![Corruption_Perception_index_2018](https://upload.wikimedia.org/wikipedia/commons/d/df/Corruption_Perception_index_2018.svg)
Corruption is a form of
dishonesty
Dishonesty is to act without honesty. It is used to describe a lack of probity, cheating, lying, or deliberately withholding information, or being deliberately deceptive or a lack in integrity, knavishness, perfidiosity, corruption or treacherou ...
or a
criminal offense
In ordinary language, a crime is an unlawful act punishable by a state or other authority. The term ''crime'' does not, in modern criminal law, have any simple and universally accepted definition,Farmer, Lindsay: "Crime, definitions of", in Can ...
which is undertaken by a person or an organization which is entrusted in a position of authority, in order to acquire illicit benefits or abuse power for one's personal gain. Corruption may involve many activities which include
bribery
Bribery is the offering, giving, receiving, or soliciting of any item of value to influence the actions of an official, or other person, in charge of a public or legal duty. With regard to governmental operations, essentially, bribery is "Cor ...
,
influence peddling
Influence peddling is the practice of using one's influence in government or connections with authorities to obtain favours or preferential treatment for another, usually in return for payment. It is also called traffic of influence or trading i ...
and the
embezzlement
Embezzlement is a crime that consists of withholding assets for the purpose of conversion of such assets, by one or more persons to whom the assets were entrusted, either to be held or to be used for specific purposes. Embezzlement is a type ...
and it may also involve practices which are legal in many countries.
Political corruption
Political corruption is the use of powers by government officials or their network contacts for illegitimate private gain.
Forms of corruption vary, but can include bribery, lobbying, extortion, cronyism, nepotism, parochialism, patronage, i ...
occurs when an office-holder or other governmental employee acts with an official capacity for personal gain. Corruption is most common in
kleptocracies
Kleptocracy (from Greek κλέπτης ''kléptēs'', "thief", κλέπτω ''kléptō'', "I steal", and -κρατία -''kratía'' from κράτος ''krátos'', "power, rule") is a government whose corrupt leaders (kleptocrats) use political ...
,
oligarchies
Oligarchy (; ) is a conceptual form of power structure in which power rests with a small number of people. These people may or may not be distinguished by one or several characteristics, such as nobility, fame, wealth, education, or corporate, ...
,
narco-state
Narco-state (also narco-capitalism or narco-economy) is a political and economic term applied to countries where all legitimate institutions become penetrated by the power and wealth of the illegal drug trade. The term was first used to describ ...
s, and
mafia state
In politics, a mafia state is a state system where the government is tied with organized crime to the degree when government officials, the police, and/or military became a part of the criminal enterprise. According to US diplomats, the expressio ...
s.
Corruption and crime are endemic sociological occurrences which appear with regular frequency in virtually all countries on a global scale in varying degrees and proportions. Each individual nation allocates domestic resources for the control and regulation of corruption and the deterrence of crime. Strategies which are undertaken in order to counter corruption are often summarized under the umbrella term
anti-corruption
Anti-corruption (or anticorruption) comprises activities that oppose or inhibit corruption. Just as corruption takes many forms, anti-corruption efforts vary in scope and in strategy. A general distinction between preventive and reactive meas ...
. Additionally, global initiatives like the United Nations
Sustainable Development Goal 16
Sustainable Development Goal 16 (SDG 16 or Global Goal 16) is about "peace, justice and strong institutions." One of the 17 Sustainable Development Goals established by the United Nations in 2015, the official wording is: "Promote peaceful and ...
also have a targeted goal which is supposed to substantially reduce corruption in all of its forms.
Definitions and scales
![Say no to bribes in Chipata, Zambia](https://upload.wikimedia.org/wikipedia/commons/0/01/Say_no_to_bribes_in_Chipata%2C_Zambia.jpg)
Stephen D. Morris, a professor of politics, wrote that
political corruption is the illegitimate use of public power to benefit a private interest. Economist Ian Senior defined corruption as an action to secretly provide a good or a service to a third party to influence certain actions which benefit the corrupt, a third party, or both in which the corrupt agent has authority.
World Bank economist
Daniel Kaufmann extended the concept to include "legal corruption" in which power is abused within the confines of the law—as those with power often have the ability to make laws for their protection. The effect of corruption in infrastructure is to increase costs and construction time, lower the quality and decrease the benefit.
Corruption is a complex phenomenon and can occur on different scales. Corruption ranges from small favors between a small number of people (petty corruption), to corruption that affects the government on a large scale (grand corruption), and corruption that is so prevalent that it is part of the everyday structure of society, including corruption as one of the symptoms of organized crime (systemic corruption).
A number of indicators and tools have been developed which can measure different forms of corruption with increasing accuracy; but when those are impractical, one study suggests looking at bodyfat as a rough guide after finding that obesity of cabinet ministers in
post-Soviet states
The post-Soviet states, also known as the former Soviet Union (FSU), the former Soviet Republics and in Russia as the near abroad (russian: links=no, ближнее зарубежье, blizhneye zarubezhye), are the 15 sovereign states that wer ...
was highly correlated with more accurate measures of corruption.
Petty corruption
Petty corruption occurs at a smaller scale and takes place at the implementation end of public services when public officials meet the public. For example, in many small places such as registration offices, police stations, state licensing boards, and many other private and government sectors.
Grand corruption
Grand corruption is defined as corruption occurring at the highest levels of government in a way that requires significant subversion of the political, legal and economic systems. Such corruption is commonly found in countries with authoritarian or dictatorial governments but also in those without adequate policing of corruption.
The government system in many countries is divided into the legislative,
executive
Executive ( exe., exec., execu.) may refer to:
Role or title
* Executive, a senior management role in an organization
** Chief executive officer (CEO), one of the highest-ranking corporate officers (executives) or administrators
** Executive di ...
and judicial branches in an attempt to provide independent services that are less subject to grand corruption due to their independence from one another.
Systemic corruption
Systemic corruption (or endemic corruption) is corruption which is primarily due to the weaknesses of an organization or process. It can be contrasted with individual officials or agents who act corruptly within the system.
Factors which encourage systemic corruption include
conflicting incentives,
discretionary powers;
monopolistic powers; lack of
transparency; low pay; and a culture of
impunity
Impunity is avoidance of punishment, loss, or other negative consequences for an action. In the international law of human rights, impunity is failure to bring perpetrators of human rights violations to justice and, as such, itself constitutes a d ...
. Specific acts of corruption include "bribery, extortion, and embezzlement" in a system where "corruption becomes the rule rather than the exception." Scholars distinguish between centralized and decentralized systemic corruption, depending on which level of state or government corruption takes place; in countries such as the
Post-Soviet states
The post-Soviet states, also known as the former Soviet Union (FSU), the former Soviet Republics and in Russia as the near abroad (russian: links=no, ближнее зарубежье, blizhneye zarubezhye), are the 15 sovereign states that wer ...
both types occur.
Some scholars argue that there is a negative duty of western governments to protect against systematic corruption of underdeveloped governments.
Corruption has been a major issue in China, where society depends heavily on personal relationships. By the late 20th century that combined with the new lust for wealth, produced escalating corruption. Historian Keith Schoppa says that bribery was only one of the tools of Chinese corruption, which also included, "embezzlement, nepotism, smuggling, extortion, cronyism, kickbacks, deception, fraud, squandering of public money, illegal business transactions, stock manipulation and real estate fraud." Given the repeated anti-corruption campaigns it was a prudent precaution to move as much of the fraudulent money as possible overseas.
As a Post-Soviet Union country - Armenia is also facing corruption-related issues. This has been transferred to Armenia as well as other Soviet Union Member Republics as a heritage. Armenia was a pleasant exception. After
the Armenian Velvet Revolution in 2018 new government made the fight against corruption an official top priority. 'Anti-corruption Strategy' seemed to give results as it upgraded from 105th place in
CPI score to 60th in just two years.
In Latin American countries, corruption is permitted as a result of the cultural norms of the institution. In countries like the United States, there is a relatively strong sense of trust among strangers, one that is not found in Latin American countries. In Latin American countries, this trust does not exist, whereas the social norms imply that no stranger is responsible for the wellbeing or happiness of another stranger. Instead, the trust is found in acquaintances. Acquaintances are treated with trust and respect—a level of trust that is not found among acquaintances in countries like the United States. This is what permits for corruption in Latin American countries. If there is a strong enough trust within an administration that no one will betray the rest, corruptive policies will take place with ease. In the United States, this could not occur, as there is not a strong enough trust among the members of an administration to allow for corruption. In Latin American countries, there is a stronger value in individuality, which includes that of acquaintances, unlike in countries like the United States, which fails to include acquaintances.
Causes
Per
R. Klitgaard corruption will occur if the corrupt gain is greater than the penalty multiplied by the likelihood of being caught and prosecuted.
Since a high degree of monopoly and discretion accompanied by a low degree of transparency does not automatically lead to corruption, a fourth variable of "morality" or "integrity" has been introduced by others. The moral dimension has an intrinsic component and refers to a "mentality problem", and an extrinsic component referring to circumstances like poverty, inadequate remuneration, inappropriate work conditions and inoperable or over-complicated procedures which demoralize people and let them search for "alternative" solutions.
According to a 2017 survey study, the following factors have been attributed as causes of corruption:
It has been noted that in a comparison of the most corrupt with the least corrupt countries, the former group contains nations with huge
socio-economic inequalities, and the latter contains nations with a high degree of social and economic justice.
By sector
Corruption can occur in many sectors, whether they be public or private industry or even
NGOs
A non-governmental organization (NGO) or non-governmental organisation (see spelling differences) is an organization that generally is formed independent from government. They are typically nonprofit entities, and many of them are active in ...
(especially in public sector). However, only in democratically controlled institutions is there an interest of the public (owner) to develop internal mechanisms to fight active or passive corruption, whereas in private industry as well as in NGOs there is no public control. Therefore, the owners' investors' or sponsors' profits are largely decisive.
Public sector
Public corruption includes corruption of the political process and of government agencies such as tax collectors and the police, as well as corruption in processes of allocating public funds for contracts, grants, and hiring. Recent research by the World Bank suggests that who makes policy decisions (elected officials or bureaucrats) can be critical in determining the level of corruption because of the incentives different policy-makers face.
Judicial
![Mau Juiz, pormenor2 (cropped)](https://upload.wikimedia.org/wikipedia/commons/e/e1/Mau_Juiz%2C_pormenor2_%28cropped%29.png)
Judicial corruption refers to the corruption-related
misconduct of judges, through the receiving or giving of bribes, the improper sentencing of convicted criminals, bias in the hearing and judgement of arguments and other forms of misconduct. Judicial corruption can also be conducted by prosecutors and defense attorneys. An example of
prosecutorial misconduct
In jurisprudence, prosecutorial misconduct or prosecutorial overreach is "an illegal act or failing to act, on the part of a prosecutor, especially an attempt to sway the jury to wrongly convict a defendant or to impose a harsher than appropri ...
, occurs when a
politician
A politician is a person active in party politics, or a person holding or seeking an elected office in government. Politicians propose, support, reject and create laws that govern the land and by an extension of its people. Broadly speaking, ...
or a
crime boss
A crime boss, also known as a crime lord, Don, gang lord, gang boss, mob boss, kingpin, godfather, crime mentor or criminal mastermind, is a person in charge of a criminal organization.
Description
A crime boss typically has absolute or nearl ...
bribes a prosecutor to open investigations and file charges against an opposing politician or a rival crime boss, in order to hurt the competition.
Governmental corruption of the judiciary is broadly known in many transitional and
developing countries
A developing country is a sovereign state with a lesser developed industrial base and a lower Human Development Index (HDI) relative to other countries. However, this definition is not universally agreed upon. There is also no clear agreem ...
because the
budget
A budget is a calculation play, usually but not always financial, for a defined period, often one year or a month. A budget may include anticipated sales volumes and revenues, resource quantities including time, costs and expenses, environme ...
is almost completely controlled by the executive. The latter critically undermines the separation of powers, because it fosters financial dependence on the judiciary. The proper distribution of a nation's wealth, including its government's spending on the judiciary, is subject to
constitutional economics
Constitutional economics is a research program in economics and constitutionalism that has been described as explaining the choice "of alternative sets of legal-institutional-constitutional rules that constrain the choices and activities of econo ...
.
The judiciary may be corrupted by acts of the government, such as through budget planning and various privileges, and by private acts. Corruption in judiciary may also involve the government using its judicial arm to oppress opposition parties. Judicial corruption is difficult to completely eradicate, even in developed countries.
Military
Military corruption refers to the abuse of power by members in the armed forces, in order for career advancement or for personal gain by a soldier or soldiers. One form of military corruption in the
United States Armed Forces
The United States Armed Forces are the military forces of the United States. The armed forces consists of six service branches: the Army, Marine Corps, Navy, Air Force, Space Force, and Coast Guard. The president of the United States is ...
, is a military soldier being promoted in
rank
Rank is the relative position, value, worth, complexity, power, importance, authority, level, etc. of a person or object within a ranking, such as:
Level or position in a hierarchical organization
* Academic rank
* Diplomatic rank
* Hierarchy
* ...
or being given better treatment than their colleagues by their officers, due to their
race
Race, RACE or "The Race" may refer to:
* Race (biology), an informal taxonomic classification within a species, generally within a sub-species
* Race (human categorization), classification of humans into groups based on physical traits, and/or s ...
,
sexual orientation
Sexual orientation is an enduring pattern of romantic or sexual attraction (or a combination of these) to persons of the opposite sex or gender, the same sex or gender, or to both sexes or more than one gender. These attractions are generall ...
,
ethnicity
An ethnic group or an ethnicity is a grouping of people who identify with each other on the basis of shared attributes that distinguish them from other groups. Those attributes can include common sets of traditions, ancestry, language, history, ...
,
gender
Gender is the range of characteristics pertaining to femininity and masculinity and differentiating between them. Depending on the context, this may include sex-based social structures (i.e. gender roles) and gender identity. Most culture ...
,
religious beliefs
A belief is an attitude that something is the case, or that some proposition is true. In epistemology, philosophers use the term "belief" to refer to attitudes about the world which can be either true or false. To believe something is to take ...
,
social class
A social class is a grouping of people into a set of hierarchical social categories, the most common being the upper, middle and lower classes. Membership in a social class can for example be dependent on education, wealth, occupation, inc ...
or
personal relationships
''Personal Relationships'' is a quarterly peer-reviewed academic journal published by John Wiley & Sons on behalf of the International Association for Relationship Research. It covers research on all aspects of personal relationships, using metho ...
with higher-ranking officers in spite of their merit. In addition to that, the US military has also had many instances of officers
sexually assaulting fellow officers and in many cases, there were allegations that many of the attacks were covered up and victims were coerced to remain silent by officers of the same rank or of higher rank.
Another example of military corruption, is a military officer or officers using the power of their positions to commit activities that are illegal, such as skimming logistical supplies such as food, medicine, fuel, body armor or weapons to sell on the local
black market
A black market, underground economy, or shadow economy is a clandestine market or series of transactions that has some aspect of illegality or is characterized by noncompliance with an institutional set of rules. If the rule defines the ...
. There have also been instances of military officials, providing equipment and combat support to
criminal syndicates,
private military companies and
terrorist groups, without approval from their superiors. As a result, many countries have a
military police force to ensure that the military officers follow the laws and conduct of their respective countries but sometimes the military police have levels of corruption themselves.
Natural resources
Within less democratic countries, the presence of resources such as diamonds, gold, oil, and forestry increases the prevalence of corruption. Corruption includes industrial corruption, consisting of large bribes, as well as petty corruption such as a poacher paying off a
park ranger
A ranger, park ranger, park warden, or forest ranger is a law enforcement person entrusted with protecting and preserving parklands – national, state, provincial, or local parks.
Description
"Parks" may be broadly defined by some systems in thi ...
to ignore
poaching
Poaching has been defined as the illegal hunting or capturing of wild animals, usually associated with land use rights.
Poaching was once performed by impoverished peasants for subsistence purposes and to supplement meager diets. It was set a ...
. The presence of fuel extraction and export is unambiguously associated with corruption, whereas mineral exports only increased corruption in poorer countries. In wealthier countries, mineral exports such as gold and diamonds are actually associated with reduced corruption. The international
Extractive Industries Transparency Initiative
The Extractive Industries Transparency Initiative (EITI) is a global standard for the good governance of oil, gas and mineral resources. It seeks to address the key governance issues in the extractive sectors.
The EITI Standard requires informa ...
seeks to create best practices for good governance of gas, oil, and minerals, particularly focusing on the state management of revenue from these resources. Any valued natural resource can be affected by corruption, including water for
irrigation
Irrigation (also referred to as watering) is the practice of applying controlled amounts of water to land to help grow crops, landscape plants, and lawns. Irrigation has been a key aspect of agriculture for over 5,000 years and has been devel ...
, land for livestock grazing, forests for hunting and logging, and fisheries.
The presence or perception of corruption also undermines environmental initiatives. In Kenya, farmers blame poor agricultural productivity on corruption, and thus are less likely to undertake
soil conservation
Soil conservation is the prevention of loss of the topmost layer of the soil from erosion or prevention of reduced fertility caused by over usage, acidification, salinization or other chemical soil contamination.
Slash-and-burn and other uns ...
measures to prevent soil erosion and loss of nutrients. In Benin, mistrust of government due to perceived corruption led small farmers to reject the adaptation of measures to combat
climate change
In common usage, climate change describes global warming—the ongoing increase in global average temperature—and its effects on Earth's climate system. Climate change in a broader sense also includes previous long-term changes to ...
.
Political
![Schurz Corruption](https://upload.wikimedia.org/wikipedia/commons/c/c9/Schurz_Corruption.jpg)
Political corruption is the abuse of public power, office, or resources by elected government officials for personal gain, by extortion, soliciting or offering bribes. It can also take the form of office holders maintaining themselves in office by purchasing votes by enacting laws which use taxpayers' money. Evidence suggests that corruption can have political consequences- with citizens being asked for bribes becoming less likely to identify with their country or region.
The political act of graft (American English), is a well known and now global form of political corruption, being the unscrupulous and illegal use of a politician's authority for personal gain, when funds intended for public projects are intentionally misdirected in order to maximize the benefits to illegally private interests of the corrupted individual(s) and their cronies. In some cases government institutions are "repurposed" or shifted away from their official mandate to serve other, often corrupt purposes.
The
Kaunas golden toilet case was a major Lithuanian scandal. In 2009, the municipality of Kaunas (led by mayor Andrius Kupčinskas) ordered that a shipping container was to be converted into an outdoor toilet at a cost of 500,000
litai (around 150,000 euros). It was to also require 5,000 litai (1,500 euros) in monthly maintenance costs.
At the same time when Kaunas's "Golden Toilet" was built,
Kėdainiai tennis club acquired a very similar, but more advanced solution for 4,500 euros.
Because of the inflated cost of the outdoor toilet, it was nicknamed the "Golden Toilet". Despite the investment, the "Golden Toilet" remained closed for years due to the dysfunctionality and was a subject of a lengthy anti-corruption investigation into those who had created it and
the local municipality even considered demolishing the building at one point. The group of public servants involved in the toilet's procurement received various prison sentences for recklessness, malfeasance, misuse of power and document falsifications in a 2012 court case, but were cleared of their corruption charges and received compensation, which pushed the total construction cost and subsequent related financial losses to 352,000 euros.
On 7 July 2020,
Carnegie Endowment for International Peace
The Carnegie Endowment for International Peace (CEIP) is a nonpartisan international affairs think tank headquartered in Washington D.C. with operations in Europe, South and East Asia, and the Middle East as well as the United States. Founded i ...
, a global think tank, released a report claiming the Emirati city,
Dubai
Dubai (, ; ar, wikt:دبي, دبي, translit=Dubayy, , ) is the List of cities in the United Arab Emirates#Major cities, most populous city in the United Arab Emirates (UAE) and the capital of the Emirate of Dubai, the most populated of the 7 ...
, of being an enabler of global corruption,
crime
In ordinary language, a crime is an unlawful act punishable by a state or other authority. The term ''crime'' does not, in modern criminal law, have any simple and universally accepted definition,Farmer, Lindsay: "Crime, definitions of", in C ...
and
illicit financial flows Illicit financial flows, in economics, are a form of illegal capital flight that occurs when money is illegally earned, transferred, or spent. This money is intended to disappear from any record in the country of origin, and earnings on the stock o ...
. It stated that the global corrupt and criminal actors either operated through or from Dubai. The city was also called a haven for trade-based
money laundering
Money laundering is the process of concealing the origin of money, obtained from illicit activities such as drug trafficking, corruption, embezzlement or gambling, by converting it into a legitimate source. It is a crime in many jurisdicti ...
, as it gives space to free trade zones, with minimal regulatory laws and customs enforcement.
A report in September 2022 revealed that the British MPs received a total of £828,211 over the period of eight years from countries forming the
Saudi-led coalition, which was waging a
war in Yemen. The money was granted in the form of all-expenses-paid trips to 96 MPs by
Saudi Arabia
Saudi Arabia, officially the Kingdom of Saudi Arabia (KSA), is a country in Western Asia. It covers the bulk of the Arabian Peninsula, and has a land area of about , making it the fifth-largest country in Asia, the second-largest in the Ara ...
(at least £319,406),
Bahrain
Bahrain ( ; ; ar, البحرين, al-Bahrayn, locally ), officially the Kingdom of Bahrain, ' is an island country in Western Asia. It is situated on the Persian Gulf, and comprises a small archipelago made up of 50 natural islands and a ...
(£197,985), the
United Arab Emirates
The United Arab Emirates (UAE; ar, اَلْإِمَارَات الْعَرَبِيَة الْمُتَحِدَة ), or simply the Emirates ( ar, الِْإمَارَات ), is a country in Western Asia (Middle East, The Middle East). It is ...
(£187,251),
Egypt
Egypt ( ar, مصر , ), officially the Arab Republic of Egypt, is a List of transcontinental countries, transcontinental country spanning the North Africa, northeast corner of Africa and Western Asia, southwest corner of Asia via a land bridg ...
(£66,695) and
Kuwait
Kuwait (; ar, الكويت ', or ), officially the State of Kuwait ( ar, دولة الكويت '), is a country in Western Asia. It is situated in the northern edge of Eastern Arabia at the tip of the Persian Gulf, bordering Iraq to Iraq–Ku ...
(£56,872). MPs also received gifts, including a £500 food hamper, tickets for a
Burns Supper
A Burns supper is a celebration of the life and poetry of the poet Robert Burns (25 January 175921 July 1796), the author of many Scots poems. The suppers are normally held on or near the poet's birthday, 25 January, known as Burns Night ( s ...
, an expensive watch and a day out at the
Royal Windsor Horse Show
The Royal Windsor Horse Show is a horse show held annually since 1943 for five days in May or June in Windsor Home Park. . The Saudi-led coalition was alleged of attempting to buy influence in the UK. While the MPs registered the trips and gifts at
Westminster
Westminster is an area of Central London, part of the wider City of Westminster.
The area, which extends from the River Thames to Oxford Street, has many visitor attractions and historic landmarks, including the Palace of Westminster, B ...
as per the rules, critics called it “absolutely shameful” to accept donations from countries with poor
human rights
Human rights are moral principles or normsJames Nickel, with assistance from Thomas Pogge, M.B.E. Smith, and Leif Wenar, 13 December 2013, Stanford Encyclopedia of PhilosophyHuman Rights Retrieved 14 August 2014 for certain standards of hu ...
records.
Police
Police corruption is a specific form of
police misconduct
Police misconduct refers to inappropriate conduct and illegal actions taken by police officers in connection with their official duties. Types of misconduct include among others: coerced false confession, intimidation, false arrest, false impri ...
designed to obtain financial benefits, personal gain, career advancement for a police officer or officers in exchange for not pursuing or selectively pursuing an investigation or arrest or aspects of the "
thin blue line" itself where force members collude in lies to protect their
precincts,
unions and/or other law enforcement members from accountability. One common form of police corruption is soliciting or accepting
bribe
Bribery is the offering, giving, receiving, or soliciting of any item of value to influence the actions of an official, or other person, in charge of a public or legal duty. With regard to governmental operations, essentially, bribery is "Corru ...
s in exchange for not reporting organized
drug
A drug is any chemical substance that causes a change in an organism's physiology or psychology when consumed. Drugs are typically distinguished from food and substances that provide nutritional support. Consumption of drugs can be via inhala ...
or
prostitution
Prostitution is the business or practice of engaging in Sex work, sexual activity in exchange for payment. The definition of "sexual activity" varies, and is often defined as an activity requiring physical contact (e.g., sexual intercourse, n ...
rings or other illegal activities. When civilians become witnesses to
police brutality
Police brutality is the excessive and unwarranted use of force by law enforcement against an individual or a group. It is an extreme form of police misconduct and is a civil rights violation. Police brutality includes, but is not limited to ...
, officers are often known to respond by harassing and intimidating the witnesses as retribution for reporting the misconduct. Whistleblowing is not common in law enforcement, one of the main reasons being because officers who do so, normally face reprisal by being fired, being forced to transfer to another department, being demoted, being shunned, losing friends, not being given back-up during emergencies, receiving professional or even physical threats as well as having threats be made against friends or relatives of theirs or having their own misconduct exposed, in response to reporting the misconduct of other officers. In America another common form of police corruption, is when
white supremacist
White supremacy or white supremacism is the belief that white people are superior to those of other races and thus should dominate them. The belief favors the maintenance and defense of any power and privilege held by white people. White s ...
groups, such as
Neo-Nazi Skinheads or
Neo-Confederates (such as the
Ku Klux Klan
The Ku Klux Klan (), commonly shortened to the KKK or the Klan, is an American white supremacist, right-wing terrorist, and hate group whose primary targets are African Americans, Jews, Latinos, Asian Americans, Native Americans, and Cat ...
), recruit members of law enforcement into their ranks or encourage their members to join local police departments to repress minorities and covertly promote white supremacy.
Another example is police officers flouting the police
code of conduct
A code of conduct is a set of rules outlining the norms, rules, and responsibilities or proper practices of an individual party or an organization.
Companies' codes of conduct
A company code of conduct is a set of rules which is commonly writt ...
in order to secure convictions of suspects—for example, through the use of
surveillance abuse Surveillance abuse is the use of surveillance methods or technology to monitor the activity of an individual or group of individuals in a way which violates the social norms or laws of a society.
During the FBI's COINTELPRO operations, there was ...
,
false confessions
A false confession is an admission of guilt for a crime which the individual did not commit. Although such confessions seem counterintuitive, they can be made voluntarily, perhaps to protect a third party, or induced through coercive interroga ...
,
police perjury and/or
falsified evidence
False evidence, fabricated evidence, forged evidence, fake evidence or tainted evidence is information created or obtained illegally in order to sway the verdict in a court case. Falsified evidence could be created by either side in a case (i ...
. Police officers have also been known to sell forms of contraband that were taken during seizers (such as confiscated
drugs
A drug is any chemical substance that causes a change in an organism's physiology or psychology when consumed. Drugs are typically distinguished from food and substances that provide nutritional support. Consumption of drugs can be via inhalati ...
,
stolen property or
weapons
A weapon, arm or armament is any implement or device that can be used to deter, threaten, inflict physical damage, harm, or kill. Weapons are used to increase the efficacy and efficiency of activities such as hunting, crime, law enforcement, s ...
). Corruption and misconduct can also be done by prison officers, such as the smuggling of
contraband
Contraband (from Medieval French ''contrebande'' "smuggling") refers to any item that, relating to its nature, is illegal to be possessed or sold. It is used for goods that by their nature are considered too dangerous or offensive in the eyes o ...
(such as drugs or electronics) into jails and prisons for
inmates
The Inmates are a British pub rock band, which formed after the split of The Flying Tigers in 1977. In 1982, they had a medium-sized international hit with a cover of The Standells' "Dirty Water", and a UK Top 40 hit with their cover of Jimmy ...
or the
abuse of prisoners. Another form of misconduct is probation officers taking bribes in exchange for allowing paroles to violate the terms of their
probation
Probation in criminal law is a period of supervision over an offender, ordered by the court often in lieu of incarceration.
In some jurisdictions, the term ''probation'' applies only to community sentences (alternatives to incarceration), such ...
or abusing their paroles. More rarely, police officers may deliberately and systematically participate in
organized crime
Organized crime (or organised crime) is a category of transnational, national, or local groupings of highly centralized enterprises run by criminals to engage in illegal activity, most commonly for profit. While organized crime is generally th ...
themselves, either while on the job or during off hours. In most major cities, there are
internal affairs sections to investigate suspected police corruption or misconduct. Similar entities include the British
Independent Police Complaints Commission
The Independent Police Complaints Commission (IPCC) was a non-departmental public body in England and Wales responsible for overseeing the system for handling complaints made against police forces in England and Wales.
On 8 January 2018, th ...
.
Private sector
Private sector corruption occurs when any institution, entity or person that is not controlled by the public sector company, household and institution that is not controlled by the public sector engages in corrupt acts. Private sector corruption may overlap with public sector corruption, for example when a private entity operates in conjunction with corrupt government officials, or where the government involves itself in activity normally performed by private entities.
Legal
Corruption facilitated by
lawyers
A lawyer is a person who practices law. The role of a lawyer varies greatly across different legal jurisdictions. A lawyer can be classified as an advocate, attorney, barrister, canon lawyer, civil law notary, counsel, counselor, solicitor, ...
is a well known form of judicial misconduct. Such abuse is called
Attorney misconduct
Attorney misconduct is unethical or illegal conduct by an attorney. Attorney misconduct may include: conflict of interest, overbilling, refusing to represent a client for political or professional motives, false or misleading statements, knowingly ...
. Attorney misconduct can be either conducted by individuals acting on their own accord or by entire
law firms
A law firm is a business entity formed by one or more lawyers to engage in the practice of law. The primary service rendered by a law firm is to advise clients (individuals or corporations) about their legal rights and responsibilities, and to r ...
. A well know example of such corruption are mob lawyers. Mob lawyers are attorneys who seek to protect the
leaders
Leadership, both as a research area and as a practical skill, encompasses the ability of an individual, group or organization to "lead", influence or guide other individuals, teams, or entire organizations. The word "leadership" often gets view ...
of criminal enterprises as well as their
criminal organizations
Organized crime (or organised crime) is a category of transnational, national, or local groupings of highly centralized enterprises run by criminals to engage in illegal activity, most commonly for profit. While organized crime is generally th ...
, with the use of unethical and/or illegal conduct such as making false or misleading statements, hiding evidence from prosecutors, failing to disclose all relevant facts about the case, or even giving clients advice on how to commit crimes in ways that would make prosecution more difficult for any investigating authorities.
Corporate
![Edise](https://upload.wikimedia.org/wikipedia/commons/9/94/Edise.jpg)
In
criminology
Criminology (from Latin , "accusation", and Ancient Greek , ''-logia'', from λόγος ''logos'' meaning: "word, reason") is the study of crime and deviant behaviour. Criminology is an interdisciplinary field in both the behavioural and s ...
,
corporate crime
In criminology, corporate crime refers to crimes committed either by a corporation (i.e., a business entity having a separate legal personality from the natural persons that manage its activities), or by individuals acting on behalf of a corp ...
refers to crimes committed either by a
corporation
A corporation is an organization—usually a group of people or a company—authorized by the state to act as a single entity (a legal entity recognized by private and public law "born out of statute"; a legal person in legal context) and ...
(i.e., a
business entity
In law, a legal person is any person or 'thing' (less ambiguously, any legal entity) that can do the things a human person is usually able to do in law – such as enter into contracts, sue and be sued, own property, and so on. The reason for ...
having a separate legal personality from the
natural person
In jurisprudence, a natural person (also physical person in some Commonwealth countries, or natural entity) is a person (in legal meaning, i.e., one who has its own legal personality) that is an individual human being, distinguished from the b ...
s that manage its activities), or by individuals acting on behalf of a corporation or other business entity (see
vicarious liability
Vicarious liability is a form of a strict, secondary liability that arises under the common law doctrine of agency, '' respondeat superior'', the responsibility of the superior for the acts of their subordinate or, in a broader sense, the re ...
and
corporate liability
Corporate liability, also referred to as liability of legal persons, determines the extent to which a company as a legal person can be held liable for the acts and omissions of the natural persons it employs and, in some legal systems, for those ...
). Some negative behaviours by corporations may not be criminal; laws vary between jurisdictions. For example, some jurisdictions allow
insider trading
Insider trading is the trading of a public company's stock or other securities (such as bonds or stock options) based on material, nonpublic information about the company. In various countries, some kinds of trading based on insider informati ...
.
=Examples
=
Petróleo Brasileiro S.A. — Petrobras, more commonly known as simply
Petrobras
Petróleo Brasileiro S.A., better known by the portmanteau Petrobras (), is a state-owned Brazilian multinational corporation in the petroleum industry headquartered in Rio de Janeiro, Brazil. The company's name translates to Brazilian Petrole ...
(), is a semi-public Brazilian
multinational corporation
A multinational company (MNC), also referred to as a multinational enterprise (MNE), a transnational enterprise (TNE), a transnational corporation (TNC), an international corporation or a stateless corporation with subtle but contrasting senses, i ...
in the
petroleum industry
The petroleum industry, also known as the oil industry or the oil patch, includes the global processes of exploration, extraction, refining, transportation (often by oil tankers and pipelines), and marketing of petroleum products. The larg ...
headquartered in
Rio de Janeiro
Rio de Janeiro ( , , ; literally 'River of January'), or simply Rio, is the capital of the state of the same name, Brazil's third-most populous state, and the second-most populous city in Brazil, after São Paulo. Listed by the GaWC as a b ...
,
Brazil
Brazil ( pt, Brasil; ), officially the Federative Republic of Brazil (Portuguese: ), is the largest country in both South America and Latin America. At and with over 217 million people, Brazil is the world's fifth-largest country by area ...
. The company's name translates to Brazilian Petroleum Corporation – Petrobras. The company was ranked No. 58 in the 2016
Fortune Global 500
The ''Fortune'' Global 500, also known as Global 500, is an annual ranking of the top 500 corporations worldwide as measured by revenue. The list is compiled and published annually by ''Fortune'' magazine.
Methodology
Until 1989, it listed onl ...
list. From 2014 to 2021, an investigation known as
Operation Car Wash
Operation Car Wash ( pt, Operação Lava Jato) was a criminal investigation by the Federal Police of Brazil's Curitiba branch. It began in March 2014 and was initially headed by investigative judge in France, but unlike judges in the common l ...
examined allegations of corporate and political collusion and corruption by Petrobras.
Odebrecht
Odebrecht S.A. (), officially known as Novonor, is a Brazilian conglomerate, headquartered in Salvador, Bahia, Brazil, consisting of diversified businesses in the fields of engineering, construction, chemicals and petrochemicals. The company ...
is a privately held Brazilian
conglomerate
Conglomerate or conglomeration may refer to:
* Conglomerate (company)
* Conglomerate (geology)
* Conglomerate (mathematics)
In popular culture:
* The Conglomerate (American group), a production crew and musical group founded by Busta Rhymes
** ...
consisting of businesses in the fields of engineering,
real estate
Real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this (also) an item of real property, (more genera ...
, construction,
chemicals
A chemical substance is a form of matter having constant chemical composition and characteristic properties. Some references add that chemical substance cannot be separated into its constituent elements by physical separation methods, i.e., wit ...
and
petrochemical
Petrochemicals (sometimes abbreviated as petchems) are the chemical products obtained from petroleum by refining. Some chemical compounds made from petroleum are also obtained from other fossil fuels, such as coal or natural gas, or renewabl ...
s. The company was founded in 1944 in
Salvador da Bahia
Salvador (English: ''Savior'') is a Brazilian municipality and capital city of the state of Bahia. Situated in the Zona da Mata in the Northeast Region of Brazil, Salvador is recognized throughout the country and internationally for its cuisi ...
by
Norberto Odebrecht
Norberto Odebrecht () (October 9, 1920 – July 19, 2014) was a Brazilian engineer, businessman and philanthropist. He was the founder of Odebrecht.
Early life
Norberto Odebrecht was born on October 9, 1920 in Recife, Brazil. He was the son of the ...
, and the firm is now present in South America, Central America, North America, the Caribbean, Africa, Europe and the Middle East. Its leading company is . Odebrecht is one of the 25 largest international construction companies and led by Odebrecht family.
In 2016, the firm's executives were examined during
Operation Car Wash
Operation Car Wash ( pt, Operação Lava Jato) was a criminal investigation by the Federal Police of Brazil's Curitiba branch. It began in March 2014 and was initially headed by investigative judge in France, but unlike judges in the common l ...
part of an investigation over Odebrecht Organization bribes to executives of Petrobras, in exchange for contracts and influence.
Operation Car Wash is an ongoing criminal
money laundering
Money laundering is the process of concealing the origin of money, obtained from illicit activities such as drug trafficking, corruption, embezzlement or gambling, by converting it into a legitimate source. It is a crime in many jurisdicti ...
and
bribes
Bribery is the offering, giving, receiving, or soliciting of any item of value to influence the actions of an official, or other person, in charge of a public or legal duty. With regard to governmental operations, essentially, bribery is "Corru ...
related
corporate crime
In criminology, corporate crime refers to crimes committed either by a corporation (i.e., a business entity having a separate legal personality from the natural persons that manage its activities), or by individuals acting on behalf of a corp ...
investigation being carried out by the
Federal Police of Brazil
The Federal Police of Brazil (Portuguese: ''Polícia Federal'') is a federal law enforcement agency of Brazil and one of the three national police forces. The other two are the Federal Highway Police, and the National Force. From 1944 to 1967 i ...
, Curitiba Branch, and judicially commanded by Judge
Sérgio Moro
Sergio Fernando Moro (; born 1 August 1972) is a Brazilian jurist, former federal judge, college professor and politician. He was elected to be a member of the Federal Senate for Paraná in October 2022. In 2015 he gained national attention a ...
since 17 March 2014.
Education
Corruption in education is a worldwide phenomenon. Corruption in admissions to universities is traditionally considered one of the most corrupt areas of the education sector. Recent attempts in some countries, such as Russia and Ukraine, to curb corruption in admissions through the abolition of university entrance examinations and introduction of standardized computer-graded tests have met backlash from part of society, while other appreciate changes. Vouchers for university entrants have never materialized.
The cost of corruption is in that it impedes sustainable economic growth.
Endemic corruption in educational institutions leads to the formation of sustainable corrupt hierarchies. While higher education in Russia is distinct with widespread bribery, corruption in the US and the UK features a significant amount of fraud. The US is distinct with grey areas and institutional corruption in the higher education sector. Authoritarian regimes, including those in the former Soviet republics, encourage educational corruption and control universities, especially during the election campaigns. This is typical for Russia, Ukraine, and Central Asian regimes, among others. The general public is well aware of the high level of corruption in colleges and universities, including thanks to the media. Doctoral education is no exception, with dissertations and doctoral degrees available for sale, including for politicians. Russian Parliament is notorious for "highly educated" MPs High levels of corruption are a result of universities not being able to break away from their Stalinist past, over bureaucratization, and a clear lack of university autonomy. Both quantitative and qualitative methodologies are employed to study education corruption, but the topic remains largely unattended by the scholars. In many societies and international organizations, education corruption remains a taboo.
In some countries, such as certain eastern European countries, some Balkan countries and certain Asian countries, corruption occurs frequently in universities.
[Heyneman, S. P., Anderson, K. H. and Nuraliyeva, N. (2008). The cost of corruption in higher education. Comparative Education Review, 51, 1–25.] This can include bribes to bypass bureaucratic procedures and bribing faculty for a grade.
[Graeff, P., Sattler, S., Mehlkop, G. and Sauer, C. (2014). "Incentives and Inhibitors of Abusing Academic Positions: Analysing University Students' Decisions about Bribing Academic Staff" In: European Sociological Review 30(2) 230–41. 10.1093/esr/jct036] The willingness to engage in corruption such as accepting bribe money in exchange for grades decreases if individuals perceive such behavior as very objectionable, i.e. a violation of social norms and if they fear sanctions regarding the severity and probability of sanctions.
Healthcare
Corruption, the abuse of entrusted power for private gain, as defined by
Transparency International
Transparency International e.V. (TI) is a German registered association founded in 1993 by former employees of the World Bank. Based in Berlin, its nonprofit and non-governmental purpose is to take action to combat global corruption with civil ...
is systemic in the health sector.
The characteristics of health systems with their concentrated supply of a service, high discretionary power of its members controlling the supply, and low accountability to others are the exact constellation of the variables described by Klitgaard, on which corruption depends.
Corruption in health care poses a significant danger to the public welfare. It is widespread and yet, little has been published in medical journals about this topic and as of 2019 there is no evidence on what might reduce corruption in the health sector.
Corruption occurs within the private and public health sectors and may appear as theft, embezzlement, nepotism, bribery up til extortion, or as undue influence. and occurs anywhere within the sector, be it in service provision, purchasing, construction and hiring. In 2019, Transparency International has described the 6 most common ways of service corruption as follows:
absenteeism
Absenteeism is a habitual pattern of absence from a duty or obligation without good reason. Generally, absenteeism is unplanned absences. Absenteeism has been viewed as an indicator of poor individual performance, as well as a breach of an impli ...
, informal payments from patients, embezzlement, inflating services also the costs of services, favouritism and manipulation of data (billing for goods and services that were never sent or done).
Labor unions
Labor unions leaders may be involved in corrupt action or be influenced or controlled by criminal enterprises. For example, for many years
(
the Teamsters) was substantially controlled by
the Mafia
"Mafia" is an informal term that is used to describe criminal organizations that bear a strong similarity to the original “Mafia”, the Sicilian Mafia and Italian Mafia. The central activity of such an organization would be the arbitration of d ...
.
Arms trafficking
"Arms for cash" can be done by either a state-sanctioned arms dealer, firm or state itself to another party it just regards as only a good business partner and not political kindred or allies, thus making them no better than
regular gun runners. Arms smugglers, who are already into
arms trafficking
Arms trafficking or gunrunning is the illicit trade of contraband small arms and ammunition, which constitutes part of a broad range of illegal activities often associated with transnational criminal organizations. The illegal trade of small arm ...
may work for them on the ground or with shipment. The
money is often laundered and records are often destroyed.
It often breaks UN, national or international law.
Payment can also be in strange or indirect ways like arms paid for in post-war oil contracts, post-war hotel ownership,
conflict diamonds, corporate shares or the long term post-war promises of superfus future contracts between the parties involved in it, etc...
In 2006
Transparency International
Transparency International e.V. (TI) is a German registered association founded in 1993 by former employees of the World Bank. Based in Berlin, its nonprofit and non-governmental purpose is to take action to combat global corruption with civil ...
ranked Angola a lowly 142 out of 163 countries in the
Corruption Perception Index
The Corruption Perceptions Index (CPI) is an index which ranks countries "by their perceived levels of public sector corruption, as determined by expert assessments and opinion surveys." The CPI generally defines corruption as an "abuse of entr ...
just after
Venezuela
Venezuela (; ), officially the Bolivarian Republic of Venezuela ( es, link=no, República Bolivariana de Venezuela), is a country on the northern coast of South America, consisting of a continental landmass and many islands and islets in th ...
and before the
Republic of the Congo
The Republic of the Congo (french: République du Congo, ln, Republíki ya Kongó), also known as Congo-Brazzaville, the Congo Republic or simply either Congo or the Congo, is a country located in the western coast of Central Africa to the w ...
with a 2.2 rating.
[
] Angola was at 168th place (out of 178 countries) on Transparency International's Corruption Perceptions Index (CPI), receiving a 1.9 on a scale from 0 to 10. On the World Bank's 2009 Worldwide Governance Index, Angola had done very poorly on all six aspects of governance assessed. While its score for political stability improved to 35.8 in 2009 (on a 100-point scale) from 19.2 in 2004, Angola earned especially low scores for accountability, regulatory standards, and rule of law. The score for corruption declined from an extremely low 6.3 in 2004 to 5.2 in 2009.
The country is regarded poorly and that corruption is wounding the economy badly despite the emerging oil industries wealth.
The
Mitterrand–Pasqua affair, also known informally as
Angolagate, was an international
political scandal
In politics, a political scandal is an action or event regarded as morally or legally wrong and causing general public outrage. Politicians, government officials, party officials and lobbyists can be accused of various illegal, corrupt, unet ...
over the secret and illegal sale and shipment of arms from the nations of
Central Europe
Central Europe is an area of Europe between Western Europe and Eastern Europe, based on a common historical, social and cultural identity. The Thirty Years' War (1618–1648) between Catholicism and Protestantism significantly shaped the a ...
to the government of
Angola
, national_anthem = "Angola Avante"()
, image_map =
, map_caption =
, capital = Luanda
, religion =
, religion_year = 2020
, religion_ref =
, coordinat ...
by the
Government of France
The Government of France (French: ''Gouvernement français''), officially the Government of the French Republic (''Gouvernement de la République française'' ), exercises executive power in France. It is composed of the Prime Minister, who ...
in the 1990s. It led to arrests and judiciary actions in the 2000s, involved an illegal arms sale to Angola despite a
UN embargo, with business interests in
France
France (), officially the French Republic ( ), is a country primarily located in Western Europe. It also comprises of Overseas France, overseas regions and territories in the Americas and the Atlantic Ocean, Atlantic, Pacific Ocean, Pac ...
and elsewhere improperly obtaining a share of Angolan oil revenues. The scandal has subsequently been tied to several prominent figures in French politics.
[
42 individuals, including: 42 people, including Jean-Christophe Mitterrand, ]Jacques Attali
Jacques José Mardoché Attali (; born 1 November 1943) is a French economic and social theorist, writer, political adviser and senior civil servant, who served as a counselor to President François Mitterrand from 1981 to 1991, and was the firs ...
, Charles Pasqua
Charles Victor Pasqua (18 April 192729 June 2015) was a French businessman and Gaullist politician. He was Interior Minister from 1986 to 1988, under Jacques Chirac's '' cohabitation'' government, and also from 1993 to 1995, under the government ...
and Jean-Charles Marchiani
Jean-Charles Marchiani, (born August 6, 1943) is a French prefect and politician. He is also a former officer of the French external intelligence agency ( DGSE).
Jean-Charles Marchiani is a counter-terrorism expert, especially focused on Islamic fu ...
, Pierre Falcone
Pierre Falcone (born 19 March 1954 in Algiers) is a French businessman. He is the Chairman of Pierson Capital Group.
Early life
Falcone is the son of Pierre Falcone senior, who created ''Papa Falcone'', a fully integrated operation in the fish ...
. Arcadi Gaydamak
Arcadi Aleksandrovich Gaydamak ( he, ארקדי אלכסנדרוביץ' גאידמק; russian: Аркадий Александрович Гайдамак; born 8 April 1952 in Moscow, USSR) is a Russian-born French-Israeli businessman, philanthr ...
, Paul-Loup Sulitzer
Paul Loup Karl Sulitzer (born 22 July 1946, in Boulogne-Billancourt) is a French financier and author. Before he turned seventeen, he was already a self-made millionaire. Sulitzer used his financial experience and knowledge in his books, which of ...
, Union for a Popular Movement
The Union for a Popular Movement (french: link=no, Union pour un mouvement populaire, ; UMP, ) was a centre-right political party in France that was one of the two major contemporary political parties in France along with the centre-left Soci ...
deputy Georges Fenech, the son of François Mitterrand
François Marie Adrien Maurice Mitterrand (26 October 19168 January 1996) was President of France, serving under that position from 1981 to 1995, the longest time in office in the history of France. As First Secretary of the Socialist Party, he ...
and a former French Minister of the Interior, were charged, accused, indicted or convicted with illegal arms trading, tax fraud, embezzlement, money laundering and other crimes. "
Philosophy
The 19th-century German philosopher Arthur Schopenhauer
Arthur Schopenhauer ( , ; 22 February 1788 – 21 September 1860) was a German philosopher. He is best known for his 1818 work ''The World as Will and Representation'' (expanded in 1844), which characterizes the phenomenal world as the prod ...
acknowledged that academics, including philosophers, are subject to the same sources of corruption as the societies which they inhabit. He distinguished the corrupt "university" philosophers, whose "real concern is to earn with credit an honest livelihood for themselves and ... to enjoy a certain prestige in the eyes of the public" from the genuine philosopher, whose sole motive is to discover and bear witness to the truth.
::To be a philosopher, that is to say, a lover of wisdom (for wisdom is nothing but truth), it is not enough for a man to love truth, in so far as it is compatible with his own interest, with the will of his superiors, with the dogmas of the church, or with the prejudices and tastes of his contemporaries; so long as he rests content with this position, he is only a φίλαυτος over of self not a φιλόσοφος over of wisdom
Over may refer to:
Places
*Over, Cambridgeshire, England
* Over, Cheshire, England
* Over, South Gloucestershire, England
*Over, Tewkesbury, near Gloucester, England
**Over Bridge
* Over, Seevetal, Germany
Music
Albums
* ''Over'' (album), by P ...
For this title of honor is well and wisely conceived precisely by its stating that one should love the truth earnestly and with one's whole heart, and thus unconditionally and unreservedly, above all else, and, if need be, in defiance of all else. Now the reason for this is the one previously stated that the intellect has become free, and in this state, it does not even know or understand any other interest than that of truth.
Religious organizations
The history of religion includes numerous examples of religious leaders calling attention to the corruption which existed in the religious practices and institutions of their time. The Jewish prophets Isaiah
Isaiah ( or ; he, , ''Yəšaʿyāhū'', "God is Salvation"), also known as Isaias, was the 8th-century BC Israelite prophet after whom the Book of Isaiah is named.
Within the text of the Book of Isaiah, Isaiah himself is referred to as "the ...
and Amos
Amos or AMOS may refer to:
Arts and entertainment
* Amos Records, an independent record label established in Los Angeles, California, in 1968
* Amos (band), an American Christian rock band
* ''Amos'' (album), an album by Michael Ray
* ''Amos' ...
berate the rabbinical establishment of Ancient Judea for failing to live up to the ideals of the Torah
The Torah (; hbo, ''Tōrā'', "Instruction", "Teaching" or "Law") is the compilation of the first five books of the Hebrew Bible, namely the books of Genesis, Exodus, Leviticus, Numbers and Deuteronomy. In that sense, Torah means the ...
. In the New Testament
The New Testament grc, Ἡ Καινὴ Διαθήκη, transl. ; la, Novum Testamentum. (NT) is the second division of the Christian biblical canon. It discusses the teachings and person of Jesus, as well as events in first-century Chris ...
, Jesus
Jesus, likely from he, יֵשׁוּעַ, translit=Yēšūaʿ, label= Hebrew/ Aramaic ( AD 30 or 33), also referred to as Jesus Christ or Jesus of Nazareth (among other names and titles), was a first-century Jewish preacher and relig ...
accuses the rabbinical establishment of his time of hypocritically following only the ceremonial parts of the Torah and neglecting the more important elements of justice, mercy and faithfulness. Corruption was one of the important issues which led to the Investiture Controversy
The Investiture Controversy, also called Investiture Contest (German: ''Investiturstreit''; ), was a conflict between the Church and the state in medieval Europe over the ability to choose and install bishops ( investiture) and abbots of mona ...
. In 1517, Martin Luther
Martin Luther (; ; 10 November 1483 – 18 February 1546) was a German priest, theologian, author, hymnwriter, and professor, and Augustinian friar. He is the seminal figure of the Protestant Reformation and the namesake of Lutherani ...
accused the Catholic Church
The Catholic Church, also known as the Roman Catholic Church, is the List of Christian denominations by number of members, largest Christian church, with 1.3 billion baptized Catholics Catholic Church by country, worldwide . It is am ...
of widespread corruption, including the selling of indulgences
In the teaching of the Catholic Church, an indulgence (, from , 'permit') is "a way to reduce the amount of punishment one has to undergo for sins". The ''Catechism of the Catholic Church'' describes an indulgence as "a remission before God o ...
.
In 2015, Princeton University
Princeton University is a private research university in Princeton, New Jersey. Founded in 1746 in Elizabeth as the College of New Jersey, Princeton is the fourth-oldest institution of higher education in the United States and one of the ...
professor Kevin M. Kruse
Kevin Michael Kruse (born 1972) is an American historian and a professor of history at Princeton University. His research interests include the political, social, and urban/suburban history of 20th-century America, with a particular focus on the ...
advances the thesis that business leaders in the 1930s and 1940s collaborated with clergymen, including James W. Fifield Jr.
James William Fifield Jr. (June 5, 1899 – February 25, 1977) was an American Congregational minister who led the First Congregational Church in Los Angeles and was co-founder and president of the conservative free-market organization Spiritual M ...
, in order to develop and promote a new hermeneutical
Hermeneutics () is the theory and methodology of interpretation, especially the interpretation of biblical texts, wisdom literature, and philosophical texts. Hermeneutics is more than interpretative principles or methods used when immediate c ...
approach to Scripture which would de-emphasize the social Gospel
The Social Gospel is a social movement within Protestantism that aims to apply Christian ethics to social problems, especially issues of social justice such as economic inequality, poverty, alcoholism, crime, racial tensions, slums, unclean envir ...
and emphasize themes, such as individual salvation, which were more congenial to free enterprise
In economics, a free market is an economic system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of government or any ot ...
.
Methods
In systemic corruption
Corruption is a form of dishonesty or a criminal offense which is undertaken by a person or an organization which is entrusted in a position of authority, in order to acquire illicit benefits or abuse power for one's personal gain. Corruption m ...
and grand corruption, multiple methods of corruption are used concurrently with similar aims.
Bribery
Bribery involves the improper use of gifts and favours in exchange for personal gain. This is also known as kickbacks
A kickback is a form of negotiated bribery in which a commission is paid to the bribe-taker in exchange for services rendered. Generally speaking, the remuneration (money, goods, or services handed over) is negotiated ahead of time. The kickbac ...
or, in the Middle East, as baksheesh
''Baksheesh'' or ' (from fa, بخشش ) is tipping, charitable giving, and certain forms of political corruption and bribery in the Middle East and South Asia.
Etymology and usage
''Baksheesh'' comes from the Persian word (), which originat ...
. It is a common form of corruption. The types of favors given are diverse and may include money
Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money ar ...
, gifts, real estate
Real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this (also) an item of real property, (more genera ...
, promotions, sexual favors
Human sexual activity, human sexual practice or human sexual behaviour is the manner in which humans experience and express their sexuality. People engage in a variety of sexual acts, ranging from activities done alone (e.g., masturbation) t ...
, employee benefits
Employee benefits and (especially in British English) benefits in kind (also called fringe benefits, perquisites, or perks) include various types of non-wage compensation provided to employees in addition to their normal wages or salaries. Insta ...
, company shares, privileges, entertainment
Entertainment is a form of activity that holds the attention and interest of an audience or gives pleasure and delight. It can be an idea or a task, but is more likely to be one of the activities or events that have developed over thousa ...
, employment
Employment is a relationship between two parties regulating the provision of paid labour services. Usually based on a contract, one party, the employer, which might be a corporation, a not-for-profit organization, a co-operative, or any o ...
and political benefits. The personal gain that is given can be anything from actively giving preferential treatment to having an indiscretion or crime overlooked.
Bribery can sometimes form a part of the systemic use of corruption for other ends, for example to perpetrate further corruption. Bribery can make officials more susceptible to blackmail or to extortion.
Embezzlement, theft and fraud
Embezzlement
Embezzlement is a crime that consists of withholding assets for the purpose of conversion of such assets, by one or more persons to whom the assets were entrusted, either to be held or to be used for specific purposes. Embezzlement is a type ...
and theft
Theft is the act of taking another person's property or services without that person's permission or consent with the intent to deprive the rightful owner of it. The word ''theft'' is also used as a synonym or informal shorthand term for som ...
involve someone with access to funds or assets illegally taking control of them. Fraud
In law, fraud is intentional deception to secure unfair or unlawful gain, or to deprive a victim of a legal right. Fraud can violate civil law (e.g., a fraud victim may sue the fraud perpetrator to avoid the fraud or recover monetary compen ...
involves using deception to convince the owner of funds or assets to give them up to an unauthorized party.
Examples include the misdirection of company funds into "shadow companies" (and then into the pockets of corrupt employees), the skimming of foreign aid
In international relations, aid (also known as international aid, overseas aid, foreign aid, economic aid or foreign assistance) is – from the perspective of governments – a voluntary transfer of resources from one country to another.
Ai ...
money, scams, electoral fraud
Electoral fraud, sometimes referred to as election manipulation, voter fraud or vote rigging, involves illegal interference with the process of an election, either by increasing the vote share of a favored candidate, depressing the vote share of ...
and other corrupt activity.
Graft
The political act of graft is when funds intended for public projects are intentionally misdirected to maximize the benefits to private interests of the corrupt individuals.
Extortion and blackmail
While bribery
Bribery is the offering, giving, receiving, or soliciting of any item of value to influence the actions of an official, or other person, in charge of a public or legal duty. With regard to governmental operations, essentially, bribery is "Cor ...
is the use of positive inducements for corrupt aims, extortion
Extortion is the practice of obtaining benefit through coercion. In most jurisdictions it is likely to constitute a criminal offence; the bulk of this article deals with such cases. Robbery is the simplest and most common form of extortion, ...
and blackmail
Blackmail is an act of coercion using the threat of revealing or publicizing either substantially true or false information about a person or people unless certain demands are met. It is often damaging information, and it may be revealed to fa ...
centre around the use of threats. This can be the threat of physical violence or false imprisonment
False imprisonment or unlawful imprisonment occurs when a person intentionally restricts another person’s movement within any area without legal authority, justification, or the restrained person's permission. Actual physical restraint is ...
as well as exposure of an individual's secrets or prior crimes.
This includes such behavior as an influential person threatening to go to the media if they do not receive speedy medical treatment (at the expense of other patients), threatening a public official with exposure of their secrets if they do not vote in a particular manner, or demanding money in exchange for continued secrecy. Another example can be a police officer being threat
A threat is a communication of intent to inflict harm or loss on another person. Intimidation is a tactic used between conflicting parties to make the other timid or psychologically insecure for coercion or control. The act of intimidation for co ...
ened with the loss of their job by their superiors, if they continued with investigating a high-ranking official.
Influence peddling
Influence peddling
Influence peddling is the practice of using one's influence in government or connections with authorities to obtain favours or preferential treatment for another, usually in return for payment. It is also called traffic of influence or trading i ...
is the illegal practice of using one's influence in government or connections with persons in authority to obtain favors or preferential treatment, usually in return for payment.
Networking
Networking (both Business
Business is the practice of making one's living or making money by producing or buying and selling products (such as goods and services). It is also "any activity or enterprise entered into for profit."
Having a business name does not separ ...
and Personal
Personal may refer to:
Aspects of persons' respective individualities
* Privacy
* Personality
* Personal, personal advertisement, variety of classified advertisement used to find romance or friendship
Companies
* Personal, Inc., a Washington, ...
) can be an effective way for job-seekers to gain a competitive edge over others in the job-market. The idea is to cultivate personal relationships with prospective employers, selection panelists, and others, in the hope that these personal affections will influence future hiring decisions. This form of networking has been described as an attempt to corrupt formal hiring processes, where all candidates are given an equal opportunity to demonstrate their merits to selectors. The networker is accused of seeking non-meritocratic advantage over other candidates; advantage that is based on personal fondness rather than on any objective appraisal of which candidate is most qualified for the position.
Abuse of discretion
Abuse of discretion
Discretion has the meaning of acting on one's own authority and judgment. In law, discretion as to legal rulings, such as whether evidence is excluded at a trial, may be exercised by a judge. Some view discretion negatively, while some view it ...
refers to the misuse of one's powers and decision-making
In psychology, decision-making (also spelled decision making and decisionmaking) is regarded as the cognitive process resulting in the selection of a belief or a course of action among several possible alternative options. It could be either ra ...
facilities. Examples include a judge improperly dismissing a criminal case or a customs official using their discretion to allow a banned substance through a port.
Favoritism, nepotism and clientelism
Favouritism, nepotism
Nepotism is an advantage, privilege, or position that is granted to relatives and friends in an occupation or field. These fields may include but are not limited to, business, politics, academia, entertainment, sports, fitness, religion, an ...
and clientelism
Clientelism or client politics is the exchange of goods and services for political support, often involving an implicit or explicit quid-pro-quo. It is closely related to patronage politics and vote buying. Clientelism involves an asymmetric rel ...
involve the favouring of not the perpetrator of corruption but someone related to them, such as a friend, family member or member of an association. Examples would include hiring or promoting a family member or staff member to a role they are not qualified for, who belongs to the same political party as you, regardless of merit.
Relationship to economic growth
Corruption can negatively impacts the economy both directly, through for example tax evasion and money laundering, as well as indirectly by distorting fair competition and fair markets, and by increasing the cost of doing business. It is strongly negatively associated with the share of private investment and, hence, it lowers the rate of economic growth.[Mo, P.H. (2001). Corruption and Economic Growth. ''Journal of Comparative Economics, 29'', 66–79.]
Corruption reduces the returns of productive activities. If the returns to production fall faster than the returns to corruption and rent-seeking
Rent-seeking is the act of growing one's existing wealth without creating new wealth by manipulating the social or political environment.
Rent-seeking activities have negative effects on the rest of society. They result in reduced economic effic ...
activities, resources will flow from productive activities to corruption activities over time. This will result in a lower stock of producible inputs like human capital in corrupted countries.
Corruption creates the opportunity for increased inequality, reduces the return of productive activities, and, hence, makes rent-seeking and corruption activities more attractive. This opportunity for increased inequality not only generates psychological frustration to the underprivileged but also reduces productivity growth, investment, and job opportunities.
Some expert have suggested that corruption actually stimulated economic growth in East and Southeast Asian countries. An often cited example is South Korea, where president Park Chung-hee
Park Chung-hee (, ; 14 November 1917 – 26 October 1979) was a South Korean politician and army general who served as the dictator of South Korea from 1961 until his assassination in 1979; ruling as an unelected military strongman from 1961 ...
favoured a small number of companies, and later used this financial influence to pressure these chaebol
A chaebol (, ; ) is a large industrial South Korean conglomerate run and controlled by an individual or family. A chaebol often consists of multiple diversified affiliates, controlled by a person or group whose power over the group often exc ...
to follow the government's development strategy. This 'profit-sharing' corruption model incentivizes government officials to support economic development, as they would personally benefit financially from it.
Prevention
According to the amended Klitgaard equation,[Stephan, Constantin (2012), Industrial Health, Safety and Environmental Management, MV Wissenschaft, Muenster, 3rd edition 2012, pp. 26–28, ] limitation of monopoly and regulator discretion of individuals and a high degree of transparency through independent oversight by non-governmental organisations (NGOs) and the media plus public access to reliable information could reduce the problem. Djankov and other researchers have independently addressed the role information plays in fighting corruption with evidence from both developing and developed countries. Disclosing financial information of government officials to the public is associated with improving institutional accountability and eliminating misbehavior such as vote buying. The effect is specifically remarkable when the disclosures concern politicians' income sources, liabilities and asset level instead of just income level. Any extrinsic aspects that might reduce morality should be eliminated. Additionally, a country should establish a culture of ethical conduct in society with the government setting the good example in order to enhance the intrinsic morality.
Enhancing civil society participation
Creating bottom-up mechanisms, promoting citizens participation and encouraging the values of integrity, accountability, and transparency are crucial components of fighting corruption. As of 2012, the implementation of the "Advocacy and Legal Advice Centres (ALACs)” in Europe had led to a significant increase in the number of citizen complaints against acts of corruption received and documented and also to the development of strategies for good governance by involving citizens willing to fight against corruption.
Anti-corruption programmes
The Foreign Corrupt Practices Act
The Foreign Corrupt Practices Act of 1977 (FCPA) (, ''et seq.'') is a United States federal law that prohibits U.S. citizens and entities from bribing foreign government officials to benefit their business interests.
The FCPA is applicable worl ...
(FCPA, USA 1977) was an early paradigmatic law for many western countries i.e. industrial countries of the OECD
The Organisation for Economic Co-operation and Development (OECD; french: Organisation de coopération et de développement économiques, ''OCDE'') is an intergovernmental organisation with 38 member countries, founded in 1961 to stimulate e ...
. There, for the first time the old principal-agent approach was moved back where mainly the victim (a society, private or public) and a passive corrupt member (an individual) were considered, whereas the active corrupt part was not in the focus of legal prosecution. Unprecedented, the law of an industrial country directly condemned active corruption, particularly in international business transactions, which was at that time in contradiction to anti-bribery activities of the World Bank and its spin-off organization Transparency International
Transparency International e.V. (TI) is a German registered association founded in 1993 by former employees of the World Bank. Based in Berlin, its nonprofit and non-governmental purpose is to take action to combat global corruption with civil ...
.
As early as 1989 the OECD had established an ad hoc Working Group in order to explore "the concepts fundamental to the offense of corruption, and the exercise of national jurisdiction over offenses committed wholly or partially abroad." Based on the FCPA concept, the Working Group presented in 1994 the then "OECD Anti-Bribery Recommendation" as precursor for the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions which was signed in 1997 by all member countries and came finally into force in 1999. However, because of ongoing concealed corruption in international transactions several instruments of Country Monitoring have been developed since then by the OECD in order to foster and evaluate related national activities in combating foreign corrupt practices. One survey shows that after the implementation of heightened review of multinational firms under the convention in 2010 firms from countries that had signed the convention were less likely to use bribery.
In 2013, a document produced by the economic and private sector professional evidence and applied knowledge services help-desk discusses some of the existing practices on anti-corruption. They found:
* The theories behind the fight against corruption are moving from a principal agent approach to a collective action problem
A collective action problem or social dilemma is a situation in which all individuals would be better off cooperating but fail to do so because of conflicting interests between individuals that discourage joint action. The collective action proble ...
. Principal–agent theories seem not to be suitable to target systemic corruption.
* The role of multilateral institutions has been crucial in the fight against corruption. UNCAC provides a common guideline for countries around the world. Both Transparency International
Transparency International e.V. (TI) is a German registered association founded in 1993 by former employees of the World Bank. Based in Berlin, its nonprofit and non-governmental purpose is to take action to combat global corruption with civil ...
and the World Bank
The World Bank is an international financial institution that provides loans and grants to the governments of low- and middle-income countries for the purpose of pursuing capital projects. The World Bank is the collective name for the Interna ...
provide assistance to national governments in term of diagnostic and design of anti-corruption policies.
* The use of anti-corruption agencies have proliferated in recent years after the signing of UNCAC. They found no convincing evidence on the extent of their contribution, or the best way to structure them.
* Traditionally anti-corruption policies have been based on success experiences and common sense. In recent years there has been an effort to provide a more systematic evaluation of the effectiveness of anti-corruption policies. They found that this literature is still in its infancy.
* Anti-corruption policies that may be in general recommended to developing countries may not be suitable for post-conflict countries. Anti-corruption policies in fragile states have to be carefully tailored.
* Anti-corruption policies can improve the business environment. There is evidence that lower corruption may facilitate doing business and improve firm's productivity. Rwanda
Rwanda (; rw, u Rwanda ), officially the Republic of Rwanda, is a landlocked country in the Great Rift Valley of Central Africa, where the African Great Lakes region and Southeast Africa converge. Located a few degrees south of the Equator ...
in the last decade has made tremendous progress in improving governance and the business environment providing a model to follow for post-conflict countries.
* Armenia
Armenia (), , group=pron officially the Republic of Armenia,, is a landlocked country in the Armenian Highlands of Western Asia.The UNbr>classification of world regions places Armenia in Western Asia; the CIA World Factbook , , and ''Ox ...
aims to achieve zero corruption through raising awareness on the societal hazards. After the lavish spending accusations on the Armenian anti-corruption council, through action strategies with implementation and observing instruments progress is noticeable.
In recent years, anti-corruption efforts have also been criticised for overemphasising the benefits of the eradication of corruption for economic growth and development,[Kuipers, S. (2021), "Rethinking anti-corruption efforts in international development", ''Journal of Financial Crime'', Vol. ahead-of-print No. ahead-of-print. .] following a diversity of literature which has suggested that anti-corruption efforts, the right kind of institutions and "good governance" are key to economic development. This criticism is based on the observed fact that a variety of countries, such as Korea and China but also the USA in the 19th and early 20th century, saw high economic growth and broader socio-economic development coinciding with significant corruption
In popular culture
In some countries people travel to corruption hot spots or a specialist tour company takes them on corruption city tours, as is the case in Prague
Prague ( ; cs, Praha ; german: Prag, ; la, Praga) is the capital and largest city in the Czech Republic, and the historical capital of Bohemia. On the Vltava river, Prague is home to about 1.3 million people. The city has a temperate ...
. Corruption tours have also occurred in Chicago
(''City in a Garden''); I Will
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, coordinates =
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, subdivision_name ...
and Mexico City
Mexico City ( es, link=no, Ciudad de México, ; abbr.: CDMX; Nahuatl: ''Altepetl Mexico'') is the capital and largest city of Mexico, and the most populous city in North America. One of the world's alpha cities, it is located in the Valley o ...
.
Films about corruption include ''Runaway Jury
''Runaway Jury'' is a 2003 American legal thriller film directed by Gary Fleder and starring John Cusack, Gene Hackman, Dustin Hoffman, and Rachel Weisz. An adaptation of John Grisham's 1996 novel ''The Runaway Jury'', the film pits lawyer We ...
'', '' The Firm'', ''Syriana
''Syriana'' is a 2005 American political thriller film written and directed by Stephen Gaghan, loosely based on Robert Baer's 2003 memoir ''See No Evil (Baer book), See No Evil''. The film stars an ensemble cast consisting of George Clooney, Mat ...
'', ''The Constant Gardener
''The Constant Gardener'' is a 2001 novel by British author John le Carré. The novel tells the story of Justin Quayle, a British diplomat whose activist wife is murdered. Believing there is something behind the murder, he seeks to uncover the t ...
'', and ''All the President's Men
''All the President's Men'' is a 1974 non-fiction book by Carl Bernstein and Bob Woodward, two of the journalists who investigated the June 1972 break-in at the Watergate Office Building and the resultant political scandal for ''The Washingto ...
''.
Legal corruption
Though corruption is often viewed as illegal, a concept of "legal corruption" has been described by Daniel Kaufmann and Pedro Vicente. It might be termed as processes which are corrupt, but are protected by a "legal" (that is, specifically permitted, or at least not proscribed by law) framework.
Examples
In 1994, the German Parliamentary Financial Commission in Bonn presented a comparative study on "legal corruption" in industrialized OECD countries They reported that in most industrial countries foreign corruption was legal, and that their foreign corrupt practices ranged from simple, through governmental subsidization (tax deduction), up to extreme cases as in Germany, where foreign corruption was fostered, whereas domestic was legally prosecuted.
The German Parliamentary Financial Commission rejected a Parliamentary Proposal by the opposition, which had been aiming to limit German foreign corruption on the basis of the US ''Foreign Corrupt Practices Act
The Foreign Corrupt Practices Act of 1977 (FCPA) (, ''et seq.'') is a United States federal law that prohibits U.S. citizens and entities from bribing foreign government officials to benefit their business interests.
The FCPA is applicable worl ...
'' (FCPA from 1977), thus fostering national export corporations. In 1997 a corresponding OECD Anti-Bribery Convention
The OECD Anti-Bribery Convention (officially Convention on Combating Bribery of Foreign Public Officials in International Business Transactions) is an anti-corruption convention of the OECD that requires signatory countries to criminalize brib ...
was signed by its members.
It took until 1999, after the OECD Anti-Bribery Convention came into force, that Germany withdrew the legalization of foreign corruption.
Foreign corrupt practices of industrialized OECD countries 1994 study
A study on foreign corrupt practices of industrialized OECD countries 1994 (Parliamentary Financial Commission study, Bonn) indicates widespread acceptance of bribes in business practices.
Belgium: bribe payments are generally tax deductible as business expenses if the name and address of the beneficiary is disclosed. Under the following conditions kickbacks in connection with exports abroad are permitted for deduction even without proof of the receiver:
* Payments must be necessary in order to be able to survive against foreign competition
* They must be common in the industry
* A corresponding application must be made to the Treasury each year
* Payments must be appropriate
* The payer has to pay a lump-sum to the tax office to be fixed by the Finance Minister (at least 20% of the amount paid).
In the absence of the required conditions, for corporate taxable companies paying bribes without proof of the receiver, a special tax of 200% is charged. This special tax may, however, be abated along with the bribe amount as an operating expense.
Denmark: bribe payments are deductible when a clear operational context exists and its adequacy is maintained.
France: basically all operating expenses can be deducted. However, staff costs must correspond to an actual work done and must not be excessive compared to the operational significance. This also applies to payments to foreign parties. Here, the receiver shall specify the name and address, unless the total amount in payments per beneficiary does not exceed 500 FF. If the receiver is not disclosed the payments are considered "rémunérations occult" and are associated with the following disadvantages:
* The business expense deduction (of the bribe money) is eliminated.
* For corporations and other legal entities, a tax penalty of 100% of the "rémunérations occult" and 75% for voluntary post declaration is to be paid.
* There may be a general fine of up 200 FF fixed per case.
Japan: in Japan, bribes are deductible as business expenses that are justified by the operation (of the company) if the name and address of the recipient is specified. This also applies to payments to foreigners. If the indication of the name is refused, the expenses claimed are not recognized as operating expenses.
Canada: there is no general rule on the deductibility or non-deductibility of kickbacks and bribes. Hence the rule is that necessary expenses for obtaining the income (contract) are deductible. Payments to members of the public service and domestic administration of justice, to officers and employees and those charged with the collection of fees, entrance fees etc. for the purpose to entice the recipient to the violation of his official duties, can not be abated as business expenses as well as illegal payments according to the Criminal Code.
Luxembourg: bribes, justified by the operation (of a company) are deductible as business expenses. However, the tax authorities may require that the payer is to designate the receiver by name. If not, the expenses are not recognized as operating expenses.
Netherlands: all expenses that are directly or closely related to the business are deductible. This also applies to expenditure outside the actual business operations if they are considered beneficial to the operation for good reasons by the management. What counts is the good merchant custom. Neither the law nor the administration is authorized to determine which expenses are not operationally justified and therefore not deductible. For the business expense deduction it is not a requirement that the recipient is specified. It is sufficient to elucidate to the satisfaction of the tax authorities that the payments are in the interest of the operation.
Austria: bribes justified by the operation (of a company) are deductible as business expenses. However, the tax authority may require that the payer names the recipient of the deducted payments exactly. If the indication of the name is denied e.g. because of business comity, the expenses claimed are not recognized as operating expenses. This principle also applies to payments to foreigners.
Switzerland: bribe payments are tax deductible if it is clearly operation initiated and the consignee is indicated.
US: (rough résumé: "generally operational expenses are deductible if they are not illegal according to the FCPA")
UK: kickbacks and bribes are deductible if they have been paid for operating purposes. The tax authority may request the name and address of the recipient."
"Specific" legal corruption: exclusively against foreign countries
Referring to the recommendation of the above-mentioned Parliamentary Financial Commission's study, the then Kohl administration (1991–1994) decided to maintain the legality of corruption against officials exclusively in foreign transactions and confirmed the full deductibility of bribe money, co-financing thus a specific nationalistic corruption practice (§4 Abs. 5 Nr. 10 EStG, valid until 19 March 1999) in contradiction to the 1994 OECD recommendation. The respective law was not changed before the OECD Convention also in Germany came into force (1999).
According to the Parliamentary Financial Commission's study, however, in 1994 most countries' corruption practices were not nationalistic and much more limited by the respective laws compared to Germany.
Particularly, the non-disclosure of the bribe money recipients' name in tax declarations had been a powerful instrument for Legal Corruption during the 1990s for German corporations, enabling them to block foreign legal jurisdictions which intended to fight corruption in their countries. Hence, they uncontrolled established a strong network of clientelism around Europe (e.g. SIEMENS) along with the formation of the European Single Market in the upcoming European Union
The European Union (EU) is a supranational political and economic union of member states that are located primarily in Europe. The union has a total area of and an estimated total population of about 447million. The EU has often been des ...
and the Eurozone
The euro area, commonly called eurozone (EZ), is a currency union of 19 member states of the European Union (EU) that have adopted the euro (€) as their primary currency and sole legal tender, and have thus fully implemented EMU policies ...
.
Moreover, in order to further strengthen active corruption the prosecution of tax evasion during that decade had been severely limited. German tax authorities were instructed to refuse any disclosure of bribe recipients' names from tax declarations to the German criminal prosecution. As a result, German corporations have been systematically increasing their informal economy from 1980 until today up to 350 bn € per annum (see diagram on the right), thus continuously feeding their black money reserves.
Siemens corruption case
In 2007, Siemens
Siemens AG ( ) is a German multinational conglomerate corporation and the largest industrial manufacturing company in Europe headquartered in Munich with branch offices abroad.
The principal divisions of the corporation are ''Industry'', '' ...
was convicted in the District Court of Darmstadt
Darmstadt () is a city in the States of Germany, state of Hesse in Germany, located in the southern part of the Frankfurt Rhine Main Area, Rhine-Main-Area (Frankfurt Metropolitan Region). Darmstadt has around 160,000 inhabitants, making it th ...
of criminal corruption against the Italian corporation Enel Power SpA. Siemens had paid almost €3.5 million in bribes to be selected for a €200 million project from the Italian corporation, partially owned by the government. The deal was handled through black money accounts in Switzerland
). Swiss law does not designate a ''capital'' as such, but the federal parliament and government are installed in Bern, while other federal institutions, such as the federal courts, are in other cities (Bellinzona, Lausanne, Luzern, Neuchâtel ...
and Liechtenstein
Liechtenstein (), officially the Principality of Liechtenstein (german: link=no, Fürstentum Liechtenstein), is a German-speaking microstate located in the Alps between Austria and Switzerland. Liechtenstein is a semi-constitutional monarchy ...
that were established specifically for such purposes.
Because the crime was committed in 1999, after the OECD convention had come into force, this foreign corrupt practice could be prosecuted. It was the first time a German court of law convicted foreign corrupt practices like a national practice, although the corresponding law did not yet protect foreign competitors in business.
During the judicial proceedings it was disclosed that numerous such black accounts had been established in the past decades.
Historical responses in philosophical and religious thought
Philosophers and religious thinkers have responded to the inescapable reality of corruption in different ways. Plato
Plato ( ; grc-gre, Πλάτων ; 428/427 or 424/423 – 348/347 BC) was a Greek philosopher born in Athens during the Classical period in Ancient Greece. He founded the Platonist school of thought and the Academy, the first institution ...
, in '' The Republic'', acknowledges the corrupt nature of political institutions, and recommends that philosophers "shelter behind a wall" to avoid senselessly martyring themselves.
The New Testament
The New Testament grc, Ἡ Καινὴ Διαθήκη, transl. ; la, Novum Testamentum. (NT) is the second division of the Christian biblical canon. It discusses the teachings and person of Jesus, as well as events in first-century Chris ...
, in keeping with the tradition of Ancient Greek thought, also frankly acknowledges the corruption of the world (ὁ κόσμος) and claims to offer a way of keeping the spirit "unspotted from the world." Paul of Tarsus
Paul; grc, Παῦλος, translit=Paulos; cop, ⲡⲁⲩⲗⲟⲥ; hbo, פאולוס השליח (previously called Saul of Tarsus;; ar, بولس الطرسوسي; grc, Σαῦλος Ταρσεύς, Saũlos Tarseús; tr, Tarsuslu Pavlus; ...
acknowledges his readers must inevitably "deal with the world," and recommends they adopt an attitude of "as if not" in all their dealings. When they buy a thing, for example, they should relate to it "as if it were not theirs to keep." New Testament readers are advised to refuse to "conform to the present age" and not to be ashamed to be peculiar or singular. They are advised not be friends of the corrupt world, because "friendship with the world is enmity with God." They are advised not to love the corrupt world or the things of the world. The rulers of this world, Paul explains, "are coming to nothing" While readers must obey corrupt rulers in order to live in the world, the spirit is subject to no law but to love God and love our neighbors as ourselves. New Testament readers are advised to adopt a disposition in which they are "in the world, but not of the world." This disposition, Paul claims, shows us a way to escape "slavery to corruption" and experience the freedom and glory of being innocent "children of God".[Roman 8:21.]
Corruption by country
See also
References
Further reading
*
* Butscher, Anke
"Corruption"
(2012). University Bielefeld – Center for InterAmerican Studies.
* Cohen, Nissim (2012)
Informal payments for healthcare – The phenomenon and its context
''Journal of Health Economics, Policy and Law'', 7 (3): 285–308.
* Garifullin Ramil Ramzievic
Bribe-taking mania as one of the causes of bribery. The concept of psychological and psychotherapeutic approaches to the problem of bribery and bribe-taking mania. J. Aktualnye Problemy Ekonomiki i Prava" ("Current Problems in Economics and Law"), no. 4(24), 2012, pp. 9–15
* Heidenheimer, Arnold J. and Michael Johnston, eds. ''Political corruption: Concepts and contexts'' (2011).
* Heywood, Paul M. ed. ''Routledge Handbook of Political Corruption'' (2014)
*Johnston, Michael ''Syndromes of Corruption'' (2006).
* Li, Ling. "Politics of Anticorruption in China: Paradigm Change of the Party's Disciplinary Regime 2012–2017," ''Journal of Contemporary China'', 28:115, 47–63, DOI: 10.1080/10670564.2018.1497911
* McCormick, Richard L. "The discovery that business corrupts politics: A reappraisal of the origins of Progressivism" ''American Historical Review'' 86 (1981): 247–74.
* Mantzaris, E., Tsekeris, C. and Tsekeris, T. (2014)
Interrogating Corruption: Lessons from South Africa
''International Journal of Social Inquiry'', 7 (1): 1–17.
*Rajan, Sudhir Chella ''A Social Theory of Corruption'' (2020).
* Sharma, Vivek Swaroop. "Give Corruption a Chance" in The National Interest 128, November/December 2013: 38–45. Full text available at
* Wallis, John Joseph. "The concept of systematic corruption in American history." in ''Corruption and Reform: Lessons from America's economic history'' (U of Chicago Press, 2006). 23–62.
online
{{DEFAULTSORT:Corruption (philosophical concept)
Concepts in ethics
Political corruption
Crime
Deception
Corporate liquidations
Corporate law
Abuse of the legal system