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Wikipedia

Corruption

January 19, 2024

"Corrupt" redirects here. For other uses, see Corrupt (disambiguation).
For other uses, see Corruption (disambiguation).

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 may involve many activities which include bribery, influence peddling and embezzlement and it may also involve practices which are legal in many countries.[1] Political corruption occurs when an office-holder or other governmental employee acts with an official capacity for personal gain. Corruption is most common in kleptocracies, oligarchies, narco-states, and mafia states.[citation needed]

A map depicting Corruption Perceptions Index in the world in 2022; a higher score indicates lower levels of corruption.
  100 – 90
  89 – 80
  79 – 70
  69 – 60
  59 – 50
  49 – 40
  39 – 30
  29 – 20
  19 – 10
  9 – 0
  No data

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. Recent data suggests corruption is on the rise.[2] 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.[3] Additionally, global initiatives like the United Nations Sustainable Development Goal 16 also have a targeted goal which is supposed to substantially reduce corruption in all of its forms.[4]

Definitions and scales edit

 
A billboard in Zambia exhorting the public to "Just say no to corruption".

Stephen D. Morris,[5] 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.[6] World Bank economist Daniel Kaufmann[7] 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.[8]

Corruption is a complex phenomenon and can occur on different scales.[9] Corruption ranges from small favors between a small number of people (petty corruption),[10] 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;[11][12] 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 was highly correlated with more accurate measures of corruption.[13][14]

Petty corruption edit

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,[15][16] and many other private and government sectors.[clarification needed]

Grand corruption edit

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.[17]

The government system in many countries is divided into the legislative, executive and judicial branches in an attempt to provide independent services that are less subject to grand corruption due to their independence from one another.[18]

Systemic corruption edit

Systemic corruption (or endemic corruption)[19] 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.[20] Specific acts of corruption include "bribery, extortion, and embezzlement" in a system where "corruption becomes the rule rather than the exception."[21] 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 both types occur.[22] Some scholars argue that there is a negative duty[clarification needed] of western governments to protect against systematic corruption of underdeveloped governments.[23][24]

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.[25]

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.[26]

Causes edit

Per R. Klitgaard[27] 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:[28]

  • Greed of money, desires.
  • Higher levels of market and political monopolization
  • Low levels of democracy, weak civil participation and low political transparency
  • Higher levels of bureaucracy and inefficient administrative structures
  • Low press freedom
  • Low economic freedom
  • Large ethnic divisions and high levels of in-group favoritism
  • Gender inequality
  • Poverty
  • Political instability
  • Weak property rights
  • Contagion from corrupt neighboring countries
  • Low levels of education
  • Lack of commitment to society
  • Extravagant family
  • Unemployment
  • Lack of proper policies against 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.[29]

By sector edit

Corruption can occur in many sectors, whether they be public or private industry or even NGOs (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 edit

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.[30]

Judicial edit

 
In the Renaissance fresco The Good and the Bad Judge (Monsaraz, Portugal), the Bad Judge, depicted as having two faces, is shown taking bribes: the nobleman to the right offers him gold coins from a purse, and the villein to the left gives him a pair of partridges.

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, occurs when a politician or a crime boss bribes a prosecutor to open investigations and file charges against an opposing politician or a rival crime boss, in order to hurt the competition.[31]

Governmental corruption of the judiciary is broadly known in many transitional and developing countries because the budget 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.

The judiciary may be corrupted by acts of the government, such as through budget planning and various privileges, and by private acts.[32] 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.[33]

Military edit

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 is a military soldier being promoted in rank or being given better treatment than their colleagues by their officers due to their race, sexual orientation, ethnicity, gender, religious beliefs, social class or personal relationships with higher-ranking officers in spite of their merit.[34] 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.[35]

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.[36][37] 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.[38] 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.[39]

Natural resources edit

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 to ignore poaching. 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 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, land for livestock grazing, forests for hunting and logging, and fisheries.[40]

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 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.[40]

Political edit

Main article: Political corruption
 
A political cartoon from Harper's Weekly, 26 January 1878, depicting U.S. Secretary of the Interior Carl Schurz investigating the Indian Bureau at the U.S. Department of the Interior. The original caption for the cartoon is: "THE SECRETARY OF THE INTERIOR INVESTIGATING THE INDIAN BUREAU. GIVE HIM HIS DUE, AND GIVE THEM THEIR DUES."

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.[41] Evidence suggests that corruption can have political consequences- with citizens being asked for bribes becoming less likely to identify with their country or region.[42]

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.[43]

 
The Kaunas "Golden Toilet"

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.[44] 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.[44] 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[44] the local municipality even considered demolishing the building at one point.[45] 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, the Carnegie Endowment for International Peace, a global think tank, released a report claiming the Emirati city, Dubai, of being an enabler of global corruption, crime and illicit financial flows. 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, as it gives space to free trade zones, with minimal regulatory laws and customs enforcement.[46]

A report in September 2022 revealed that British Members of Parliament received a total of £828,211 over a period of eight years from countries of the Saudi-led coalition in the Yemeni Civil War. The money was granted in the form of all-expenses-paid trips to 96 MPs by Saudi Arabia (at least £319,406), Bahrain (£197,985), the United Arab Emirates (£187,251), Egypt (£66,695) and Kuwait (£56,872). MPs also received gifts, including a £500 food hamper, tickets for a Burns Supper, an expensive watch and a day out at the Royal Windsor Horse Show. The Saudi-led coalition was alleged of attempting to buy influence in the UK. While the MPs registered the trips and gifts at Westminster as per the rules, critics called it “absolutely shameful” to accept donations from countries with poor human rights records.[47]

Police edit

Main article: Police corruption
 
A 1902 cartoon depicts a police officer whose eyes are covered with a cloth labelled "bribes".

Police corruption is a specific form of police misconduct 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 bribes in exchange for not reporting organized drug or prostitution rings or other illegal activities. When civilians become witnesses to police brutality, officers are often known to respond by harassing and intimidating the witnesses as retribution for reporting the misconduct.[48] Whistleblowing is not common in law enforcement in part 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.[49] In America another common form of police corruption is when white supremacist groups, such as Neo-Nazi Skinheads or Neo-Confederates (such as the Ku Klux Klan), 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.[50]

Another example is police officers flouting the police code of conduct in order to secure convictions of suspects—for example, through the use of surveillance abuse, false confessions, police perjury and/or falsified evidence. Police officers have also been known to sell forms of contraband that were taken during seizers (such as confiscated drugs, stolen property or weapons).[51] Corruption and misconduct can also be done by prison officers, such as the smuggling of contraband (such as drugs or electronics) into jails and prisons for inmates or the abuse of prisoners.[52][53] Another form of misconduct is probation officers taking bribes in exchange for allowing paroles to violate the terms of their probation or abusing their paroles.[54] More rarely, police officers may deliberately and systematically participate in organized crime 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.

Private sector edit

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 edit

Main article: Attorney misconduct

Corruption facilitated by lawyers is a well known form of judicial misconduct. Such abuse is called Attorney misconduct. Attorney misconduct can be either conducted by individuals acting on their own accord or by entire law firms. A well known example of such corruption are mob lawyers. Mob lawyers are attorneys who seek to protect the leaders of criminal enterprises as well as their criminal organizations, 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.[55]

Corporate edit

See also: Corporate crime
 
Petrobras headquarters in downtown Rio de Janeiro

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 corporation or other business entity (see vicarious liability and corporate liability). Some negative behaviours by corporations may not be criminal; laws vary between jurisdictions. For example, some jurisdictions allow insider trading.

Examples edit

Petróleo Brasileiro S.A. — Petrobras, more commonly known as simply Petrobras (Portuguese pronunciation: [ˌpɛtɾoˈbɾas]), is a semi-public Brazilian multinational corporation in the petroleum industry headquartered in Rio de Janeiro, Brazil. The company's name translates to Brazilian Petroleum Corporation – Petrobras. The company was ranked No. 58 in the 2016 Fortune Global 500 list.[56] From 2014 to 2021, an investigation known as Operation Car Wash examined allegations of corporate and political collusion and corruption by Petrobras.[57]

Odebrecht is a privately held Brazilian conglomerate consisting of businesses in the fields of engineering, real estate, construction, chemicals and petrochemicals. The company was founded in 1944 in Salvador da Bahia by Norberto Odebrecht, 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 Norberto Odebrecht Construtora [pt].[58] 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 part of an investigation over Odebrecht Organization bribes to executives of Petrobras, in exchange for contracts and influence.[59][60][57] Operation Car Wash is an ongoing criminal money laundering and bribes related corporate crime investigation being carried out by the Federal Police of Brazil, Curitiba Branch, and judicially commanded by Judge Sérgio Moro since 17 March 2014.[61][62][63][57]

Education edit

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.[64] 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,[65] while others appreciate the changes. Vouchers for university entrants have never materialized.[66] The cost of corruption is that it impedes sustainable economic growth.[66]

Endemic corruption in educational institutions leads to the formation of sustainable corrupt hierarchies.[67][68][69] While higher education in Russia is distinct with widespread bribery, corruption in the US and the UK features a significant amount of fraud.[70][71] The US is distinct with grey areas and institutional corruption in the higher education sector.[72][73] Authoritarian regimes, including those in former Soviet republics, encourage educational corruption and control universities, especially during the election campaigns.[74] This is typical for Russia,[75] Ukraine,[76] and Central Asian regimes,[77] among others. The general public is well aware of the high level of corruption in colleges and universities, including thanks to the media.[78][79] Doctoral education is no exception, with dissertations and doctoral degrees available for sale, including for politicians.[80] Russian Parliament is notorious for "highly educated" MPs[81] High levels of corruption are a result of universities not being able to break away from their Stalinist past, over bureaucratization,[82] and a clear lack of university autonomy.[83] Both quantitative and qualitative methodologies are employed to study education corruption,[84] 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.[85] This can include bribes to bypass bureaucratic procedures and bribing faculty for a grade.[85][86] 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.[86]

Healthcare edit

Corruption, the abuse of entrusted power for private gain, as defined by Transparency International[87] 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.[88]: 26 

Corruption in health care poses a significant danger to the public welfare.[89] 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.[90] Corruption occurs within the private and public health sectors and may appear as theft, embezzlement, nepotism, bribery up til extortion, or as undue influence.[91] 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, 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).[92]

Labor unions edit

Labor unions leaders may be involved in corrupt action or be influenced or controlled by criminal enterprises.[93] For example, for many years the Teamsters were substantially controlled by the Mafia.[94]

Arms trafficking edit

"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 may work for them on the ground or with shipment. The money is often laundered and records are often destroyed.[95] It often breaks UN, national or international law.[95]

Main article: Mitterrand–Pasqua affair

The Mitterrand–Pasqua affair, also known informally as Angolagate, was an international political scandal over the secret and illegal sale and shipment of arms from the nations of Central Europe to the government of Angola by the Government of France 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 and elsewhere improperly obtaining a share of Angolan oil revenues. The scandal has subsequently been tied to several prominent figures in French politics.[96]

42 individuals, including Jean-Christophe Mitterrand, Jacques Attali, Charles Pasqua and Jean-Charles Marchiani, Pierre Falcone. Arcadi Gaydamak, Paul-Loup Sulitzer, Union for a Popular Movement deputy Georges Fenech, Philippe Courroye [fr] the son of François Mitterrand 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.[96][97][98]

Philosophy edit

The 19th-century German philosopher Arthur Schopenhauer 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"[99] 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 [lover of self], not a φιλόσοφος [lover of wisdom]. 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.[100]

Religious organizations edit

Main articles: Simony, Cardinal-nephew, Benefice § Pluralism, Mental reservation, Casuistry § Early modern times, and Detraction § Controversies involving detraction
 
Wikiquote has quotations related to Corruption in religion.

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 and Amos berate the rabbinical establishment of Ancient Judea for failing to live up to the ideals of the Torah.[101] In the New Testament, Jesus 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.[102] Corruption was one of the important issues which led to the Investiture Controversy. In 1517, Martin Luther accused the Catholic Church of widespread corruption, including the selling of indulgences.[103]

In 2015, Princeton University professor Kevin M. Kruse advances the thesis that business leaders in the 1930s and 1940s collaborated with clergymen, including James W. Fifield Jr., in order to develop and promote a new hermeneutical approach to Scripture which would de-emphasize the social Gospel and emphasize themes, such as individual salvation, which were more congenial to free enterprise.[104]

Business leaders, of course, had long been working to "merchandise" themselves through the appropriation of religion. In organizations such as Spiritual Mobilization, the prayer breakfast groups, and the Freedoms Foundation, they had linked capitalism and Christianity and, at the same time, they likened the welfare state to godless paganism.[105]

Methods edit

In systemic corruption and grand corruption, multiple methods of corruption are used concurrently with similar aims.[106]

Bribery edit

Main article: Bribery
 
An election leaflet with money stapled to it

Bribery involves the improper use of gifts and favours in exchange for personal gain. This is also known as kickbacks or, in the Middle East, as baksheesh. It is a common form of corruption. The types of favors given are diverse and may include money, gifts, real estate, promotions, sexual favors, employee benefits, company shares, privileges, entertainment, employment and political benefits. The personal gain that is given can be anything from actively giving preferential treatment to having an indiscretion or crime overlooked.[107]

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 edit

Main article: Embezzlement

Embezzlement and theft involve someone with access to funds or assets illegally taking control of them. Fraud 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 money, scams, electoral fraud and other corrupt activity.

Graft edit

Main article: Graft (politics)

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 edit

Main article: Extortion

While bribery is the use of positive inducements for corrupt aims, extortion and blackmail centre around the use of threats. This can be the threat of physical violence or false imprisonment 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 threatened with the loss of their job by their superiors, if they continued with investigating a high-ranking official.

Influence peddling edit

Influence peddling 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 edit

Main article: Business networking

Networking (both Business and Personal) 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.[108][109]

 
Euro bank notes hidden in sleeve.

Abuse of discretion edit

Main article: Abuse of discretion

Abuse of discretion refers to the misuse of one's powers and decision-making 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 edit

Main article: Nepotism

Favouritism, nepotism and clientelism 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.[110]

Measurement edit

Several organizations measure corruption as part of their development indexes. The Corruption Perceptions Index (CPI) ranks countries "by their perceived levels of public sector corruption, as determined by expert assessments and opinion surveys." The index has been published annually by the non-governmental organization Transparency International since 1995.[111] On the supply side, Transparency International used to publish the Bribe Payers Index, but stopped in 2011.

The Global Corruption Index (GCI), designed by the Global Risk Profile to be in line with anti-corruption and anti-bribery legislation, covers 196 countries and territories. It measures the state of corruption and white-collar crimes around the world, specifically money laundering and terrorism financing.[112]

Absence of corruption is one of the eight factors[113] the World Justice Project[114] Rule of Law Index[115] measures to evaluate adherence to the rule of law in 140 countries and jurisdictions around the globe. The annual index measures three forms of government corruption across the executive branch, the judiciary, the military and police, and the legislature: bribery, improper influence by public or private interests, and misappropriation of public funds or other resources.[116]

Relationship to economic growth edit

Corruption can negatively impact 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.[117] It is strongly negatively associated with the share of private investment and, hence, it lowers the rate of economic growth.[118]

Corruption reduces the returns of productive activities. If the returns to production fall faster than the returns to corruption and rent-seeking 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.[118]

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.[118]

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 favoured a small number of companies, and later used this financial influence to pressure these chaebol to follow the government's development strategy.[119][120] This 'profit-sharing' corruption model incentivizes government officials to support economic development, as they would personally benefit financially from it.[117][121]

Prevention edit

According to the amended Klitgaard equation,[122] 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[123] 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 edit

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[124] and also to the development of strategies for good governance by involving citizens willing to fight against corruption.[125]

Anti-corruption programmes edit

See also: List of anti-corruption agencies
 
United Nations Convention against Corruption

The Foreign Corrupt Practices Act (FCPA, USA 1977) was an early paradigmatic law for many western countries i.e. industrial countries of the OECD. 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.

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."[126] 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[127] 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[128] 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.[129]

In 2013, a document[130] 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. 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 and the World Bank 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 in the last decade has made tremendous progress in improving governance and the business environment providing a model to follow for post-conflict countries.[130]
  • Armenia 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.[131]

In recent years, anti-corruption efforts have also been criticised for overemphasising the benefits of the eradication of corruption for economic growth and development,[132][133][134][135] 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.[136][137] This criticism is based on the observed fact that a variety of countries, such as Korea and China but also the US in the 19th and early 20th century, saw high economic growth and broader socio-economic development coinciding with significant corruption [138][139]

In popular culture edit

See also: Kleptocracy Tour

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.[140][141][142][143] Corruption tours have also occurred in Chicago[144] and Mexico City.[145][146]

Films about corruption include Runaway Jury, The Firm, Syriana, The Constant Gardener, and All the President's Men.

Legal corruption edit

Though corruption is often viewed as illegal, a concept of "legal corruption" has been described by Daniel Kaufmann and Pedro Vicente.[7][147] 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.[148]

Examples edit

In 1994, the German Parliamentary Financial Commission in Bonn presented a comparative study on "legal corruption" in industrialized OECD countries[149] 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 (FCPA from 1977), thus fostering national export corporations.[150] In 1997 a corresponding OECD Anti-Bribery Convention was signed by its members.[151][152] It took until 1999, after the OECD Anti-Bribery Convention came into force, that Germany withdrew the legalization of foreign corruption.[153]

Foreign corrupt practices of industrialized OECD countries 1994 study edit

A study on foreign corrupt practices of industrialized OECD countries 1994 (Parliamentary Financial Commission study, Bonn)[149] 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 edit

Referring to the recommendation of the above-mentioned Parliamentary Financial Commission's study,[149] the then Kohl administration (1991–1994) decided to maintain the legality of corruption against officials exclusively in foreign transactions[154] 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.[155] The respective law was not changed before the OECD Convention also in Germany came into force (1999).[156] 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.[157]

 
Development of the shadow economy in (West-) Germany 1975–2015. Original shadow economy data from Friedrich Schneider, University Linz.

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)[158] along with the formation of the European Single Market in the upcoming European Union and the Eurozone. 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.[159] 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.[160]

Siemens corruption case edit

In 2007, Siemens was convicted in the District Court of Darmstadt 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 and Liechtenstein that were established specifically for such purposes.[161] 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.[162]

During the judicial proceedings it was disclosed that numerous such black accounts had been established in the past decades.[158]

Historical responses in philosophical and religious thought edit

Philosophers and religious thinkers have responded to the inescapable reality of corruption in different ways. Plato, in The Republic, acknowledges the corrupt nature of political institutions, and recommends that philosophers "shelter behind a wall" to avoid senselessly martyring themselves.

Disciples of philosophy ... have tasted how sweet and blessed a possession philosophy is, and have also seen and been satisfied of the madness of the multitude, and known that there is no one who ever acts honestly in the administration of States, nor any helper who will save any one who maintains the cause of the just. Such a savior would be like a man who has fallen among wild beasts—unable to join in the wickedness of his fellows, neither would he be able alone to resist all their fierce natures, and therefore he would be of no use to the State or to his friends, and would have to throw away his life before he had done any good to himself or others. And he reflects upon all this, and holds his peace, and does his own business. He is like one who retires under the shelter of a wall in the storm of dust and sleet which the driving wind hurries along; and when he sees the rest of mankind full of wickedness, he is content if only he can live his own life and be pure from evil or unrighteousness, and depart in peace and good will, with bright hopes.

— Plato, Republic, 496d

The New Testament, in keeping with the tradition of Ancient Greek thought, also frankly acknowledges the corruption of the world (ὁ κόσμος)[163] and claims to offer a way of keeping the spirit "unspotted from the world."[164] Paul of Tarsus acknowledges his readers must inevitably "deal with the world,"[165] 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."[166] New Testament readers are advised to refuse to "conform to the present age"[167] and not to be ashamed to be peculiar or singular.[168] They are advised not be friends of the corrupt world, because "friendship with the world is enmity with God."[169] They are advised not to love the corrupt world or the things of the world.[170] The rulers of this world, Paul explains, "are coming to nothing"[171] While readers must obey corrupt rulers in order to live in the world,[172] the spirit is subject to no law but to love God and love our neighbors as ourselves.[173] New Testament readers are advised to adopt a disposition in which they are "in the world, but not of the world."[174] 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".[175]

Corruption by country edit

See also edit

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Further reading edit

 
Wikiquote has quotations related to Corruption.
 
Wikimedia Commons has media related to Corruption.
  • Diwan, Ishac; Haidar, Jamal Ibrahim (2021). "Political Connections Reduce Job Creation: Firm-level Evidence from Lebanon". Journal of Development Studies. 57 (8): 1373–1396. doi:10.1080/00220388.2020.1849622. S2CID 229717871.
  • 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 Ramzievich 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). . 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: [1].
  • 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

January 19, 2024
corruption, corrupt, redirects, here, other, uses, corrupt, disambiguation, other, uses, disambiguation, form, dishonesty, criminal, offense, which, undertaken, person, organization, which, entrusted, position, authority, order, acquire, illicit, benefits, abu. Corrupt redirects here For other uses see Corrupt disambiguation For other uses see Corruption disambiguation 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 may involve many activities which include bribery influence peddling and embezzlement and it may also involve practices which are legal in many countries 1 Political corruption occurs when an office holder or other governmental employee acts with an official capacity for personal gain Corruption is most common in kleptocracies oligarchies narco states and mafia states citation needed A map depicting Corruption Perceptions Index in the world in 2022 a higher score indicates lower levels of corruption 100 90 89 80 79 70 69 60 59 50 49 40 39 30 29 20 19 10 9 0 No dataCorruption and crime are endemic sociological occurrences which appear with regular frequency in virtually all countries on a global scale in varying degrees and proportions Recent data suggests corruption is on the rise 2 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 3 Additionally global initiatives like the United Nations Sustainable Development Goal 16 also have a targeted goal which is supposed to substantially reduce corruption in all of its forms 4 Contents 1 Definitions and scales 1 1 Petty corruption 1 2 Grand corruption 1 3 Systemic corruption 2 Causes 3 By sector 3 1 Public sector 3 1 1 Judicial 3 1 2 Military 3 1 3 Natural resources 3 1 4 Political 3 1 5 Police 3 2 Private sector 3 2 1 Legal 3 2 2 Corporate 3 2 2 1 Examples 3 2 3 Education 3 2 4 Healthcare 3 2 5 Labor unions 3 2 6 Arms trafficking 3 2 7 Philosophy 3 3 Religious organizations 4 Methods 4 1 Bribery 4 2 Embezzlement theft and fraud 4 3 Graft 4 4 Extortion and blackmail 4 5 Influence peddling 4 6 Networking 4 7 Abuse of discretion 4 8 Favoritism nepotism and clientelism 5 Measurement 6 Relationship to economic growth 7 Prevention 7 1 Enhancing civil society participation 8 Anti corruption programmes 9 In popular culture 10 Legal corruption 10 1 Examples 10 1 1 Foreign corrupt practices of industrialized OECD countries 1994 study 10 1 2 Specific legal corruption exclusively against foreign countries 10 2 Siemens corruption case 11 Historical responses in philosophical and religious thought 12 Corruption by country 13 See also 14 References 15 Further readingDefinitions and scales edit nbsp A billboard in Zambia exhorting the public to Just say no to corruption Stephen D Morris 5 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 6 World Bank economist Daniel Kaufmann 7 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 8 Corruption is a complex phenomenon and can occur on different scales 9 Corruption ranges from small favors between a small number of people petty corruption 10 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 11 12 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 was highly correlated with more accurate measures of corruption 13 14 Petty corruption edit 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 15 16 and many other private and government sectors clarification needed Grand corruption edit 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 17 The government system in many countries is divided into the legislative executive and judicial branches in an attempt to provide independent services that are less subject to grand corruption due to their independence from one another 18 Systemic corruption edit Systemic corruption or endemic corruption 19 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 20 Specific acts of corruption include bribery extortion and embezzlement in a system where corruption becomes the rule rather than the exception 21 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 both types occur 22 Some scholars argue that there is a negative duty clarification needed of western governments to protect against systematic corruption of underdeveloped governments 23 24 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 25 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 26 Causes editPer R Klitgaard 27 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 28 Greed of money desires Higher levels of market and political monopolization Low levels of democracy weak civil participation and low political transparency Higher levels of bureaucracy and inefficient administrative structures Low press freedom Low economic freedom Large ethnic divisions and high levels of in group favoritism Gender inequality Poverty Political instability Weak property rights Contagion from corrupt neighboring countries Low levels of education Lack of commitment to society Extravagant family Unemployment Lack of proper policies against 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 29 By sector editCorruption can occur in many sectors whether they be public or private industry or even NGOs 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 edit 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 30 Judicial edit nbsp In the Renaissance fresco The Good and the Bad Judge Monsaraz Portugal the Bad Judge depicted as having two faces is shown taking bribes the nobleman to the right offers him gold coins from a purse and the villein to the left gives him a pair of partridges 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 occurs when a politician or a crime boss bribes a prosecutor to open investigations and file charges against an opposing politician or a rival crime boss in order to hurt the competition 31 Governmental corruption of the judiciary is broadly known in many transitional and developing countries because the budget 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 The judiciary may be corrupted by acts of the government such as through budget planning and various privileges and by private acts 32 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 33 Military edit 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 is a military soldier being promoted in rank or being given better treatment than their colleagues by their officers due to their race sexual orientation ethnicity gender religious beliefs social class or personal relationships with higher ranking officers in spite of their merit 34 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 35 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 36 37 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 38 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 39 Natural resources edit 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 to ignore poaching 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 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 land for livestock grazing forests for hunting and logging and fisheries 40 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 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 40 Political edit Main article Political corruption nbsp A political cartoon from Harper s Weekly 26 January 1878 depicting U S Secretary of the Interior Carl Schurz investigating the Indian Bureau at the U S Department of the Interior The original caption for the cartoon is THE SECRETARY OF THE INTERIOR INVESTIGATING THE INDIAN BUREAU GIVE HIM HIS DUE AND GIVE THEM THEIR DUES 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 41 Evidence suggests that corruption can have political consequences with citizens being asked for bribes becoming less likely to identify with their country or region 42 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 43 nbsp The Kaunas Golden Toilet The Kaunas golden toilet case was a major Lithuanian scandal In 2009 the municipality of Kaunas led by mayor Andrius Kupcinskas 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 44 At the same time when Kaunas s Golden Toilet was built Kedainiai tennis club acquired a very similar but more advanced solution for 4 500 euros 44 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 44 the local municipality even considered demolishing the building at one point 45 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 the Carnegie Endowment for International Peace a global think tank released a report claiming the Emirati city Dubai of being an enabler of global corruption crime and illicit financial flows 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 as it gives space to free trade zones with minimal regulatory laws and customs enforcement 46 A report in September 2022 revealed that British Members of Parliament received a total of 828 211 over a period of eight years from countries of the Saudi led coalition in the Yemeni Civil War The money was granted in the form of all expenses paid trips to 96 MPs by Saudi Arabia at least 319 406 Bahrain 197 985 the United Arab Emirates 187 251 Egypt 66 695 and Kuwait 56 872 MPs also received gifts including a 500 food hamper tickets for a Burns Supper an expensive watch and a day out at the Royal Windsor Horse Show The Saudi led coalition was alleged of attempting to buy influence in the UK While the MPs registered the trips and gifts at Westminster as per the rules critics called it absolutely shameful to accept donations from countries with poor human rights records 47 Police edit Main article Police corruption nbsp A 1902 cartoon depicts a police officer whose eyes are covered with a cloth labelled bribes Police corruption is a specific form of police misconduct 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 bribes in exchange for not reporting organized drug or prostitution rings or other illegal activities When civilians become witnesses to police brutality officers are often known to respond by harassing and intimidating the witnesses as retribution for reporting the misconduct 48 Whistleblowing is not common in law enforcement in part 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 49 In America another common form of police corruption is when white supremacist groups such as Neo Nazi Skinheads or Neo Confederates such as the Ku Klux Klan 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 50 Another example is police officers flouting the police code of conduct in order to secure convictions of suspects for example through the use of surveillance abuse false confessions police perjury and or falsified evidence Police officers have also been known to sell forms of contraband that were taken during seizers such as confiscated drugs stolen property or weapons 51 Corruption and misconduct can also be done by prison officers such as the smuggling of contraband such as drugs or electronics into jails and prisons for inmates or the abuse of prisoners 52 53 Another form of misconduct is probation officers taking bribes in exchange for allowing paroles to violate the terms of their probation or abusing their paroles 54 More rarely police officers may deliberately and systematically participate in organized crime 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 Private sector edit 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 edit Main article Attorney misconduct Corruption facilitated by lawyers is a well known form of judicial misconduct Such abuse is called Attorney misconduct Attorney misconduct can be either conducted by individuals acting on their own accord or by entire law firms A well known example of such corruption are mob lawyers Mob lawyers are attorneys who seek to protect the leaders of criminal enterprises as well as their criminal organizations 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 55 Corporate edit See also Corporate crime The examples and perspective in this section may not represent a worldwide view of the subject You may improve this section discuss the issue on the talk page or create a new section as appropriate January 2018 Learn how and when to remove this template message The neutrality of this article is disputed Relevant discussion may be found on the talk page Please do not remove this message until conditions to do so are met March 2020 Learn how and when to remove this template message nbsp Petrobras headquarters in downtown Rio de JaneiroIn 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 corporation or other business entity see vicarious liability and corporate liability Some negative behaviours by corporations may not be criminal laws vary between jurisdictions For example some jurisdictions allow insider trading Examples edit Petroleo Brasileiro S A Petrobras more commonly known as simply Petrobras Portuguese pronunciation ˌpɛtɾoˈbɾas is a semi public Brazilian multinational corporation in the petroleum industry headquartered in Rio de Janeiro Brazil The company s name translates to Brazilian Petroleum Corporation Petrobras The company was ranked No 58 in the 2016 Fortune Global 500 list 56 From 2014 to 2021 an investigation known as Operation Car Wash examined allegations of corporate and political collusion and corruption by Petrobras 57 Odebrecht is a privately held Brazilian conglomerate consisting of businesses in the fields of engineering real estate construction chemicals and petrochemicals The company was founded in 1944 in Salvador da Bahia by Norberto Odebrecht 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 Norberto Odebrecht Construtora pt 58 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 part of an investigation over Odebrecht Organization bribes to executives of Petrobras in exchange for contracts and influence 59 60 57 Operation Car Wash is an ongoing criminal money laundering and bribes related corporate crime investigation being carried out by the Federal Police of Brazil Curitiba Branch and judicially commanded by Judge Sergio Moro since 17 March 2014 61 62 63 57 Education edit 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 64 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 65 while others appreciate the changes Vouchers for university entrants have never materialized 66 The cost of corruption is that it impedes sustainable economic growth 66 Endemic corruption in educational institutions leads to the formation of sustainable corrupt hierarchies 67 68 69 While higher education in Russia is distinct with widespread bribery corruption in the US and the UK features a significant amount of fraud 70 71 The US is distinct with grey areas and institutional corruption in the higher education sector 72 73 Authoritarian regimes including those in former Soviet republics encourage educational corruption and control universities especially during the election campaigns 74 This is typical for Russia 75 Ukraine 76 and Central Asian regimes 77 among others The general public is well aware of the high level of corruption in colleges and universities including thanks to the media 78 79 Doctoral education is no exception with dissertations and doctoral degrees available for sale including for politicians 80 Russian Parliament is notorious for highly educated MPs 81 High levels of corruption are a result of universities not being able to break away from their Stalinist past over bureaucratization 82 and a clear lack of university autonomy 83 Both quantitative and qualitative methodologies are employed to study education corruption 84 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 85 This can include bribes to bypass bureaucratic procedures and bribing faculty for a grade 85 86 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 86 Healthcare edit Corruption the abuse of entrusted power for private gain as defined by Transparency International 87 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 88 26 Corruption in health care poses a significant danger to the public welfare 89 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 90 Corruption occurs within the private and public health sectors and may appear as theft embezzlement nepotism bribery up til extortion or as undue influence 91 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 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 92 Labor unions edit Labor unions leaders may be involved in corrupt action or be influenced or controlled by criminal enterprises 93 For example for many years the Teamsters were substantially controlled by the Mafia 94 Arms trafficking edit The examples and perspective in this section may not represent a worldwide view of the subject You may improve this section discuss the issue on the talk page or create a new section as appropriate January 2018 Learn how and when to remove this template message 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 may work for them on the ground or with shipment The money is often laundered and records are often destroyed 95 It often breaks UN national or international law 95 Main article Mitterrand Pasqua affairThe Mitterrand Pasqua affair also known informally as Angolagate was an international political scandal over the secret and illegal sale and shipment of arms from the nations of Central Europe to the government of Angola by the Government of France 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 and elsewhere improperly obtaining a share of Angolan oil revenues The scandal has subsequently been tied to several prominent figures in French politics 96 42 individuals including Jean Christophe Mitterrand Jacques Attali Charles Pasqua and Jean Charles Marchiani Pierre Falcone Arcadi Gaydamak Paul Loup Sulitzer Union for a Popular Movement deputy Georges Fenech Philippe Courroye fr the son of Francois Mitterrand 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 96 97 98 Philosophy edit The 19th century German philosopher Arthur Schopenhauer 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 99 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 filaytos lover of self not a filosofos lover of wisdom 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 100 dd Religious organizations edit Main articles Simony Cardinal nephew Benefice Pluralism Mental reservation Casuistry Early modern times and Detraction Controversies involving detraction nbsp Wikiquote has quotations related to Corruption in religion 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 and Amos berate the rabbinical establishment of Ancient Judea for failing to live up to the ideals of the Torah 101 In the New Testament Jesus 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 102 Corruption was one of the important issues which led to the Investiture Controversy In 1517 Martin Luther accused the Catholic Church of widespread corruption including the selling of indulgences 103 In 2015 Princeton University professor Kevin M Kruse advances the thesis that business leaders in the 1930s and 1940s collaborated with clergymen including James W Fifield Jr in order to develop and promote a new hermeneutical approach to Scripture which would de emphasize the social Gospel and emphasize themes such as individual salvation which were more congenial to free enterprise 104 Business leaders of course had long been working to merchandise themselves through the appropriation of religion In organizations such as Spiritual Mobilization the prayer breakfast groups and the Freedoms Foundation they had linked capitalism and Christianity and at the same time they likened the welfare state to godless paganism 105 Methods editIn systemic corruption and grand corruption multiple methods of corruption are used concurrently with similar aims 106 Bribery edit Main article Bribery nbsp An election leaflet with money stapled to itBribery involves the improper use of gifts and favours in exchange for personal gain This is also known as kickbacks or in the Middle East as baksheesh It is a common form of corruption The types of favors given are diverse and may include money gifts real estate promotions sexual favors employee benefits company shares privileges entertainment employment and political benefits The personal gain that is given can be anything from actively giving preferential treatment to having an indiscretion or crime overlooked 107 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 edit Main article Embezzlement Embezzlement and theft involve someone with access to funds or assets illegally taking control of them Fraud 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 money scams electoral fraud and other corrupt activity Graft edit Main article Graft politics 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 edit Main article Extortion While bribery is the use of positive inducements for corrupt aims extortion and blackmail centre around the use of threats This can be the threat of physical violence or false imprisonment 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 threatened with the loss of their job by their superiors if they continued with investigating a high ranking official Influence peddling edit Influence peddling 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 edit Main article Business networking Networking both Business and Personal 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 108 109 nbsp Euro bank notes hidden in sleeve Abuse of discretion edit Main article Abuse of discretion Abuse of discretion refers to the misuse of one s powers and decision making 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 edit Main article Nepotism Favouritism nepotism and clientelism 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 110 Measurement editSeveral organizations measure corruption as part of their development indexes The Corruption Perceptions Index CPI ranks countries by their perceived levels of public sector corruption as determined by expert assessments and opinion surveys The index has been published annually by the non governmental organization Transparency International since 1995 111 On the supply side Transparency International used to publish the Bribe Payers Index but stopped in 2011 The Global Corruption Index GCI designed by the Global Risk Profile to be in line with anti corruption and anti bribery legislation covers 196 countries and territories It measures the state of corruption and white collar crimes around the world specifically money laundering and terrorism financing 112 Absence of corruption is one of the eight factors 113 the World Justice Project 114 Rule of Law Index 115 measures to evaluate adherence to the rule of law in 140 countries and jurisdictions around the globe The annual index measures three forms of government corruption across the executive branch the judiciary the military and police and the legislature bribery improper influence by public or private interests and misappropriation of public funds or other resources 116 Relationship to economic growth editCorruption can negatively impact 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 117 It is strongly negatively associated with the share of private investment and hence it lowers the rate of economic growth 118 Corruption reduces the returns of productive activities If the returns to production fall faster than the returns to corruption and rent seeking 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 118 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 118 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 favoured a small number of companies and later used this financial influence to pressure these chaebol to follow the government s development strategy 119 120 This profit sharing corruption model incentivizes government officials to support economic development as they would personally benefit financially from it 117 121 Prevention editThis section may lend undue weight to an individual s viewpoint Please help to create a more balanced presentation Discuss and resolve this issue before removing this message July 2022 According to the amended Klitgaard equation 122 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 123 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 edit 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 124 and also to the development of strategies for good governance by involving citizens willing to fight against corruption 125 Anti corruption programmes editSee also List of anti corruption agencies nbsp United Nations Convention against CorruptionThe Foreign Corrupt Practices Act FCPA USA 1977 was an early paradigmatic law for many western countries i e industrial countries of the OECD 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 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 126 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 127 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 128 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 129 In 2013 a document 130 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 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 and the World Bank 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 in the last decade has made tremendous progress in improving governance and the business environment providing a model to follow for post conflict countries 130 Armenia 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 131 In recent years anti corruption efforts have also been criticised for overemphasising the benefits of the eradication of corruption for economic growth and development 132 133 134 135 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 136 137 This criticism is based on the observed fact that a variety of countries such as Korea and China but also the US in the 19th and early 20th century saw high economic growth and broader socio economic development coinciding with significant corruption 138 139 In popular culture editSee also Kleptocracy Tour 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 140 141 142 143 Corruption tours have also occurred in Chicago 144 and Mexico City 145 146 Films about corruption include Runaway Jury The Firm Syriana The Constant Gardener and All the President s Men Legal corruption editThough corruption is often viewed as illegal a concept of legal corruption has been described by Daniel Kaufmann and Pedro Vicente 7 147 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 148 Examples edit In 1994 the German Parliamentary Financial Commission in Bonn presented a comparative study on legal corruption in industrialized OECD countries 149 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 FCPA from 1977 thus fostering national export corporations 150 In 1997 a corresponding OECD Anti Bribery Convention was signed by its members 151 152 It took until 1999 after the OECD Anti Bribery Convention came into force that Germany withdrew the legalization of foreign corruption 153 Foreign corrupt practices of industrialized OECD countries 1994 study edit A study on foreign corrupt practices of industrialized OECD countries 1994 Parliamentary Financial Commission study Bonn 149 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 remunerations 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 remunerations 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 resume 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 edit Referring to the recommendation of the above mentioned Parliamentary Financial Commission s study 149 the then Kohl administration 1991 1994 decided to maintain the legality of corruption against officials exclusively in foreign transactions 154 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 155 The respective law was not changed before the OECD Convention also in Germany came into force 1999 156 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 157 nbsp Development of the shadow economy in West Germany 1975 2015 Original shadow economy data from Friedrich Schneider University Linz 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 158 along with the formation of the European Single Market in the upcoming European Union and the Eurozone 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 159 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 160 Siemens corruption case edit In 2007 Siemens was convicted in the District Court of Darmstadt 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 and Liechtenstein that were established specifically for such purposes 161 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 162 During the judicial proceedings it was disclosed that numerous such black accounts had been established in the past decades 158 Historical responses in philosophical and religious thought editThis section uses texts from within a religion or faith system without referring to secondary sources that critically analyze them Please help improve this article August 2020 Learn how and when to remove this template message Philosophers and religious thinkers have responded to the inescapable reality of corruption in different ways Plato in The Republic acknowledges the corrupt nature of political institutions and recommends that philosophers shelter behind a wall to avoid senselessly martyring themselves Disciples of philosophy have tasted how sweet and blessed a possession philosophy is and have also seen and been satisfied of the madness of the multitude and known that there is no one who ever acts honestly in the administration of States nor any helper who will save any one who maintains the cause of the just Such a savior would be like a man who has fallen among wild beasts unable to join in the wickedness of his fellows neither would he be able alone to resist all their fierce natures and therefore he would be of no use to the State or to his friends and would have to throw away his life before he had done any good to himself or others And he reflects upon all this and holds his peace and does his own business He is like one who retires under the shelter of a wall in the storm of dust and sleet which the driving wind hurries along and when he sees the rest of mankind full of wickedness he is content if only he can live his own life and be pure from evil or unrighteousness and depart in peace and good will with bright hopes Plato Republic 496d The New Testament in keeping with the tradition of Ancient Greek thought also frankly acknowledges the corruption of the world ὁ kosmos 163 and claims to offer a way of keeping the spirit unspotted from the world 164 Paul of Tarsus acknowledges his readers must inevitably deal with the world 165 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 166 New Testament readers are advised to refuse to conform to the present age 167 and not to be ashamed to be peculiar or singular 168 They are advised not be friends of the corrupt world because friendship with the world is enmity with God 169 They are advised not to love the corrupt world or the things of the world 170 The rulers of this world Paul explains are coming to nothing 171 While readers must obey corrupt rulers in order to live in the world 172 the spirit is subject to no law but to love God and love our neighbors as ourselves 173 New Testament readers are advised to adopt a disposition in which they are in the world but not of the world 174 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 175 Corruption by country editCorruption in Afghanistan Corruption in Albania Corruption in Angola Corruption in Argentina Corruption in Armenia Corruption in Australia Corruption in Austria Corruption in Azerbaijan Corruption in Bahrain Corruption in Bangladesh Corruption in Belarus Corruption in Belgium Corruption in Benin Corruption in Bolivia Corruption in Bosnia and Herzegovina Corruption in Botswana Corruption in Brazil Corruption in Bulgaria Corruption in Cambodia Corruption in Cameroon Corruption in Canada Corruption in Chad Corruption in Chile Corruption in China Corruption in Colombia Corruption in Costa Rica Corruption in Croatia Corruption in Cuba Corruption in Cyprus Corruption in Czech Republic Corruption in Denmark Corruption in Ecuador Corruption in Egypt Corruption in Estonia Corruption in Equatorial Guinea Corruption in Ethiopia Corruption in Finland Corruption in France Corruption in Georgia Corruption in Germany Corruption in Ghana Corruption in Greece Corruption in Haiti Corruption in Hungary Corruption in Iceland Corruption in India Corruption in Indonesia Corruption in Iran Corruption in Iraq Corruption in Ireland Corruption in Israel Corruption in Italy Corruption in Jordan Corruption in Kenya Corruption in Kosovo Corruption in Kuwait Corruption in Laos Corruption in Latvia Corruption in Lebanon Corruption in Liberia Corruption in Lithuania Corruption in Luxembourg Corruption in Malaysia Corruption in Mauritania Corruption in Mauritius Corruption in Mexico Corruption in Moldova Corruption in Mongolia Corruption in Montenegro Corruption in Myanmar Corruption in Nepal Corruption in the Netherlands Corruption in New Zealand Corruption in Nicaragua Corruption in Nigeria Corruption in North Korea Corruption in North Macedonia Corruption in Norway Corruption in Pakistan Corruption in Panama Corruption in Papua New Guinea Corruption in Paraguay Corruption in Peru Corruption in the Philippines Corruption in Poland Corruption in Portugal Corruption in Romania Corruption in Russia Corruption in Saudi Arabia Corruption in Senegal Corruption in Serbia Corruption in Singapore Corruption in Slovakia Corruption in Slovenia Corruption in Somalia Corruption in South Africa Corruption in South Korea Corruption in South Sudan Corruption in Spain Corruption in Sudan Corruption in Sweden Corruption in Switzerland Corruption in Tajikistan Corruption in Tanzania Corruption in Thailand Corruption in Tunisia Corruption in Turkey Corruption in Turkmenistan Corruption in Uganda Corruption in Ukraine Corruption in the United Kingdom Corruption in the United States Corruption in Uruguay Corruption in Uzbekistan Corruption in Vanuatu Corruption in Venezuela Corruption in Vietnam Corruption in Yemen Corruption in Zambia Corruption in ZimbabweSee also edit1Malaysia Development Berhad scandal Academic careerism Accounting scandals Anti globalization movement Appearance of corruption Biens mal acquis Business ethics Business oligarch Bribe Payers Index Blue wall of silence Command responsibility Conflict of interest Crony capitalism Corporate abuse Corporate Accountability International Corporate warfare Corporate crime Corporate malfeasance Corporate tax haven Corruption in local government Corruption Perceptions Index Cover up Enron Federal Bureau of Investigation Fraternization Graft politics Guanxi Goldman Sachs Investigative magistrate Industrial espionage Kaunas golden toilet case Kleptocracy Lobbying List of companies convicted of felony offenses in the United States Meritocracy Multinational Monitor Noble cause corruption Non disclosure agreement Operation Car Wash Patronage Penny stock scam Privilege evidence Pump and dump Pay to play Professional courtesy Political repression Poisoning the well Regulatory capture Second economy of the Soviet Union Social influence Sexual misconduct Tax evasion Tax havens Trial in absentia United Nations Convention against Corruption Wasta WhistleblowersReferences edit Report PDF siteresources worldbank org Archived from the original PDF on 5 May 2015 Retrieved 25 September 2012 Insights WJP Rule of Law Index 2022 worldjusticeproject org Archived from the original on 8 February 2023 Retrieved 8 February 2023 Lehtinen Jere Locatelli Giorgio Sainati Tristano Artto Karlos Evans Barbara 1 May 2022 The grand challenge Effective anti corruption measures in projects International Journal of Project Management 40 4 347 361 doi 10 1016 j ijproman 2022 04 003 ISSN 0263 7863 S2CID 248470690 Doss Eric Sustainable Development Goal 16 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Haidar Jamal Ibrahim 2021 Political Connections Reduce Job Creation Firm level Evidence from Lebanon Journal of Development Studies 57 8 1373 1396 doi 10 1080 00220388 2020 1849622 S2CID 229717871 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 Ramzievich 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 1 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 Retrieved from https en wikipedia org w index php title Corruption amp oldid 1196792602, wikipedia, wiki, book, books, library,

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