Versions of this article appeared on the website of Transparency International on September 18 and on the new "Masterminds" site of The Huffington Post on September 22, 2014.
Finance Ministers of the Group of 20 leading global economies agreed to take measures against tax avoidance by giant global corporations at their meeting in Australia on September 20. This now needs to be seen by the G20 as a stepping stone towards far tougher and meaningful actions against illegal tax evaders, corrupt corporations and financial institutions that launder money for corrupt officials, politicians, criminal organizations and businesses.
The watchwords for the G20 should be "NO IMPUNITY."
The G20 finance ministers acted to end the tax practices of companies like Apple, Amazon, Starbucks that evaded high rates in countries where they have huge markets by registering their businesses in low business tax countries like Ireland and the Netherlands. These tax approaches have been legal, but they prompted public outrage. The politicians felt the heat and have started to take measures. Now, they need to go after the illegal practices in global corporate business. The G20 meets at the Summit level on November 15 in Brisbane, Australia and that is the time when forceful actions should be announced. The immediate goal should be for the G20 to strengthen its existing “Anti-Corruption Action Plan.”
The G20 should be inspired by a dramatic and far-reaching campaign that is just being launched by Transparency International - UNMASK the CORRUPT.
Let us just look at a few of the major cases that need to be addressed, from the plunder by the current ruler of Sudan, to the vast theft by the former president of Ukraine, to the activities of one of the world’s biggest banks, as well as possibly vast international bribe-paying by the world’s biggest retail corporation. These cases are just the tip of the iceberg of political and corporate corruption that demands G20 action.
Villains and Investigations
Example: BNP Paribas, France’s largest bank. In early July it pleaded guilty to U.S. Justice Department charges and paid a $8.9 billion fine (the largest ever for money laundering) for violating U.S. sanctions on Sudan, Cuba and Iran. The Justice Department stated that the bank had taken deposits over many years from these countries into its Geneva office and then changed the identities of the account holders so that they could illegally acquire U.S. dollar investments.
The charges indicated that billions of dollars were laundered for Sudan and that means the accounts of Sudan’s dictator Omar al-Bashir and his cronies. Al-Bashir is wanted by the International Criminal Court on five charges of crimes against humanity, for allegedly being responsible for the slaughter of thousands of people in Dafur and elsewhere in Sudan and South Sudan.
Several years ago, Wikileaks, according to The Guardian newspaper, revealed that the Sudanese leader had “siphoned as much as $9 billion out of his impoverished country, and much of it may be stashed in London banks.”
There is no evidence that U.K. authorities have investigated these allegations. There is no evidence that BNP Paribas is no longer serving as Sudan’s banker or that the French authorities care. No top banker at BNP, or for that matter any of the major banks caught by the U.S. Justice Department for money laundering and sanctions violations, have been hauled into court and prosecuted.
Example: former Ukraine president Viktor Yanukovych. Ukrainians where aghast when Yanukovych was forced out of office in February to see the incredible riches of his gold-plated mansion in Kiev. Politicians claimed he had stolen at least $20 billion and perhaps double or triple that sum. Immediately, Swiss and Austrianauthorities announced they were blocking bank accounts in their countries belonging to the dictator. In June, the Ukraine authorities announced they were investigating the links of two domestic banks to the former leader.
However, the Austrian and Swiss authorities have not revealed which banks held the stolen cash or how large the assets are that are frozen and whether they will be returning the money to the people of Ukraine. Meanwhile, the dictator or his cronies who have the foreign assets, which were almost certainly laundered through holding companies in countries like Cyprus, Liechtenstein and the Cayman Islands to hide the real owners of the accounts, have been pressured to reveal where the stolen money is.
The vast funds stolen by corrupt leaders, like Yanukovych, or the former dictators of Egypt (President Mubarek) and Tunisia (President Ben-Ami) have not been seized by Western authorities and returned to their rightful owners -- the citizens of their countries. The G20 needs to act to close the money laundering havens and ensure asset repatriation.
Example: Walmart, the world's largest retailer. In March, the company announced that over the previous two years it had spent $439 million conducting internal investigations of bribing foreign government officials in Mexico, China, India and Brazil. It was not the U.S. Justice Department that prompted Walmart to become alarmed. It was an investigation the New York Times in 2012.
There are many other cases of international corruption where the justice departments of G20 governments have either turned a blind eye or done very little. Challenging this complacency is vital. It is now time for the G20 to do some unmasking and use its summit meeting and put an end to the impunity that is so widespread.