Corruption and Bribery


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  1. Black Market: Corruption$1600 Billion ($1.6 Trillion)

News and statistics about the various forms of corruption around the world. Data about the types of corruption and its impact is collected from intelligence agencies, criminal justice programs and other public information sources.

The international Labor Organization released a report that stated that corruption in Cambodia causes $1.7 Billion in annual losses to the Cambodian economy, or about 10 percent of Cambodia’s GDP.

According to business and firms who answered a survey, the companies spend an average of 9 percent of their sales to pay bribes to officials.

Source:  Khouran Theara, “Report Calculates Major Drain of Corruption,” Voice of America, March 12, 2014.

In the US State of Hawaii, a prison guard plead guilty in federal court for smuggling contraband items into prison.

The guard accepted $5,000 from a dealer to smuggle methamphetamine into the correctional facility, which was then distributed to a confidential informant.

(More earnings and income from illegal jobs.)

Source:  Associated Press, “Ex-Halawa guard pleads guilty in meth smuggling,” SeattlePI.com, March 19, 2014.

36 percent of organizations in Canada reported in a survey that they were victims of white collar crime between 2012-2013. The percentage of companies reporting white collar crime was slightly up from the 32 percent rate in 2011, but was down from the 50 percent range in the mid-2000s.

The survey, conducted by PwC, found that the global average of organizations falling victim to white collar crime was 37 percent.

The most reported type of white collar crime was assets theft, which accounted for 58 percent of the reported crimes. Procurement fraud accounted for 33 percent of crimes, accounting fraud 22 percent, and cybercrime 22 percent. Nearly half of the organizations stated that cybercrime and cyber attacks were increasing.

15 percent of companies in Canada reported that they have been asked to pay a bribe. 14 percent reported that they have lost business due to refusing to pay the bribe money.

(See bribe money prices from around the world.)

The global average of companies being asked to pay a bribe was 28 percent.

10 percent of the organizations in Canada reporting losing over $4.5 Million (5 Million Canadian) to white collar crimes during the year.

Source:  Barrie McKenna, “White-collar crime hits more than a third of Canadian organizations,” Globe and Mail, February 24, 2014.

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The European Commission for Home Affairs released a study that found the European Union loses at least $162 Billion (€120 Billion) to corruption each year.

More than 75 percent of citizens in EU member states believe that corruption is widespread in their country. More than half also stated that they felt corruption was increasing in their country.

The top countries where citizens expected to pay bribe money to officials were in Bulgaria, Croatia, the Czech Republic, Greece, Hungary, Lithuania, Poland, Romania and Slovakia. In these countries, between 6 to 29 percent of people surveyed reported that they had either been asked for a bribe or was expected to pay a bribe within the last year. In many of the incidents, the bribes were prevalent in the healthcare industry. An example was previously reported in about the corruption in Romania’s healthcare industry.

The lowest rate of bribes were reported in the United Kingdom, where less than 1 percent reported that they either paid a bribe or were expected to.

In a survey of businesses, four out of 10 companies stated that corruption was an obstacle to doing business in the EU.

(Prices of bribe money paid around the world.)

Source:  “Corruption across EU ‘breathtaking’ – EU Commission,” BBC News, February 3, 2014.

In 2011, the Philippines Government lost an estimated $3.85 Billion in tax revenue due to illicit financial flows. When the total losses from illegal financial transactions is calculated from 1960 to 2012, over $400 Billion was lost to the Philippines Government, according to a report by Global Financial Integrity.

During the 52 year period, the country lost $132,9 Billion due to various crime, corruption and tax evasion activities.

An additional $277.6 Billion illegally entered the Philippines. Most of the illicit funds entered the country though false invoicing of imports that allowed traders to avoid tariffs.

Since the year 2000, the government has lost an average of $1.46 Billion in tax revenue to illicit financial flows.

(What is money laundering?)

Source:  Associated Press, “Watchdog Shows Illicit Money Flows in Philippines,” ABC News, February 4, 2014.

A survey conducted by the University of the Thai Chamber of Commerce found that companies that pay kickbacks and bribes to state officials pay in the range of 25 to 35 percent of the project value. The survey was based upon 2,400 respondents.

In 2013, the value of corruption in Thailand was estimated to cost $8.6 Billion (240 to 330 Billion Thai Baht), or roughly 10 percent of the 2.4 Trillion Thai Baht that was spent on teh country’s overall investment and procurement budget.

Based on the 35 percent kickback rate, Thailand’s GDP rate would be cut by 2.63 percent due to corruption.

Source:  “Corruption ‘still plagues Thailand’ ,” Bangkok Post, January 17, 2014.

In a single case investigated by Guatemalan security services, $46.7 Million of Sinaloa drug cartel money was seized and 21 people arrested in December for money laundering violations in Guatemala. A fruit and vegetable was serving as a front company that was sending money to Mexico along with payments of avocados.

Criminal justice programs in Guatemala are seeing an increase in suspicious financial transactions and are reporting more potential money laundering cases. In the first six months of 2013, a total of 76 potential laundering reports were filed that involved $58.2 Million in funds.

In all of 2012, a total of 131 suspicious transactions were filed totaling $31.9 Million. 30 percent of the reports for 2012 were involved possible corruption, 28 percent were extortion cases, drug trafficking accounted for 17 percent, and the remaining reports were from human trafficking, tax fraud, illegal adoptions and other scams and frauds.

Financial crimes investigators state that a single money laundering case can involve up to 50 bank accounts.

In additional to tracing money through bank accounts, security services have also seized cash from smugglers.  $11.4 Million in cash was seized from people smuggling the money, with most of the seizures taking place at the Guatemalan Airport.

Source:  Araceli Osorio, “Guatemala fights money laundering,” Infosurhoy, January 14, 2014.

The cost of corruption in Saudi Arabia is estimated to cost the Kingdom up to $14.6 Billion (55 Billion Saudi Riyal) a year. In an example of the type of graft occurring in Saudi Arabia, one employee of the Education Department reportedly embezzled nearly $40 Million (150 Million Riyal) in government funds.

Across the entire Arab region, the costs of corruption is estimated to cost states $350 Billion.

Source:  “Corruption costs state SR55 billion a year,” Saudi Gazette, January 2, 2014.

According to media reports, doctors and other medical professionals looking to work in Romanian hospitals must pay a bribe in order to gain employment. The price of the bribe paid is determined on an unofficial sliding scale depending on the location of the hospital.

One pediatrician reported that to receive employment at a hospital in a town with 9,000 residents would cost $20,000 (€15,000). The same position in a city with a population of 105,000 would cost $27,000 (€20,000), and in a city with 250,000 residents the bribe would be $40,000 (€30,000).

(More prices of bribes around the world.)

The bribe money is split between the hospital administrators and senior doctors.

A survey of 1,000 people in Romania found that over 60 percent of respondents offered bribes to medical professionals. Many patients freely pay bribes to their doctors hoping to secure the best possible treatment. Some patients have reportedly become distressed when  a doctor refuses the bribe, thinking that their condition must be incurable.

A resident doctor working at a public hospital earns about $271 (€200) a month. A specialist at the hospital earns about $680 (€500) a month.

(Additional corruption statistics.)

Source:  Elena Stancu, “Mass exodus: Why corruption in Romania’s healthcare system is forcing its doctors to work abroad,” Independent, January 2, 2014.

According to a survey conducted by the Corruption Eradication Commission (KPK) in Indonesia, the Forest Ministry is viewed as being the most corrupt institution in the country.  The Commission found that illegal loggers buying logging permits through bribes were the most common form of corruption in the ministry.

Government data shows that 16 percent of logging permits that were issued by the ministry followed regulation and met all environmental requirements prior to being issued.

In addition to the forest ministry employees, workers from various criminal justice programs in Indonesia has also been found to have been participating in illegal logging. In May 2013, a police officer was arrested for running a $150 Million logging ring in the eastern Papua region.

As many as two million hectares of Indonesian forest is cut down and lost each year. The amount of forest lost is equivalent to 10,000 football fields per day.

Source:  “Indonesia struggles to clean up corrupt forestry sector,” Bangkok Post, January 1, 2014.