How Nigeria can take the profit out of corruption

President Muhammadu Buhari has rather wisely
turned the spotlight on recovering stolen funds.
The President recently confirmed that his
government has “received firm assurances of
cooperation from the United States and other
countries on the recovery and repatriation of funds
stolen from Nigeria. According to the President,
“the government in the next three months will be
busy getting facts and figures needed to help us
recover our stolen funds in foreign countries.”
It’s no coincidence that the first priority of the
Buhari government is not to throw corrupt officials
in jail but to recover stolen funds. Nigeria is broke,
and several of its 36 states can’t even pay their
workers’ salaries. But this is hardly surprising
given that for many years the country has fallen
victim of systematic stealing by career politicians
and soldiers dabbling in politics. Previously
considered a matter of “little brown envelopes”,
corruption is now a huge “profitable business” for
politicians (and their families and friends, the so-
called go-betweens or ‘looting pipes’), corporations
and financial institutions and centres.
Stealing is odious, illegal and immoral but stolen
funds don’t stink, as corrupt officials continue to
empty the public treasuries for personal gains–to
amass luxury cars, buy extravagant homes, and
enjoy exotic vacations–to the amazement and
anger of millions of Nigerians. Images of
government officials lining their pockets with the
treasure of the poor are stark and raw.
Yet, corrupt officials are allowed to keep their
looted funds and thus reaping the benefits of their
corruption. The abundance of wealth of the ruling
class stands in stark contrast to the poverty of the
majority of Nigerians.
Allowing corrupt officials to benefit from their crime
has a degenerative effect on the institutions of
governance, human rights and the rule of law.
Therefore, the Buhari government is spot-on to
focus on the return of stolen funds, as this can
help take the profit out of corruption, thereby
reducing the incentive to act corruptly. This notion
of taking the profit out of corruption is premised on
a belief that the individual’s economic behaviour is
rational and based on a balance of interest and
risk.
However, asset recovery is complex, expensive
and slow, requiring sound planning and proactive
actions by the government if any significant
success is to be recorded. Important documents
and primary information will be needed to allow
forensic experts, accountants, lawyers, etc., to
build a prima facie case to initiate mutual
assistance requests. Once stolen funds are
identified, the government must move swiftly to
seize and freeze the funds as a provisional
measure, to prevent the possibility of funds being
moved around and closure of accounts.
The government may for example request that a
blanket disclosure and freezing order be sent to
targeted banks in Europe and North America where
prima facie information is available that stolen
funds are deposited in those banks.
But none of these will succeed without the full and
effective cooperation of other states. That is why
the “firm assurances of cooperation” by the US
and other unnamed countries is in principle to be
applauded.
Nevertheless, it has to be stressed that the way
jurisdictions like the US keeping stolen funds
respond in practice to requests for technical and
financial assistance suggests that the promise of
cooperation should be taken with a pinch of salt.
For example, the US and the UK have not shown
sufficient political will to cooperate in the
repatriation of the funds looted by the late Gen Sani
Abacha. Although often touted as a “success
story”, only a small part of the Abacha funds have
actually been repatriated by the UK and
Switzerland. France even failed to execute a letter
of request for mutual assistance on the rather
flimsy grounds that it was drafted in English!
Therefore, to make sure that the US and other
countries fulfil their promises to cooperate, the
Buhari government can make the best use of
progressive rules on asset recovery as contained
in the UN Convention against Corruption which the
US ratified on October 30, 2006. The UNCAC for
example makes it obligatory for states to exchange
information and take measures to facilitate the full
return of funds to the countries from which they
were stolen.
Yet, the use of the UNCAC may not necessarily
guarantee success in securing the cooperation of
financial centres without the requisite political will
to observe the rules on international cooperation
and assistance. Experience has indeed shown that
while many countries including the US, the UK
(and Nigeria) have ratified the UNCAC, the
convention is rarely effectively implemented by
financial centres in Europe and North America.
In essence, recovery of stolen funds still largely
depends on the goodwill of the states where the
funds are located. Therefore, the Buhari
government would need to make a strong case on
why it is in the public interest of the US to facilitate
recovery of stolen funds by Nigeria, as the US (and
other countries) won’t cooperate if cooperating
with Nigeria is deemed harmful to its public or
economic interest.
However, Nigeria is not entirely left to the political
whims and caprices of the financial centres. One
way Buhari can deal with the cases of unwilling or
uncooperative financial centres and offshore
havens is to consider, first, the possibility of
judicial intervention through the mechanism of the
International Court of Justice (already con­
templated under Article 66 of the UNCAC as a
means of resolving disputes among states parties).
Second, in cases of jurisdictions that persistently
violate rules on international cooperation regarding
asset recovery, the government should work with
friendly countries to put pressure on the
international community to consider imposing
heavy political and economic sanctions against
those jurisdictions.
Although not an international court, the OECD
mechanism allows non-members like Nigeria to
make a request to its Working Group on Bribery or
to its Secretary General. The Buhari government
can take full advantage of this mechanism by
requesting the Working Group and the Secretary
General to include the government’s asset
recovery initiative on their “Tour de Table”.
To be concluded on Friday
Dr Olaniyan is the author of ‘Corruption and Human
Rights Law in Africa’
Culled from punchng.com

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