CorruptionPEPs

Manafort and money laundering

By August 22, 2018 No Comments

Manafort and money laundering – what should we learn?

Yesterday, Paul Manafort’s journey from Presidential campaign chairman to convicted criminal finally came to a close. He was found guilty on eight charges including tax fraud and failing to disclose foreign bank accounts for which he will receive a stern 80-year jail sentence. The trial, which is the first of the Mueller investigation examining Russian collusion in the 2016 US election was hotly fought with even the judge requiring police protection.

Manafort’s troubles are not over yet, however. The jury was unable to reach a verdict on ten additional charges, including a charge of money laundering. This charge will be revisited in a federal court in Washington D. C. where key evidence from the first trial will still be used. Of note was the evidence given by former protégé Rick Gates on how the duo used a mix of shell companies, high-value purchases and property to hide the millions of dollars they received from pro-Russian politicians in Ukraine. Tales of $1 million being spent on Persian rugs may seem comical, but at the heart of this story is a highly influential man who for years managed to move considerable sums of money out of a high-risk region and spend it without questions being asked in the US. Paul Manafort may finally be facing his comeuppance but wider questions should be asked about why it took so long.

Voting away corruption – Colombians return to the polls

Colombia’s new President, Ivan Duque was sworn into power on the 7th August, this weekend Colombians will return to the ballot box. Not to vote for a President however, but for a referendum with seven proposals designed to fight corruption in the country. The seven proposals, each of which will require over 50% of the vote to pass into law, are as follows:

  • The salary of congressmen and top government officials must be reduced
  • Prison and a life-long ban on government contracts after a corruption conviction
  • Compulsory transparency in the awarding of government contracts
  • Citizen participation in budget debates
  • Congressmen must publicly clarify voting behavior and attendance
  • Illegitimate income of lawmakers must be made public and seized
  • Congressmen may not serve more than three terms in Congress

The referendum may seem like a step in the right direction, but success is not a foregone conclusion. Turnout is predicted to be low with this being the fourth time Colombians have been to the polls this year. On top of this, knowledge of the referendum is limited and support from influential politicians, like the outspoken former President Álvaro Uribe, has been withdrawn. Whatever the outcome of the referendum, the issue of corruption will remain on Colombia’s political agenda. It will be down to Duque to try and solve it.

The inquiry into Jacob Zuma begins…

On Monday, the inquiry into Jacob Zuma’s many financial indiscretions finally opened. The inquiry was set up in response to the overt levels of corruption he and his government practiced over the nine years they were in power. The crime that most South Africans want answers for is “state capture”, which is when corruption is so endemic that private interests have a significant impact on a state’s decision-making process. The “private interests” in South Africa’s case refer to those of the Gupta brothers, who allegedly bribed the President in return for government contracts and influence on political appointments.

The inquiry, which could last up to two years, has not got off to an easy start. The security services apparently dragged their feet on granting prosecutors security clearances. A campaign to get the public to report information failed, according to the lead prosecutor to bear much fruit. Fortunately, Zuma fired enough Finance Ministers during his tenure to fill the first few witness spots. Unfortunately for South Africans seeking justice for frittered away public funds the inquiry, although significant, does not have the power to prosecute the former President.

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