Over the last year, we have reached several noteworthy milestones in the global fight against corruption. In the arena of fighting corruption in international development, two important milestones stand out as having paved the way for significant progress and in setting us on a course for our continued success in reducing the impact of corruption on the poor.
It was ten years ago that the investigation into the UN’s Oil for Food corruption scandal came to an end. This was perhaps the biggest, most complex, corruption investigation to date involving an international organization. The investigation was conducted under the leadership of an independent panel, including Paul Volcker (as Chair), Mark Pieth and Richard Goldstone, all of whom were and continue to be thought leaders for global integrity.
An important consequence of the scandal and the ensuing investigation was in creating both the opportunity and a pressing mandate for international development agencies to take on corruption inside their own programs, and among their own staff.
As a result of this investigation, most UN agencies and other international financial institutions now have their own independent integrity office charged with rooting out fraud and corruption in their activities. While many are still small, under-resourced and looking for support from their leadership, individually and collectively they have the ability to make a difference.
I am proud to say the World Bank Group has remained a leader in setting a high bar for integrity standards and in international development financing. Within that framework, the 90 staff of the Integrity Vice Presidency (INT) dedicate themselves to investigating, sanctioning and ultimately preventing fraud and corruption in Bank Group-financed operations.
INT’s investigations are accomplished without any of the traditional law enforcement powers so critical to following the money and uncovering the hallmarks of a corrupt arrangement. In other words, with no access to banking records, no ability to compel witnesses, and no subpoenas, INT’s successful investigations are the product of leg work and creativity, exercising audit rights, finding witnesses willing to help and, increasingly, the use of data, both big and small, open source, and in-house.
However, a key enabler of success in our work is cooperation with other entities, with our development partners, the private sector and with national authorities.
We recently celebrated another important milestone in the global fight against corruption: the five-year anniversary of the Cross Debarment Agreement among the five leading international organizations. This historic agreement was a game-changer by harmonizing the standards for applying sanctions or fraud and corruption, and granting mutual recognition of the sanctions imposed by each. This effort to join forces has become a cornerstone in the broader effort to prevent fraud and corruption, because it sends a signal to firms that there are global costs for engaging in corruption.
As we all know, for prevention to succeed, the threat of enforcement must be credible, and the costs associated with sanctions must tip the balance in favor of integrity. Cross debarment raises the cost of corruption to a new high, sending a clear message of collective deterrence.
Our work with national authorities is equally important. The World Bank has taken an important step in this direction by creating the International Corruption Hunters Alliance (ICHA); an alliance of heads and senior officials of corruption fighting bodies from around the world. ICHA members come together periodically to share innovations, push the policy envelope, and collaborate in solving cases. Improving informal cooperation across borders, and finding alternatives to the onerous steps involved in implementing mutual legal assistance treaties, may well prove to be a determining factor in advancing global enforcement against corruption.
The next meeting of ICHA members will address the evolving challenges of global corruption. One of the solutions will need to be to find new and creative ways to collaborate informally and expeditiously across jurisdictions. The collective wealth of experience and dedication ICHA brings together underscores what an exciting time this is to be fighting corruption and gives us a window into the next generation of milestones we will soon be able to celebrate. It is all about Integrity with an impact.
Stephen Zimmermann, pictured above, is the Director of Operations for the World Bank’s Integrity Vice Presidency, the unit charged with detecting, investigating and sanctioning fraud and corruption in Bank-financed activities. He was previously the Chief of the Office of Institutional Integrity for the Inter-American Development Bank. He also has served as the interim Chief of Staff for the Independent Inquiry Committee into the United Nations Oil for Food Program, and from 1991 until 1999, was an Assistant United States Attorney in the District of Maryland. He has led efforts to harmonize the integrity programs of the Multilateral Development Banks, including the creation of the groundbreaking cross-debarment agreement in 2010, and oversaw the creation of the World Bank’s International Corruption Hunters Alliance.