ombudsman will not yet file criminal charges against Binay while he is the sitting vice president as this is not permitted by law.

Should Binay lose in the presidential elections in May, the Ombudsman may immediately file the cases against the United Nationalist Alliance standard-bearer before the Sandiganbayan.
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Aid-Money Laundering as an NGO Racket. Haiti

Aid-Money Laundering as an NGO Racket. Haiti | Global Corruption | Scoop.it

It took the January 12, 2010 earthquake in Haiti to expose the rot in the world’s charities. Well-meaning people and their governments donated about $12 billion dollars of emergency aid, virtually none of which reached individual Haitians. The funds that were delivered went mostly to enrich the donor countries’ government agencies, aid agencies and non-governmental organizations (NGO), and the vast majority of the pledged funds were never delivered at all. Some of this disappeared money was embezzled. Two criminal cases in 2015 give a glimpse into the use of NGOs by criminal networks to launder embezzled aid money.

Aid, Mediterranean style

Rafael Blasco, one of Spain’s longest-lived and most indestructible politicians, became the first person to serve time for stealing Haitian reconstruction funds when he began a six-and-a-half-year prison sentence on June 15, 2015 for committing embezzlement of public funds, administrative prevarication, and forgery while he was the Director of the Aid Ministry in Valencia’s regional government. Although the English-language press ignored this news, in Spain, the “Aid Case” was a major scandal that the media followed for three years, until the Spanish Supreme Court denied Blasco’s final appeal for clemency in May 2015.

According to a Valencia High Court and the Spanish Supreme Court, Blasco received his sentence for running a criminal ring that had syphoned off all but 3 percent of a $2 million aid package that should have brought water and sustainable food to two poor rural areas of Nicaragua. This was only one part of the three-part Aid Case, which involved a total of $10 million and irregularities in 30 humanitarian projects in Central America and the Caribbean, Africa, and Asia. Another important part of the Aid Case was the planned construction of a hospital in Haiti after the 2010 earthquake for $5.1 million, but it turned out that there was sufficient evidence in the Nicaragua part to convict Blasco.

To solicit and syphon off the funds, Blasco formed and ran a criminal ring composed of members of Valencia’s Aid Ministry and various NGOs. In the Nicaragua part of the Aid Case, the NGO was called the Cultural and Social Studies Foundation (Fundación CYES). Its president, Marcial Lopez, and his wife, Maria Jose Cervera, were both convicted. Other members of this crime ring included the businessman Augusto Cesar Tauroni, who was sentenced to six years in prison; the former Secretary General of Valencia’s Aid Ministry, Agustin Sanjuan, who was also sentenced to six years in prison; and the former Under Secretary of the Aid Ministry, Alejandro Catala, who was sentenced to four and a half years in prison.

The criminal conduct began in August 2010 when Rafael Blasco, as the Director of Valencia’s Aid Ministry, pressured a committee to grant the $2 million development subsidy to CYES despite the NGO’s application being previously rejected. Shortly thereafter, two members of the committee who had opposed the grant were fired, and 25 percent of the amount of the grant was paid to the middleman Augusto Tauroni, for “advisory services, consulting, and engineering.” A court investigation could account for virtually none of the disbursed aid funds. Invoices were presented that were unrelated to the project, and in one case the salaries of Nicaraguan workers were changed to euros instead of the local currency, in which they were paid, so as to justify a monthly payroll of $5,100 instead of $71. In the end, 97 percent of the $2 million humanitarian aid to Nicaragua was laundered through CYES and then syphoned off into real-estate purchases in Spain’s Mediterranean region of Valencia.

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Corruption Currents: Ukraine Minister Quits in Protest Against Graft

Corruption Currents: Ukraine Minister Quits in Protest Against Graft | Global Corruption | Scoop.it
Ukraine’s economic minister resigned in protest amid widespread government corruption. Does Kiev have to outsource its fight against graft? (BBC, Foreign Policy, Euronews)

Malaysia accused Switzerland of “misinformation” relating to the 1MDB scandal. A former minister challenged the ruling not to charge the premier. Does Malaysia have a credibility problem? (Guardian, AP, GAB)

Nigeria’s anti-corruption sweep continued with a raid on a former vice president. (Economist, Reuters)

New Yorkers want a tougher line against corruption than the current crop of proposals, a poll found. (Newsday, WSJ)

Moldova is tottering, due to corruption troubles. (Economist)

A former aide to the Czech premier was jailed for corruption. (Reuters)

An Iraqi integrity commission member says he’s corrupt. (Asharq Al-Awsat)
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SOUTH AFRICA: Poor people more susceptible to corruption DA's Mashaba

SOUTH AFRICA: Poor people more susceptible to corruption   DA's Mashaba | Global Corruption | Scoop.it
Some poor people are more susceptible to corruption when placed in leadership positions because they have not learnt how to handle money, DA's Johannesburg mayoral candidate, Herman Mashaba told News24 on Tuesday.

"In a leadership position, we really need people who understand finances and who know what they are dealing with. If they are saying that I am saying poor people cannot lead, what nonsense is that?" 

The Black Like Me founder was responding to criticism on social media after he said, during an SABC interview on Monday, that poor people could not be expected to lead. 

"It is interesting that you can expect poor people to be the leaders. That is looking for trouble, in any given situation," he said.

Mashaba said making someone, who had never seen R100, responsible for a large budget of a city for example, was putting temptation in their way. 

Corruption was not peculiar to South Africa and leaders had to make sure that they appointed knowledgeable and competent people to strategic positions
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Corruption Currents: U.S. Busts Hezbollah Money-Laundering Ring

Corruption Currents: U.S. Busts Hezbollah Money-Laundering Ring | Global Corruption | Scoop.it
The daughter-in-law of Chile’s president was charged with bribery. She didn’t appear to be contacted, but is banned from leaving the country. (NY Times, Reuters)

A U.S. Navy officer was sentenced to more than three years in prison in a sex-for-secrets scandal. (Washington Post)

In local politics: A former vice mayor in China is under investigation for bribe-taking; he didn’t appear to be contacted. Testimony in a bribery case burned Cypriot officials. (Shanghai Daily, InCyprus)

Cybercrime:

Hackers posted the files of the largest U.S. police union. (Guardian)

A U.S. federal agent sentenced to prison for pilfering Silk Road proceeds tried to flee the country. (Wired)

Money Laundering:

The U.S. Drug Enforcement Administration said it busted a money-laundering and drug-dealing scheme that linked Hezbollah to major drug-trafficking operations in Latin America. France detained four men, including one recently targeted by the U.S. with sanctions, in the case. (Vox, Daily Star)

Brazilian prosecutors summoned a former president over allegations he laundered money. A foundation linked to him said the allegations are frivolous. (AFP)

Appeals attempts backfired on a Zetas Cartel-linked businessman. (Austin American-Statesman)

A U.S.-based activist said Nigerian expats launder money abroad for corrupt politicians. (Sun News)

PEPWatch: A son of former Sri Lankan president Mahinda Rajapaksa was arrested under the country’s anti-money laundering act. The former president angrily condemned the police action. (Reuters, NY Times)
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Brazil Petrobras former director Jorge Zelada jailed - BBC News

Brazil Petrobras former director Jorge Zelada jailed - BBC News | Global Corruption | Scoop.it
A former director of the Brazilian state-owned oil company Petrobras has been sentenced to twelve years in prison, as part of a huge investigation into bribery and corruption.
Jorge Zelada, who ran Petrobras's international division, was convicted of money-laundering and corruption.
Another Petrobras manager, Eduardo Costa Musa, and two others were also jailed.
The men were paid millions of dollars in bribes by a Petrobras contractor.
The investigation also found that Jorge Zelada had transferred huge amounts of money offshore into bank accounts he owned in China.
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Latin America Again Performs Poorly on Transparency International’s Corruption Index

Latin America Again Performs Poorly on Transparency International’s Corruption Index | Global Corruption | Scoop.it
The Petrobras scandal appears to be dealing a heavy blow to Brazil’s image internationally, with the South American country dropping seven positions on the latest corruption perception index released by the Transparency International.

The report is a grim reading from a Latin American perspective, because major regional countries, including Mexico, are ranked below Brazil. Ranked 158th, the socialist country of Venezuela is the most corrupt countriy in the region, while Uruguay and Chile, ranked  21st and 23rd, respectively, are seen as the least corrupt.

The countries that performed relatively better on the index include Costa Rica (40th), Cuba (56th), El Salvador, and Panama.

Brazil is ranked 76 on the index, and the countries ranked below Brazil include Colombia, Peru, Mexico, Bolivia, Dominican Republic, Ecuador, Argentina, Honduras, Guatemala, Nicaragua, and Paraguay.

An investigation into Petrobras scandal has already led to the arrest of more than 100 people, including politicians and executives of some of the country’s biggest construction firms. Although President Chair Dilma Rousseff has not been directly implicated in the scandal she is under severe political pressure.
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USA: New Technologies Give Government Ample Means to Track Suspects, Study Finds

USA: New Technologies Give Government Ample Means to Track Suspects, Study Finds | Global Corruption | Scoop.it

For more than two years the F.B.I. and intelligence agencies have warned that encrypted communications are creating a “going dark” crisis that will keep them from tracking terrorists and kidnappers.

Now, a study in which current and former intelligence officials participated concludes that the warning is wildly overblown, and that a raft of new technologies — like television sets with microphones and web-connected cars — are creating ample opportunities for the government to track suspects, many of them worrying.

“ ‘Going dark’ does not aptly describe the long-term landscape for government surveillance,” concludes the study, to be published Monday by the Berkman Center for Internet and Society at Harvard.

The study argues that the phrase ignores the flood of new technologies “being packed with sensors and wireless connectivity” that are expected to become the subject of court orders and subpoenas, and are already the target of the National Security Agency as it places “implants” into networks around the world to monitor communications abroad.

The products, ranging from “toasters to bedsheets, light bulbs, cameras, toothbrushes, door locks, cars, watches and other wearables,” will give the government increasing opportunities to track suspects and in many cases reconstruct communications and meetings.

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PHILIPPINES: Ombudsman Morales appeals: Vote for people with integrity

PHILIPPINES:  Ombudsman Morales appeals: Vote for people with integrity | Global Corruption | Scoop.it
The official noted how corruption remains prevalent in government, with thousands of complaints about graft and corrupt practices and other administrative violations filed before her office.

The Ombudsman’s current case workload is at 11,056, which includes 8,715 pending cases from previous years and 2,341 cases filed in the first half of 2015, according to data on the Ombudsman’s official website.

Of the said total, 27 percent or 2,940 cases have been resolved—either dismissed, forwarded to the courts or resulted in administrative penalties.

Most of the newly filed cases last year involved local officials, a total of 1,092, while police officers accounted for more than 600 cases. Other officials who faced investigation by the Ombudsman include those from the military, the departments of education, finance, natural resources, justice and agriculture, state universities and colleges and the fire protection and jail management bureaus.

“Our job is difficult,” said Morales.

“I’d like to to believe that there has been an increase in confidence and trust in the Office of the Ombudsman. And, on account of that, people think we can solve all their problems,” she said.

The official said her prosecutors have to sift through complaints as simple ones, for instance, retirement benefit claims, could be settled through the Ombudsman’s assistance program.
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