In the past, rich countries had no legal authority to stem the flow of dirty money into their coffers. But today a powerful upsurge of demands ‘from below’ aided ‘from above’ by global rules is giving impetus to the anti-kleptocracy regime. Powerful autocracies like China are mindful of popular discontent linked to any intimation of the ruling elite feathering its nest. A staggering 1.34 million officials at high and low levels – the so-called ‘tigers and flies’ were brought down by corruption and disciplinary charges during Xi Jinping’s first five years in office.
Xi’s great purge resulted in 170 ministers and deputy ministers dismissed, jailed and charged with corruption, misconduct and violation of party discipline. Such a purge has not been seen since Mao Zedong. Today, it is morally unacceptable to host money stolen by public officials from another country. A dragnet of treaties, laws, conventions and regulations have enshrined this principle. Wealthy nations are now inviting scrutiny from peer countries and bodies like Global Witness and Transparency International. Transparency International produces a Corruption Perceptions Index that rates a country’s performance in the pale areas of money laundering and corruption.
According to Transparency International, the Troika laundromat is a new type of financial crisis. Troika Dialog is a private Russian investment bank that was acquired by state-owned Sberbank in 2012. Troika was established to attract foreign investment. But, leaked bank records reveal that Troika created 75 companies in tax haven jurisdictions like the British Virgin Islands (BVI) in the West Indies. The companies were further incorporated within shell companies in other tax havens. When bank accounts were opened the real owners used unknowing proxies like Armenian seasonal workers in Moscow. The shell companies issued, cancelled and paid for contracts, invoices, and loans with fake paperwork. From 2009 to 2011 transfers from the BVI shell company, Quantus Division Ltd totalling $200,000, went to a London Charitable Foundation. In other instances threads within the Panama Papers reveal that money was used to pay for private jets, custom-built yachts, luxury properties, holidays, football tickets and fees at top English private schools.
Holding individual leaders accountable for corruption crimes committed in office undermines years of accepted practice and will alter international diplomacy. Since 2008 G8 and G20 countries have endorsed visa denials and entry blockage to senior foreign officials suspected of corruption. This suffocates their well-known proclivity for conspicuous consumption in the Hamptons, London and Southern France. A visa ban also serves to block access to a country’s financial system and isolates chieftains from their luxury real-estate overseas. With the fall of a corrupt regime host countries may now have a moral obligation to conduct an inquiry to determine how the capital entered its financial system and punish the parties and institutions at fault with sanctions.
Traditional domestic tax powers and new international tax agreements have great potential for tracing and seizing illicit funds. Failure to report the interest earned on foreign bank deposits may constitute tax evasion. Tax laws often require that foreign bank accounts, assets and income be declared in the home country. Since tax evasion is largely a predicate crime for money laundering these laws may also be brought into play. To deter potential overlords and associated money launders and to satisfy the desire for accountability in victim-countries, a number of well-articulated measures have been erected in Trinidad and Tobago.
The Tax Treaty Unit established by Cabinet Minute 2248 on December 3, 1987, is a resource hub for double taxation matters and tax treaties. The Financial Intelligence Unit (FIU) incorporated under the Financial Intelligence Unit of Trinidad and Tobago Act of 2009 implements the anti-money laundering and combatting the financing of terrorism policies of the Financial Action Task Force (FATF) established by G7 nations. The Civil Asset Recovery and Management and Unexplained Wealth Bill confronts the benefits accrued to persons through criminal conduct. The Whistleblower Protection Bill empowers people in the private and public sector to expose wrongdoings without sanctions. The Evidence Amendment Bill provides for witness anonymity orders and video recordings when a witness is unfit, or abroad or is fearful.
Jean-Paul Sartre in Les Mains Sale (Dirty Hands) poses the provocative question- ‘Do you think you can govern innocently?’ The play gains its force from a dual message- the search of the individual for faith in himself and for faith in the Party. ‘Dirty Hands’ is at intersection of moral philosophy, political philosophy, and political ethics. A kleptocracy is a type of leadership where government officials use their authority to embezzle public funds for self-gain and to solidify their political prominence and live in opulence as they expand the grip of their dirty hands over power. It involves the routine looting and stashing of ill-gotten gains in financial capitals and in less scrupulous financial centres.
The anatomy of victim-countries include soaring per capita GDP, a mysterious pervasive poverty, stagnant state services, and jousting multinationals competing for lucrative government contracts to exploit the assets of these resource rich economies. Corruption causes poverty. This is why Martin Hollis believes that there is utilitarian value in making a ‘bloody example’ of persons with dirty hands, since it dissuades the rest.
