Chinese Anti-Corruption Crusader Vanishes on Mysterious Leave

by Aaron Kessler / Published February 8, 2012 in The Big Sweep | Leave a comment

Wang Lijun, deputy mayor of Chongqing, an anti-corruption crusader placed on leave, after rumors that he had tried to defect. / REUTERS

A Chinese official who’s been venerated by the government as an “anti-corruption iron hero” has now been placed on mysterious “stress” leave following rumors that he may have tried to defect.

“A key deputy to Bo Xilai, the Chongqing Communist party secretary who has been tipped for a top position in China’s upcoming political transition, has been put on leave, the Chongqing government said Wednesday, prompting speculation of internal dissent among the top ranks of the southwestern city’s leadership,” TIME reports.

The government said Wang was “undergoing ‘vacation-style treatment’ due to his heavy workload and stress.” That announcement, TIME reports, came “hours after Chinese police surrounded the U.S. consulate in Chengdu, a city about 200 miles from Chongqing, which touched off widespread rumors on Chinese microblogs that Wang had sought asylum.”

The U.S. embassy is so far staying tight-lipped, not commenting on the asylum claims.

During a career that spanned nearly three decades, Wang achieved almost folk-hero status for fighting crime and corruption, and he allegedly has “more than 20 scars on his body from run-ins with criminals.”

Sweep to China: A top corruption fighter takes mysterious “stress” leave

A new report by the European Commission points to shortcomings in Bulgaria when it comes to the country’s judicial system and other efforts to root out corruption.

As the Sofia Echo reports, the EC is calling for “strong action” in several areas, including an overhaul of the judicial election process to improve “transparency and integrity and as an important step towards a fundamental reform of the judicial system.” Also, a new law related to asset forfeiture “should be comprehensive and backed up by strong institutions.”

“The track record of decisions and penalties in cases related to high-level corruption, fraud and organised crime under investigation and in court should demonstrate the convincing results needed to provide effective dissuasion,” the EC report said.

The report is part of a verification process put in place by the European Union when Bulgaria joined in 2007, to ensure the country can meet EU standards.

Sweep to Stronger action needed by Bulgaria 

A file photo of Egypt's former president, Hosni Mubarak, and his wife Suzanne in 2003. / REUTERS

Did the wife of former Egyptian president Hosni Mubarak attempt suicide when she was on the verge of being arrested on corruption charges after the revolution?

In a new memoir by Suzanne Mubarak being put out soon by Scottish publisher Canongate Books, the former first lady allegedly confesses to a suicide attempt, according to a report by Egyptian broadcast news outlet EGYnews, which obtained the memoir.

She describes May 13, 2011 as her “darkest” day, and writes that when a high-ranking Egyptian corruption official brought an order for her arrest, “I took an overdose of sleeping pills and wanted to commit suicide as I could not imagine what for and how to live.”

She recounts being saved, and then finally being released from detention after Mubarak’s lawyer Farid al-Dib brokered a deal that involved the former first lady signing away all of her property to the government. She was released on May 17.

The memoir, according to EGYnews, also contains some interesting insights into the revolution as a whole – including Suzanne Mubarak’s claim that she and her husband had been offered asylum before he resigned under pressure.

“USA, Saudi Arabia, United Emirates, Bahrain and Kuwait offered husband and all family members political asylum at the beginning of February 2011. But when he resigned on February 11, these offers were immediately called off,” she says.

Sweep to Mubarak’s wife attempted suicide over corruption charges

Putin Tries to Claim Anti-Corruption Movement as His Own

by Leslie Wayne / Published February 6, 2012 in The Big Sweep | Leave a comment

He'll be around for awhile: The Uzor weaving plant outside St. Petersburg churns out tapestries of Vladimir Putin. / REUTERS

To his critics, Russian Prime Minister and presidential frontrunner Vladimir Putin is the problem, not the solution, to corruption. Just the same, he has come out as a full-throated opponent of corruption, in a new plank to his campaign platform.

Writing in the Kommersant business daily, Putin said that a transparency movement sweeping the country should become a “national cause” and that everyone – “authorities and opposition” – bears responsibility for halting corruption.

Putin’s essay, the fourth in a series that defines his campaign, came as tens of thousands braved below-freezing temperatures and snow in Moscow to protest his planned return to power, charging that Putin represents repression and rigged elections.

His essay proposes to open administrative courts to hear individual complaints against officials, greater disclosure of court hearings and “huge salaries for [some] government officials” who agree to “absolute transparency” that would include their family spending.

The former KGB chief also offers to open the legislative process to Internet activists—in exchange for their anonymity. (Given the tendency of Putin’s rivals and critics to land in jail or the grave, the proposal seems unlikely to spark a rebirth of democracy.)

Putin is expected to win election to a six-year term.  He had served as president from 2000 to 2008, until he was prevented for running again by term limits. His hand-picked successor Dmitry Medvedev then became president and is now stepping aside, allowing Putin to run again.

Transparency International ranks Russia as more corrupt then such perennials on its list as Nigeria and Sierra Leone.

Sweep to Putin ponders corruption, Internet democracy in new article

“Baby Doc” Duvalier is in big trouble – and should be, according to a Canadian professor and expert on Haiti.

In an opinion piece in Toronto Star, Jorge Heine, a governance professor at Wilfrid Laurier University in Ontario, said that how Haiti handles Jean-Claude Duvalier, who has been charged with corruption, is a test for whether the country can stand up to the kind of impunity the Duvalier family represents.

Baby Doc was Haiti’s “president for life,” even though his tenure only lasted from 1971 to 1986.  He returned after fleeing Haiti – a country which saw 30,000 people killed or “disappeared” during his regime and an estimated $300 million to $800 million lost to embezzlement.

Right now, Duvalier has been saying he may well run for president. Not so fast, says Judge Carves Jean, who ruled that Duvalier should stand trial on corruption charges. Even though Duvalier is not charged with human rights violations, Heine said the corruption charges are a step in the right direction.  Comments by Haiti’s current president, Michel Martelly, hinting that he might pardon Duvalier – comments that he later backed away from – raise questions about how big that step might be.

Sweep to Jean-Claude Duvalier should be tried for more than corruption

A seagull perches on a statue covered in snow at St. Peter's square Saturday. / REUTERS

The Vatican is fighting back against corruption charges – and in a way that only stirs the pot of intrigue.

Four Vatican clerics said in a statement that corruption charges leveled by Archbishop Carlo Maria Vigano, the Holy See’s current ambassador to Washington, are “either the fruit of erroneous evaluations or based on fears not backed up by proof.”

Vigano was transferred to Washington over his objections, after he wrote to Pope Benedict to complain of corruption in awarding contracts at the Vatican, where he held a top-level management position.

Reuters reported that the Vigano’s letters, which were leaked to the press last month, “read like a Renaissance drama of court intrigue, rivalry and petty bickering that have embarrassed the Vatican.”

Vigano has remained silent as cardinals, bishops and monsignors have taken to a very public spat over his allegations.  Among those defending the Vatican were a cardinal and an archbishop who is to be raised to cardinal this month.

Given the fact that the Vatican has survived for more than a thousand years – and through scandals far worse than this – perhaps the officials who are upset should take a long view.

Sweep to Vatican officials contest corruption charges

Indian Supreme Court Comes Through Loud and Clear

by Diana Jean Schemo / Published February 3, 2012 in The Big Sweep | Leave a comment

A vendor speaking on his cellphone in Mumbai. / REUTERS

A decision by India’s Supreme Court Thursday could leave millions of Indians without cellphone service. The court threw out 122 mobile phone licenses granted through one of India’s biggest corruption scandals in history.

The licenses were sold in 2008 at 2001 prices, costing the country’s treasury more than $39 billion in lost revenue, according to one report cited by the Los Angeles Times. The amount, the paper reported, was “more than twice the country’s combined education and health budgets for 2011.”

Andimuthu Raja, the disgraced telecommunications minister, is now in prison on corruption charges, while an investigation threatens to bring down other ministers who may have been in on the scheme. The country, meanwhile, has four months to set in place new rules and run another auction for the licenses.

Sweep to Indian court cancels 122 telecom licenses in anti-corruption move

New York Attorney General Eric Schneiderman filed suit against three major banks Friday, accusing them of fraud in attempting to save billions in fees while foreclosing on homeowners by using an electronic mortgage registry.

Schneiderman’s suit names Bank of America, J.P. Morgan Chase and Wells Fargo, as well as the Mortgage Electronic Registration Systems Inc.

“The banks created the MERS system as an end-run around the property recording system, to facilitate the rapid securitization and sale of mortgages,” the Associated Press quoted Schneiderman as saying. In doing so, foreclosing banks made it impossible for homeowners and the courts to track property transfers through public records.

The electronic system, the attorney general said, is plagued by inaccuracies. Banks relied on the data to bring foreclosure actions against homeowners, creating the appearance—falsely, it often turned out—that they had the authority to turn homeowners out on the street.

Sweep to NY’s Schneiderman Sues Banks in Foreclosure Effort

The financial muscle behind LightSquared, the communications company that Senator Chuck Grassley accused of attempting to bribe him last week, has come out swinging against the Iowa Republican.

U.S. Senator Chuck Grassley / REUTERS

Harbinger Capital, the hedge fund that has reportedly invested $3 billion into LightSquared, derided charges by Grassley’s office that LightSquared had tried to buy him off.  Last week Grassley had accused LightSquared of proposing his office go easy on a review of the company’s technology in exchange for a promise to build a call center in his home state.

LightSquared is planning to launch an LTE network aimed at delivering fast Internet service to more than 250 million customers. But it has run into opposition from the satellite and telecommunications industries, which cite research suggesting the LTE technology produces interference in broadband networks that cover GPS signals and cellphones.

In a 13-page letter, attorneys for Phil Falcone, the head of Harbinger Capital, attacked Grassley for taking his accusation to the press, and he denied any intent to bribe the senator. Falcone’s bet on LightSquared cost his company dearly: The fund reported a 47 percent drop in income for 2011 on Friday.

Sweep to LightSquared backer rebuts Grassley bribery charges

Fracking 1, Democracy 0 at U.S. Congress

by Aaron Kessler / Published February 2, 2012 in The Big Sweep | 1 Comment

Exploring for shale gas, or fracking. / REUTERS

It’s not something you expect to happen in the United States, let alone at the U.S. Capitol: but on Wednesday a journalist and documentary filmmaker was arrested while attempting to film a public Congressional hearing.

Josh Fox, whose documentary “Gasland” was nominated for an Academy Award, arrived with his camera crew to record a House subcommittee hearing on a natural gas drilling technique known as hydraulic fracturing. However, the Republican chairman of the committee, Andy Harris of Maryland, objected to his presence – and directed that he and the crew not just be barred from filming, but be arrested by police.

Filmmaker Josh Fox being arrested in Congress at public hearing on fracking. / Photo courtesy of EARTHWORKS

“Gasland” raised questions about the safety of “fracking” and featured interviews with several residents of Pavillion, Wyoming – the town at the center of an EPA study set to be discussed at Wednesday’s hearing. Critics of the arrests charge that Fox and his crew were singled out for retaliation because of the film’s questioning of fracking and that camera crews are almost never subject to such treatment on Capitol Hill.

“Hearings are open to the public, and any citizen can attend,” the Huffington Post reports. “Regulations only govern the use of cameras. Even under an extreme adherence to the rules, Fox’s camera could have been confiscated or disabled without subjecting him to arrest. And while Fox did not have formal Capitol Hill credentials, such formalities are rarely enforced against high-profile journalists. Temporary passes are easy to obtain, and if Republicans had objected on procedural grounds, they could have simply sent the crew to the front desk, rather than ordering police to arrest journalists.”

In a statement issued after the incident, Fox said he was “not expecting to be arrested for practicing journalism.”

Sweep to Gasland journalists arrested at hearing by order of House Republicans (with video)

A federal investigation has recommended that the U.S. Air Force discipline three officials for illegally retaliating against whistle-blowers at Dover Air Force Base, after the workers brought to light instances of troops’ body parts being lost or mutilated.

“Federal investigators have concluded that Air Force officials at the military mortuary in Dover, Delaware illegally punished four civilian workers for blowing the whistle on the mishandling of body parts of dead troops,” the Associated Press reports.

The Office of Special Counsel, which conducted the investigation, previously found in a separate probe last fall that Dover – the main entry point for U.S. war dead returning to the country – was suffering from “gross mismanagement,” and that body parts of fallen U.S. troops had been lost or deliberately discarded.

As the AP reports, two of the whistleblowers wound up with letters of reprimand after coming forward, and one was fired in 2010 but then subsequently reinstated.

Sweep to Report: Dover punished air force whistleblowers

Until now, if you were a Russian citizen and engaged in bribery abroad, you need not have worried. Why? It wasn’t a crime.

That changed Wednesday, when Russia signed on to the Anti-Bribery Convention of the Organization for Economic Co-operation and Development, or OECD. Joining the convention effectively means it’s now a crime for Russians to pay such bribes.

As RIA Novosti – the Russian state news agency – reports, anti-corruption analysts have long said that Russian businesses had “an unfair global competitive advantage” because of their ability to spread bribes around with impunity. Transparency International Russia apparently spent more than a decade lobbying the country’s leaders to sign the convention.

Now, only one major economic power remains outside the anti-bribery convention: China.

Sweep to Russia bans paying bribes abroad

Victory Lap for Georgian Leader

by Leslie Wayne / Published February 1, 2012 in The Big Sweep | Leave a comment

U.S. President Barack Obama with Georgian President Mikheil Saakashvili. / REUTERS

All and all, it’s been a great trip to Washington for the president of Georgia, Mikheil Saakashvili.

Not only did Saakashvili get an Oval office meeting in which President Obama pledged to explore a free trade pact between the United States and Georgia, but the World Bank also lavished praise on the country. A report the bank issued Tuesday showed that Georgia has made great strides in tackling sleaze at home.

The World Bank cited the country’s “unique success” in rooting out corruption, an effort that “destroys the myth that corruption is cultural and gives hope to reformers everywhere.”

Here are the stats: The bank’s “Doing Business” survey now puts Georgia in the 16th spot, up from 112th place in 2005.  One reason for the jump was the elimination of police corruption.  Saakashvili fired 16,000 cops, replaced them with a smaller force and then kept a close eye on them. Red tape was cut and tax collections modernized – eliminating the need to pay bribes.  Ditto for improvements to the energy sector. With reliable energy provided for the citizens, there was no need to pay bribes to keep the lights on.

The bottom line for Georgia may well be its own bottom line.  The country is hoping its cleaner image will attract foreign investment and put the country on track for a double-digit growth rate.

Sweep to The Georgian paradox

Another report painted a far less rosy picture for another part of the world.  PriceWaterhouseCooper’s annual Global Economic Crime Survey came up with a gloomy forecast for the Middle East.

More than 40 percent of the respondents to the survey from the region said they expect their companies or organizations to face bribery and corruption in the Middle East in the coming year.  This compares to fewer than 25 percent who said they expected to be shaken down in other parts of the world.  The kind of corruption that these business leaders anticipate in the Middle East includes accounting fraud and money laundering.

Those surveyed may know what they are talking about.  The crime survey polled 3,600  globally, and included interviews with 126 respondents who were C-suite executives (chief executive officers, chief financial officers and others with “chief” in their titles), senior vice presidents  and department heads who do business in Bahrain, Egypt, Jordan, Kuwait, Lebanon, Libya, Oman, Qatar, Saudi Arabia, United Arab Emirates and the West Bank.

Since many of these are “Arab Spring” countries, the findings suggest the road to a more open and accountable society may be a long one.

Sweep to Survey finds bribery, corruption in the Middle East increasing

Charles Cramb. / COMPANY PHOTO

It doesn’t look like Avon will be calling on Charles Cramb, its vice chairman, any time soon.  The beauty products company has fired Cramb over allegations of overseas bribery and possible improper disclosures to Wall Street analysts.

Cramb was the latest head to roll at the company, which sells its beauty products door-to-door. He is follows two top U.S. executives and three in China who have been ousted amid a long-running investigation into possible bribes in the company’s operations in China and elsewhere. In addition, another line of inquiry centers on whether the company’s disclosures to investors over the probes was adequate.

Until his ouster, Cramb was considered in the running to replace Andrea Jung, who is slated to step down as chief executive once a replacement for her is named.  Last month, Avon’s board told Jung she would be leaving, citing the company’s poor financial performance and continued bribery investigations.

Sweep to Avon executive Charles Cramb departs amid bribery probe

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