International asset recovery
Often used to emphasize the "multi-jurisdictional" or cross-border aspects of a corruption investigation, international asset recovery includes numerous processes such as the tracing, freezing, confiscation, and repatriation of proceeds stored in foreign jurisdictions, thus "making it one of the most complex projects in the field of law".
[1] Even considering the difficulties present, Africa specialist Daniel Scher counters that international asset recovery's "potential rewards in developing countries make it a highly attractive undertaking".
By taking advantage of differences in legal systems, the high costs in coordinating investigations, lack of international cooperation, and bank secrecy in some recipient countries, corrupt officials have been able to preserve much of their loot overseas.
According to the World Bank, the cross-border flow of proceeds from criminal activity, corruption and tax evasion is estimated between US$1–1.6 trillion per year—half of this amount is looted from developing and transition economies.
Successful conviction of criminals and/or confiscation of their assets creates a strong deterrent for potential corrupt officials that there is no safe haven for hiding illicit wealth.
For example, by 2005 Nigeria had recovered $1.2 billion stolen by former President Sani Abacha by requesting assistance from multiple jurisdictions including Switzerland, Jersey, and Liechtenstein.
To recover Nigerian assets, the Swiss government designated the Abacha family a "criminal organization", allowing it to bypass the need for a conviction.
Managing the stages of an asset recovery investigation can be extremely time consuming, complex and requires a great deal of resources, expertise, and political will.
As stolen assets are often layered through several different accounts and corporate vehicles, investigators will often benefit from outside information such as seized financial documents and suspicious transaction reports filed with banking regulators and other law enforcement agencies.
Given the speed that monies can be transferred in the global financial system, identifying and tracing the bank accounts of the perpetrators is not an easy task, even for a seasoned investigator.
[8] Additionally, suspicious activity reports filed with national financial intelligence units can often uncover connections that can expose cases of grand corruption.
If no other arrangement is in place, UNCAC signatories may use the Convention itself as a legal basis for enforcing confiscation orders obtained in a foreign criminal court.
"[9] Indeed, UNCAC Section 54 2A also provides for the provisional freezing or seizing of property where there are sufficient grounds for taking such actions in advance of a formal request being received.
Mutual Legal Assistance (MLA) is vital to this process, although there remain countries that are reluctant to enforce a court order from another jurisdiction without some form of pre-existing treaty.
However, MLA requests can generate vital information in the early stages of an investigation in tracing, identifying, and temporarily freezing the accounts linked to corruption.
Additionally, influential and powerful defendants can use their influence to suppress investigations, manipulate witnesses or judges, or hire law firms to create endless adjournments and appeals.
This is the same process that would be used by private citizens or corporate entities with a claim against another, in the context of fraud for example, by a liquidator seeking to recover assets wrongfully diverted from an insolvent company.
The foreign State will have the ability to access documents on the Court file, to participate in the examination of witnesses, to make submissions to the investigating magistrate, and to seek the repatriation of the assets.
[12] While the OECD Convention is important in the sense that it creates the obligation for state parties to criminalize the bribery of foreign public officials, it does not directly consider the recovery of proceeds of corruption.
[17][18] There are several organizations that have prioritized asset recovery and created initiatives to enable further international cooperation while bringing the issue to the forefront of political and public discussion.
These organizations include but are not limited to: Additionally, several regional networks exist to facilitate judicial cooperation between national authorities by enabling direct personal contact and sharing information.
These networks include, but are not limited to: Asset recovery can be a highly complex field of work, requiring expertise, funds, coordinated action and persistence.
[COSP Note on AR] Training and technical assistance are sometimes needed to pursue asset recovery cases, particularly in those countries lacking institutional framework and experience.
[24] Several organizations have taken steps to address the lack of easily accessible, comprehensive and practical information on international asset recovery.
This lack of information has been identified as a key problem by a number of countries at the first meeting of the UNCAC Open-Ended Working Group on Asset Recovery held in Vienna in August 2007.
The ICAR hosts an online learning platform on asset recovery[25] that includes technical publications, news articles, case studies, and individual country laws.
[26] The U4 Help Desk[27] gives practitioners the ability to ask experts any question related to asset recovery/anti-corruption and receive a tailor-made response within 10 working days (or assistance within 48 hours in case of urgency).
For instance, Switzerland confiscated US 600 million of former Nigerian President Abacha's loot, but worked out an agreement to use the money for development purposes, monitored by the World Bank.
[25] Notably, the Knowledge Center has an extensively detailed library of asset recovery related news articles, along with a Newsfeed[41] that is updated daily.
The StAR bibliography also draws upon literature on related topics including money laundering prevention and civil asset forfeiture.
