GTI Applauds World Bank on Improved Disclosure Policy, Though Significant Weaknesses Remain

For immediate release – 3 November 2009

The Global Transparency Initiative (GTI) today released its analysis of the World Bank’s new draft disclosure policy, Toward Greater Transparency Through Access to Information: The World Bank’s Disclosure Policy. The analysis concludes that while the revised policy will bring greater transparency to the Bank, it still falls well short of the standards set out in the GTI’s Transparency Charter for International Financial Institutions, as well as its Model World Bank Policy on Disclosure of Information.

The GTI analysis, provided in advance of an anticipated 17 November 2009 meeting of the Bank’s Executive Board to consider the draft policy, recognises a number of important advances in the Bank’s proposals. The Bank is poised to take a major conceptual step by accepting the principle that all Bank information should be available to the public unless it falls within the scope of the regime of exceptions. Other positive commitments include:

§  disseminating more materials in advance of Board meetings;

§  releasing the summaries of Board meetings;

§  launching a proper system for processing requests for information; and

§  establishing an independent appeals body.

Unfortunately, the proposed exceptions to the presumption of disclosure threaten to severely undermine these positive developments. Governments and third parties, such as Bank contractors, would be able to veto the release of almost any information they provide to the Bank. The draft policy also provides nearly absolute protection to internal information through a “deliberative process” exception, viewed as so central that it is posited as an independent principle in the policy, instead of being included as an ordinary exception.

The GTI recognises that certain interests need to be protected through exceptions, for example to protect personal information, health and safety. However, it recommends more nuanced and precise harm-based tests to protect legitimate interests such as relations with other States, the commercial interests of third parties, and the free and frank provision of internal advice.

Also troubling is the proposal’s assertion that the Bank’s disclosure policy trumps national right to information laws. Among other things, this would restrict access to the statements made by country representatives such as the Executive Directors in official World Bank meetings.

"The GTI congratulates the Bank for making some very important strides forward in the new proposed policy," said Toby Mendel, Senior Legal Advisor, ARTICLE 19. "However, the very wide exceptions being proposed could really undermine the policy. The Bank should make a strong commitment to openness, as many of its members have in their national right to information laws."

Bruce Jenkins, a consultant with the Bank Information Center, noted that while the revised policy is an improvement from previous iterations, it is not without significant weaknesses.  He stated that"the Bank has taken major steps forward, including expanded routine disclosure and a first-of-its kind independent appeals body. However, it then partially claws back these gains through heavy-handed limitations, such as the withholding of draft information that would undermine more participatory decision-making processes."

The GTI calls on the World Bank to revise the draft Policy so that it is better aligned with the standards set out in the GTI Transparency Charter. It is ready to offer any assistance to the Bank to achieve this goal.

NOTES TO EDITORS:

• The GTI Analysis is available at:  www.ifitransparency.org
• For more information please contact: Toby Mendel, Senior Legal Counsel, a19law@hfx.eastlink.ca, +1 902-431-3688, Toby McIntosh, FreedomInfo.org,  tmcintosh@bna.com, +1 703-887-5197 or Bruce Jenkins, consultant, Bank Information Center, +1 202-329-6875.
• The GTI is an independent network of organisations that works around the world to promote access to information held by international financial institutions.

Zambia disbands graft team that prosecuted Chiluba!

Since we previously did the Chiluba story on this blog - thought this latest release from the Associated Foreign Press of interest.

LUSAKA — Zambia will disband the anti-graft team that prosecuted ex-president Fredrick Chiluba, drawing accusations Friday that the government was seeking to bury the case two months after his acquittal.
Vice President George Kunda told parliament late Thursday that the special task force created to investigate corruption allegations against Chiluba would now become part of the Anti-Corruption Commission (ACC).
The previous government of the late president Levy Mwanawasa had created the task force in 2002, saying the commission did not have the capacity to investigate complex cases.
But Kunda said all cases handled by the task force will be handed over to the ACC.
"Under this policy, the anti-corruption commission shall be the lead institution in the fight against corruption," he said.
Anti-graft watchdogs denounced the move as a politically motivated, saying it cast doubt on current President Rupiah Banda's commitment to rooting out graft.
"This whole decision was politically motivated and meant to stop people from talking about the acquittal of Chiluba," Transparency International Zambia president Reuben Lifuka told AFP.
"This is a clear testimony that the government is not serious in fighting corruption," Lifuka added.
In August, Chiluba was acquitted on charges of misappropriating 500,000 dollars in public resources as he developed a taste for tailor-made shoes and suits.
The executive chairman of the task force, Max Nkole was sacked a week after the acquittal and his effort to appeal the ruling was quashed.
Given Lubinda, head of the African Parliamentarian Network Against Corruption, said the move showed government was not serious about the fight against corruption and would tarnish the country's image.
"The government is to blame for the bad image created to the outside world. Since the death of Levy Mwanawasa," he said.
"Zambia's image as far as corruption fight is concerned has been dented. They have decided to disband the task force because they want to protect their friend Chiluba," Lubinda said.
The former president still faces legal action in a separate matter stemming from a graft conviction in Britain, where a court in 2007 found him and former aides guilty of stealing nearly 50 million dollars of state funds.
In the London case, Chiluba and others were found guilty of defrauding the Zambian government, and the court ruled that he should be denied access to his pension at Barclays Bank.
Zambia's government last year began efforts to register the judgement locally, which would allow authorities to seize his assets to recover the money. Chiluba has argued that the British court ruling should not apply here.

Copyright © 2009 AFP. All rights reserved.

Transparency International launches Global Corruption Report 2009: Corruption and the Private Sector

Transparency International (TI), a leading anti-corruption organisation, has launched a wide-ranging review of corrupt practices in the private sector, including bribery and undue influence, corporate fraud and cartels. New challenges for carbon trading markets, sovereign wealth funds and emerging economic powers in Asia and Latin America are also covered.

TI’s Global Corruption Report 2009: Corruption and the Private Sector features more than 75 experts examining the scale, scope and devastating consequences of corporate corruption, ranging from small entrepreneurs in Sub-Saharan Africa to multinationals in Europe and North America. These are complemented by 45 in-depth country reports (Trinidad and Tobago country report included). Best practices and practical recommendations for businesses and governments are also identified.

The Report is available for download here.

Oh Khaleda! Women and Corruption...

Earlier this month, Khaleda Zia, the former Prime Minister of Bangladesh was committed to stand trial with her son and other top ranking officials for embezzling approximately 300 000 dollars which was originally intended to build a state orphanage. Zia, who became the first female Prime Minister of Bangladesh in 1991 and who was ranked number 33 in the Forbes list of the world's 100 most powerful women has certainly dropped from glory.

The Charges

The circumstances giving rise to the charges were that the plaintiff alleged that the accused in collaboration with each other misappropriated Tk 2,1071,643 belonging to Zia Orphanage Trust. The accused withdrew the money through cheques from November 11 to March 28 in 2007 from Prime Bank, New Eskaton Branch in Ramna, where Tk 2 crore was deposited in the account of Zia Orphanage Trust. Tk 1071,643 comes as interest against Tk 2 crore.        

A foreign firm in 1991 donated $ 12,55,000 (then equivalent to Tk 4,44,81,216) for the welfare of orphans. The then BNP government deposited the money with a bank and kept it till 1994, according to the case details. The amount increased to Tk 5.3 crore with interest in four years.
The prime minister's office later distributed the money in two separate projects in Bogra and Khulna districts under the name of Zia Orphanage Trust, the case statement said. Of the Tk 5.3 crore, the accused embezzled around Tk 2.11 crore from the trust, according to the statement. 

The plaintiff in the case statement alleged that though there were hundreds of orphanages in Bangladesh, the then BNP government did not distribute the money among them. With a view to misappropriating the money, the then prime minister Khaleda Zia formed Zia Orphanage Trust, which was registered at the sub-registry office in Gulshan in the city on September 5 in 1993, according to the case details. The address of the trust was mentioned as House No-6, Shaheed Mainul Road at Dhaka Cantonment, which is the residence Khaleda Zia and her family members.      

About Khaleda

Born in 1945 to Iskandar Majumder, a businessman, and Taiyaba Majumder at Dinajpur district in north-western Bangladesh, Zia's eventual rise to political power could hardly have been predicted.

According to records she got married in 1960 to Ziaur Rahman, a prominent war hero who himself later became the President of the Republic and formed the Bangladesh Nationalist Party (BNP)in 1978. However, unlike Hilary Clinton, until the assassination of her husband in an abortive military coup in Chittagong on 30 May 1981, Zia had taken little to no interest in either politics or public life.

From all reports, even when her husband was propelled to power after the political changes in 1975, "she remained a shy and withdrawn housewife who devoted most of her time grooming up her two sons".

After the assassination of her husband, Vice President Sattar took over the reigns of the BNP party and acted as President. This however was short-lived after a successful military coup of sorts headed by Chief of Army Staff General H.M. Ershad who proclaimed martial law on 24th October 1982. In 1983 Sattar appointed Zia as Vice Chairman of the BNP party and when he retired in February 1984 Zia took over the leadership. So that it would appear that her ascendancy to the leadership of the BNP party came less through the dint of hard work but more by a quirk of fate!

However, how this woman handled this new power initially was impressive, even if one shuns her as a role model given these allegations. Zia was seen to work hard as leader of the opposition to regain political power for the BNP party. Records of the early days of her rise demonstrate effective leadership and resolve on Zia's part.

"She stood resolutely, took the reins of BNP and with like minded pro-democratic parties and elements, formed the 7-party Alliance and started uncompromising resistance against the usurper of people's rights.

In the Parliament elections that followed on 27 February 1991 under a Non-Party Caretaker Government, Begum Khaleda Zia led her party to a thumping victory, herself emerging as the most popular political leader of the country. On 20 March 1991 she was sworn in as the country's first woman Prime Minister in a Presidential form of Government. Respecting the wishes of the people, Begum Khaleda Zia and her party took the lead in switching over from the Presidential to the Parliamentary system of Government in order to give the hard-won democracy a permanent institutional shape. She formally took over as the Head of Government on 19 September 1991 under the Parliamentary system.

Begum Zia's Dall-Bhaat (lentil and rice) approach received both regional and international acceptance as a tangible programme for poverty alleviation in SAARC countries as well as in other developing nations.

She became Prime Minister for the second consecutive term after the February 1996 general election.

Her party BNP restored the parliamentary system through the 12th amendment to the Constitution in 1991 and introduced the Caretaker Government for holding neutral and free election through 13th amendment to the Constitution in 1996.

The government of Khaleda Zia made tangible progress in empowering huge rural womenfolk in the countryside. Her government brought about major reforms in the education sector that included introduction of compulsory free primary education, free education for girl students, stipends for the girl students and food for education programme. Side by side, she initiated bold reforms to revitalize national economy, accelerate production in all sectors and to alleviate poverty. Agriculture, the mainstay of Bangladesh's economy, was given the main thrust to achieve autarky in food production in the shortest possible time.

Promoting good neighbourly relations, strengthening regional cooperation within the ambit of SAARC, strict adherence to the UN Charter and furthering world peace and amity were the cornerstones of her government's foreign policy.

In the 1996 polls, the BNP emerged as the largest opposition party in the country's parliamentary history with 116 seats. The party under the leadership of Begum Zia formed a four-party opposition alliance on 6 January 1999".[Life Sketch BEGUM KHALEDA ZIA Hon'ble PRIME MINISTER PEOPLE'S REPUBLIC OF BANGLADESH]


So there we have a stellar record of a woman exercising political power as commendably as any other of her male counterparts. Studies, though challenged by many, have suggested that women are lest prone to corrupt acts than men. According to the World Bank in 2001 in an important policy statement on gender equality,
‘Engendering Development’, there is a strong relationship between relatively high levels of female involvement in public life and low levels of government corruption. The report concludes that this finding lends ‘additional support for having more women in politics and in the labor force – since they could be an effective force for good government and business trust’ (World Bank, Engendering Development, 2001:96).

Women & Leadership

In the Western world, with the evolution of the feminist movement and the growing empowerment of women, there has been increasing involvement of women in politics. If one were to look at the Scandinavian countries we see 40% representation by women on the legislature and in fact this is the highest political representation of women in the world. Followed by, interestingly enough, leaders in the Asian continent. So I wonder, is it that women in Asia are further along in terms of equality and non-discrimination in the political sphere or is it as Stanley Wolpert describes it an “accident of gender” or as Shakespeare would say having "leadership thrust upon them"? One study singled out a commonality in these Asian women leaders as being the manner in which they came into office in the first place. In most cases, like Zia, these women are victims of the violent death of a close male relative – a husband or father. And it has been said that even in the case of exceptions where they were groomed for the highest office it was not by their ability alone but more by reason of their proximity to male rule.

Indira Gandhi, for example, was the daughter of the illustrious Jawaharlal Nehru who died a natural death. Benazir Bhutto assumed the mantle of the Pakistan People’s Party after the hanging of her father Zulfikar Ali Bhutto by the military leadership. While Indira and Benazir had some amount of political experience the others like Chandrika Kumaratunga of Sri Lanka, and Zia lost their husbands, both politically significant members, to assassination.

Accident or not, it would seem that Zia, if the allegations are proved to be true, despite her commendable strength, vision and determination exhibited throughout her leadership, may put the lie to this myth that women are less corrupt than men.

[ LMG World TV digression. Interestingly, although, as we have seen above, it is unremarkable that the former housewife of a political war hero becomes a leading political figure, it would seem far less likely that such a person develops an innovative economic aid programme, especially in a country like Bangladesh.  Bangladesh in this regard is a particularly interesting study of how one country has responded to the challenges of poverty. We should not forget that Bangladesh is also the home country of Mohammed Yunus, Noble Prize Winner and Founder of the Grameen Network which spearheaded the creation of the, now so-popular, micro-finance model]

On the Collapse of a Commission ..

And so there we have it, the apparent collapse of the Commission of Enquiry into UDeCOTT and the construction sector in Trinidad and Tobago. The news came yesterday when Chairman of the Commission Professor John Uff held a press conference instead of opening the fourth and last hearing of the enquiry. Uff read a prepared statement which stated

"It seems to be generally accepted that the Commission, when issued by His Excellency the President on 9 September 2008 and extended on 10 December 2008 was not, as it should have been, published in the Gazette. That is a formality which can be cured at any time. However, it seems to be the opinion of most of the lawyers involved in the Enquiry that, unless and until it is cured, the Commission cannot take effect under the Commissions of Enquiry Act and the powers provided by the Act are therefore not available. If and when action is taken to regularise the Enquiry, it is suggested that publication in the Gazette at that stage will not have retrospective effect and that a validating statute would be necessary. I should say that a contrary opinion has been provided to the effect that gazetting at this stage would validate the Enquiry retrospectively. This matter is still under review."

Cynicism abounds throughout the small twin island state of Trinidad and Tobago as the Commission of Enquiry saga which had begun amidst much public furor [after the firing of then Minister of Trade and Industry, Dr. Keith Rowley who had demanded greater oversight of the state-owned enterprise UDeCOTT] now ends amid questions, much like those surrounding the bombing of the World Trade Center of how, when and why?.



A Consideration of the Reason Advanced : Failure to Gazette the Commission of Enquiry

Coming as the latest chapter after a tirade of challenges, from UDeCOTT, Mr. Calder Hart and their counsel, which have plagued the enquiry's continued work from inception and under circumstances where Government officials were seen on numerous public platforms continuing to support and praise the beleaguered state enterprise, many view with grave suspicion what they see as just the last and ultimately most successful attempt to derail the Commission.

The reason advanced for the cancellation of the fourth session is the failure on the part of officials unknown to gazette the Commission of Enquiry. So what does this mean?

According to section 15 of the Commission of Enquiry Act Chapter 19.01 "All commissions under this Act and all revocations of any such commission, shall be published in the Gazette, and shall take effect from the date of publication". The Gazette is the official publication of the Government which is in many cases the statutorily mandated form of official notice to the public. Ordinarily failure to gazette would not invalidate the act done, however in the case of a Commission of Enquiry under the law of Trinidad and Tobago it is expressly stated that it shall only take effect from the date of publication.

According to the Privy Council in the 2007 St Vincent and the Grenadines case of Joachim v Attorney General, the proceedings of the inquiry are ineffective without the gazetting. In that case it was ruled that section 16 of the St Vincent and the Grenadines Commission of Inquiry Act — which is on all fours with our section 15 — made the proceedings ineffective until gazetted.

It was stated in that decision that “Parliament must indeed be taken to have intended the consequence of non-publication of the commission to be total ineffectiveness. That intention is as plain as can be from the last ten words of section 16: ‘and shall take effect from the date of such publication’,”



But has the Commission really collapsed?

The question now is - can this defect be repaired? and if so, by what means? There have been two main arguments advanced for the repairing of the defect and I consider each of them briefly below.

1. Publish in the Gazette now and rely on the retrospective operation of section 42 of the Interpretation Act Chap. 3.01

Section 42 reads as follows:

"An appointment (however described or designated) under a written law may be made to have effect retrospectively from the date upon which the person appointed in fact first performed any of the functions of his appointment."

Lawyers are going back and forth on whether this section is applicable. My view is that it is not applicable. That section relates to the appointment of public officials and not expressly with a Commission of Enquiry. To go this route will be to rely on the hope that it would apply and merely leave the door open for not so ingenious legal challenge at a later stage.

2. Pass an act of Parliament validating the Commission of Enquiry retrospectively.

This in my view is the safest route. It can be done very quickly, since there is no need for compendious legislation. There may only be the need for 2-3 clauses. Parliament can change the law at anytime. If there are those who are of the view that this retrospective application of the validating act would operate to breach some individuals fundamental rights and freedoms under the Constitution - then the precaution should be taken to have the Act passed by the requisite special majority.

Common Law Enquiry?

Professor Uff, quite interestingly, threw another spoke in the wheel of the argument that the Commission of Enquiry was illegal or invalid. He stated that he was of the view that in a common law territory - if there is no statutory law it does not mean that there is no law that would operate to cover a particular scenario - the common law (judge made law - doctrine of precedent) would apply. Accordingly, since there is precedent and provision in the British common law for common law enquiries the instant Commission will be covered thereby. I have not researched this issue as yet - so I prefer not to express a legal opinion on it. It does at first blush though appear to make very good sense.

So, in synopsis, there has been a defect, but I have not heard anyone credibly advance that it is fatal. It is curable and the safest cure would be the validating legislation. Ironically, in the present circumstances, the Government [which is perceived by many as not entirely supportive of the work of the Commission, given their vociferous defence of UDeCOTT despite the evidence adduced], will be forced to demonstrate to the public whether in fact they are desirous of remedying this defect.

In fact, it is far better that this defect has come to light now and not later during the course of judicial challenge brought by any of the parties before the Commission.


And the result is....


Though many may refuse to admit it, as the evidence burgeoned through our television sets, day after day, telling stories of the apparently unchecked exorbitant expenditure on projects being undertaken by the state agency and of alleged improprieties, irregularities and in some instances self-interested conduct on the part of the Chairman Mr. Calder Hart and other UDeCOTT consultants and employees, a growing though reluctant optimism was being felt throughout the country. Some, though not daring to mutter out loud, allowed themselves the luxury of the cautious and hopeful thought 'perhaps something would come of this Commission?'.

On the other hand the perennial cynics who are never wrong and love to craw "I told you so!" now seem not to be able to contain their mirth that they have been proven to have been right all along. The Commission was a sham, a farce - no hope of success!!

However, as one of the many persons involved in one way or another with the work of the Commission who gave of themselves tirelessly hour after hour, poring over thousands of pages of transcripts, cases, submissions and reports and sitting through hearing after hearing, making submissions, questioning witnesses and unearthing information to inform the Commission's eventual findings and recommendations, such assertions ring hollow. Those involved know the plethora of very specific material which has been advanced before the Commission demonstrating critical gaps in our legislative, regulatory and operational frameworks existing in our public sector which no doubt will influence the eventual findings and recommendations of the Commission. We also know of information which has been brought to the fore in respect of alleged improprieties on the part of public sector employees. We also know that some persons have been exonerated by the information adduced, some persons have had to resign and in the case of one state-enterprise we saw consultants, lawyers and board members unceremoniously replaced. And last but by no means least, we know about the vast sums of money and resources which have been devoted to this Commission both by the Government and private citizens who bore the brunt of their own legal costs.

Margaret Chow, Former MD HDC

So the question emerges, if there are no further hearings as had been planned - does this mean that the Commission was a sham or a farce? Is this really the collapse of a Commission?

For two reasons, I say No!

(i) The Commission's work was practically complete

Firstly, from a practical perspective, according to Uff, outside of the expanded Terms of Reference (TOR) relating to the Cleaver Heights Development Project, there was very little else left to do by way of public hearing. When one considers the stage of the Commission's work in respect of the original and first amended Terms of Reference (TOR) which were items (i) - (viii) on UDeCOTT and the procurement practices in the Construction Sector and (ix) dealing with the Cleaver Heights Development Project, all that was outstanding in respect of these items were the final partially completed submissions of UDeCOTT and Mr. Calder Hart.

Counsel for both these parties had indicated that they were not minded to cross-examine the explosive testimony of the last and unexpected witness Mr. Karl Khan, who gave evidence of a familial relationship between Mr. Calder Hart, Chairman of UDeCOTT and the directors of CH Development & Construction Company Ltd which was personally invited by Mr. Hart to tender, in breach of UDeCOTT's own published tender requirements. Significantly, this company was awarded a 368 million dollar contract over two other bidders whose prices were at least 60 million dollars lower.

In respect of the reason for the Cleaver Heights Development Project first amended TOR, the evidence had been produced and subjected to cross examination by all affected parties. Net result - not one shred of evidence was adduced that
(a) 10 million or any other sum was missing from the project as alleged
(b) Dr. Rowley was connected in anyway with any impropriety on the project.

According to Commissioner Khan during the course of the proceedings there was not a scintilla of evidence impugning the character of Dr. Rowley.

Notably, the Government had stated that they had hired Bob Lindquist (Forensic Accountant) to examine the accounts of the project forensically - no Lindquist report was produced to the enquiry.

HDC later in the day, after the removal of their previous lawyers, the entire board except its Chairman and the resignation of the Ag MD Margaret Chow - promised yet another expert's report on the issue - this too was never forthcoming, despite several and repeated requests from the Commission.

Uff's view is therefore that there is no need for further hearings on those items of the TOR.

What remains is only the expanded TOR which was generated by the Government during the last week of the last scheduled session of the Commission. In fact, it is clear that the fourth hearing would not even have been set were it not for this expanded TOR. The expanded TOR related to the Cleaver Heights Project and mandated the Commission to look into the the design, delays on the project and other operational matters which had nothing whatsoever to do with the well publicised genesis of the issues surrounding Cleaver - (remember 10 or 20 million was supposed to have been missing!). In respect of this aspect Uff neatly states

"I next deal with what is to happen about the issues which would have been the subject of this week’s hearing. This refers to the issues in the second extension to the Terms of Reference dated 21 May 2009 which concern alleged defective and delayed work at Cleaver Heights. On those issues the evidence and submissions have yet to be heard. It follows that a fresh commission can be issued (and Gazetted) at any time. That has not happened and as a result we do not intend to take any action with regard to those issues unless invited to accept a fresh Commission. If a fresh Commission is to be issued decisions will have to be taken as to who should be appointed as Commissioners and those Commissioners will have to decide whether they will accept the appointment. There the matter rests."


(2) The true purpose of a Commission was accomplished

In order to assess the success or otherwise of a Commission of Enquiry one needs to appreciate the purpose of such a body. Under the Commission of Enquiry Act Chap.19.01 the President of Trinidad and Tobago has the power to appoint such a Commission to enquire into the conduct of any officer in the public service in Trinidad and Tobago, the conduct or management of any department of the public service or of any public or local institution, or into any matter in which an enquiry would, in the opinion of the President, be for the public welfare.

Contrary to widely held belief, a Commission of Enquiry is not a body established to determine who is guilty of either a criminal or civil wrong. It is not a necessary precursor to charging someone and it does not result in charges being laid. Very simply a Commission of Enquiry is one which is established as the ultimate citizen's accountability mechanism to satisfy their need to know the facts on an issue which is of serious public concern. After the publication of the report the executive may do with it what it sees fit. Neither the President nor the Prime Minister are statutorily bound to accept the findings or follow the recommendations. This factor seems to be consistently missed and this factor alone results in many of the uninformed expectations of a Commission of Enquiry.



A Commission of Enquiry must be distinguished from judicial proceedings or the criminal justice system and must never be viewed as a substitute therefor. Commissions are in fact largely viewed as inappropriate to investigate alleged criminal conduct.

In the Ontario Court of Appeal in Re The Children’s Aid Society of the County of York, Justice Mulock stated:
“…in answering the questions submitted it might be advisable to point out the nature of the inquiry in question. It is one to bring to light evidence or information touching matters referred to the Commissioner…where useful documents or other evidence could be obtained, it would seem reasonable that
he avail himself of such a source of information… It is for the Commissioner,
from all available sources, to bring to light such evidence as may have a bearing
on the matters referred to him. …”

And according to Justice Riddell:

“… A Royal Commission is not for the purpose of trying a case or a charge against any one, any person or any institution – but for the purpose of informing the people concerning the facts of the matter to be inquired into. Information should be sought in every quarter available."

Commissions can be particularly useful in uncovering the systems, methods and procedures used by corrupt officials which processes are usually not the focus of conventional criminal investigations which are more focused on obtaining proof of the illegal act itself. Commissioners are usually experts in the relevant fields and can give constructive recommendations to prevent the recurrence of the impugned activity. A Commission is expected to investigate and come to grips with what happened, why it happened and who is responsible for causing it to happen. It must do more than place facts on the table and consider the most appropriate remedy or solution to address the problem.

So, has this been achieved by this Commission? Does the instant Commission pass this litmus test?

Certainly, it would be difficult to argue that pertinent facts have not been unearthed relative to the TOR. Evidence of what was going on in UDeCOTT, the construction sector and surrounding the issue of alleged missing funds on Cleaver has been quite comprehensively adduced. Even now, without a report of the Commission, the relevant authorities can initiate appropriate investigations into the matters which have arisen.

With respect to the recommendations, Uff has unequivocally stated that come what may, he has every intention of producing the required report based on the evidence adduced before him. According to Uff, whether or not the Commission is published in the Gazette or validated by an Act of Parliament, he will be finalising his report and submitting it to the President.

Based on the professional manner in which Professor Uff has run the Commission and his wisdom in the face of mounting challenges, I for one, have every confidence in his ability to produce a report with appropriate recommendations for the benefit of the people of Trinidad and Tobago.

That being said, for the naysayers and the doubting members of the public, I urge a more temperate view on the events surrounding the close of the Commission. Much has been accomplished and much much more to be gained in the months and years ahead. What will come of this enquiry will depend in large part, not on what the officials do with the information that has been unearthed, but on what we as, right thinking citizens of Trinidad and Tobago, will do with the information we have gained as we exercise our democratic rights, if and when the time comes.

Former Israeli PM Charged for Corruption - a Test of Democracy

Mr. Ehud Olmert made history this week as the first former Prime Minister of Israel to face criminal charges. This came after a series of corruption allegations, probes and police investigations since as early as 2006. The ongoing corruption scandals had forced Olmert to resign earlier this year. Olmert however, has staunchly asserted his innocence despite growing evidence surfacing of impropriety while he was in office.

The indictment against Olmert was served at the Jerusalem District Court on August 30, 2009 and it reportedly includes counts of obtaining by fraud, fraud, breach of trust, falsifying corporate documents and tax evasion. It refers to three out of the four corruption-related cases standing against him:
(i) 'Rishon Tours' where he is accused of using his Travel Agency Rishon Tours to manage a special account for him and double charge for some of his travel and speaking engagements ,
(ii) 'Talansky' (Also known as 'Money envelopes' affair) where he is accused of receiving over 150 000 USD in cash envelopes from a Jewish-American Businessman Morris Talansky for political favours and
(iii) the 'Investment Center' where he is accused of acting in conflict of interest by arranging investment opportunities for a friend, Uri Messner, while he was industry minister.

Once again, I find the timing of this incident somewhat coincidental since in my last blog entry, when dealing with corruption in the construction industry in Trinidad and Tobago, I sought to draw a positive though cursory comparison between Israel's plan for economic development and the Vision 2020 Plan of Trinidad and Tobago.




Israeli Democracy?

Israel, a developing country as well, has been said to be "the only democracy in the Middle East" enjoying a special relationship with the United States, some considerable economic success, and engaging in sporadic requests for EU membership.

However, I would certainly not be the first one to suggest that numerous factors make this self styled democracy somewhat strained. Israel has had very fervent critics from inception, who have asserted that Israel's formal democratic status is a sham given that Israel is constitutionally termed a "Jewish Democratic State" with no separation of synagogue and state despite the fact that approximately 20% of its citizens are not Jewish. Even more controversial is that several laws are explicitly discriminatory. These can be traced back to Israel's foundation in 1948 which, driven primarily by the racist genocide suffered by Jews in Europe during the Second World War, was based on the notion of a Jewish state for Jewish people. Some of Israel's laws reflect this principle and as a result discriminate against non-Jews, particularly Palestinians who had lived on the lands for generations. The Law of Return for instance provides automatic Israeli citizenship for Jewish immigrants, whereas Palestinian refugees who were born and raised in what is now Israel are denied even the right to return home. Other statutes explicitly grant preferential treatment to Jewish citizens in areas such as education, public housing, health, and employment.

Leaders in post colonial democratic states like those in the English Speaking Caribbean may readily turn up their noses at this style of democracy where there is no separation of church and state and overt state sanctioned discriminatory action against citizens. Certainly here in the Caribbean, we may very well feel that if we were all to sit the Democracy test our States would achieve higher grades than Israel.

But, is this really true? Of interest, no doubt spurred on by the controversy surrounding its democratic status, Israel has established its own Israel Democracy Institute. Established in 1991, the Israel Democracy Institute (IDI) is an independent, nonpartisan, nonprofit think tank located on the seam between academia and government. Comprising a select cadre of Israel's leading thinkers, the Institute is the premier nongovernmental agent of change in the Israeli body politic and has been driving the process of Israel's transition from formal to substantive democracy.

In 2009 IDI produced a Democratic Index which ranks and compares Israel with several established democracies using several institutional, rights based and stability indicators. The Democratic Index reveals that despite some demonstrable improvement in some indicators, Israel still received low scores when compared with the developed democratic countries that participated in the study. The general trend change compared to the 2008 Index was mixed. Out of the 18 indicators updated this year, while seven registered improvement, six registered deterioration, and five showed no change. When comparing internationally, Israel’s ranking went up in three indicators, remained unchanged in ten indicators, and declined in four indicators.




Interestingly, the main improvement was recorded in the institutional indicators, following a slight rise in the political participation and representativeness measures. Olmert's resignation in February 2009 amidst corruption allegations which had been escalating since the last quater of 2008 caused a negative impact on the scores of Israel on the indicators of corruption and stability in the political system. Tzipi Livni, who replaced Olmert as head of the Kadima party, failed to form a coalition and, therefore, not for the first time, elections were called before the official end of the government’s term. According to the Index since both the process by which the government was dissolved and the bringing forward of the date of elections were set in motion by suspicions of corruption against the Prime Minister, there is room for drawing a connection between the growing levels of corruption and the increasing instability of the political system

It may be that the relative scores on the IDI Democratic Index that the very serious corruption allegations which forced Olmert to resign are negative indicators from the point of view of democratic governance and corruption levels. I take a different view and will develop that a little more below.

Juxtaposing Trinidad and Tobago and Israel for the purposes of useful comparison may not be as far-fetched as some may think on its face. The Heritage Foundation in Washington and the Wall Street Journal have developed Economic Freedom Index which they define as "the fundamental right of every human to control his or her own labor and property. In an economically free society, individuals are free to work, produce, consume, and invest in any way they please, with that freedom both protected by the state and unconstrained by the state. In economically free societies, governments allow labor, capital and goods to move freely, and refrain from coercion or constraint of liberty beyond the extent necessary to protect and maintain liberty itself".

In developing the Index ten indicators were measured and the methodology is transparent, available for download here.

With the one qualification that I make absolutely no assessment of the merit or demerit of the methodology [since I must confess that being of legal background statistical measurement and analysis is not my area], I think the results are pretty instructive in the context of comparing these two nations. The results for both Israel and Trinidad and Tobago on each of the indicators are set out below:

Indicator Israel Trinidad & Tobago

1. Business Freedom 67.8 60.1
2. Trade Freedom 86.0 79.8
3. Fiscal Freedom 57.1 79.7
4. Government Size 35.1 75.6
5. Monetary Freedom 83.7 72.2
6. Investment Freedom 80.0 70.0
7. Financial Freedom 70.0 70.0
8. Property rights 70.0 60.0
9. Freedom from Corruption 61.0 34.0
10.Labor Freedom 64.9 78.3

Despite significantly outscoring Trinidad and Tobago on several indicators, the end result was that Trinidad and Tobago received the score of 68.0 and Israel received an overall score of 67.6 with the countries ending up back to back on the list of 179 countries, 41st and 42nd respectively!

I was struck by this, having whimsically embarked upon this blog item on Olmert's corruption charges, not expecting in my comparison of Israel and Trinidad and Tobago that I would find so many similarities.

What this index reveals, however, is that behind more or less similar average overall scores, we are actually dealing with two totally different small developing countries. One is small and seen as "the enemy of its region" surrounded by nations with which it has an almost war-like relationship, the other a small, oil state surrounded by semi-dependent, touristic tropical islands. That Israel scores poorly on government size is the direct consequence of it being in a state of war, something which translates immediately into a far above average government size. The rating is constructed in such a way that large government size is in normal circumstances positively correlated with an increased probability of corruption and reduced freedom. The other way around, the situation of Trinidad and Tobago with its oil wealth translated into a relatively free/capitalist structure with a small government - a situation normally assumed to lead to a reduced probability of corruption - reveals something quite remarkable: it is actually in the corruption indicator that the island state is posting its worst grade by far!

In other words, careful analysis of the component indicators unravels what was hidden when looking solely at the overall ranking. Although scoring similarly overall with Trinidad and Tobago slightly ahead, taking this on face value would be dangerous given the drastically different and remarkable scores on corruption levels. Israel with its large government (usually thought to result in higher corruption scores) is in actuality far less corrupt than Trinidad and Tobago with it's small government size.

No surprise really which is why I formed the view above. A system of governance
(i)which allows a state prosecuting office to operate independently and without interference in the investigation of a Prime Minister in office, (ii) has a strong media to aggressively expose alleged corrupt activity, (iii) which facilitates the voluntary resignation of a Prime Minister and (iv) which produces an institute like the Israel Democracy Institute is doing far better in terms of democratic governance and curbing corrupt activity, than let us say for arguments purposes Trinidad and Tobago.

This may not be off the mark given the following circumstances currently existing in Trinidad and Tobago:

1. Widespread allegations of corruption in the public construction sector - Commission of Enquiry appointed. Although the work is not complete, already damaging evidence adduced including the startling evidence of the Chairman of a State Company Board inviting a company to tender which shared his fax number and on which his wife's brother and brother in law were the directors. Awarding the contract to this company which was not the lowest or the second lowest tenderer.
2. Government officials steadfastly refusing to step down from office despite calls from throughout the country for them to do so.
3. Court ruling that the Integrity Commission established to protect integrity in public life acted unconstitutionally, unlawfully and maliciously in pursuing an investigation which was rumoured to be politically motivated.
4. Several important Government posts not filled for considerable periods of time, Director of Public Prosecutions, Solicitor General, Integrity Commission, Commissioner of Police,
5. Firing of a Government Minister for speaking out and calling for greater oversight over a state agency.
6. Allegations of the interference of the politically appointed Attorney General in public enquiries and prosecutions.
7. Threatened media - with a situation occurring where the Prime Minister caused two broadcasters to be suspended for criticising him on air.

These and many other incidents in Trinidad and Tobago may have contributed to the poor corruption score on the Transparency International Corruption Perception Index and the Index of Economic Freedom.

For me, I did not have to analyse the corruption indices and the Index of Economic Freedom to know that Israel was doing better than Trinidad and Tobago on the issue of confronting and enforcing the law against corrupt offenders. Whilst some may view the Olmert scandal as an indicator of high corrupt levels, I say it is arguably one of the strongest indicators of a robust democracy serious about addressing the issue of corruption.

Banda - Establishes Zero Tolerance Against Corruption Policy??

Banda Promising Reforms..

OK OK. It seems that almost as soon as LMG World TV asked the question in our last post - how will Banda respond to the Chiluba acquittal on all corruption charges - our question was answered. A mere 10 days after the controversial verdict, President Rupiah Banda yesterday announced the launch of a new national anti-corruption policy, hoping, no doubt, to erase doubts over his government's anti-graft credentials after former leader Frederick Chiluba was cleared of embezzlement.


Interestingly, after the verdict the head of Zambia's Task Force on Corruption, Max Nkole was fired and his appeal in the Chiluba case was withdrawn by prosecutors.

The resulting controversy has raised some doubts about whether Banda would continue the anti-corruption crackdown launched by the late president Levy Mwanawasa, which had won Zambia praise overseas and which we had also noted in the last post.

Some excerpts from news reports are quoted below:

Opposition parties have accused Banda of interfering in the courts to win Chiluba's acquittal on charges that he embezzled 500,000 US dollars of public money.

Banda said the new policy would reinforce government's commitment to eradicating graft and provide a framework for government agencies to cooperate with the public in investigations.

"We renew our resolve to uphold the motto of "Zero Tolerance Against Corruption". The war against corruption is the responsibility of everyone," Banda said.

"My government shall remain committed to the rule of law and respect for human rights," Banda said.

"Even as we fight corruption we should not lose sight of the constitutional rights of those accused," he added.

Banda credited the government's efforts in fighting corruption with helping fuel Zambia's record economic growth over the last decade.

"The government has over the last eight years implemented a wide range of reform measures to combat corruption, streamlined the management of public resources and enhanced service delivery," he said.

"The reforms had a positive effect on the economy until the onset of the global economic downturn," Banda said.

The top British aid official in Zambia, Mike Hammond, urged Banda to show commitment in the anti-corruption fight.

"If the government of Zambia is to build on the momentum of the past success, it must be seen to take action against those that do not abide by the rules, and no individual should be above the law," Hammond said.

Britain has given more than 13 million dollars since 2000 to support Zambia's anti-corruption agencies.



Chiluba contemplative in Court
Chiluba has accused Britain of masterminding his prosecution, saying the case was driven by "imperialists".

The Chiluba Story

As a precursor to our Zambia analysis, thought it might be useful to share some musings on Frederick Chiluba the former President of Zambia who earlier this week [17.08.09], was acquitted of allegedly embezzling nearly 500 000USD of state funds into accounts to pay for an extravagant lifestyle when he served as Zambia's first democratically elected leader from 1991 to 2001.

Like many others in the anti-corruption community, I was particularly surprised by the outcome of the trial because the circumstances of Chiluba's period of rule were well known to many. Several of Chiluba's colleagues had already been found guilty and jailed for embezzling state funds. Chiluba's own wife Regina was found guilty and sentenced to serve 3 years imprisonment for theft of state funds and Chiluba himself had lost a civil case wherein a UK court found that he had diverted approximately 46M USD into a London account.The Judge Peter Smith in that case, in his bold ruling, accused Chiluba of shamelessly defrauding his people and flaunting his wealth with an expensive wardrobe of "stupendous proportions". Smith subsequently went on to order Chiluba to leave his home in Lusaka which he found to be built on proceeds of embezzled state funds.

Not surprisingly therefore, the criminal charges filed against Chiluba in Zambia were just the last in a spate of investigations and prosecutions which most felt would go the way of the others. Many anti-corruption practitioners were anxious to see what the first internal criminal prosecution of an African leader for corrupt activity would yield and what broader repercussion such a judgment would have for African governance. The case was being called the "flagship corruption case for sub-saharan Africa".

Chiluba, a former bus conductor and trade unionist was hailed as one of a new breed of post independence African leaders who were democratically elected. Promising a spate of liberalization reforms and a commitment to a free market economy, some of which were in fact implemented, lamentably Chiluba, the second leader since Zambia's independence from British Colonial rule in 1964, followed the path of so many others on this unfortunate Continent. From very early on in Chiluba's reign it became obvious that things were not quite right. He started out by firing many of the independent thinkers in his Cabinet and surrounding himself with "yes men". It is said that corruption flourished as some Chiluba's cronies seemed more interested in lining their own pockets, than serving their country. [My foreign readers will forgive my local digression for a moment. There are some stark and very disturbing similarities between the widely held perception of Patrick Manning the current Prime Minister of Trinidad and Tobago and Chiluba in this regard but more on that in another blog!] Chiluba, then was perceived to have used his office to hound his predecessor, Kenneth Kaunda who had been the first post independence leader.

Kenneth Kaunda President of Zambia [1964 - 1991]

Although Kaunda had his own detractors, holding on to power through one-party rule, many saw Chiluba's intense prosecution of Kaunda as vindinctive. In 1997, Chiluba caused charges to be brought against Kaunda for conspiring in a failed coup plot and had him imprisoned. Chiluba had to be pressured by external forces to release Kaunda. Chiluba therefter used the judicial system again to attempt to strip Kaunda of his citizenship! After 10 years in power Chiluba who had gained quite a reputation for his flashy dressing, a fondness for expensive, monogrammed clothes, and high heel shoes to improve his diminutive height [he was a little over 5ft], had sold off state land at suspect prices and the state copper mine amidst scandal where much of the assets seemed to vanish for next to nothing. In 2001 Chiluba, true to form, fought to change the constitution so that he could remain in power for a third consecutive term, but acceded to internal party pressure to step down. His successor President Levy Mwanawasa [2002-2008]

in an anti-corruption campaign which he pursued until his death in 2008 successfully prosecuted Chiluba's colleagues and his wife Regina. Chiluba's defence in the criminal case was that the monies held in the account were actually proceeds of gifts given by businessmen and others to him personally and were not state funds. It was this money that he would have used to buy clothes totaling approximately 500 000 USD paid in trunks of cash in one instance. The court found in Chiluba's favour stating that the prosecution had failed to prove "beyond a reasonable doubt" that the money was state funds as opposed to gifts. It should be noted that the standard of proof in a civil case is much lower than in a criminal case i.e, the case must be proved "on a balance of probabilities".


To those of us from countries with far more sophisticated governance frameworks one of the first questions we would raise would be - Can a president personally receive monetary gifts of such large amounts??!! In Zambia, it would appear that the answer is yes! There is no law preventing a public official from receiving gifts of money nor any limit on the size of gifts. As I see it, these are the kinds of regulatory gaps in some newly democratic states which demonstrate the form of democracy without the accountability checks and balances which ensure democracy in substance. Regulatory inspection and overhaul needs to take place in order to begin to fight corruption meaningfully and sharpen enforcement mechanisms.

Preceded by Kaunda and Chiluba, and succeeded by Banda, Levy Mwanawasa who died in office in 2008 while pursuing his relentless anti-corruption campaign should not be forgotten. For those who feel that Africa is devoid of leaders who are willing to and capable of approaching the task selflessly and with integrity for the benefit of the people, his legacy will be that there is hope for African leadership. It has been said that Banda does not share Mwanawasa's exuberance to eradicate corruption and went "soft" on the issue. Already there are rumblings that the Chiluba trial was in some way politically influenced to cause the eventual outcome.

In the wake of this verdict all eyes will now turn to Banda. We at LMG World TV ask, which path will he follow? The worn path of post independence African rulers like Chiluba and Robert Mugabe or the rarer likes of Mwanawasa? Only time will tell, and we will be looking on.

Rupiah Banda President of Zambia [2008 - present]

Corruption & Africa : The Introduction

I have been waiting for quite a while for the inspiration to start my blog posting here on LMG World TV and just as I was beginning to think that I was devoid of one creative bone in my body, today as I began reading the latest in corruption news I felt the familiar writers twinge to express.

So here goes. This year I made two trips to the continent of Africa, one to Tunisia in MENA (Middle East North Africa) and the second to Nigeria (Sub-Saharan Africa). The differences between the two could not be more stark from cultural, lingual, political, historical and economic perspectives and perhaps the differences could lend some insight into the plight of Sub Saharan Africa states. Tunisia with a population of a little over 10 million is culturally very middle eastern in its food, music, language and identity (approximately 98% Arab - CIA Factbook), the language is arabic and french, political system is a parliamentary democracy and historically a former french colony. From an economic perspective Tunisia has a diverse economy, with agricultural, mining, tourism, and manufacturing sectors and a GDP per capita of approximately 7900USD.

Nigeria on the other hand with an approximate population of 149 million is a former British colony, culturally diverse with 50% muslim, 40% christian and the rest indigenous cultures. There are over 200 languages and an economy centered around petroleum and a GDP per capita of 2300USD. According to sources oil-rich Nigeria, has been long hobbled by political instability, corruption, inadequate infrastructure, and poor macroeconomic management.

It would seem that Tunisia on a per capita basis is certainly more well off than Nigeria, providing its citizens with a higher quality and standard of living and this I did observe first hand when I was there, notwithstanding the grandeur of Nigeria's new capital city Abuja. Abuja, as ostentatious as LA, a city conceived and built from scratch by the Nigerian Government, some 20-30 years ago, to reflect the true essence of the country is full of fantastic structures, four and five lane highways, massive sometimes palatial homes but shockingly at night no traffic lights or street lighting! When I asked about why this was so, I was informed that there was not enough energy coming into the city!

No doubt, Sub-Saharan Africa is a fascinating continent reflecting a disturbing paradox of wealth and poverty. Some African countries can be said to be some of the richest in the world when one looks at the abundance of resources like oil, minerals, sunshine but also some of the poorest in the world when one considers the quality of life, health care and poverty statistics. Many writers have tried to explore the phenomenon about why Africa is poor with varying degrees of success.

It is clear that the answer or answers are not as simple as one would hope and some of the theories postulated will certainly ruffle the feathers of many. It certainly could not have helped Sub Saharan Africa to actualise when from very early its resource richness was seen as an object of plunder by external forces. It could not have helped that the growth of many of these nations was stunted by the mass exportation of slave labour or the subsequent "take vs build" and "divide & conquer" imperialist ideology, the remnants of which remain firmly embedded in the culture and thinking of the people. It could not have helped that people were thrown together with artificial boundaries regardless of culture, language or religion by external parties. It could not have helped that as the developed world in this century began to take responsibility for the travesty of Africa that the dis-empowering solution proposed was the "give a bible and some bread" philosophy without consideration of the longer term focus on sustainable economic growth and development.

Now while I am the first one to jump on the bandwagon of all the above reasons for Africa's plight and what follows is no watering down of this at all - there does come a time when responsibility must be taken from within the boundaries of Africa for the continued suffering of its people. Recently Obama in his speech in Ghana and Hilary Clinton as she made her tour of Africa as US Secretary of State urged the leaders to clean up the mess. Certainly it is easy for us to proselytize from the outside. Is it true that corruption is now a significant factor in Africa's current economic plight?

YES Africa has been raped and pillaged by other countries and suffered through dis-empowering aid efforts and continual disadvantage from unequal bargaining power in international trade negotiations BUT is that 100% of the story? Is there a level of culpability which the post colonial African leaders must have for the continued plight of Africa? Is it true that African Leadership seems attracted to positions of power not to serve but to enrich themselves? Is the African Leadership truly blind or ignorant to the effects of their actions on their impoverished constituency? This is the rhetoric now because the statistics are revealing that corruption does play a part in diverting the wealth of the countries' resources into the hands of a few to the detriment of the many. How big a part it plays when one takes all the factors into play? That is a question to be addressed. The future of the children of Africa will depend on the response of its leaders to the present crisis.

In this series Corruption & Africa, I propose to take one Sub Saharan African country at a time in no particular order and analyse (i) their political, regulatory and economic systems and (ii) the actions of their leaders to determine the extent to which corruption can be said to be a significant part of the answer to the question : why Sub Saharan Africa remains so impoverished? Many writers have traversed this road and we will be citing some of their work as references along the way. This is the LMG Window to Corruption and Africa. If this is a topic that interests you and you want to learn more I look forward to you taking this journey with me. If you have done some research in this area already, even better! Feel free to drop a line, statistic, story, factoid or point of view which will assist us as we build this work.